The City of West Kelowna is looking at an increase in developer cost charges (DCCs) to offset the rising cost of land.
DCCs are paid by developers who construct single-family housing, as well as multi-family, commercial, industrial and institutional developments. DCCs fund development-related infrastructure projects like water, sewer, parkland and transportation upgrades.
In a staff report tabled at the Dec. 14 regular council meeting, development engineering manager Bob Dargatz wrote the city should look at increasing several changes to the DCC bylaw. That recommendation is based on a report compiled by Kelowna-based consulting firm Urban Systems.
Urban systems found single home-builders should pay between 41 and 53 per cent more in DCCs as West Kelowna’s population grows. In their report, they noted the cost of land has increased 49 per cent since 2016, meaning a piece of waterfront parkland that cost $1,746,815 now costs $2,602,754. New parkland will be needed as the city is set to add 12,373 new residents by 2040.
Under the current DCC bylaw, DCCs are only paying for 33 per cent of the costs, which Urban Systems said are 100 per cent related to population growth. That adds up to $3.6 million in forgone DCC revenue for the city. Single-family home builders currently pay $4,700 in DCCs for park development. Ubran Systems recommends increasing them to $8,700 per home.
Other DCCs like water projects are recommended to increase to $3,600 from $3000; roads to $14,861 from $10,500; sanitary sewers to $256 from $85; and storm sewers to $653 from $250.
Council received the staff report after the West K News print deadline.
The city will engage with stakeholders and the public about the proposed DCC changes in January and February. Council will then receive the input and a draft bylaw for approval.
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