Penticton proposes 40 percent increase in DCCs

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The City is encouraging residents to learn more about its plans to update Penticton’s Development Cost Charges (DCCs) bylaw.

DCCs are the fees the City collects from developers to help pay the cost of new infrastructure needed to support growth in Penticton. The City collects fees for Water, Parks, Roads, Sewer and Stormwater systems in accordance with provincial regulations. The fees are applied when applications are made for residential subdivisions, and building permits for commercial, industrial and institutional developments.

“New development adds to our vibrancy and contributes to our economy but it also places a lot of pressure to add new infrastructure. Development Cost Charges allow us to recover some of those costs from the people who will benefit,” says Mayor John Vassilaki. “Ensuring that the Development Cost Charges are current and fair is going to be an important part of Penticton’s solution to funding our infrastructure needs. This is why Council has made modernizing the DCC bylaw a priority for this term.”

Penticton’s DCC rates were last updated in 2007 and are now out of step with current construction costs, building practices, development needs and infrastructure requirements. The bylaw will be brought up to date in two stages. The first stage will be completed over the next several weeks and will include the following activities as directed by Council in their meeting on June 4, 2019:

  • The City is proposing to increase all of the DCC rates by 40 per cent to reflect the rise in the cost to build infrastructure costs since the bylaw was set in 2007.  If approved, the increase would be phased in with the first 20 per cent planned to take effect on July 1, 2020 and the second 20 per cent planned to take effect on December 31, 2020.
  • The City is also considering adjusting the discounts offered on DCCs to encourage certain types of development. The DCC discount available to encourage sustainable construction would be reduced from 50 per cent to 25 per cent and would require a higher level of energy efficiency to qualify. The DCC discount available for affordable housing would be reduced from 100 per cent to 75 per cent and the program would be expanded to offer a 25 per cent DCC reduction for rental housing.
  • The City is also reviewing the 2018 Parks and Recreation Master Plan to identify all of the new projects eligible for funding in order to calculate new rates for Parks DCCs.
  • Changes to the DCC reductions and the Parks rates are also anticipated to take effect on July 1, 2020.

In the second stage, the City will conduct a complete review of the program and policies as identified in Council’s priorities for this term. As part of this work, the rates for the remaining four DCC types will also be updated once an Infrastructure Master Plan is completed that identifies the Roads, Water, Sewer and Stormwater projects that will be eligible for DCC funding. These updates are expected to be completed in 2021.

“These changes in the short term will bring our rates and discounts more in line with those offered across the valley while we take the time to complete the full update and ensure it is in line with the vision for the City’s future,” says Director of Development Services Blake Laven.

Anyone interested in learning more about this work or sharing their feedback on the recommendations for the first phase of the update is invited to review the materials available on shapeyourcitypenticton.ca and attend an open house on February 25 from 4 pm to 7 pm at the Penticton Trade and Convention Centre. Staff will provide a presentation as part of the open house beginning at 5 pm.  Materials will also be available at the City’s new engagement kiosks located at City Hall, the library and the Community Centre. The City will be collecting feedback on the first stage until March 1, 2020.