Unpacking The Myth That Growth Pays For Growth

Summary

---

Upzoned – "Unpacking The Myth That Growth Pays For Growth"

Podcast: Upzoned by Strong Towns
Date: April 15, 2026
Host: Norm Van Eeden Petersman
Guests: Mitch Durand Wood (author, DearWinnipeg; creator, Strong Towns Finance Decoder)
Dan Weinert (Small Housing BC)

---

Episode Overview

This episode dives deep into the widely-accepted idea that "growth pays for growth," specifically examining a recent CBC story about a high-profile federal-provincial infrastructure fund in Ontario, its impacts on municipal finances, and the often-misunderstood consequences of development cost charges (DCCs). With expert guests, the conversation spans Canadian and US policy contexts, exploring housing affordability, municipal incentives, equity in infrastructure costs, and the pitfalls of assuming new development will always cover its own costs.

---

Key Discussion Points & Insights

1. The Ontario Housing Fund Proposal (00:18 – 06:11)

• Context: Ontario municipalities are being pressured to cut their development charges in exchange for access to $8.8 billion in federal/provincial infrastructure funding, aimed at unlocking 1.5 million new homes.
• Norm’s Calculation: Even with the new fund, there is a projected multi-billion dollar shortfall—municipalities may be left holding the bag.
  • “If the province is actually intending to reach 1.5 million new homes, there would be a shortfall of... $28.7 billion. So yes, $8.8 billion sounds like a lot until you actually look at how much that would cost and how far that would go.” (04:45 – 05:45)
• Policy Dilemma: Municipalities face long-term revenue loss, with little guarantee the gap is truly being covered.

2. Immediate Reactions & Alternate Math (06:11 – 08:35)

• Dan’s Take: While the numbers are bad, they’re not as drastic as Norm estimated, and the current measures may only be temporary (2–3 years). But he agrees: “I think it’s going to be a Band-Aid solution.” (07:40)
• Political Observation: Local officials may be incentivized to agree due to political pressures—problems will likely resurface in a few years.

3. Do Development Charges Actually Cover Costs? (08:35 – 12:56)

• Mitch’s Critique: DCCs raise housing prices, often more than the fee itself, and their impact spreads to existing homes. Worse, they don’t begin to cover the real infrastructure cost.
  • “For every dollar that you raise the DCC by, the housing costs go up by $1.50 or $2… And I want to take your argument even further: Is the DCC even covering the cost of what it says it’s covering?” (08:35 – 09:35)
  • Federation of Canadian Municipalities data: “Every new housing unit in Canada requires $107,000 worth of new infrastructure. There are no DCCs in Canada that are even that high save maybe City of Toronto [or] Vancouver.” (09:45 – 10:42)
• Broader Implication: The problem isn’t just funding—it’s the way cities calculate and apportion infrastructure and what’s feasible for households and taxpayers.

4. The Real Cost of Growth and the Role of Incentives (12:56 – 18:39)

• Infrastructure Reality: The best infrastructure is what already exists. New development adds huge costs and fiscal exposures—schools, pools, libraries are seldom included in impact calculations.
• Equity Concerns: Dan points out the per-unit structure penalizes gentle density:
  • “If I wanted to redevelop a single-family property and put a fourplex on it, I am going to pay the municipality $180,000 in DCCs… If I build a mansion, I could pay $45,000. So we have a structure…actively disincentivizing the type of density that we want.” (16:38)
• Policy Innovations: B.C.’s approach may allow municipalities to decide what to incentivize—urban cores or sprawling suburbs. Suggests careful targeting of fee waivers.

5. Alternative Approaches & Fee Structures (18:39 – 21:17)

• Frontage Levies: Some jurisdictions use street frontage rather than per-unit fees, tying costs more directly to infrastructure use.
• Practical Dilemmas: Unused lots still incur public infrastructure costs; the costs of existing infrastructure are an inherited community burden, not just a developer’s problem.

6. Legal Challenges & Definitions (21:17 – 25:10)

• Case Study: Winnipeg: DCCs were overturned by courts in Winnipeg for being “taxes disguised as fees.” Only fees directly tied to specific uses or that alter behavior (like library late fees or congestion charges) are typically allowed.
  • “It's a fee if the money can be linked to a specific purpose…It's not a property tax to some people and not to others.” (21:45)
• Incentive Potential: Properly structured, DCCs could be used as planning tools to support desired growth and penalize sprawl.

