Thank you, for this opportunity to present to Council. I am Barry Wolfe. My wife and I live in Baden. Based on the superb quality of delegate presentations provided so far, Wilmot citizens can be very proud of the motivated citizens we already have living here.
I will be speaking quicker than my preferred rate to present as much as I can for consideration. A lot of my prepared package will not get presented in the 7 minutes allotted.
Thank you also to previous speakers for many informed comments – they made several points about accuracy and conflicting statements that I’m going to try to skip as I go and hope I get it all in.
Here are the topics that I will be covering re. the MZO authorization application:
- everyone wants a place to live.
- ground-related perspective
- probability of completion on a timeline
- where’s the archaeological assessment?
- who pays for what?
- Public Consultation and a Traditional Zoning Application Process
- An estoppel is a legally binding precedent
- low hanging fruit
- 4 recommended motions for consideration
Everyone wants a place to live.
Additional living space is needed in Wilmot.
Potential development in Wilmot would be good, depending on the details of what, where, how much, and how it is done.
Developers play an essential role in communities’ growth and assume some risks which they attempt to mitigate using their experience, connections and any possible method of getting approvals through quickly and cheaply.
Reasonable profit for business is good.
Fiscal due diligence and not using an MZO process by a municipality are best.
Cachet Developments, from Concord – GTA – has a vision of what it sees for Wilmot and how it wants to implement it. Their presentation makes a first impression as it comes with multi-colour maps, overhead layout sketches and a lot of consultants’ documentation and charts which are presented as a rationale for their vision. Superficially there appears to be everything all 2,030.9 of the prospective inhabitants would want, on 43.21 hectares out in the country.
BE AWARE OF WHAT YOU’RE GETTING INTO
Never step into water until you know how deep it is, where the stepping stones are, or what exactly is in the water!
Cachet Developments has provided evidence of what people want in Wilmot Township. On page 103, their urbanMetrics consultants’ report
- “The Region of Waterloo has seen significant net in-migration from municipalities in the GTA, likely due, in part, to the limited supply of ground-related housing (single-detached, semi-detached and row units) in GTA municipalities and increasing house prices, which is impacting affordability. By comparison, the Region of Waterloo is losing residents to neighbouring communities in the south and west, as these individuals search for more affordable ground-related housing.”
notes that people are looking for “ground-related” housing. The 3 examples of desirable housing – single-detached, semi-detached and row units – are all close to the ground, 2-storeys max., maybe with a basement. People are pulled to Wilmot because they want ground. They want their own ground-based living space.
Let’s check the sketch and ‘test the waters.
Based on the sketch on page 43, which does not have a sizing scale, it describes 5 of the residential and mixed-use buildings, representing 800 of the 1200 units (67% of all units) as being 6-storeys tall. If one uses the “upper range” numbers on the page 44 chart, which would increase the density to 1500 units, then 950 of the 1500 units (64%) of all units are 6-storey tall.
Therefore, if there are 1200 units, then 2/3rds of potential residents or 1,353.933 persons will be living in a 6-storey building.
If there are 1500 units, then proportionately the population rises to 2,538.6258 and 1,692.41667 of residents would be in a high-rise 6-storey building. (75 ½ fee high)
Who plans living space based on fractional portions of a person in a unit?
Cachet does not tell us whether they would do that by making each unit smaller, adding more storeys to each building, or adding units somewhere that are not placed on the sketch? Does that 2nd option mean that the park has to be eliminated or gets smaller, that the medical building becomes residential, or the employment zone gets reduced or eliminated? With an MZO you’ll never know
Each unit in four of the five buildings is presently designed to hold 1.276 people each. Each unit in the fifth building is presently designed to hold 2.369 people. Only 100 of the 1200 units, single-family houses, are designed to accommodate 3 persons, and that 100 is designed for only 3 persons. So much for the concept of two parents and 2 kids and a pet or two. This is not a “family-oriented development and thus is not a “complete community”! (page 42)
Density Targets Are Too Big
Cachet’s proposed plan, in its present form, is dependent on a fundamental requirement – a minimum density of 65 persons and jobs per hectare of surface space and a minimum of 1200 residential units, on a footprint of 43.21 hectares, to meet their desired profit goals.
