Proposed development charge boost panned by builders

A recent report is recommending South Huron triple its development charges, which are currently some of the lowest in the region. Pictured is a sign at the entrance of Exeter’s South Pointe subdivision, which could see its townhouse prices rise as development charges go up.

By John Miner

South Huron council is being warned that a proposal to triple development charges would put housing out of the reach of new buyers and risk stifling the local economy.

The increased charges, rising from the current $6,206 to $18,641 for a single-detached house, are suggested in a report prepared for council by consultants Watson and Associates Economists Ltd.

Under provincial rules, council is required to pass a new development charges bylaw this year.

At a public meeting to review the report, Nancy Neil of Watson and Associates said the increased charges are calculated to recover the capital costs associated with development in the municipality.

Council is free to phase in the increase and can provide exemptions, she said.

But if it decides not to collect all the charges it might not have the money necessary in the future to cover the costs to the municipality of new development.

“Therefore, there would be an impact on your taxes,” she said.

The report suggests council pass its new development charges bylaw on March 16.

According to the report, South Huron currently has one of the lowest development charges of area municipalities at slightly over $6,000 for a single-detached house.

Lucan Biddulph charges $46,340 for development in Lucan; North Middlesex charges $47,790; West Perth $19,827; Stratford $17,343; and Lambton Shores $13,021. Goderich charges less than South Huron at $4,035.

Asking council to delay the bylaw and reconsider the charges, John Meinen, president of Pinnacle Quality Homes, said developers are in a tough situation with building costs climbing.

In the case of Pinnacle, Meinen said he has spent millions on services for the South Pointe subdivision in Exeter but only sold six units in 2025 and is currently sitting on 35 to 40 serviced lots.

“I know the perception out there is builders are rich and builders are wealthy. I can tell you one thing for certain, six units does not cover the cost of what I’ve done out there,” he said.

Pinnacle reduced prices on its townhouses, but if the proposed hike goes through it will have to raise them back up again. It is getting to the point where it is impossible for young people to build or buy in the community, he said.

Meinen suggested some of the services used to calculate the new development charges are wants rather than needs.

“We have to be very very concerned about stifling our own economy.”

Don de Jong of Tridon Properties also called on council to delay its development charges bylaw.

He said his company has consulted an economist and would like time to provide input.

In a written submission, the Perth-Huron Builders Association said it is concerned with the speed and magnitude of the increases. It warned the threefold increase in development charges may lead to stalled residential projects.

The association suggested new charges be phased in over multiple years.

Council appeared sympathetic to delaying the bylaw.

Coun. Wendy McLeod-Haggitt said she supported reviewing the study to find ways of making the charges more affordable.

“We are in a recession, we have some very serious financial restraints on our residents.”

Coun. Ted Oke said he would like to know what other municipalities plan to charge when they revise their development charge rates.

“I don’t want to be in a race to the top here,” he said. “We have to be competitive to attract people to move to South Huron and we can’t price ourselves out of that.”