7. Rethinking Property Tax & Land Value Taxation (25:10 – 27:48)

• Dan: Higher property taxes can correlate with lower home costs; considering land value tax could incentivize better land use.
  • “Generally across Canada, the higher the property tax, the lower the housing costs. And it’s super important to acknowledge that.” (25:42)
• Comparative Examples: Montreal’s use of land value tax as a possible model; emphasis on capturing recurring revenue from denser, long-term uses.

8. What Should be Incentivized? (27:48 – 29:39)

• Dan: Advocate for prioritizing 3+ bedroom, family-friendly multifamily units close to amenities, not just “micro-condos” or single-family sprawl.
  • “We should be considering single-family homes... taxed more so, like cigarettes.” (28:50)
• National Perspective: Achieving housing, mobility, and economic goals relies on enabling the right unit mix in the right locations.

9. The Missing Ingredient: Mixed Use and Walkability (29:39 – 33:38)

• Mitch’s Big Picture: Increasing housing density alone is not enough; must also allow commercial/services density to create walkable, functional neighborhoods.
  • “You can add 10 new housing units…if you add 8 new housings and 2 commercial units, now you have the ingredients for a walkable, thriving, financially sustainable neighborhood.” (32:33)
• Observation: Federal and provincial programs are hyper-focused on “housing” rather than “neighborhoods,” missing the importance of everyday services and adaptable spaces.

10. The Politics and Perception of “Growth Pays for Growth” (33:38 – 36:53)

• Community Pushback: Residents often resist change because infrastructure and public resources are already at capacity; new arrivals seen as a burden, not an asset.
• Blunt Instruments: DCCs are often used simply because they can raise money, rather than to shape better communities.
• Memorable Metaphor: “The orange that’s getting squeezed is people. Like you can only get so much juice out of that orange. And it’s people’s lives, it’s people’s wellbeing, it’s our local economy, it’s our regional economy, it’s our provincial economy…” (35:38)

---

Memorable Quotes

• Norm: “$8.8 billion sounds like a lot until you actually look at how much that would cost and how far that would go.” (05:45)
• Mitch: “The question kind of becomes if you have a $50,000 a year salary and you live in a $20 million house, it doesn’t matter how good you are at negotiating mortgage rates, you cannot afford that house.” (10:04)
• Dan: “We have a structure that is not only not equitable, it is actively disincentivizing the type of density that we want to see in our communities.” (16:38)
• Dan: “We should be considering single-family homes… taxed more so, like cigarettes.” (28:50)
• Mitch: “You can add 10 new housing units to a neighborhood and you’ve added density. But if you add 8 new housing units and 2 commercial units, now you’ve started to have, like, the ingredients for what is a walkable, thriving, financially sustainable neighborhood.” (32:33)
• Norm: “The orange that’s getting squeezed is people. Like, you can only get so much juice out of that orange. And it’s people’s lives, it’s people’s wellbeing…” (35:38)

---

Notable Timestamps

• Ontario Infrastructure Math: 03:41 – 06:11
• Are DCCs Arbitrary?: 08:35 – 10:42
• FCM $107,000 Infrastructure Cost: 09:45 – 10:42
• Gentle Density vs. Mansion Paradox: 16:12 – 18:22
• Fee vs. Tax Debate (Winnipeg Case): 21:17 – 25:10
• Land Value Tax Discussion: 25:10 – 27:48
• What to Incentivize in Housing Policy: 27:48 – 29:39
• Mixed-Use and Walkability Missing in Policy: 29:39 – 33:38

---

Episode Tone & Personality

• Candid and Analytical: The discussion is robust, with guests challenging each other’s math and assumptions, but always constructively.
• Wry and Personable: Speakers use relatable metaphors and a bit of humor (“taxed like cigarettes”; “the juice out of the orange is people”).
• Locally Rooted, Globally Relevant: While focused on Canada, panelists draw parallels to US policy and broader urban issues.
• Mission-Driven: Clear advocacy for reforming how cities view infrastructure, growth, and resilience.

---

Conclusion

This Upzoned episode systematically dismantles the myth that development always pays its own way, revealing a municipal finance system rife with inequities, perverse incentives, and unsustainable expectations. The panel’s consensus: simply reducing fees or throwing money at new housing is not enough. Sustainable change hinges on holistic planning—prioritizing gentle density, fairer fee structures, walkable mixed-use neighborhoods, and long-term financial realism.

