(JENNIFER STAHN / iNFOnews.ca)

The City of Vernon has reduced the cost of building in what the mayor described as a "significant" move.

Vernon city councillors voted unanimously to reduce development cost charges at their Jan. 13 meeting.

The development cost charge is a fee charged by the City to developers, or anyone building a house, with the money going toward long-term infrastructure projects and maintenance. While initial savings will be felt by those building homes or developments Vernon Mayor Victor Cumming said the move will have a lasting impact.

"It's a subtly that happens at a municipal level and people say, 'so what?' but it's significant... and it indicates very good financial management at the City," he said.

"Everything we can do to have downward pressure on the cost of new housing makes Vernon more attractive to those who are trying to operate or grow a business."

The mayor said reducing the cost charges will contribute to putting downward pressure on the price of new lower and medium-cost homes and will probably be most felt in $300,000 to $400,000 price range.

While the reduction covers everything from single residential homes to the price per hectare for industrial land, the largest decrease is for single-detached housing which goes from $16,430 to $13,766 - a 16 per cent decrease.

According to the City of Vernon the new rate remains lower than other cities in the region with costs (based on June 2019) in Kelowna from $23,606 to $46,125 depending on area; West Kelowna at $21,669; Penticton from $13,262 to $17,458 and Kamloops at $10,673. Some other cities are also planning increases to their development cost charges.

While the obvious beneficiary may be those working in the building industry, the mayor said the economic spin-off from this affects the city as a whole. Companies wanting to expand and attract new workers will have affordable housing for their staff.

The mayor said the move to lower charges comes after a comprehensive and thorough review of the City's assets.

"We've been very systemic in asset management... and been very careful in what we are going to have to replace and what we are going to have to add," he said.

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