Plans by several developers to build new neighbourhoods in Regina have hit a snag: city officials say Regina can not — on its own — afford to build all the necessary infrastructure needed for such growth.
To deal with that, City Council on Monday approved a temporary solution: have developers shoulder more of the infrastructure cost for new subdivisions.
The interim plan also restricts the number of neighbourhoods that can be developed in Regina, until a longer term plan is in place.
According to information prepared by officials, part of the problem is that Regina's ability to borrow money is maxed out to pay for a new waste-water treatment facility and a football stadium.
"The City can not afford to continue to pay for growth-related capital projects," administrators said in a report for council. They said if they did not change the current policy the city would run into trouble because there would be "too many projects" on the go.
'We're phasing in the growth. Phasing in the expansion that's affordable.'- Regina Mayor Michael Fougere
"This would result in the need for the City to exceed its debt limit," officials said.
The new, temporary, policy is the best solution according to Regina Mayor Michael Fougere.
"We're phasing in the growth. Phasing in the expansion that's affordable," Fougere said Monday. He also said it was the best solution for taxpayers.
"It's very complicated but it is also absolutely fundamental that we get this right so taxpayers don't subsidize new development," he said.
Several developers addressed council expressing concern about the added financial burden noting the higher costs are passed along to the people who buy homes in the new neighbourhoods.
According to the city, the development fees can increase the cost of a home by up to 4.5 per cent.
The policy will be in place for two years during which time the city promised to undertake a comprehensive review of development fees.