Here is an interesting article from Christina Commisso from the Champion.
Councillors debate DC issue
Corporate welfare or a tax grab?
Regional council was divided yesterday on the issue of charging business owners a development charge (DC) to convert their space from a non-retail to a retail use.
The issue was a sticking point for business improvement associations that said the hefty fee, which would amount to tens of thousands of dollars, would hurt small, family-run businesses in Halton’s downtowns.
For example, a 2,500 square-foot office, which paid DCs when it was built, that’s converted to a retail use would face a $24,000 DC.
The Region has said generally retail operations generate more traffic and wear and tear on the roads in justifying the charge.
In its 2012 development charges update, the Region agreed to wave the fee for businesses under 3,000 square-feet in the interest of economic development. However, Oakville Mayor Rob Burton called the move “corporate welfare” and asked that all businesses, regardless of size, pay the fee.
His motion was supported by most of Oakville’s councillors and Regional Chair Gary Carr, but failed after being widely criticized by the majority of Halton’s 21-member council.
“This is not welfare. Honestly, if you vote for this amendment you’re stealing money from people. Let’s find out who the thieves are,” said Halton Hills Councillor Jane Fogal. “This (conversion) amount is small to Halton Region but big for the mom and pop operations.”
Added Burlington Councillor Marianne Meed Ward, “Let’s see who is in favour of a tax grab and who is against economic development and small business owners, who are residents and taxpayers as well.”
Not all were convinced that the fee for small businesses should be waved.
“Retail, when it’s converted from an industrial or office use, it creates more demand and use of our transportation infrastructure. There is a cost, it’s not free,” said Oakville Councillor Tom Adams. “We’re talking about money that will come out of the taxpayers pocket eventually for the benefit of two or three developers. That’s the exact definition of corporate welfare.”
Fogal asked if businesses who convert from a retail operation to non-retail would receive some sort of refund on the development charges previously paid, however staff said that move would create uncertainty in terms of regional revenue.
The conversion fee was part of Halton’s 2012 development charges update, which was passed by council.
Currently non-residential DCs — office space, retail and industrial — are grouped together. The updated DCs, which come into effect September, separates retail and non-retail business into two separate categories with retail DCs increasing by 52 per cent and the non-retail charge decreasing by 25 per cent for Greenfield development.