By Sam Borsato - @BorsatoSam on Twitter

Slowed Growth Could Mean Putting Off Major Development Projects

Mar 14, 2016 | 6:07 PM

LETHBRIDGE – Growth isn’t looking as optimistic as it has in past years, which could have some effects on the off-site levy account balance.

The levy provides upfront funding to land developers for infrastructure, like water, sanitary and storm lines in future serviced lots.

At Monday’s Finance Committee meeting, Urban Construction Manager, Byron Buzunis, said that instead of growing by 53 hectares per year, downwards adjustments were made to 30 hectares.

While this isn’t the slowest growth the city has seen, Buzunis notes that the city and developers can mitigate costs by putting off some major projects, “Because growth is going slower, developers don’t need the infrastructure quite as soon. We’re able to put off some projects, but that’s not quite enough to get us to a place where we need to be with the off-site levy account.”

“We’ve had to push off some major infrastructure investments in both the West Lethbridge Employment Centre and southeast Lethbridge. We are projecting to start making investments in the southeast around 2029.”

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However, there would be a mechanism put in place so developers could go ahead if they wanted to take on the initial financial risk.

As of 2015, levy revenues are down by $13-million due to the slow down. That equals to roughly a year’s worth of development.

On the other hand, expenditures from 2012 to 2016 were $7.8-million less than projected. That comes as a result of projects being under budget and some deferrals.

The next off-site levy bylaw to set rates from 2017 to 2020 will go for first reading on April 4th. A public meeting, and possible second and third reading will follow on the 18th.

The review committee, with members from the city, the Urban Development Institute and the Canadian Home Builders of Alberta, identified another forthcoming issue.

A near term funding shortfall is anticipated between 2018 and 2020 that’s estimated to reach $5-million. It was agreed that in order for it to be minimized, expenditures will be put off and some debt payments will be held until 2020. Any remaining shortfalls could be covered by accumulated utility surpluses.

The newly projected rates (pictured to the right) are agreed inflation adjustments of 3.1-per cent.