---

For further exploration:

• You'll Pay for This by Mitch Durand Wood (Great Plains Press).
• SmallHousingBC Toolkits (smallhousingbc.org)
• Strong Towns Finance Decoder

---

Transcript

[A]

Foreign. First class streetcar downtown with a fine ladies in the peeps.

[B]

Hello, this is Norm and this is upzoned, a podcast from Strong Towns where we take a current news story about cities and we use it to explore the deeper incentives, the trade offs, the are shaping how our places actually work and what we can do to make them work more effectively. What we're trying to understand is how do municipalities manage the cost of growth and what are some of the things that need to really be considered when higher levels of government push to reduce or standardize things like development charges, as well as pushing for more housing in response to real needs that are identified in communities? There's economic consequences of a lack of housing in many of our communities. There's impacts on social services. Even just the amount you have to pay a teacher or a nurse or a caregiver in a community really does have a direct link with the prices of housing. And so considering that in the context of our existing neighborhoods and whether or not they are ready for or even able to be built in so that more housing can emerge within existing neighborhoods, this has been one of those things that is really challenging for a lot of places. So today we're talking about a recent CBC News article out of Ottawa City Councilors fear the devil is in the details in a federal provincial housing fund that was recently announced by our federal government. And the article came out March 30, 2026, and really does touch on that growing tension that is being experienced as federal and provincial leaders want cities to lower development charges or in the US impact fees or development levies. There's different names for them, but the idea is that when a new project is proposed and brought forward for permission, that at that point an additional sort of suite of fees should be added to that project. So that way it will cover the cost of growth. And so these municipalities in Ontario have been offered a deal which is cut your development cost charges in half in exchange for access to $8.8 billion in infrastructure funding. But local officials are warning, well, those fees aren't arbitrary. If we have to cut them in half, what is it that we are making up on the other side in order to be able to pay for the expansion of infrastructure that's needed in our places, as well as its maintenance and upkeep? And so what exactly happens if we reduce them? Do homes get cheaper or do the costs just show up somewhere else? I'm joined today by Mitch Durand Wood, author of the book you'll Pay for How we can afford a Great City for everyone forever, which is just fantastic title. It's one of the most accessible guides out there to how municipal finance actually works and doesn't work. And Mitch is also a frequent contributor to the Strong Towns blog From his Dear Winnipeg.com blog and the architect behind the Strong Towns finance decoder. And also with us is Dan Weinert, co executive leader of industry activation at Small Housing Vancouver, British Columbia based nonprofit working to make smaller, more attainable housing forms things like Laneway homes, townhomes and other missing middle housing more feasible to build. Dan and the team at Small Housing work directly with builders and designers and policymakers to unlock those opportunities on the ground. And so welcome to both of you.

[C]

Thanks, Norm. Happy to be here.

[A]

Great to be here.

[C]

I probably should have said hi after you introduced me so that listeners can know who's talking, but yeah, they'll get it.

[B]

So you're Mitch. Dan is also with us. It's awesome to have it. And just unpacking the article just a little bit further, it's touching on the fact that city council members are sort of hedging their bets or they're cautious because they said, look, the provincial government and the federal government are saying you can have $8.8 billion in infrastructure funding. That sounds good, right? And if we were in the states, we would just multiply that by 10 in terms of the amount that an area of a comparable population would be getting. You think, okay, here we go. Let's move forward with this. But I ran the numbers because the province anticipates adding 1.5 million homes in the next five years. And so if that is the case, and as the article cites, it says each of the projects, the average for a single family home is $50,000 per home that's being added. And so the municipalities are told, cut that in half and we'll make up the difference. So let's assume the community brings in $25,000 now in reduced fees. That would mean the total funding pool of $8.8 billion would only fully offset costs for about 352,000 homes. Which means that if the province is actually intending to reach 1.5 million new homes, there would be a shortfall of 37.5 or $28.7 billion. And that shortfall would be experienced by the municipalities. So yes, 8.8 billion sounds like a lot until you actually look at how much that would cost and how much, how far that would go. And then it raises the challenge, what do we mean when we are setting these arbitrary standards of a 50% reduction feels right, but we are not talking a 50% increase in government funding. Instead we're talking a finite amount of funding being provided in terms in contrast with a ratio of what we are changing in our communities. And so this structural crap becomes a problem for our communities. Cities would be committing to a long term reduction in revenue without a corresponding reliable replacement. Which raises for me the question why any municipal administrator would accept a deal that leaves such a large deficit unaccounted for, except for the fact that there's political pressure to accept it. Dan, I'd love to hear your reaction then first to the news out of the federal government and what they've done with the Ontario government and then connect that with soon we'll get to British Columbia and our efforts here in the province to address this. But what were some of the things that came to mind as you read through the piece today?

