Off-site Levies

What is it?

Off-site Levies are a tool that helps pay for the cost of off-site infrastructure associated with growth. When growth occurs, developers pay the cost of on-site infrastructure; however, the new residential, commercial, or industrial development will also impact infrastructure outside the new site. These off-site infrastructure costs, such as the need to expand roads or increase sewage treatment capacity, would then fall on the municipality. Off-site Levies allow the municipality to charge the developer so that growth pays for growth.

How can municipalities use it?

The Municipal Government Act enables municipalities in Alberta to collect off-site levies for “hard services” including new or expanded facilities for water supply, sanitary sewage, sewer drainage, roads, recreation facilities, libraries, police and fire. Municipalities must establish an off-site levy bylaw and determine the off-site levy charges. A municipality can impose a uniform charge, charge calculated per-hectare or lot, or charge by land-use (such as by residential unit type).

What are the advantages?

The advantages of Off-site Levies include:

  • Assists with financial sustainability; the cost of growth does not fall on the municipality

  • Ensures critical infrastructure can continue to function under higher demand, lowering risk of failure that can impact service quality, human or environmental health

  • Off-site levies are transparent and equitable

What should you watch out for?

Off-site Levies are not without potential issues. Consider the following:

  • Municipalities must transparently work out the method on which off-site levies are calculated

  • Developers may disagree with the municipality over the levy required

  • Off-site Levies must be reviewed regularly to ensure accurate pricing

  • Home buyers end up paying for some of the Off-site Levy cost; developers often include the levy in the cost of the new home

How can it help maintain natural infrastructure?

Off-site Levies are a tool that municipalities use to remain financially sustainable in times of growth, allowing the construction and expansion of services. This can help to maintain the natural infrastructure system, because high quality and functioning infrastructure services help to manage the environmental impact of growth. For example, expansion of sewage drainage systems to manage increased sewage from new developments can help to ensure proper movement and treatment of sewage, protecting water quality. Further, financial sustainability ensures a municipality can instead direct resources to continue to work on projects that protect or enhance the natural infrastructure system (e.g., land acquisition or naturalization projects).

Resources

Town of Canmore Off-Site Levy Bylaw – Canmore estastablished the Off-site Levy Bylaw in 2018 to ensure developers pay a proportionate cost of new or expanded infrastructure required for land that is to be subdivided, developed or is to undergo a change of use or intensity.


City of St. Albert Off-site Levy Bylaw – St. Albert established the Off-site Levy Bylaw in 2013 to facilitate growth, ensure infrastructure servicing in new developmental areas and help the City build a competitive investment environment.


City of Medicine Hat Off-site Levy Bylaw – Bylaw No. 4157 in Medicine Hat establishes an off-site levy to pay for water supply, sanitary sewage, storm sewage drainage, and facilities, as well as the land associated, in residential, commercial, or industrial development.


Proposed NRM Water Levy (Clare Valley Prescribed Water Resources Area) – briefly describes a prosed water levy for Clare Valley, South Australia.


AUMA Municipal Planning Hub - The hub has been developed to provide members with a basic understanding of land use planning in Alberta. The material is divided into four main parts: (1) An overview of proposed planning related amendments to the Municipal Government Act (MGA), (2) A discussion of the purposes of planning and a brief overview of the history of planning, (3) A review of legislation, the hierarchy of plans and roles and responsibilities, and (4) Information on planning issues, trends and best practices. This document includes a section on development agreements and offsite levies.

Did we miss something?

If you know of a resource that should be on this list - or your municipality has a sample or case that should be here, please let us know!