The current Wilmot official plan sets 45 pj/ha as the minimum density, Waterloo Region sets 60 pj/ha as its long-term goal and the traditional provincial benchmark comparator is the Golden Horseshoe target of 50 pj/ha. It appears that this application requires the rural community of Wilmot to leapfrog beyond all long-term target minimums in the entire province – and they want approval now, with a ‘hurry-up and sign the NZO application right now’ push.
Not only would Wilmot have to amend its official plan to allow such a high-density minimum, but it would also have to amend building height allowances, and potentially what construction materials are allowed for a 6-storey building (wood frame versus poured concrete?). There are probably others I’m not aware of but professional staff would identify through the traditional application process.
The present 65 pj/ha is their proposed absolute minimum – the starting point for Cachet development. It could evolve so that this space ends up with 70, 75 pj/ha, or 1500, 2000+ residential units crammed into the space, or whatever the developer pushes through. Because there is no maximum, Wilmot staff and Council would have no legal recourse to insist on how the space is developed with a lower density. Wilmot could negotiate, but we citizens would have no legal right of final denial or approval.
A question might be, “Does a 6-storey, 75 ½ feet, high-rise building meet the definition of ‘ground-based’ living which is a factor pulling people toward Wilmot?”
The only structures I’m aware of in Wilmot that might be 6-storeys are farm silos. The B&W mill building in New Hamburg is only 4-storeys plus a cupola. There are ZERO buildings in Wilmot, that are used for people to live their complete lives in, that are 6-storeys high. And that, I postulate, is why people are attracted to Wilmot. People who are ground-related want to live here. Just like the developer’s consultants told it and us.
This image is not to scale and the 10 high-rise buildings along Cty. Rd. 5 & the southern edge are 75 1/2 feet high. Note the buildings are visualized as being right up to the ditch along Nafziger with no ‘perspective’ set-back’ = max. profit?
A ground-related view of the proposal.
Cachet Developments has provided, on pages 83 & 84, 2 axonometric views (as from an airplane at an angle), but the buildings’ heights are not drawn to relative scale and appear lower, squashed closer to the ground, than reality. They, noticeably, did not provide an artist’s or architectural sketch, at ground level, of the view of the complex while driving along Nafziger Road.
What Cachet Developments and its Toronto-based consulting firm visualize is a “complete community” (page 42). What I see, when looking from Nafziger Road, from my ground-related perspective, is a row of 6-storey buildings, each 2-storeys higher than the B&W grain mill in New Hamburg, extending from the rail tracks to the cemetery corner.
I see Scarborough plunked down in the middle of a farm field in Wilmot Township. If Scarborough was perceived as a complete community, the GTA wouldn’t be coming to Wilmot. If you make Wilmot into Scarborough, you no longer have Wilmot.
You no longer have Wilmot Township!
One can conclude that Cachet’s own documentation refutes its own espoused goals in this MZO application. 6-storeys, 5-storeys, 4-storeys are not the desired ground-related structures.
It must be recognized that the developer has hired some consultants who have done a huge amount of work. A lot of this is potentially useful background research. (which Wilmot got for free if you don’t count the fact that Cachet didn’t pay the $5,000 fee because it was an MZO application, not the usual process), This background research could be used in considering a different approach to development that does not have such a high-density ratio and buildings that were not 6-storeys high
PROBABILITY OF COMPLETION ON A TIMELINE?
