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Right now, an empty bungalow sits on Sheppard Ave., waiting for someone to move in. The City of Toronto said that won’t happen until the owner pays a six-figure development fee.

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The bungalow sits a few doors down from the office of Brian Goldfinger, a personal injury lawyer. He’s owned the bungalow for a few years and over that time it’s been home to a handful of businesses that didn’t last, including a beauty salon and an escape room.

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He decided the time had come to convert it back to a place to live. He figured he’d turn it into a duplex, as he had done with other properties “without issue.” He expected that wouldn’t be a problem given Toronto’s housing crisis and city hall’s constant boasts about cutting red tape for small-scale housing developments.

It’s been a problem.

“Nothing has been added. The footprint has stayed the exact same,” Goldfinger said. “This isn’t a height thing. This isn’t a density thing. This is just about creating housing and one of the roadblocks that the city is doing.

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“They’re a bunch of hypocrites.”

While city hall approved a variance to allow the bungalow to be used as a duplex, Goldfinger has been told he’ll need to pay more than $125,000. While nearly $50,000 of that is a proper development charge, more than half of the total is in lieu of the creation of parkland.

Smaller charges – still in the thousands of dollars – are for educational development and a road damage deposit.

‘Line the city coffers’

“It’s crazy. It’s mind-boggling. I don’t understand it. I just see it as the city trying to get through the back door what they can’t get through the front door,” Goldfinger said.

“So they don’t want to raise – or actually, they are raising property taxes on everybody, but this is a way for them to just further line the city coffers without raising property taxes on everyone.”

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Goldfinger said the charges add up to more than a renovation would. A slide deck he prepared for a city hearing said it’s only because the bungalow had a commercial use since 1991 that a duplex isn’t allowed by default.

Goldfinger would split the bungalow into two units: One on the main floor and the other in the basement, each at around 700 sq. ft, according to floor plans viewed by the Toronto Sun. He said he’s reached out to the local councillor, Lily Cheng, but has been told there’s nothing her office can do. (Cheng did not respond to a request for a comment.)

While the parkland requirement makes some sense in a city where mega-developers regularly convert old factories and parking lots into condo towers, there’s no real way to turn any of Goldfinger’s tiny lot, not far from Yonge St., into a parkette.

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Development fees, taxes ‘out of control?’

Richard Lyall, president of the Residential Construction Council of Ontario, said the growth of development fees has far outstripped incomes in places like Toronto.

“The government’s just gang-tackled housing from a tax and charges perspective to the point where it’s gotten out of control,” he told the Toronto Sun.

He said the fundamental idea behind development charges is that as a city grows, that growth should help pay for things like roads, sewers and parks that new residents need. Of Goldfinger’s six-figure conundrum, however, Lyall asked: “Why? Why?

“I mean, what’s the additional infrastructure or whatever else like that that’s involved with that?” he said.

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Councillor defends development charges, but ‘intrigued’ by case

Lyall argued there are “very few meaningful controls” on development charges. He likened them to a “modern-day version of crack-cocaine for municipalities” and suggested too many cities are now addicted.

But Stephen Holyday, a longtime Toronto city councillor, defended development charges in an interview with the Toronto Sun. While not speaking to the specifics of Goldfinger’s case, he said those fees are “a very fair way” to help pay for “incremental demands on the city” that come with growth.

“In not paying (development charges), the average taxpayer then has to bear the cost,” Holyday said.

“I get it, it’s business, right? (But) I’m not sure that the development industry can point to a drop in housing costs for consumers because of their advocacy or even any success in reducing development charges.”

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Still, Holyday said, he’s “intrigued” by Goldfinger’s dilemma “because it was a house before.”

Will city ‘come to senses?’

In a statement, the City of Toronto emphasized that development charges and cash in lieu of parkland are separate fees and are “required under provincial legislation and the city’s bylaws.” The city said there are exemptions for certain kinds of development and added that the charges help pay for everything from transit to libraries to paramedic services.

“The changes at 177 Sheppard Ave. W are considered development and in addition to (development charges), it is also subject to a parkland dedication, as (it) is classified as development in the city’s Municipal Code,” as a “non-residential-to-residential use conversion,” the statement said.

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Just a few months ago, city hall brought in a new policy that would allow residential buildings – like some of the other little homes on Sheppard – to host a small business without any need for zoning changes. Lyall said if city hall expects tens of thousands of dollars to turn retail space back to a residence, as with Goldfinger’s case, that could “100%” have a chilling effect on anyone considering a home business.

Goldfinger just learned of the total fees a few days ago and told the Toronto Sun he’s not sure what he’ll do. He’s hoping the city “will come to their senses and reverse their position.

“It’s a house waiting to be lived in,” he said.

jholmes@postmedia.com

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