The City of Delta is looking at new ways to encourage housing redevelopment, particularly on a busy corridor eyed for major change.
Council this week agreed with a staff recommendation to grant Westcorp Developments 116th Street Ltd. a tax exemption agreement for the Oakcrest townhouse project.
The developer will be granted municipal tax exemptions for a period of two years, which means the assessed property value for municipal property taxes purposes for the townhouses, now under construction at the corner of 116 Street and 72 Avenue, will be held at the 2021 base year level for two years.
The developer will also get a 75 per cent reduction in development cost charges.
The DCC reduction and other waived fees total $480,207.
A staff report notes the 2021 Delta taxes for all 10 lots, which have been consolidated into the legal address 11556-72A Avenue, are $34,000.
Following completion of the development, Delta taxes are projected to increase by $75,000-to-$100,000 per year.
The current 72nd Avenue Revitalization Bylaw enables the city to provide municipal property tax exemptions, reduced development cost charges (DCCS) and municipal fee exemptions for eligible projects located in what’s known as the 72nd Avenue Economic Investment Incentive Zone.
The municipal tax exemption allows a “freeze” on assessed value for municipal property taxes for eligible projects for up to three years.
The bylaw is intended to encourage accelerated private sector investment in higher density townhouse developments through lot consolidations.
The report notes the intent is to provide the incentive to the developer, not future townhouse owners.
Earlier this year, council approved a zoning amendment for Westcorp Developments 116th Street Ltd. to construct the 64 unit townhouse complex consisting of 13 buildings through the consolidation of 10 single-family lots.
Westcorp applied for a tax exemption certificate as well as a reduction in development cost charges and the waiver of municipal fees.
The 72nd Avenue corridor has already seen a couple of other new townhouse developments which received incentives.
Planning staff note the city has recently undertaken a review of the revitalization tax exemption program and will soon bring forward a report with recommendations for the elimination of certain elements of the program, including 72nd Avenue Revitalization Bylaw.
During council’s discussion this week, Coun. Dan Copeland said that while he’s in favour of such redevelopments, he’s not in favour of the city providing such financial breaks for market housing.
He added he’s also looking forward to the results of the city’s overall review of its development cost changes.
Coun. Bruce McDonald said the city has been wanting to see redevelopment of the 72 Avenue corridor for years but, until the invectives, nothing had worked.
Noting Delta will receive more tax revenue from the new townhomes than the 10 single-family houses that had been there, he agreed it may be time to look at alternatives.
Coun. Dylan Kruger said he hopes some form of incentive is still in place to encourage further redevelopment of the corridor.
