The province has assigned Ernst & Young LLP to decide whether Newmarket and other municipalities are crying wolf over the loss of development charges.
The firm will audit Newmarket and five other municipalities to assess the impact of changes in the More Homes Built Faster Act. Some municipalities across the province have protested that the act will do too much financial harm through more developments becoming exempt from development charges, which are intended to pay for servicing caused by growth.
“This next step in the audit process is a critical part of our work to rein in the soaring cost of housing across Ontario,” Minister of Municipal Affairs and Housing Steve Clark said in a July 26 news release. “We want to ensure development-related charges and fees are being used in a manner that supports increased housing supply and critical housing-related infrastructure, but which does not unduly raise the cost of finding a home for hard-working Ontarians.”
Newmarket has estimated that the development charge changes from the provincial legislation could have a five to 15 per cent impact on local property taxes going forward. But the province has assured municipalities that they will be “kept whole” in the costs for servicing new development, although details on that have yet to be determined.
Mayor John Taylor has previously said he hopes the audit can make the province understand the impact its legislation will have.
“New housing doesn’t just come with new revenue and new (development charges), it comes with new costs,” Taylor said. “I’m sure a credible accounting firm doing a full audit will understand those concepts.”
But the province and its housing task force have pushed back on these charges and said they are contributing to high housing costs.
“These charges, which have increased in some municipalities by as much as 900 per cent in less than 20 years, are a significant part of the reason housing costs have increased in many parts of the province," the province said.
Ernst and Young LLP is not unknown in the region, with the firm also hired by York Region to do an efficiency review concluded earlier this year.
The province expects the first phase of the provincial audits to conclude by the end of 2023. Other municipalities getting audited include Toronto, Peel Region, Mississauga, Caledon and Brampton.