[A]

Yeah, I'm glad that you're sending that question to me first because I think Mitch is going to be able to clean up some of my bad lazy math. And I'm definitely as a housing guy first and not necessarily an infrastructure person first, but I mean even some of the so of course the devil's always in the details with any government announcement. And in British Columbia it's going to be an announcement about an announcement about an announcement. Who knows when any policy will actually come into effect. But I'm, and I will also preface this with ultimately, Norm, I think you're right that this is, you know, it's, it's still going to have a long term deficit effect that we need to consider how we pay for and make up that gap. At the same time, I think some of the math that you've kind of suggested in that intro is not as bad or as drastic because if we're asking municipalities to reduce their DCCs, their development cost charges by 50% and the feds and the provincial government are coming to the table with 25% of that. We're actually putting in 12. So that $50,000 per unit model, it sounds to me more like the feds and the provincial government are kicking in $12,500, not 25,000. So by my math that gets us to 704,000 units of those 1.5 million still, still a shortfall, but not as bad as the 300,000 we're starting off with. And it's also important to highlight that this is a three year experiment, if you will. I think it's a freeze of two to three years is what the federal government, the provincial government has suggested, and that 1.5 million target is to get to 2030, 2035. So there's a little bit of a longer gap. So, I mean, if I'm a municipality, I'm excited about it. It kind of, if I'm a mayor or a council, I'm super excited about it because it's probably going to kick the can down the road to the next council that wants to get elected. So it's good for industry, it's going to get more housing built, but I don't think it's going to solve the problem. I think it's a Band Aid solution and I think we're going to be back in this mess again in two to three years. So, you know, excitement. It's good to see industry getting going again. It is a massive opportunity, but I think it's not. I think it's a Band Aid solution.

[B]

Yeah, Mitch, you're. Let's talking kicking cans down the road over to Manitoba. So we actually have an all Canadian lineup today. And I know that there's a ton of overlap with US policy as well. But what are you noticing and what are some of the things that have emerged as you've looked at this closely?

[C]

I mean, there's tons to unpack here, Right. Like CMHC Canada Mortgage Housing Corporation released some data last December that showed that DCC has increased the cost of housing. You know, it's pretty widespread and in a lot of cases, it increases housing costs by more than the dcc. Right. And so, you know, for every dollar that you raise the DCC by, the housing costs go up by $1.50 or $2 or whatever. On top of that, it actually spreads to not to existing housing. Right. So if you got existing housing that's near this, new housing that's being developed with DCCs, that also increases the house, the house prices of these existing houses. Right. So it's increasing housing prices across the board. So reducing these. I can understand why the federal government is wanting to step in to reduce these charges in order to keep, you know, housing affordability within the realm of, you know, possibilities. But I mean, you know, we're kind of looking at it from the strong townspeople perspective of like, what infrastructure gap does this create? And I chuckled to myself when you said these, these DCCs aren't, aren't arbitrary except that they are like that. And I think it is where I want to take Norm, I want to take your argument even further. Right. And what Dan was saying, like, you know, the gap is what it is. And we can get refine the math on like whether the federal money and the provincial money that's coming is going to cover the cost of the reduction of the dcc. But I think even further, we got to ask, is the DCC even covering the cost of what it's saying it's covering? Right. The Federation Community Municipalities fcm, they put out backgrounder awful probably two years ago now showing that on average every new housing unit in Canada requires $107,000 worth of new infrastructure. Right. That's, that's there. There are no DCCs in Canada that are even that high save maybe City of Toronto. Right.

[A]

Vancouver might have a word with you as well.

