By: Sylene Argent, Local Journalism Initiative Reporter, Essex Free Press

The Town of Essex will apply to participate in the Development Charge (DC) Reduction Program, following administration’s recommendation. This will be for two planned projects.

A majority of Council made the decision at the June 15 meeting, in addition to endorsing a reduction of residential DCs of 50% for a minimum of three-years, subject to successful funding approval. Deputy Mayor Rob Shepley and Councillor Jason Matyi were opposed.

If successful in obtaining the provincial f u n d i n g, Town administration will come back to Council with a financial model that would need to be considered for possible adoption in the future.

Town of Essex administration provided Council with very new information learned from a 1:30pm call Monday from the Ministry of Municipal Affairs and Housing. That addressed some information its reps have noticed from other local municipalities regarding how program guidelines were interpreted on the Development Charge Reduction Program.

Information from the Ministry notes that DCs have become a significant barrier to home building. Housing is stalling in Ontario and will continue to be deeply affected unless all levels of government come together to take collective, strategic action to incentivize housing development.

It adds that the program gives municipalities a unique opportunity to partner with the provincial and federal governments to support new housing. It will help municipalities to fund and build the infrastructure needed for growth, including h o u s i n g – e n a b l i n g infrastructure.

Essex CAO Kate Giurissevich explained that the Province of Ontario and the Government of Canada launched the DC Reduction Program on June 1, which includes a ten-year, $8.8B funding initiative intended to support housing-enabling infrastructure and accelerate residential development.

Municipalities have until June 19 to apply to participate in the program.

In order to be eligible to tap into the funding program, Giurissevich said municipalities must have a DC By-Law in place as of March 30 of this year, must commit to reducing residential DC rates in effect on March 30 by 30% to 50% or greater, and maintain the reduction for three-years. The DC reduction has to be applied to all residential development types.

There are three criteria the Ministry will look at when awarding reductions, Giurissevich explained. They include DC rate reduction, housing impact, and municipal contribution. Other factors include shovel readiness. Housing-enabling will be prioritized over community-building projects.

Town Administration completed a thorough analysis of the current DC study, Giurissevich said, to determine what projects would make the most financial sense.

“If we are going to waive DCs across the entire municipality, we have to make sure that we are not – in essence – losing money on certain projects,” she explained.

To be eligible, it has to be used for new infrastructure, and there needs to be a willingness to have construction completed by October 31, 2035. Though the Ministry noted it would work with the municipality if it would not be able to quite meet that deadline. It would also have to be primarily to enable new housing development.

In addition, the Town would have to demonstrate long-term financial sustainability, be incorporated into the next update of the applicant’s asset management plan, and satisfy any applicable duty to consult requirements prior to site preparation or construction activities. It would also need to meet or exceed applicable accessibility requirements under the Ontario Building Code.

Giurissevich noted during its communication with the Province earlier that day that it was learned the grant program would cover up to the total amount of foregone DC revenue, with eligible costs, including land acquisition for the provincial share of funds, costs of construction, labour, materials, and equipment, and environmental assessment and design costs incurred after February 26, 2026.

The Town can bundle together similar projects in a geographical area that will score housing, Giurissevich said. Knowing that, Town admin isolated Ward 1/ Essex Centre under the Transportation Summary Category.

The Town clustered six projects together, including the Hanlan Street extension, Talbot Street storm sewer

improvements, Maidstone Avenue and Talbot Street North intersection improvements (not including underground work), Go s f i e l d Avenue and Talbot Street intersection improvements, and the North Malden salt storage and facility expansion, totalling just over $10M in possible grant funding.

The second project was in Ward 4, upgrades to the Harrow raw sewage pump station, that could total $826,706 in grant funding.

Both projects were allocated based on prorated shares of waived DCs.

The Town’s total application to the Province would be $10.8M. That aligns with administration’s prediction that it would no longer be collecting in waived DCs over the three-year period.

That leaves the Town to fund just over $11M from other sources. There is also a recommended minimum reduced DC of $7.2M. Together, that totals $18.3M.

This would have a benefit of 826 homes resulting from the DC reduction. In addition, the housing units to be enabled would be around 2,700.

Director of Corporate Services, Kate Rowe, explained how the Town will come up with its portion of project costs. While she provided three scenarios, the preferred option of 50% reduction represented the Town’s commitment to the reductions and was financially viable to the Town.

The proposed funding of the Town’s contribution of $18.3M over a ten-year period would include OCIF and other grants totalling $3.7M, long-term debt of $9.6M (paid for by taxation from supplemental housing in Wards 1, 2, and 4), and $4.8M from the Asset Management Reserve and other reserves.

The debt allows the Town to stretch out remaining costs over time, ensuring current or future ratepayers are not burdened disproportionately, Rowe said.

It was noted the ten-year horizon is indicative of projects being staggered in their start and end times. In terms of the long-term debt, that may not happen. It could be staggered, or the taxation revenue is collected sooner as homes are built, Giurissevich explained.

The Town did not consider an array of projects for various reasons, including the Colchester Water Pollution Control Plant, for which the design study is still in the works, as it was considered high-risk. Giurissevich noted the local settlement review brought up overland flooding concerns in addition to where the Town would like to direct future growth. Council also previously decided not to proceed with the second intake of the Province’s Housing- Enabling Water Systems Fund (HEWSF).

In answering Councillor Rodney Hammond’s question if the Town could achieve these numbers, Giurissevich said in order to do so, the Town may have to make some aggressive decisions when it comes to development. The Town would have to monitor targets to ensure they are achieved and reduce risk of funding claw backs.

In answering Deputy Mayor Shepley’s question on if the funding sources admin recommended would create a shortfall elsewhere, Rowe said admin would not want to take from other projects to give to others. She said they are not new sources of funding, but strategies in place and modified slightly to meet the needs of the grant application.

Shepley also asked if the Town applied and was approved with a lesser amount than expected, would it damage the relationship it has with the Province with future grant requests. Giurissevich said that is possible, but so could not applying.

Councillor Joe Garon asked if administration was confident the Town will get the funding. Giurissevich said administration is taking a “we don’t know if we don’t try” approach. They were told by the Ministry they are meant to benefit fast growing GTA areas.

Mayor Sherry Bondy would like to loop in Essex MPP Anthony Leardi as to what Essex is applying for. Leardi has criticized Essex for not applying for the second intake for the Housing- Enabling Water Systems Fund (HEWSF) for the Colchester Pollution Plant and the possible impact it could have on flooding in the area.

She said these grants are great, but will not solve the flooding issue.