CANMORE – An appeal by developers against the Town of Canmore that could impact who pays for tens of millions of dollars in future infrastructure costs has been filed.
Five developers and the Bow Valley Builders and Developers Association (BOWDA) formally gave their appeal to the Land and Property Rights Tribunal (LPRT).
The eight-page appeal outlines developers’ belief the Town didn’t “conduct a viable and reasonable assessment of costs required to meet regulatory mandates as compared to the costs only arising from growth due to new development above those regulatory mandates.”
Spring Creek Mountain Village, Three Sisters Mountain Village Properties Limited (TSMVPL), Stone Creek Resorts, Altitude Developments Limited (Logel Homes), BOWDA and SC3 Limited Partnership (Devonian Properties) are the appellants.
The grounds for appeal focus on the calculations of costs are inconsistent with provincial regulations, the imposed off-site levies are “unlikely to benefit future occupants of the land who may be subject to the off-site levies” and the principles and criteria of provincial regulation weren’t followed.
“The Town has failed to account for all benefits to the Town’s existing development as a result of new, upgraded or expanded infrastructure included in the off-site levy bylaw [amendment],” stated the appeal.
“The Town’s methodology of allocating benefit generally only considers a cost allocation to existing development based on cost of replacing “like for like” the existing infrastructure, less the residual value for the remaining lifecycle of existing infrastructure. The Town’s methodology fails to consider benefits, expected, anticipated or implied by the regulations to the existing development of new, upgraded or expanded infrastructure, including redundancy.”
Canmore council approved the off-site levy bylaw amendment in March, but developers and Town staff had differing opinions on whether or not it complies with the Municipal Government Act (MGA) and off-site levy regulations.
The appeal’s primary argument is the benefitting area wasn’t followed by the Town and the calculation used for determining the off-site levy rate didn’t properly follow provincial regulations.
At council’s Tuesday (June 4) meeting, up to $500,000 in estimated legal costs was approved to come from reserves to defend the appeal.
Town staff noted it’s “an extraordinary, emergent expenditure that is disproportionate to the legal department operations budget” and is required for outside legal counsel.
“These cost allocations will impact the development industry where they are allocated to new development, but the cost on the Town will ultimately fall on sources of public funds – utility ratepayers, taxpayers, debt, grants if available,” said Adam Driedzic, the Town’s solicitor.
Town staff estimate up to $300,000 will be needed for legal costs, $150,000 for expert fees and a contingency fund of $50,000.
“Off-site levies are a highly technical and multi-disciplinary subject matter. The LPRT appeals will foreseeably involve live witnesses and presentations. The Town may also need funds for contractors to boost capacity of departments or backfill for staff who are supporting the legal actions,” stated a staff report.
The report highlighted if the Town were to not update its off-site levies, municipal taxpayers would bear the burden of costs that would “greatly exceed the proposed costs of responding to the legal actions.”
“Without updating the 2020 off-site levy bylaw [amendment], the Town has a shortfall on the collection of levies needed to account for the cost of public infrastructure attributable to new growth,” stated the budget summary. “This shortfall will fall on the municipal utility ratepayers, taxpayers, or otherwise on the public purse.
Driedzic said municipal staff estimated $1-2 million would be lost a year through off-site levies if Canmore maintained its current growth based on the 25-year forecast.
“It’s not a case where the Town wants to litigate. It really follows from those responsibilities to consider and balance the trust of the community as a whole,” he said.
The developers’ appeal highlighted the Town has at least five versions of its Utility Master Plan (UMP), which is a key guiding document in establishing the off-site levy bylaw. It noted how it was first presented to staff as information – whereas the previous two versions were council-approved – and eventually accepted for planning purposes. However, the key document was updated at least a further three times without council ascent.
The appeal asks for all information and data used to calculate the off-site levy bylaw amendment, information on what UMP version was used for calculating costs, detailed information on necessary upgrades to the Town’s wastewater infrastructure, capital infrastructure borne by the MD of Bighorn and how it’s calculated with the Town and communication between the Town and multiple organizations.
It further adds certain projects and costs weren’t in the council-accepted version of the UMP and developers weren’t consulted.
“There are numerous versions of the 2022 Utility Master Plan and associated documents including amendments, addendums or memos related to same, concurrent or subsequent to the council accepted 2022 UMP. This has resulted in a lack of transparency,” stated the appeal.
Developers are seeking a preliminary hearing “to have the LPRT require the Town to provide full disclosure” for information and data sought, and to have the off-site levy bylaw amendment made invalid, repassed and amended to follow proportionate benefit for projects, use consistent methodology and remove non-capital-related projects.
The Town has until June 7 to provide comments and additional information to the LPRT.
None of the claims have been heard or decided by the tribunal, nor has a date yet been scheduled for the appeal. The two sides could negotiate a potential settlement until a decision from the tribunal has been issued.
If arguments are heard, the LPRT could amend the bylaw, repeal it or leave it as is. Any changes to the bylaw would be for all development and not just those part of the appeal.
BOWDA and TSMVPL filed an application for judicial review of the off-site levy amendment, but it’s adjourned until after a decision has been reached on the LPRT appeal.
The judicial review outlines the off-site levy bylaw amendment added about $69.7 million in extra levies.
It specifically mentions Section 648.2(6) and 648.3(4) of the MGA, with the Town not making publicly available all information on how capital costs were estimated or the modelling to get to the now approved levies.
It also argues the determination of the benefitting areas and allocation of costs based on the benefitting area wasn’t included, as well as information and data used to calculate costs.
“A municipality is required to consult with stakeholders in establishing an off-site levy and provide stakeholders the ability to provide input on an ongoing basis. For these consultations, the municipality must make publicly available before approving the off-site levy bylaw any calculations the municipality has made and any information the municipality has relied upon, including, without limitation, any assumptions and data the municipality has used in models to complete calculations,” stated the application.
The application claims the Town failed to properly consult with stakeholders required by legislation, the consultation that took place was not in good faith and calculations for off-site levies weren’t consistent, clear or reasonable.
Coun. Joanna McCallum said at the June 4 meeting “somebody still has to pay for these things” and “it’s stuff that still has to be built if development goes forward.”
Mayor Sean Krausert highlighted the Town hasn’t chosen to be in the position to defend litigation, but it is always a possibility. He said any legal costs would be far outweighed by what wouldn’t be collected if the bylaw hadn’t been passed by council.
“We need to defend this because this is about protecting the ratepayer, this is about protecting residents from increased costs that they wouldn’t have to have to pay were they covered through the off-site levy bylaw as it was passed,” he said.
