Local contractors say they worry about potential layoffs coming later this year if the region doesn’t sign off on servicing agreements for new development projects.

The region has said it would not enter into new servicing agreements as a result of a water capacity constraint that was identified in December in the Mannheim service area, which services Kitchener, Waterloo and parts of Cambridge, Wilmot and Woolwich.

That means the region cannot support new development that will put additional demand on the Mannheim Service Area water system.

That’s a problem for contractors like Scott MacDonald and Michael Bell, who say they need to plan months in advance for the number people they will need on site for a project.

“We’re planning 10 months ahead of time for when work is going to be arriving on site,” Bell, who is a sales manager with Stubbes Precast, told CBC News.

“They are large projects that take months to complete and you do the coordination for the upcoming projects.”

Macdonald explained that as one project winds down, those workers get moved on to the next project and any delay means they need to find work to bridge that gap.

“In a typical cycle, there’s always projects starting at different times of the year so there’s always something going on, but currently with a hold, there’s going to be a gap where nothing is happening,” MacDonald, who is one of the owners and president of Dean-Lane Contractors, told CBC News.

He worries the situation may get worse going into 2027.

“[Construction] is a slow start, anywhere from three to six months on a typical multi-unit family project is when the peak of the job starts and ramps up, and if we don’t start projects now you’re pushing that peak time way out to the end of the year and there’s going to be a huge gap,” MacDonald said.

He said many of the projects his company is working on will come to an end around the fall and the current situation is forcing them to look outside the region.

‘Lift development freeze’

Both MacDonald and Bell, were among the almost two dozen delegates that spoke at a committee meeting on Feb. 10, many of whom were from the construction and development industry urging the region to “lift the development freeze” and to provide clear timelines.

“We want to know that we’re all in this together, so we support any motion that takes the full pause off water constraint and permitting,” Jeff MacIntyre, president of Grand Valley Construction Association told councillors.

Larry Masseo a policy advisor for Waterloo Region Home Builders’ Association said a continued development freeze will have long lasting economical impacts with “the departure of institutional capital, especially for rental housing.”

“With timelines now uncertain, capital is leaving in real time,” Masseo said.

Others told council construction should continue as many projects won’t need to access water for several years.

“Assuming you start at the point of the servicing agreement or registration, you’re looking at least three to four years,” said Joseph Puopolo, co-CEO of Polocorp, a land development company.

Motion would see some development continue

In that same committee meeting, councillors approved a motion tabled by Kitchener Mayor Berry Vrbanovic that could see development continue.

Vrbanovic’s motion directs regional staff work with the municipalities so that up to 50 per cent of new water capacity brought on to the system over the next five years will support development projects.

“The reality is that this is about potentially thousands of people in our community, who are painters, plumbers, electricians and so on, who are going to be impacted,” Vrbanovic told CBC News.

It would apply to development applications that have the necessary approvals prior to the region identifying the water capacity constraint, Vrbanovic said.

For Bell and MacDonald, Vrbanovic’s motion is critical.

“I don’t know how quickly that will progress to getting shovels in the ground … it still could take a months to get something approved for a project to move ahead, but it’s definitely a help,” MacDonald said.

“There’s hope that they are coming out with a solution because nobody wants this pause to be continuing, it’s not good for anyone,” Bell said.