Attachment 8(a) to FND-004-21 January 7, 2021 Weston Consulting 201 Millway Avenue, Suite 19 Vaughan, Ontario L4K 5K8 Attention: Ryan Guetter, Senior Vice President Dear Ryan: Thank you for your submission regarding the Municipality’s 2020 Development Charge Background Study, received on December 22, 2020. Your questions regarding the secondary plan area are being reviewed by the Municipality. In light of the timing of the receipt of your submission, and with the intended DC by-law passage on January 18, 2021 reflecting the last possible date for Council’s consideration of the matter before the current by-law expires, the Municipality is proposing to assess the DC implications of these capital needs arising from the various Secondary Plans as approved by Council. The Municipality will consider amendments to the proposed DC by-law in 2021/2022 to reflect and material changes in the underlying funding for these growth-related needs. In response to your questions pertaining to the municipal-wide by-law, please find attached a memorandum from Watson & Associates Economists, as well as a letter from CIMA regarding the benefit to existing deductions for Services Related to a Highway. We look forward to engaging with you further through the finalization of the Secondary Plan and future amendment to the DC Background Study and by-law Yours truly, Trevor Pinn, BA, CPA, CA Director of Financial Services/Treasurer The Corporation of the Municipality of Clarington, 40 Temperance Street, Bowmanville, ON L1C 3A6 1-800-563-1195 | Local: 905-623-3379 | [email protected] | www.clarington.net Memorandum Trevor Pinn, Director of Financial Services/Treasurer, Municipality To of Clarington From Andrew Grunda, Principal, Watson & Associates Economists Ltd. Date January 5, 2021 Municipal Development Charges By-law Bowmanville East (Soper Hills) and Bowmanville North (Soper Re: Springs) Secondary Plan Areas Municipality of Clarington December 22, 2020 ☒ Fax ☐ Courier ☐ Mail ☐ Email The Municipality of Clarington (Municipality) received a letter from Weston Consulting (Weston) on behalf of the Bowmanville East Developers Group dated December 22, 2020 regarding the Municipality’s 2020 Development Charges (D.C.) Background Study. The key dates regarding the D.C. background study process that has been proceeded through with stakeholders and Council are follows: • February 19, 2020 – Development Industry Stakeholder Consultation session, including distribution of summary presentation and technical appendix substantiating the preliminary calculations • April 6, 2020 – Presentation of draft findings to Council • October 15, 2020 – Release of the D.C. Background Study on the Municipality’s website • November 3, 2020 – Addendum to the October 15, 2020 D.C. Background Study • November 30, 2020 – Public Meeting of Council The December 22, 2020 Weston letter contains various questions related to Bowmanville East (Soper Hills) and Bowmanville North (Soper Springs) Secondary Plan Areas as well as two specific questions pertaining the municipal development charges by-law. The Municipality will be corresponding regarding their proposed approach to address questions pertaining to the secondary plan areas. This memorandum has been prepared to address the municipal development charge by-law questions related to the Rail Grade Separation, the Allocation of Capital Costs in Recreation, Parks, and Library Services, and funding of growth-related studies Address Contact Information Filepath Plaza Three Office: 905-272-3600 101-2000 Argentia Rd. Fax: 905-272-3602 H:\Clarington\2019 DC & CBC\Developer Consultation\Weston Mississauga, Ontario www.watsonecon.ca Response.docx L5N 1V9 1. Rail Grade Separation Services Related to a Highway project #5 (Lambs Rd. Grade Separation) has been included as 100% benefit to growth over the 2020 to 2031 period. This project was also identified in the Municipality’s 2015 D.C. Background Study as 100% benefit to growth over the period to 2031. The growth forecast contained within the 2020 D.C. Background Study has been prepared on the same basis as that for the 2015 D.C. Background Study). Furthermore, the Municipality’s 2016 Transportation Master Plan identifies that a grade separation on Port Darlington Rd. and the CNR crossing is warranted based on growth in Annual Average Daily Traffic (AADT) to 2031. It is proposed that this need will be met through the Lambs Rd. Grade Separation south of the 401 Highway. The Municipality’s approach for benefit to existing development for Services Related to a Highway projects has been summarized in the attached letter from CIMA+. Consistent with the approach used for culvert and bridge structure projects, no benefit to existing has been applied for the project as it is not required to support the road network that is currently in place to support the existing population. 