On November 28, 2022, the More Homes Built Faster Act (Bill 23) received Royal Assent in the Provincial Legislature. This Act decreases the amount of development charges that all municipalities, including East Gwillimbury, can collect on development charges. The Act also has measures that has heritage and environmental impacts.

The Town submitted a letter to the province in relation to the Act, followed by a news release on December 7, 2022 which outlined how the Act will affect the Town’s financial position. A further statement was released on January 9, 2023.

The following are responses to frequently asked questions about the More Homes Built Faster Act (Bill 23).

Frequently Asked Questions 

What is the More Homes Built Faster Act?

The province introduced Bill 23 (More Homes Built Faster Act) as a means to facilitate the construction of 1.5 million homes over the next 10 years.

The Act amends several pieces of legislation regarding natural heritage and land use planning and policy. Among the changes is a reduction in development charges fees municipalities can collect from developers who construct new homes and buildings in the community. 

What are development charges?
Development charges are fees municipalities collect from developers to help pay for the cost of building infrastructure for the new development. This includes roads, sidewalks, trails, parks, water and wastewater systems, and community centres. 
 Why are development charges needed? 

Development should pay for development.

By charging developers a fee for the cost of infrastructure, municipalities are able to build the roads, parks, trails, and water systems that communities need to thrive. 

What is the expected shortfall of development charges because of the More Homes Built Faster Act?
For East Gwillimbury, initial estimates project a potential shortfall in development charge collections of $40 to $70M over the next 10 years. These are one-time fees that pay for infrastructure to support our growing community. 
What do property taxes pay for?

Property tax dollars pay for programs and services as well as the ongoing cost of maintaining infrastructure (such as cleaning parks, clearing snow, waste collection).

The Town currently collects approximately $27 million in property taxes annually to fund ongoing annual operations.

With the More Homes Built Faster Act, how will the municipality pay for building roads, sidewalks, parks and other infrastructure?

To replace the shortfall, the Town must find alternative funding which could include grants from the provincial and federal government and reserves (savings).

If unsuccessful, property taxes would be needed to fund the cost of building community infrastructure.

 Will property taxes increase by 100%?
The full impact of the Act is not yet clear. Initial estimates suggest if no other sources of funding (such as government grants) are available to pay for infrastructure, East Gwillimbury could be required to increase property taxes 3% to 5% per year for the next 10 years to account for the decrease in development charges revenue that the legislation enables. 
Will I see changes to my 2023 property tax bill?

The Town will commence the 2023 budget process on January 30.

The base program and service budget will be at or below the rate of inflation which is averaging 6.9% for 2022.

This does not include the shortfall expected due to the More Homes Built Faster Act and there are no additional impacts from Bill 23 that are included in the budget submission.

Beginning in 2024, the impacts of Bill 23 could require a 3% to 5% annual increase to property taxes to account for the cost of municipal infrastructure that would have otherwise been paid for through development charges.

Are these changes only happening in East Gwillimbury?
No. The More Homes Built Faster Act is legislation the Ontario government passed. It impacts all 444 municipalities in Ontario. 

Has the Town received notice of potential funding from the Province to offset the shortfall of funds? 

At this time, the Town has not received any information regarding any potential funding to address any shortfall of funds resulting from the Act. On November 30, 2022, Municipal Affairs and Housing Minister Steve Clark wrote a letter to the Association of Municipalities of Ontario to address municipal feedback regarding the Act. As part of the letter, Minister Clark indicated the province would take immediate action to launch third-party audits of municipal finances in select municipalities. The review would look at reserve funds and the administration of development charges. The Town has not been identified as a potential municipality for a third-party review.