Vancouver’s newest proposed Development Cost Charges; is there a democratic deficit in the city’s densification policies?

Yet another tax, in this instance called a “DCC” ( development cost charge ) is to be added to all new developments.

This has been approved by the Translink Mayors’ Council to pay for future transit expansion and road infrastructure.

It will vary from $2,100 for a house to $1,200 for a condo (but unlike the Foreign Buyers Tax it will also apply to retail ($1.00/sq.ft.), office ($0.50/sq.ft.) and industrial ($0.50/sq.ft.) developments.

The reason for this thinly disguised tax is that presumably more developments will put more pressure on transit and roads, so more money is needed to improve them. Needless to say that charge will be added directly to the cost of the project and passed along to the buyers, thus increasing the already sky high prices.

As cities are hamstrung in their ability to tax their residents (having no direct taxation power like the feds and the provinces), they are always on the lookout for more avenues to squeeze money out of the residents (like increased parking rates, DCC’s, property taxes, by-law fines and parking tickets, empty homes tax etc.)

One of the main ways municipalities raise money is to increase DENSITY in neighborhoods by rezoning areas to permit high rise towers where single family dwellings or low rise apartments once stood. Densification increases the property tax base exponentially.

However, it also increases the need for more transit and road infrastructure costs –thus requiring MORE inventive forms of taxation to pay for the higher number of residents –and on it endlessly goes.

The mayors’ view of increased density and migration into the metropolitan areas in BC is diametrically opposed to those of the residents, 90% of whom seem to think that we already have enough people here.

This is something that Noam Chomsky has referred to as “the democratic deficit”, a situation where the majority of people are in favor of a particular policy or state of affairs and it doesn’t happen. GMO labelling is a prime example of this. Studies have repeatedly shown that 80% or more of consumers want to know whether their food has been genetically modified. Despite this, in North America initiatives for mandatory labelling have been routinely defeated for the last 25 years by the bio-tech industry.

So if most British Columbians don’t want more people coming to the Lower Mainland, why is the population increasing by 30,000-40,000 per year?

Part of the reason is the dubious immigration policies of the federal government. Part of the reason is that land developers are making a lot of money building towers and they are able to sway the many leaf-in-the-wind politicians with campaign donations.

And lastly, part of the reason is that governments can ignore the will of the masses because they are not organized and do not “block vote” to further their own collective agenda.

Over the past ten years I have made it a point of asking my real estate clients who are buying or selling whether they would like to see more people move the Lower Mainland. To a man (or woman) they have told me that they are NOT in favor of more people moving here as there are already enough traffic jams, pollution and general congestion.

So what do you think – THE MORE THE MERRIER or ENOUGH IS ENOUGH?

Disclaimer:  The foregoing is for information purposes only and not intended as legal advice to the reader.  Always consult with an experienced real estate lawyer when modifying the standard real estate contract in use in BC. In addition statutory law as well as case law may change from time to time which could render this analysis inaccurate in the future. 

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