The vision presented by Cachet is not a time-defined ‘plan’. It implies that this request is a visionary sketch of what might be at some undefined time in the future. How long into the future will this be incomplete?
a) Medical Building: There is provision for a 6-storey building described as “medical”. When is this going to be built and by whom? Does the developer have a sub-contractor willing to complete construction on this 6-storey building simultaneously with the residential occupations? Where does the developer or its builder plan to get all the medical professionals to fill such a building? Council has publicly acknowledged that it cannot attract a developer to build a medical building anywhere in Baden itself. Does Council actually think that a developer from Concord, GTA, is going to be able to find a builder willing to take that risk for a location in the middle of greenfield, and only 2,030.9 potential inhabitants? There is no demographic or business case to be made for a medical building that is described as being bigger (taller / 6-storeys and longer) than the medical building at Ira Needles 4-storeys! Ira Needles draws on the entire population of Kitchener, Waterloo, and surrounding townships including Wilmot.
EXISTING 4-STOREY MEDICAL BUILDING AT IRA NEEDLES
b) Mixed-Use / Employment: There is 3.41 ha set aside for future employment opportunities. The rationale in the cover documents is that people who live here will be able to work here, and thus it becomes a “complete community”. It’s implied that the community will be complete because it will be self-supporting. If you buy in, move there, you will be able to walk to work there. The population projection is for 2,030.9 persons. Eliminate the seniors. Are they suggesting that 1,000 or more people are going to find work on-site that will pay them enough to live there? Do the local Chambers’ of Commerce agree that this is a practical option in the short-run (less than 5 years)? Council must ask them.
c) 4 Office Buildings: The application indicates that there will be four 6-storey office buildings located here. If we guess at 50 people per storey, times 6-storeys, times 4 buildings, that’s 1200 people working there. Are they all going to work AND live there? Remember, that 800 of the living units are designed for one person. Are 2/3 of the office workers, assumed to be living there, going to be “singles”? In 4 buildings, with 6-storeys each, you are going to need somewhere between 24 – 72 different businesses attracted to Nafziger Road and set up there. How successful has the local Chamber been so far in attracting businesses? How long do you estimate it will take to fill 4 office towers? No builder is going to construct 4 6-storey office buildings without signed commitments from future tenants. It’s about the money, remember! Do you really believe that a builder is going to complete the construction of 4 office buildings and fill them in any less than 40 years? I lived on Good Street in New Hamburg between 1980 and 1990. I was waiting then for the available business land space to fill in. It still has openings. This vision of these all being completed in time for everyone to move into the residences is not just a pipe dream, it’s a “wobbly-smoke” pipe dream.
d) Transit-Hub: This is a good concept! It provides a transit option for people there. However, if you have 4 office buildings each 6-storeys high, and a 6-storey medical building, there will be a huge number of people arriving and leaving at the same time periods each day, because the employees will NOT all be living there.
The transit portion of the consultant’s report was vague and aspirational, it did not have any demographic or potential time-of-day scheduling projections anywhere. There are not enough buses and is not enough road width on Nafziger Road to accommodate this vision. This is a vision. It is NOT a realistic, practical plan. It is a request to bypass public input so that the developer can contract with builders to build single-family homes, rear-lane townhouses, traditional townhouses, mixed-use towers and then leave the rest for later. The return on investment comes from the residential portion. That’s where the developer loses interest and dumps the rest on the vision to “future potential”. By then it and the builders are gone and there’s empty space for “later”. Later will not come for 40 years or more.
THIS IS NOT A COMPLETE COMMUNITY. THIS IS A ‘PROJECT’ THAT WILL BE INCOMPLETE FOR THE NEXT 20 YEARS.
ARCHAEOLOGICAL ASSESSMENT REPORT
There is no archaeological assessment study reported in the documentation submitted. In the context of recent Wilmot history, this appears to be a significant omission?
Affordability is another targeted concept in development applications because there is a real identified need for segments of our communities.
