New tax angers Stratford developer

Nigel Armstrong
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Don Hickox of Kel-Mac Inc. rips into Stratford town council Wednesday, Jan. 13. A new water and sewer tax is turning builders away from the town, says Hickox.

New expansion of water, sewer tax kills interest of contractors to build in the town, warns Kel-Mac Inc.

Stratford is going ahead with a bold new tax, but a developer in the town said it is killing growth.

The monthly council meeting Wednesday saw Stratford adopt an expansion to an existing one-time tax aimed at paying for new water and sewer projects.

"It's an issue of fairness," said Mayor David Dunphy, who reviewed the background of the tax at the meeting.

A few years ago, before he became mayor, Stratford brought in a special water and sewer tax that was applied just once to newly developed lots. In total, it amounted to $1,500 per lot.

That was paid upfront by the land developer to get permits to proceed and passed on down the line to likely be absorbed into the total cost for the eventual resident. It was the same amount whether for a single-family lot or a multi-unit lot.

Newly approved by Stratford council Wednesday, taking effect immediately, is a requirement for a developer to now pay the water and sewer capital tax per apartment unit, rather than per building lot.

"They have many more water and sewer demands than a single-family home," said Dunphy. "It's more stress on our system."

Dunphy said the town is facing a huge expense in the next two to four years to pay for a whole new sewage treatment system, whatever that may be.

No other place on P.E.I. has such a tax, said an irate Don Hickox of Kel-Mac land developers.

He ripped into council during the public input stage of the meeting.

"This council came up with a plan that will destroy any potential for sustainable development," he said.

Hickox said because of this tax, contractors have walked away from land prepared for development by his company. He also said contractors are telling him they have no intention of doing business in Stratford "unless there is a change in the anti-development policies of the town."

His company is now going to do the same, he warned.

"We will have to walk away and leave development for future generations or until a pro-development council with economic common sense is formed."

He used an example of land Kel-Mac wanted to develop near Stratford town hall — 19 acres for 27 single-home lots, one triplex and seven apartment lots.

"This new proposed water and sewer tax comes to a staggering $300,000," said Hickox.

A developer can't pass that on to builders because they will just go elsewhere, like the Charlottetown area of Winsloe which does not have that extra cost, he said.

Stratford Coun. Steve Ogden asked that the issue be delayed to see if other ways of paying for big projects could be found, like through water rates, but council voted that down.

Ogden was the only one to vote against the tax expansion.

Organizations: Stratford council

Geographic location: Stratford, P.E.I., Charlottetown

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Recent comments

  • islander2
    January 15, 2016 - 16:48

    Good on Don, he's trying to save new owners/tenants money. Don, do what they do in any other place in the free world -- pass on the costs to the customer. But then the frugal islanders would complain about cost increase. OH WELL to all you know it alls commenting before me. Enjoy the extra bill :)

  • about time
    January 14, 2016 - 20:04

    Boo flipping hoo to Don Hickox and the other crybaby developers who have gotten FILTHY RICH off our lax development policies across PEI. It is about time that they paid 100% of the upfront costs for new water & sewer, new roads, new schools, new playgrounds, new streetlights, more police officers, more fire equipment, etc. They have gotten off Scot free for way too long. All of PEI needs to have the same consistent approach to development so they don't go skipping around and cherry picking based on economic advantage. I'll be writing to Robert Mitchell about this tomorrow.

  • Philip Andrew
    January 14, 2016 - 16:09

    I totally agree with the tax. It should have been in effect years ago. Better late than never. It wouldn't hurt my feelings one bit if developers built their apartment buildings somewhere else. We have enough in this area now. Take note Mr Dunphy and council.

  • Douglas
    January 14, 2016 - 14:56

    They will just go to irac like they did for their project on Kensington Rd.

  • Stratfordian
    January 14, 2016 - 12:47

    Great to see council finally acting on this. Great initiative - The stress on the town's Infrastructure must be staggering after years of rubber stamping apartment buildings.

  • Truth be known
    January 14, 2016 - 10:50

    Maybe not a popular decision by council but probably the right one. Can Stratford's current water and sewer infrastructure support this type of expansion?

  • James Wellington
    January 14, 2016 - 09:46

    "They have many more water and sewer demands than a single-family home," said Dunphy. "It's more stress on our system." Mr. Dunphey is correct and has demonstrated the courage of his convictions. The chap from Kel-Mac is blowing hot air. Stratford has been growing too quickly for its base infrastructure to support without significant upgrades, and upgrades cost dollars. Existing residents should not be subsidizing new development, furthermore, the increased fee is reasonable for multi-unit buildings given the larger number of occupants who will be using much more water and sewage than a single household. Stratford has made the correct decision. Mr. Ogden, as the town's sole objector, demonstrates his lack of understanding, or perhaps better put, his lack of courage to do the right thing for the sake of avoiding confrontation. Developers don't mind playing hardball, town council should be commended for doing the right thing. If development slows a bit that is fine, development of the town has been hit and miss in the past mainly due to provincial jurisdiction of the roads and developers' short-sightedness. Well down Town of Stratford and council, you have demonstrated once again why you are the best town council in PEI.

  • no thanks
    January 14, 2016 - 05:03

    why should pei homeowners subsidize apartment living -- all localities need to pick up on this loophole used by developers