Posted on February 10, 2017
Fassbender’s “transit-supporting levy:” a new way to make municipalities pay?
Transportation minister Peter Fassbender’s latest musings about a new “transit-supporting levy” imposed on transit-oriented development sound like a complex new way for Victoria to impose the entire cost of transportation investment on municipalities.
Says Fassbender: “If you build transit corridors and you invest billions of dollars in transportation, there is a benefit to densification as a result of that, and should a portion of that benefit accrue to the very transportation corridors that have helped to build that?”
Translation: if developers densify along transit corridors, shouldn’t Victoria get a chunk of that added value to pay for transit investment? As it stands, all of that lift accrues to municipalities. In Vancouver’s case, it’s used for affordable housing, parks, heritage protection and other benefits.
The Translink Mayor’s Council has already asked for legislative power to impose development cost charges for transit development. Those would be applied either regionally or along corridors to pay for the region’s share of transit investment. They are collected on all development, with or without rezoning.
Fassbender seems to be heading into new territory, contemplating some kind of density levy from the increased value of the land after rezoning. But that payment comes only when development occurs, not when transit investment occurs. The delay can be years or even decades long. And the money would be diverted from other municipal needs, forcing a reduction in amenities or an increase in taxes.
We’re a long way from the 1990s, when the NDP government paid 100 percent of the capital cost of the Millennium Line, from which several municipalities are now reaping development benefits.
Recently, NDP leader John Horgan promised to increase the provincial contribution to 40 percent, if he’s elected Premier, up from the hard cap of 33 percent imposed by the BC Liberals.
But Fassbender’s musings suggest a much bleaker scenario: a new province-directed levy that diverts scarce municipal dollars to make up a further reduction in provincial investment. After all, the minister says, ” we can’t just find money all over the place.”