Affordability, in the past, has been a result of two strategies:
1) Subsidies provided by the Federal, Provincial and Municipal governments. These governments have taken monies generated from all the usual taxation sources, depending on the level of government (including, residential, commercial, industrial, agricultural assessments, sales taxes, income taxes, special levies, etc.) and then distributed it to subsidize identified targets. It is my understanding that those government subsidies/transfers of money, no longer exist. Therefore the developer must have another strategy of how it plans to provide for the viability of this 6-storey building on into the future.
2) Spreading costs within a project onto other portions of the development. Just as roads are paid for at the lot purchase price, so too are subsidies potentially paid. However, how to continue to subsidize an entire building from such a small development seems problematic.
3) The MZO application indicates that Cachet’s definition of “affordable” is, “rent equal to or less than 80 percent of the median market rent of a unit in the regional market area”. However, the market rate for the Wilmot area is less than the median regional market area rate and thus could end up being a higher rental rate. There is no explanation for how that “affordable rate” would be sustained (financed) over the future. (page 20, #7)
“WHO PAYS FOR WHAT”
A useful life rule is “Follow the money”
There is no indication of the development costs that the developer is willing to take responsibility for. Physical infrastructure costs are part of a developer’s responsibility and there is no indication for what the developer is willing to pay
The proposed lands are situated in a relatively isolated spot. The MZO application deals with essential services (page 50) that must be in place before Cachet’s proposed development is able to have residents legally move in. These essential services have costs. At the Ira Needles Developments, for example, the essential support infrastructure costs were and are being carried by the developer(s). As the developer of this proposed Nafziger Road development, will Cachet Developments be paying for the costs of the required services for:
i) stormwater management ponds, (page 50)
ii) on-site pumping station, sanitary and other wastewater sewers and connecting lines to treatment plants, I understand that there is NOT a sewage line along Nafziger at present so that is a huge potential cost. (page 50)
iii) stormwater sewers, (page 50)
iv) potable water mains and connecting lines to sources, (page 50)
v) provision and installation of appropriate traffic control signage (traffic lights and/or roundabouts) at the central access and the southern access where the transit hub is located, (page 50)
vi) widening of Nafziger Road in anticipation of increased and potentially congested north-south traffic flow, (page 50)
vii) installation of at least 2 ‘storage lanes’ to accommodate traffic congestion for those north-bound vehicles waiting to enter the proposed development area off Nafziger Road, and provide for traffic exiting the proposed development onto Nafziger Road both to north and south, (page 50)
viii) installing, safety security, and maintenance of the SWM Pond of 2.09 ha at the south end of the proposed development, (page 43)
ix) play equipment, benches, walkways at the park at the north end, (page 43)
x) provision and installation of fencing of the perimeter, and appropriate landscaping throughout the development (page 43)?
If the answer to any or all of the questions of the above cost is, “No. Cachet Developments will not pay for these development costs.”, then who do they think will pay to provide these services to allow Cachet to make a maximized profit on only building high-density buildings which do not have even enough living space to accommodate families?
Public Consultation and a Traditional Zoning Application Process
If this developer is honestly sincere in its stated goals, then it does not need an MZO. It can follow the proven path of detailed transparent public consultation and a traditional zoning application that includes accountability steps along the way.
This land has been here without residences since the last glaciers melted over 10,000 years ago. There is NO EMERGENCY requiring an MZO.
I suggest that there is no emergency demand to build 1200 – 1500+ residential units in Wilmot Township. If the MZO application is denied and the traditional zoning application process is followed, no one is going to die or be seriously injured or be denied oxygen, food and water. Cachet is still able to develop this valuable land BUT has to do it differently.
The statement that Waterloo Region has to put final approval on a subdivision plan anyway is, in reality, a red-herring. It’s a distraction. Once an MZO is authorized by Wilmot, then transferred via Waterloo Region to a politician in Toronto, there is no real opportunity for going back. The broad parameters and permissions are determined.