[C]

Well, maybe. Right, that's, that's basically the two places. Right. So you know, 107,000, no DCCs anywhere are coming close to covering that. Right. So there's already a gap, an existing gap. And I think part of that comes

[B]

from

[C]

treating sort of our infrastructure challenges as a financing problem. Right. It's always about like how do we find the money? Are there innovative financing models that we can use like municipal utility districts or you know, always trying to find these off balance sheet or these like exotic financial instruments or trying to find new revenue sources to pay for something that is ultimately insolvent. Right. And you know, the question kind of becomes like if you have a $50,000 a year salary and you live in a $20 million house, it doesn't matter how good you are at negotiating mortgage rates, you cannot afford that house. Right. And when we look at the FCS FCM's numbers of $107,000 of infrastructure per housing unit, we have to ask ourselves, can we afford that as a society, as a country on a continent base, is that a reasonable amount of infrastructure for one household to be expected to financially carry? And ultimately the answer is no. Right. What's super interesting in the FCM data, which nobody really seems to really glom onto, is the fact that is an average and that different types of housing require vastly different types of intensity of infrastructure. Right. And so multifamily in existing neighborhoods, you know, it's something like between five and nine times less on site infrastructure. Right. So now instead of 107, we're talking like 12 to 20,000. Well, hey, maybe now we're talking. Right? And now DCCs are covering that amount for sure. Right. And so I think there's, there's a place for a further discussion, right. To really ask ourselves the questions like can we like is this a financing problem or is this Actually a much, much deeper problem. And I think that's the question that Strong Towns has been asking. But I think that in a lot of circles is not being, not being asked at all.

[B]

I mean, as you think about that 107, then schools and rec centers and libraries, they're not even incorporated in that. Like, the best pool is the one that's already there. The best library is the one that's already built. The best school is the one that's already knit into a neighborhood, already part of the established fabric. And especially in province like British Columbia, where we've had rapid growth in a lot of core areas, the failure to keep up because the province has funding formulas that basically put a school on the projects list the moment that the enrollment has reached capacity. So it isn't based on future projections. It's basically kids have to be turned away in from kindergarten classes before it's noted in a file somewhere in Victoria that we've got to start working on a school there. And this was when I was in the mayor's office in Surrey. They were always frustrated because they said, we know that we're creating more homes for community members that are going to have children and they're going to be challenged by this. And I think that can be that challenge. That. What it stood out to me in the piece too is you've got the federal government that just says, well, we know what to do. We're going to put money into this. And the provincial government says, we're going to put money into this. And we're also going to wield a bit of a stick, which is if you don't step up local municipalities, we're basically going to come in and we'll bulldoze. In Ontario's case, quite literally, we're going to start to bulldozers and get going. And then the municipalities are asking a different question, which is helpful in my mind in what they're asking is how does this pencil out over the long term? If we take a hit right now, what are we on the hook for? And Daniel or Dan, do you want to describe especially around like, smaller housing, the, the more integrated within existing neighborhoods. You, you know, sort of how the math pencils for large suburban development. But it's very different in the types of projects that you're coaching communities to make normal or commonplace. Again, sort of, you know, I, I like in the work of small housing to helping a cottage industry grow that builds cottages again and getting back into the swing of, of those things. What, what does that sort of work Looking like, especially when you're up against these headwinds of growth, needs to pay for growth. And that growth means you have to cover the cost of the upgrade to the whole street. And you know, oh, you know, I want a new utility pole and I want a new, you know, sewage treatment plant. And all of a sudden everything seems to be on the poor little homeowner that's trying to do just a little good in the world.

[A]

Yeah, I so, so much to unpack there. So I think it's important to recognize that homebuilding industries across Canada vary from province to province. They're kind of like a micro economy. At a provincial level. The average British Columbia home builder builds about four homes per year. And during the COVID pandemic when things were running like gangbusters, we built about 48,000 units a year. And that's like record productivity for British Columbia.

[C]

Are you a listener who thinks I want to bring strong towns to my community? Visit strongtowns.orgevents to set up face to face conversations about the future of our city cities. When you host a strong towns event, you're bringing together residents, local leaders and professionals to build a shared understanding and real momentum in your community. If you're ready for bottom up momentum and making places people truly love, visit strongtowns.orgevents to learn more.

