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Cost to build going up with proposed changes to what Kamloops charges developers

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November 23, 2016 - 4:30 PM

KAMLOOPS - Costs for home builders and developers are going to be changing in Kamloops.

The city is updating its development cost charges bylaw. While updates are scheduled to happen every three years, this one is a more systemic change than past years with a revamp to cost calculations.

The new system will charge developers based on size of their project, instead of a flat fee for any unit. While the math can be complex city engineering director Marvin Kwiatkowski says there’s likely to be a 0.4 per cent increase to residential home prices on average.

Commercial sites will likely see a 12.5 per cent increase. The formula for industrial developments is too complex to sum up in an average, he says.

"We’ve changed the whole way it’s going to work," Kwiatkowski says. "I’m excited where we’re going."

Overall, it means developers will see likely costs go up to build in Kamloops, though not all projects will cost more. Kwiatkowski says Kamloops is still competitive with other communities.

“We’re looking for what's fair and equitable,” he says. “If you look at overall rates compared to other cities we’re doing quite well.”

Kamloops currently sits well below other comparable cities in the region, according to a chart included in a city report on the subject. Right now, on average the cost of a new home is $9,525 in Kamloops compared to $18,800 in Vernon and $26,500 in Kelowna. The only city that had a lower average cost was Prince George. Kwiatkowski says that’s because of negative growth in that city.

Development cost charges are levies developers have to pay when constructing a new building to help cover new infrastructure costs related to the new building. Kwiatkowski says this helps the city manage growth. In the report to council it's noted the new system should help create affordable housing and track secondary residential suites. 

“If additional projects are needed due to growth, development cost charges are levied at time of building permit,” he says. “It’s really having development help pay for new growth projects.”

An assist factor will be set as well; this is the rate at which the municipality will help offset the development cost charges so developers aren't paying 100 per cent of new infrastructure costs. It's a part of the Local Government Act. The factor is a percentage of the cost of the infrastructure required by the new development.

In the report to council, administration suggests a 10 per cent factor for transportation and one per cent of municipal services covering things like water and sewer. 

City administration plans to have a new bylaw infront of council for consideration on Dec. 6.

To contact a reporter for this story, email Brendan Kergin or call 250-819-6089 or email the editor. You can also submit photos, videos or news tips to the newsroom and be entered to win a monthly prize draw.

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News from © iNFOnews, 2016

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