Citing the economic challenges encumbering the building industry, BILD Central Alberta urged the City of Red Deer to reconsider planned fee increases for developers and contractors.
“Considering the year that the building industry has had, and is expected to have,” BILD CEO Denie Olmstead said in a letter, the permit fee hikes come as a “surprise.”
The association that represents many Red Deer-area builders mentions the “tightening market and a slowing economy.“
Any changes that further inhibit local builders “are difficult to support,” said Olmstead.
City administration said Red Deer’s permit fees were found to be low after a comprehensive fees and charges review of most Alberta municipalities.
The city’s existing fees were lower than the County of Red Deer’s fees, and council was told the proposed adjustments will bring the new fees only minimally higher than the county’s.
A schedule for development and safety code permit fees for plumbing, gas, building and heating (for both residential and commercial), shows these full costs are heavily subsidized by the city by 70 per cent or higher.
The city’s existing fees, ranging from $70 to $85, were much lower than the market average, which ranged from $90 to $165.
Administration recommended raising these fees to $100 each, which would still be below the market average in most cases.
Council debated implementing the higher fees on April 1, as suggested, or delaying the implementation to Sept. 1 of this year, or Jan. 1, 2020.
Mayor Tara Veer was in favour of pushing the increases back to a Sept. 1 implementation. She said council cannot lose sight of the fact the construction industry is among the hardest hit by the province’s difficult economy. And she said construction contributes to city revenue growth.
But Coun. Frank Wong said waiting until the fall will miss an entire construction season, which he feels doesn’t make sense, since the new fees are still well within market averages.
People who are ready to build, will still build — a slight fee increase will not stop projects, added Coun. Lawrence Lee, who also opposed delaying the new fees, as did Coun. Vesna Higham, who did not like transferring the $129,000 revenue loss onto general taxpayers through a delay.
In the end, council approved the permit increase to take effect on April 1, with only the mayor casting a dissenting vote.
Council unanimously approved new fees for safety code services that are not currently charged for (but other municipalities recoup), as well as penalties for safety code infractions that can now be written up as municipal tickets and not have to go to court.