OPINION: Based on observations of events over several years, it is my opinion that the present governing party has demonstrated a pattern of ignoring or undermining regulations regarding environmental protection and enhancement, and removing regulatory procedures that were designed to carefully monitor what and where various types of development were allowed to move forward. The provincial government has shown an apparent desire to see density intensification and thus would probably encourage and thus rubber-stamp applications such as the one before us now. It may already be applying pressures onto lower-tier bodies that the general public is unaware of?
Page 26 of the agenda package includes this declaration from the MZO authorization generously submitted by the developer for the township to approve in a by-law:
- (1) This order is deemed for all purposes, except the purposes of the section 24 of the Act, to be and to always have been a by-law passed by the Council of the Township of Wilmot.
- This Regulation comes into force on the day it is filed.”
If an MZO is signed, all local control over this area of land by Wilmot citizens is gone forever. It would create a legal precedent, limiting Council forever into the future, as estoppel. Estoppel is a legal principle that precludes a person or body (such as Wilmot Township), from asserting something contrary to what is implied by a previous action or statement (verbal or written) of that person or by a previous pertinent judicial determination. In other words, if 6 Wilmot councillors, up for election this year, authorize this MZO, Wilmot citizens are screwed forever. No going back. The Township’s lawyers can confirm my observation?
As the staff report clearly states on page 12, “The process of the Minister using an MZO does not support Community Engagement as it excludes public notice and rights of appeal. The exclusion of appeal rights within the MCR process is a similar troubling concern. While recent requirements that Municipal Councils indicate support or opposition to an MZO proposal appear on the surface to introduce some measure of community engagement, they fall short of the standards the public typically expects in local Council planning processes.”
The professional staff, upon whom Council is required to depend for their advice is clearly stating that the MZO process can be flawed and falls short of the standards of acceptable behaviour demanded by citizens/taxpayers of its elected representatives. The staff have been carefully neutral in the report.
LOW HANGING FRUIT
Anyone with bargaining experience might wonder:
a) Is this MZO application just an opening bid by the developer, and it is prepared to settle, later in the process for fewer storeys and lower densities? Is it prepared to settle for 5-storeys, or 4-storeys, or 3-storeys depending on how much resistance it gets at various stages?
b) If the developer gets an authorizing by-law from Wilmot for this MZO application for 6-storeys, will it use its lawyers to argue vehemently all the way along to keep as many buildings as possible, with as many storeys as possible, and with as high a density as possible?
c) Why would a developer submit an MZO application with a density level (65) which is widely known to be excessive to Wilmot’s (45), Waterloo Region’s (60), the Golden Horseshoe’s (50) density levels unless it was prepared to negotiate downward or it has some other goal?
d) If Wilmot declined this application in its present form, and used the traditional approvals method, might Wilmot get what is best for Wilmot, lower levels and lower densities?
e) If Wilmot Councillors approve this MZO application now, and don’t ensure that the developer has to negotiate with Wilmot first, will our citizens ever know?
f) What external forces exist on Wilmot Council from the Province and the Region that might pressure Council into a quick MZO authorization by-law that Wilmot taxpayers will never hear about?
There is no one going to die, go hungry, be homeless as a result of using the traditional development process. There is no emergency or urgency for this development.
There are a lot of concepts that need revision:
- There is no archaeological assessment study reported in the documentation submitted;
- A minimum of 65 pj/ha is excessive, does not comply with the provincial benchmark, exceeds the Waterloo Region long-term into the future goal, and is incompatible with Wilmot Township’s own 45 pj/ha target.
- 6-storey buildings are too high;
- 67% of all living units only accommodate one person comfortably – not a family-oriented complete community;
The deal-breaker ideas:
- It depends on the use of an MZO;
- An MZO creates unacceptable legal estoppel for Wilmot citizens;
- There is no financial presentation of how each item is to be paid for.
