At the heart of the municipal campaign which will see its outcome at the end of the week, we must rejoice in the fact that urban sprawl and its harmful consequences – in particular on agricultural land – occupy an important place in certain struggles at the town hall and in the public debate. Despite the best of intentions, will new city councils be willing or equipped to deal with it? Many point to their excessive dependence on property tax, but this old diagnosis must be refreshed in the light of advances in Quebec in recent decades.
In short, the property tax, while important, should only be used to continue financing municipal services. It should no longer be used excessively to finance large capital investments made necessary by real estate, residential or industrial developments. However, the municipalities choose to maintain their dependence on the property tax, since they neglect to use other powers, however loudly claimed and obtained over the years, since some dating from 1994 (amendment to the Act respecting LAU planning and town planning) until others obtained by Bill 122, adopted in 2017.
Significant investments
More often than not, urban sprawl comes hand in hand with new real estate developments whose financial merits are blindly praised, while keeping in the shade the identity of who is really paying the price. Any development, residential or industrial, requires not only private investments made by owners or developers, but also significant public investments, often larger than private investments and serving to make them viable and profitable. There is no private investment without public investment from the municipality, but also from Quebec – especially when industrial developments are involved.
Would it not then be fair and equitable for the promoter to participate in this financing instead of passing on the burden – in an invisible but real way – on all the properties already present or on all the taxpayers of Quebec?
Unused powers
Municipalities have powers that they too often neglect to use. They make undue recourse to the traditional property tax. Since 1994, Quebec municipalities have been able to require developers who request authorization to subdivide the land and carry out a new development to bear the cost of the required municipal works.
By municipal by-law, followed by an agreement with the permit applicant, the promoter must then finance the public infrastructure (roads, sidewalks, water and sewer network, etc.) serving the new development, which makes it possible to do absorb by the developer all or at least part of the public costs and send to the potential buyer a first signal of the real cost which is no longer hidden and diluted in the property tax for all.
A 2017 survey revealed that only 40% of Quebec municipalities claim to have adopted such a by-law to recover from the developer part of the public costs directly related to development. Even in the two metropolitan communities, the rate is still too low (63% in the CMM and 77% in the CMQ).
Municipalities also have another power: the development fee, added to the LAU in 2016, making it possible to subject the permit or certificate (construction, subdivision, occupation) to a regulatory fee. […]
However, only a handful of rapidly growing municipalities use this power, which would make it possible to internalize the costs of growth with permit applicants, to whom the municipalities do not hesitate to give gifts that they then make their property taxpayers pay by. citing their pseudo-dependence on property tax.
In addition to representing an overall marginal amount (between $ 750 and $ 6,000 per permit), these royalties nevertheless allow municipalities to accumulate the millions necessary for the construction of infrastructure made necessary by new developments, while reducing the comparative advantage of 3 and 4 crown properties compared to properties in central cities that already have adequate urban infrastructure and public transport services.
Unless we take a serious look at these municipal powers, urban sprawl will continue with a futile discord behind the scenes between the various municipal scales and Quebec, which refer to each other responsibilities that can only be united, to fuel urban sprawl as well as to tame it.
As long as our collective inaction in the use of these powers persists, those who speculate on undeveloped land, developers and builders will unduly benefit from public investments which burden the taxpayer and limit our progress on the path to sustainable development. and the fight against climate change.