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Tracking Development Charges in Reserve Funds: Toward Best Practices in Our Community

Tracking Development Charges in Reserve Funds: Toward Best Practices in Our Community. Presentation by CHBA – [Name] To the [Province] Minister of Municipal Affairs May, 2009. Background:. Municipality responsible for installing off-site infrastructure for residential growth.

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Tracking Development Charges in Reserve Funds: Toward Best Practices in Our Community

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  1. Tracking Development Charges in Reserve Funds: Toward Best Practices in Our Community Presentation by CHBA – [Name] To the [Province] Minister of Municipal Affairs May, 2009

  2. Background: • Municipality responsible for installing off-site infrastructure for residential growth. • Collect development charges from development industry to pay for infrastructure investment in off-site services. These, in turn, paid by new home buyers. • Over period 2005-2006, such charges amounted to some $1.8 billion annually across Canada. • Critically important that transfers to public bodies of this magnitude be transparent and accountable within each municipality. Tracking Reserve Funds for Municipal Infrastructure

  3. Scope of Altus Clayton research: • Considers data and information for 2005. • Examines how reserve fund reporting is done in representative sample of 12 major Canadian municipalities across Canada. • Determines how provincial legislative requirements affect municipal reporting activities. Tracking Reserve Funds for Municipal Infrastructure

  4. Main Findings of Altus Clayton Research: • Wide array of different municipal accounting practices, funding mechanisms and terminology across Canada. • General lack of transparency in stewardship of infrastructure investment funds that come from private sector. • Issues of reporting tend to be concentrated in municipalities outside of Ontario. • Lack of transparency and accountability increases risk that funds will be misallocated. Tracking Reserve Funds for Municipal Infrastructure

  5. The Ontario Framework as a Potential Model: • Accounting practices and financial reporting by Ontario municipalities show welcome degree of transparency…there is a consistent reporting framework through the Ontario Ministry of Finance. • Stocks and flows of development charge funds are easier to track among Ontario municipalities. • Beneficial to public if this level of transparency and hence accountability found among all municipalities in Canada. • Of course, can still be improvements in Ontario too. Tracking Reserve Funds for Municipal Infrastructure

  6. Recommendations: 1. Reserve Fund reports should be based on a standard template developed by the Province in consultation with municipalities. 2. Reports to public should clearly set out - reserve fund revenues; - expenditures; - credits and balances. 3. Reports should be itemized by infrastructure and other projects earmarked for funding by the Reserve Fund. 4. Reports should be produced annually. Tracking Reserve Funds for Municipal Infrastructure

  7. The home building industry wants to work with you to improve public reporting practices on reserve funds, and to increase benefits of municipal infrastructure investment!

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