This proposal is contradictory in that it espouses certain values and visionary aspirations, but rebuts those aspirations with its own data:
- The project is NOT ground-related – it is mostly high-rise buildings;
- It does NOT create a “complete community” – none of the units will accommodate a family of 4 plus pets, and most care silos, boxes with doors where only one person can live comfortably;
This package is only visionary. Visions are useful when brainstorming without commitments. This presentation is like the bird’s-eye picture, just a sketch of possible options. It is NOT A PLAN. It has more questions than answers. It does not define who is responsible for what, and there are a lot of known and as yet unknown “what’s” to be implemented in this vision.
This vision does have potential, but in NOT IN THE FORM OF A MZO, and not with its present densities and building heights.
This MZO application does not meet even its own defined criteria. The density targets are unreasonable in their extreme over-reach (they’re too high) and lack defined maximum densities.
In principle, development is good. Additional housing is needed in Wilmot.
There is, in my opinion, a lot of very useful data in the provided support documentation that must be selectively sieved through to get to the useful stuff. Some “good” ideas:
- A transit hub;
- A medical facility; (although too tall)
- Offices; (although too tall)
- Mixed-use / Employment area; (no height specified)
- Seniors; (too tall)
- Agir Hub.
Council needs to 1) receive the submission, 2) table it definitely until after the next election or after scheduling another consultation meeting with the public, then 3) schedule another public meeting for Council discussion, deliberation and vote to defeat the application, and 4) in the mean-time direct staff to investigate with the developer an alternative model that uses the traditional method of full and transparent public consultation.
1) Wilmot Council should pass 4 separate motions, before moving on with its agenda tonight, in the following sequence:
i) Moved by, etc., that, Report DS 2022-001 be received for information.
ii) Moved by, etc. that Report DS 2022-001, and any potential subsequent actions regarding its implementation, be tabled definitely until at least 30 calendar days after the results are known of the next Municipal election, October 24, 2022, in Wilmot Township.
iii) Moved by, etc., that Council, in consultation with Wilmot professional staff, set and widely advertise a series of dates for educational purposes of members of Council and interested citizens of the Municipality of Wilmot, respecting all implications of Minister’s Zoning Orders (MZO).
iv)Moved by, etc. that Wilmot professional staff be directed to consult as soon as practical with Cachet Developments, and report to Council, seeking alternate potential development strategies, that do not include an MZO, for the properties described as Cachet Developments (NH INC.) and Cachet Developments (NH WEST INC. 1265 and 1299 Waterloo Street.
THANK YOU FOR YOUR TIME
See comparison photos below which show urban development with a mix of low-rise and high-rise buildings.
The first 2 show core Kitchener at the corner of Charles and Victoria Streets with access to the GRT, rapid transit surface rail transit, and wide streets, typical of that area.
The next 1 shows the core area of New Hamburg, with the highest building, B&W Feed mill, and row buildings along the main arteries, with all buildings no higher than 3-storeys. The main street buildings have residential above the retail, commercial units at street level.
The last one shows what happens to high-density wooden buildings after a few years = a high level of retro-active or ongoing maintenance is required.
I have added Appendix A, which was not intended for public discussion but is my perspective on how development is financed. It is an FYI item, which is probably within the knowledge base of most, if not all, councillors.
VICTORIA @ CHARLES 8-STOREY BUILDING WITH SURFACE RAIL AND PARKING
4-STOREY BUILDINGS WITH SURFACE RAIL AND PARKING
NEW HAMBURG 3-STOREY MAIN STREET; 3 -STOREY GRAIN WITH CUPOLA = 4-STOREYS
Development, Developers, Builders, Buyers, Taxpayers
The following reflects only the author’s understandings. This is a ‘generic’ overview, and does not make any implications, accusations, allegations about any particular person, organization, developer, etc..
Developers are generally in the business of converting land surface from what exists at any point in time into something else. There may be areas of land that have something located on it, and the developer will remove or convert it into something else.
