When the DC takes effect
Section 26.2 of the Development Charges Act (DCA) “Freezes” development charges at the rate in effect on:
- The day of an accepted application for a site plan agreement
- If there is no such application, the day of an accepted application for a zoning by-law amendment
- Or if neither of these applications has been made, the charge will continue to be determined at the time of the first building permit issuance
By way of Bill 185, Cutting Red Tape to Build More Homes Act, 2024, which received Royal Assent on June 6, 2024, development charges will be frozen only if a permit is issued within 18 months of the approval of the site plan agreement or zoning by-law amendment and will include interest.
Timing of payment
Development charges are due upon the issuance of the first building permit, except for rental and institutional developments.
Rental and institutional developments: Installments and interest
Development charges for institutional and rental developments are to be paid over six equal installments, plus interest, starting on occupancy (1st payment) and every year thereafter for five more payments.
- To be eligible for an installment payment plan an acknowledgement letter must be submitted to the City 20 days prior to the issuance of the first building permit. The form is located here: Acknowledgement Letter (PDF) (Section 26.1 of the DCA).
Alternatively, institutional or rental developers can opt out of payment of development charges over installment by submitting an early payment agreement form to the City. The form is located here: Early Payment Agreement (section 27 of the DCA)
Interest and missed payments
- The interest rate is 5%. The Development Charges Act sets the maximum rate at prime plus 1%.
- The fee for a missed installment payment is $550 (no HST)
