Rough development-fee beast slouches toward Winnipeg

When Mayor Brian Bowman started talking about the need to ensure new developments don't cost more money than they generate in the long term, the conversation started with terms like "growth fees" or "development charges."

Now, the city is talking about "impact fees," while opponents deride proposed "housing taxes." 

Whatever they're called, the name doesn't matter as much as what they're supposed to do. And the objective is no longer clear.

• Premier Pallister raises red flags over Winnipeg's proposed growth fees
• Growth fees on hold in Winnipeg, but it's not clear how long
• Growth-fee plan takes too much power from politicians, Bowman and councillor say

In some cities, growth fees are used as a planning tool and are employed as a means of stimulating some forms of development and deterring others. 

For example, if you charge lower fees to build multi-storey apartments in existing neighbourhoods than you do to build, say, single-family homes at the edge of a city, you may wind up with greater population density in the long run. This, at least in theory, results in lower costs in perpetuity for building and maintaining roads, sewers and watermains, not to mention police stations, community centres and other facilities.

Two weeks ago, however, the City of Winnipeg unveiled a proposed "impact fee" that wasn't designed by the city's planners. Instead, it was drawn up by the corporate finance department with a focus on generating revenue.

Bowman has stated repeatedly he's not interested in a cash grab. Instead, he says he wants to ensure Winnipeg has a means of doing what most other cities do: require new developments to pay for themselves to ensure the entire city is financially sustainable in the long term. 

That goal is at odds with the corporate finance report on growth fees, which recommended those charges go into effect on Jan. 1. That report was written mostly in August, before the completion of the independent study it was supposed to be based upon.

It also was not written with any appreciable input from developers, which is important considering they plan their projects three to four years ahead of time. For a planning tool to have an effect on actual planning, it has to be unveiled well ahead of its implementation date.

So what is really going on? Mayor Bowman and council property chairman John Orlikow (River heights-Fort Garry) are calling the publication of the impact-fee report that nobody seems to like a radical exercise in openness. They claim no politician had any input into the document and insist it was the creation of corporate finance officials alone.

That would be unprecedented, as politicians typically have advisors and policy experts review administrative plans before they're made public. 

Orlikow says only now is the policy work being conducted on the growth-fee plan, although the policy-making process is being led by members of council rather than city planners.

Ironically, the creation of a growth-fee plan for Winnipeg is less open and less transparent than ever. It's unclear who's in charge of the process or what that process even is, now that executive policy committee has placed the idea on hold indefinitely and other members of council now say it will take many months if not years to hammer out a workable deal with developers.

So once again, what exactly is going on? Perhaps Brian Bowman is a better negotiator than anyone expected.

Consider that a few months ago, no Winnipeg developer was eager to talk about development charges. But after facing the threat of new and disruptive fees arriving as soon as New Year's Day, some of the most powerful people in the industry showed up in person at city hall this week to tell the mayor they're willing to talk any time.

• Growth fees coming to Winnipeg on Jan. 1, pending council approval
• ANALYSIS: For Brian Bowman, it's growth fees or bust

It's almost as if Bowman is the crafty handyman who presents you with a $50,000 quote to replace the insulation in your home just to get your attention. Once you're scared out of your wits, you're more than willing to replace $10,000 worth of windows instead and even think you walked away with one hell of a deal after that fact.

The problem with this theory is it suggests Bowman or someone else in his office is a Machiavellian genius who's willing to sacrifice oodles of political capital just for the sake of ensuring developers sit down at the table and talk.

But in politics as in logic, the simplest explanation is usually correct. What appears to be policy chaos at city hall is probably just that.

Ironically, the confusion of the past few weeks has left developers willing to engage in long-term talks. Intentionally or otherwise, an equitable deal may be achieved. ​

To paraphrase Forrest Gump, chaos is as chaos does.