In inhabited areas there is usually an existing structure which is removed or converted into something else if it is deemed to be a profitable action. In ‘open’ areas the vacant space is built upon from its vacant state.
Often developers will look for ‘open’ land that does not have anything built on it and purchase it for future development. If a large project is envisioned by a developer, it will seek out and purchase large tracts such as farm land, greenfields, bush lots, wet areas that can be affordably filled by grading soil from nearby areas – preferably on the tract itself.
Developers are taking a risk that the land they purchase or make a legal agreement for future closure on, will appreciate in market value from the time of ‘purchase’ until it is sold. In the recent decades the risk of land depreciating has been non-existent and market values have increased exponentially. It is widely recognized by all with any connection to marketing real estate, that it is the developer that has the greatest likelihood of making the largest long-term profits in a development project.
Developers have investment expenses before they sell and determine profit:
- Land acquisition;
- Application fees to municipality;
- Zoning change fees;
- Building permits;
- Regional development fee;
- Provincial education fee?
- Archaeological study;
- Consultants’ fees.
It is extremely rare for a development company to use its own capital / cash instruments to purchase land for future development. The optimum business practice is to use other entities’ monies. A developer will borrow money, often using other instruments as collateral, and the carrying costs are managed and reconciled between the developer and its accountants reporting to the Canadian Revenue Agency. In any case, a developer does assume a financial risk when undertaking a project.
An experienced or well-informed developer mitigates that risk by how it bundles the initial borrowing, how it ‘plans’ the development (what, how many, how tall, how big or small each portion / unit, how many units it can place within the land space), and how it manages the regulatory and supervisory processes in place.
There are regulatory pieces of legislation for the entire province, for specific types of geography, and different geo-political regions such as counties, regions, cities, townships.
Astute developers will acquire land in areas that are most likely to generate the most profit by:
- minimizing the cost of the land originally;
- find land that is vacant;
- find land that is available in suitably-sized parcels that can by combined if necessary;
- avoid municipalities that have large populations of aware and involved citizens, politicians and a large professional staff that have individual specialties and thus, that can make the approvals process detailed, lengthy and require a lot of overview time before the land units / lots in the ‘plan’ are approved, and sold to sub-contractors for building, and thus sale;
- implement an approvals process that is least likely to legally permit wide-spread involvement by the public citizens / taxpayers who have to live with the resulting environment and pay for fallout costs unforeseen by the Municipal staff or were overridden by the process itself;
- the traditional zoning and sub-division approval process takes more time and is riskier for a developer because it requires public notification PLUS ongoing ability to determine approvals;
- the easiest, fastest process is a MZO, because once a municipality passes a by-law of support, it is on its slide through a regional government process, and off to a provincial politician. Once it leaves a municipality’s control at the very start, it is really out of their hands – it can have some input, but can be overridden by a higher-tier government that has connections and influences with unknown inputs;
- if a developer approaches a municipality for a zoning change and sub-division approval, the fastest and cheapest route is a MZO. Using a MZO application a developer does not even have to cover the municipality’s own legal costs and staff time ($5,000 and higher) to review the request. In other words, the developer has tossed its normal business costs onto the local tax payers.
- (A recent president bragged to his citizens / tax payers, “Of course I don’t pay taxes. A smart business man does not pay taxes. Taxes are for little people. Paying fees and taxes is stupid!”, and a previous Prime Minister wrote, “What’s in it for me?” in a book.)
After a developer has received approval to proceed the land units / lots are sold to sub-contractors who do the actual construction of buildings, facilities on the land. The sale of these land units is where a developer makes its profit. Because its actual ‘input costs’ are ‘relatively’ small even after buying the land, (remember the land was originally purchased for very much less than its present market value for sale) its ‘mark-up’ to the sub-contractor / builder can be very large. This is why the developer makes the proportionately largest profit in any community development.
