CORNWALL – Developers wanting to put up buildings with ground-floor commercial and residential on top won’t be getting any tax breaks – at least for now.
The Planning Advisory Committee (PAC) voted 6-4 Monday night to impose a moratorium on tax increment grants for multi-storey mixed use construction. The moratorium still has to be approved by city council. Since PAC is a committee of council, it’s a foregone conclusion it will be approved.
Under the program, developers would pay all the taxes on the residential portion of the building but would have a portion of the commercial taxes refunded on a sliding scale over 10 years. For example, they would get 80 per cent back in year one and that share would drop to 40 per cent by year 10.
Examples of those types of buildings are Knox City Center at Sydney and Second, the Cotton Mill Lofts on Cotton Mill Street and Dominion Place at Pitt and Second.
PAC wants to revisit the criteria for the grant program because it’s felt these types of developments are starting to put a strain on city resources. The committee also feels the program is moving away from what it was originally intended for – to rebuild the downtown in the mid-2000s.
Denis Carr is spokesman for Heart of the City and is vice chairman of the Cornwall Planning Programs Evaluation Committee. “We’ve talked for many meetings about this and we were of the opinion there has to be some changes made to that part of the program. That’s not what Heart of the City program was designed for in the first place. It was designed for the downtown.”
The moratorium does not affect the Brownfield CIP or the six other Heart of the City community improvement programs.
Carr says the makeup of these developments have changed with smaller square footage for commercial space and increasingly larger residential components. “Because of the height of the building, more floors, less commercial space but more residential space, so it’s becoming a purely residential program. Initially, this was a commercial program with a residential component,” Carr said.
Carr suggests a tax increment grant could be calculated on other criteria such as land values, uses for the building or senior government funding.
News of the moratorium was not well received by some major city developers who were sitting in the gallery – at least one with a proposal like this on paper.
Planning Supervisor Ken Bedford says the moratorium could be challenged. “If there’s support from council then we would prepare a bylaw to amend the Community Improvement Plan (CIP). That process is appeal-able (to the Ontario Municipal Board). If no one lodges an appeal then it comes into effect after a 20 day appeal period,” Bedford said.
Bedford says PAC “really concluded business” on this type of development with the approval of the final phases of the Cotton Mill Lofts.
PAC will hold a public meeting in May to look at the criteria for the tax increment grant.