Report to/Rapport au :

Corporate Services and Economic Development Committee

Comité des services organisationnels et du développement économique

and Council / et au Conseil

10 September 2003 / le 10 septembre 2003

Submitted by/Soumis par : Ned Lathrop, General Manager/Directeur général,

Development Services/Services d'aménagement

Contact Person/Personne ressource : Richard Kilstrom, Manager / Gestionnaire

Planning, Environment and Infrastructure Policy/Politique d'urbanisme, d'environnement et d'infrastructure

(613) 580-2424 x22653, Richard.Kilstrom@ottawa.ca

Ref N°: ACS2003-DEV-POL-0044

SUBJECT:	FINANCIAL AGREEMENT FOR THE ENVIRONMENTAL ASSESSMENT FOR THE HUNTMAR ROAD EXTENSION

OBJET :	ACCORD FINANCIER CONCERNANT L'ÉVALUATION ENVIRONNEMENTALE POUR LE PROLONGEMENT DU CHEMIN HUNTMAR

REPORT RECOMMENDATION

That the Corporate Services and Economic Development Committee recommend that Council approve an agreement with the landowners within the Kanata West area for the payment and reimbursement of the costs for the environmental assessment of the Huntmar Drive Extension in accordance with the principles outlined in this report, the final version of the agreement to be to the satisfaction of the Director, Planning, Environment and Infrastructure Policy and the City Solicitor.

RECOMMENDATION DU RAPPORT

Que le Comité des services organisationnels et du développement économique recommande au Conseil municipal d'approuver l'accord financier avec les propriétaires fonciers de la région de Kanata Ouest, lequel prévoit le paiement et le remboursement des coûts de l'évaluation environnementale concernant le prolongement du chemin Huntmar en vertu des principes établis dans le présent rapport, dans la mesure où la version finale de l'accord est jugée satisfaisante par le directeur, Politiques d'urbanisme, d'environnement et d'infrastructure et par le chef du contentieux.

BACKGROUND

At its meeting of 3 September 2003, Council approved the Statement of Work for the Huntmar Drive Extension with the expectation that the work will be initiated prior to the end of 2003.

The concept plan for the Kanata West or ROPA 9 area was approved by Council on 26 March 2003. The approval included the following recommendations:

City Staff initiate immediately discussions with Kanata West landowners to finalize a financial agreement by April 30, 2003 to recover both the costs of an EA for the extension of Huntmar Drive, and the costs of constructing that extension;

This agreement include provisions that the City "front-end" the cost of constructing the extension of Huntmar Drive and specify mechanisms for the complete recovery of attributable costs from Kanata West landowners within a specified time frame. Such an agreement shall not preclude the possibility of a landowner or group of landowners front-ending the project themselves;

This agreement require the approval of Corporate Services and Economic Development Committee and City Council to ensure that it include a secure arrangement for the complete recovery of attributable costs to the City.

DISCUSSION

The cost of the environmental assessment for the Huntmar Drive extension is expected to be approximately $300,000. According to the principles proposed for the financial agreement, the costs will be front-ended by area landowners and ultimately funded through development charges and other City revenues, with the proportions determined by the shares of the extension that benefit growth and existing development. The growth portion, currently estimated at approximately 60%, will be covered through future development charges. The share of benefits to growth and existing development will be determined through a needs analysis completed as part of the environmental assessment to be carried out by a firm under contract to the City and confirmed through the review of development charge bylaws.

The staff report on the Kanata West Concept Plan considered by City Council on March 26, 2003 (ACS2003-Dev-Pol-0011) discussed the financing of the infrastructure required for the Kanata West area, and concluded with the following paragraph:

The cost-sharing principles in the Kanata West Concept Plan will be considered in the preparation the area specific development charge by-law and the concurrent revision to the new citywide development charge by-law to be completed by August 2004. The recommendations of the Long-Range Financial Plan Sub-Committee, approved by Council in October 2002, included the principle that "growth pays for growth", and directed that development charges need to be increased to the full level allowed by legislation. The principles of the new development charge by-laws will need to reflect this direction while working within legislative restrictions. The background study will consider which costs should be in a citywide uniform charge and which should be in a Kanata West special area charge based on a common set of principles.

At this point, staff are not in a position to make a final recommendation with respect to the means by which the costs of the infrastructure for Kanata West are to be recovered from that area. However, each of the stakeholders in Kanata West recognizes the need to move forward with the Huntmar extension environmental assessment. Therefore, given that the relatively modest portion of the overall cost of the Kanata West infrastructure (the total cost of road improvements is estimated at approximately $50.3 million) that is represented by the cost of the environmental assessment, the landowners are prepared to go forward, on a without-prejudice basis to future discussions over cost recovery, on the following basis:

1. The landowners shall post letters of credit to the value of the estimated cost of the environmental assessment.

2. The initial payments to the engineering consultant will be made by the City.

3. The landowners shall reimburse the City for the payments to the engineering consultant within 30 days of being invoiced by the City.

4. The landowners will be reimbursed for the percentage of the cost of the environmental assessment represented by growth at the earlier of three years after the completion of the environmental assessment or the commencement of the construction of the Huntmar extension.

5. The contributions of the landowners to the environmental assessment will be capped at $300,000.

6. The growth component of the cost of the environmental assessment will be included in the City's development charge for the Kanata West area.

7. The non-growth component of the cost of the environmental assessment will be borne by the City, through property taxes.

One of the developers who will be front-ending the cost of the environmental assessment will not be in a position to do so until they become a landowner in the area. The application to the Committee of Adjustment for a consent to sever to permit this to occur was heard on 2 September 2003. It in anticipated that the appeal period on the granting of the consent will conclude by mid-October. Staff will work together with this developer and all the landowners to ensure that the consent can be finalized, the agreement entered into, and the environmental assessment initiated as soon as possible thereafter. The request for proposals for the environmental assessment is in progress, with the award of the contract conditional on completion of an agreement with the landowners.

CONSULTATION

Extensive consultation took place with respect to the Kanata West concept plan. The principles of this agreement have been outlined to the landowners and they are in agreement with them.

FINANCIAL IMPLICATIONS

The agreement with the area landowners is being pursued without prejudice to future discussions on cost recovery. The City will need to reimburse the landowners for the portion of costs attributed to existing development, and may need to compensate them for the portion of costs attributed to growth before that amount is collected through development charges.

SUPPORTING DOCUMENTATION

None.

DISPOSITION

In co-operation with the Planning, Environment and Infrastructure Policy Branch, Legal Services will finalize the agreement.