The lot-buying ‘builders’ then make their profit by calculating their cost to purchase each space unit / lot, adding their real expenses for overhead, materials and labour, and adding whatever margin they can. The builder then markets each unit on a lot, selling each at whatever the market will bear. In the case of multi-unit buildings such as townhouses or multi-level apartment buildings for example, each individual apartment or townhouse is sold separately.
Thus, a builder will buy from the developer a lot size that is large enough (in the original municipal approval) to build as many saleable units within the given space as possible. An astute developer presents a ‘plan’ to the municipality that allows for defined minimums but no maximums for how many people can be placed into a unit of space. Thus, if a municipality has a defined minimum of 45 pj/ha (person jobs per hectare of land), it is to the advantage of the developer to request a larger number, a much greater degree of density, placing more people into a smaller space. If a developer can get approval from the municipality, for example of 65 pj/ha, then it can sell each unit of land to the builder at a much higher price, because it knows that the developer can cram more units into a smaller space, meaning there are more units to sell, meaning the builder makes more profit. It’s almost like magic, with the approval of a by-law by a Council, the developer’s nickel can be converted into a dime or quarter.
The larger the number of units the developer can get at the front end, the larger to profit for both the developer and builder at the back end. Of course, a builder can market its units at a desired price, but if the units are perceived by the public as not being attractive, then the units will not sell at all, or at another market’s price.
In large units such as apartment buildings there are great economies of scale by using one foundation for all 50 or 100 units, fewer inputs for potable water, and outputs for sewage, fewer inputs for energy, etc. and simply connecting everything together as per building codes provincially and in the municipality. If a builder is ‘permitted’, because there is no maximum number of units that be put into a unit of space, a builder will make more, smaller units on each level / storey, and add as many storeys as possible. This may, but does not necessarily make the purchase price of each unit any less, it just means it sells more units for the same price.
The developer plays a role here by putting as many storeys as it thinks it can get away with from the municipality. Thus, 3-storeys is better than 2, and 6-storeys is better than 3. It does not matter what the surrounding environment looks like, if a developer can negotiate it, it will put a city into the countryside.
This is where the definition of “affordability” hits reality. It is not the municipality or the developer that sets the price of a unit built, it is the ‘builder’ determining what the market will carry, and more is obviously better than less. The developer, as stated, has set the stage for greater profit for itself and the builder by allowing for more units to be sold in the same piece of land. But it is the builder that sets the final sale price, unless the municipality has negotiated specific numbers at the very beginning that determine the outcome. It is a negligent developer that does not mention “affordability” in any proposal. An astute developer knows that Councils are receptive to the concept because developers know that it is only a conscientious council that actually directs its professional staff to do the detailed cost / benefit analysis of the project, and does not trust that the colour pictures and detailed charts from consultants will come true.
Hint: Verify first, conduct the complete approval process with ongoing public consultation, then trust! Trust comes after the development has been legally turned over to the municipality. Before that, “it’s just business”.
The development of any piece of land is a negotiation between a developer and the local government which represents the interests of its citizens.
On any issue of development, it is the responsibility of a Council to provide full opportunity for all citizens / tax payers, to whom it is accountable under law, to provide ongoing input. Sometimes, it is the case that a Council believes in their hearts that they know what is best for their citizens / tax payers in spite of what they may hear from the 1 – 10% of voices that talk out to them. Sometimes, hubris kicks in for Councils and they conclude that they have only heard from “the usual voices”, and the other 99% would agree with whatever they decide. (Hubris: excessive pride or self-confidence or, in Greek, defiance of the gods. Hubris results in nemesis – downfall, injury, retributive justice)
Thus, a developer will try to eliminate any accountability to the citizens / tax payers by eliminating them from the process. This is obviously because it takes longer to complete a project, and there are usually changes that the citizens / tax payers require to make the project compatible with their community’s environment. Thus, a developer will use the MZO process if it can get away with it. When the citizens provide nemesis, retributive justice, it is too late and is imposed upon the council members, and the developer still gets its profit.