2. Allocation of Capital Costs in Recreation, Parks, and Library Services Growth related capital costs have been allocated 100% to residential development within Parks and Recreation and Library Services. While some municipalities may allocate a nominal share of growth-related costs to non-residential development (e.g. 5%) for Parks and Recreation Services and Library Services, the approach used in the Municipality’s 2020 D.C. Background Study to allocate 100% of the growth-related costs to residential development is consistent with the Municipality’s policy used in their 2015 D.C. Background Study as well as many other D.C. background studies across the Province. 3. Funding of Growth-Related Studies The future Subwatershed Studies and Municipal Secondary Plans that have been included within the Administration Studies Service do not include the privately funded Subwatershed Studies and Municipal Secondary Plans that have already been undertaken. As such, no D.C. credits would be available for those works. To the extent that development provides up-front financing for D.C. eligible studies or other D.C. eligible works, the Municipality would enter into D.C. credit agreements in this regard. Watson & Associates Economists Ltd. PAGE 2 Weston Response December 18, 2020 Municipality of Clarington Public Works Department [via email] Attention: Mr. Sean Bagshaw, P.Eng. – Manager of Infrastructure RE: BENEFIT TO EXISTING FOR ROADS AND RELATED CAPITAL PROJECTS Dear Mr. Bagshaw: The following provides a summary description of methodologies used to determine/establish the Benefit to Existing (BTE) amounts for various types of projects included in the Municipality of Clarington’s “Roads and Related” Development Charge capital program. 1 LINEAR ROAD PROJECTS 1.1 DEFERRED COSTS For linear road projects in the Development Charge Capital Program that involve reconstruction of an existing road the Benefit to Existing (BTE) amount is established based on the cost (in 2020 dollars) of maintenance and rehabilitation that the Municipality will be able to defer/forego due to the completion of such projects. The maintenance and rehabilitation costs are calculated using the Municipality’s road condition ratings and pavement management model to establish the lifecycle activities that would occur in a no-growth scenario over a 20-year period in order to maintain road conditions. This analysis is conducted conservatively by assuming that the Municipality’s budget would be sufficiently large to allow for all ideal activities to be undertaken even though that may not be the case. Thus, in simple terms, the BTE is defined as the value (in 2020 dollars) of an ideal pavement management strategy for each road that would include initial reconstruction (to a standard appropriate to existing conditions), if warranted by road conditions, followed by on-going resurfacing, crack sealing, micro surfacing, slurry sealing, etc. This approach applies to projects involving reconstruction/urbanization of existing roads. C14-0347-L-BTE Methodology rev02.docx 415 Baseline Road West, 2nd Floor Bowmanville, ON L1C 5M2 CANADA T 905 697-4464 F 905-697-0443 cima.ca December 18, 2020 Page 2 of 3 1.2 GROWTH/NON-GROWTH SHARE For linear road projects that involve upgrading portions of the rural road network to support traffic growth between urban growth centres and higher order facilities (e.g. regional roads and provincial highways) the Benefit to Existing (BTE) amount is established based on growth/non-growth population share. Specially 74% of the project cost is allocated to BTE and 26% is allocated to growth. 1.3 NO BENEFIT TO EXISTING For linear road projects that involve constructing new roads or simply widening existing roads that are already built to current standards no Benefit to Existing (BTE) is established. 2 INTERSECTION PROJECTS The Benefit to Existing (BTE) for intersection projects that involve signalization improvements and widening has been established individually for each project through the consideration for three components making-up the project cost: • BTE for signal upgrades is determined based on the Transportation Master Plan (TMP) growth/non-growth share of forecasted traffic at key screen lines for the 2031 horizon year in the relevant community (Courtice or Bowmanville), with Courtice being 23% growth and 77% non-growth and Bowmanville being 20% growth and 80% non-growth. • Rehabilitation of the existing footprint of intersections is considered 100% BTE in instances where it is required and not otherwise captured by linear road projects. • Widening for the provision of new dedicated auxiliary lanes is considered 100% attributably to growth with no BTE.