Court hears outlines of Winnipeg growth fee fight

The case isn't at trial yet, but both sides in the fight over impact fees charged to developers was in court on Monday.

At issue: does Winnipeg have the jurisdiction to levy a growth or impact fee on new developments

The fight is over whether Winnipeg has the jurisdiction to levy a growth or impact fee on new developments in the city. (Gregory Bull/The Associated Press)

A trial is months away but both sides of Winnipeg's contentious growth fee battle were in court Monday.

A planner and an economist from the city of Winnipeg were cross-examined over affidavits they gave about their roles in planning the fees before being approved by city council in October 2016. 

The fight is whether Winnipeg has the jurisdiction to levy a growth or impact fee on new developments in the city. The fee, which the city is collecting but not spending until legal issues are resolved, is about $500 for every 100 square feet of new residential space.

Both bureaucrats testified they had little to do with establishing the legal framework to impose the fees.

The Manitoba Home Builders Association and the Urban Development Institute (representing the development industry) as well as some private companies have asked the court to quash the fees.

City economist Tyler Markowsky was questioned by lawyers on the Hemson report —a study that helped formed the basis for Mayor Brian Bowman's determination to charge the fees.

Markowsky told the court Hemson wasn't hired to provide a legal opinion on the fees, but to give an analysis of infrastructure and costs related to growth.

Markowsky was asked if he understood how the city would legally support the imposition of fees through the City of Winnipeg Charter.

The economist testified he was focused on providing technical information and project management, not providing legal opinions.

"I'm not comfortable getting into this ... that would have been focused on by legal professionals," Markowsky said.

Markowsky was questioned at length about the name the fees would be called, with the words "regulatory scheme," appearing in all capital letters in some reports. 

"There were a lot of discussions about the name of this fee ... we were trying to come up with something generic," Markowsky said. 

In the U.S. the words "impact fees" were used a lot, Markowsky recalled. "Build Winnipeg" was also considered.

The decision was eventually made to "keep it generic. In other words, a regulatory fee," he testified.

City planner Valdene Lawson was questioned at length about the consistency with which the fees are being applied.

The planner was asked to comment about a growth fee that was applied to a development application for section of Gilmore Avenue. If the property owner held the land on the other side of the street the growth fee wouldn't have applied.

"Isn't this arbitrary and inconsistent with planning principles?" asked lawyer Keith Ferbers.

Lawson said no because the one side of the street was governed by an area use plan that qualified it for the fees.

The current head of the Home builder Association says the goal of the court challenge is to determine whether the city overstepped its authority.

"To really get to the crux of it...does the city have the authority through the province to implement a fee or a tax of this kind? That's really the clarity we're seeking. Can the city of Winnipeg implement something like this? Do they have the authority to do that?" said Lanny McInnes during a break at court. 

The cross–examinations continue on Thursday with testimony from representatives of the development business and the Home Builders Association.