[A]

The recent CMHC reports that Mitch is referencing, the sky is falling reports state that we need to get to in a low population growth scenario, we need to be building 80,000 homes a year and in a high population growth scenario, 98,000 homes per year. And that is to keep home prices at the modest rate of $1 million that they are currently at. So like we need to double productivity just to not have $2 million homes. And that's how you can see this argument starts to fall apart. It's and when we're talking about these small scale builders, the way development cost charges are typically structured in British Columbia is that they're charged on a per unit basis regardless of the size of the property. And this is probably one of our most frustrating things that I love to rant about. So I'm in the city of Kelowna today. If I wanted to redevelop a single family property and I wanted to put a fourplex on it, I am going to pay the municipality $180,000 in development cost charges, let alone any of the other off site improvements. If I am a multi generational family or if I'm just wealthy and love living by the lake, I could build a mansion And I could pay $45,000 in municipal fees. So we have a structure that is not only not equitable, it is actively disincentivizing the type of density that we want to see in our communities. So I think this is where to kind of transition. It's going to get really interesting in this building communities fund that the federal government has promised. So whereas Ontario, it seems like they're taking an every house is getting a discount approach. It's a classic conservative type of a move not to get into the political weeds of this. The NDP government here has kind of taken a more strategic approach, probably learning from the pain points of implementing Bill 44. What so Mayors councils, we don't want to have zoning forced down our throats and be told what we can allow in our communities. Well, congratulations. We are going to expand what DCC waivers you can provide and municipalities, it's going to be up to you to decide which houses you want to provide waivers for and which ones you don't. And it's going to be very fascinating to see what happens when the rubber meets the road as far as whether they are going to actively encourage urban sprawl in communities that can't necessarily support it so that we make this infrastructure problem even worse. Or are we going to focus on incentivizing the type of gentle density that supports small builders, supports small trade companies, supports more robust local economies and ultimately more livable walkable spaces.

[B]

It was interesting, we had a session of Astron towns. Anything about frontage levees as a way of assigning fees for water treatment and water service. And it was, you know, an interesting discussion in utilities are normally on a per gallon basis and delivery fees are baked into that and things like that. But, but the actual impact of, for example, having a number of vacant lots means that you have, you have to provide service to that area and yet they're not actually paying into the system. Sort of like pizza delivery services that are obliged to drive by every single home in the community, but they only get paid if they actually have a customer asking for the meal to be delivered at their doorstep. And so we were, you know, grappling with that. It was a good thought exercise. But places in California to address the costs of development have actually said we will use a frontage levy based on how much of the street front you are going to be using, will prorate it based on that. And that would really have a direct impact on multifamily. If you have four units that are going on to one lot, if that lot is Fairly modest and narrow. It's not consuming more of the public realm, aside from, you know, a little bit more water being consumed, a little bit more sewage being taken away from household activity. But even then, I would say that that's often not directly predicated on the number of units in a home, but the number of occupants, which we already would say, you know, I'm Dutch, so I know what large families are. I've got many in my family tree. You can have lots of people. We've never regulated on per person. And so the true impacts of development, I see it in my community, everyone assumes that they are not the reason that the development is or the infrastructure is under strain. And I'm like, it's your poop that has made the pipes, you know, a little faulty at this point. And it's been your pattern of the consumption of resources. Pipes are a resource that slowly degrade over time. You didn't pay enough upfront to be able to help create the long term reserve that will cover this. And so now you just say like, please don't add anybody else to the system because we're over capacity. I'm like, how did we get to that point? You can't just penalize the newcomer that is here on this front. But Mitch, one of the challenges that you faced as a city, it was a legal dispute over whether or not the city of Winnipeg could actually have fees like this. And ultimately the court ruled, I believe, or else the city stepped back from it, that impact fees were not allowed. Or was it that the impact fees were being too broadly applied and basically had to be pulled back? Because we have lots of jurisdictions across North America where there are, There is nothing like a development cost charge that is allowed to be charged.

[C]

Yeah, and so, yeah, I mean, that's part of the challenge. With all the federal housing money that's come around, the city, Winnipeg accepted some housing money and as part of that deal, they agreed not to increase their DCCs, which it just happened. We don't have any DCCs right now. So we, we cannot implement a DCC until the end of this Housing Accelerator Fund agreement, which I think is 2027, 2020, something like that. So Winnipeg is stuck with no DCC until then. But yeah, we did have one for a very brief period. This was probably 2018, 2017. In that realm, City Winnipeg implemented a DCC which was eventually challenged in court by the development industry and overturned in early 2020. I think basically the. Not to bore you with the long details of it, but the city charter in Manitoba in Winnipeg does not allow it to charge any tax other than property tax. And so the way this was implemented, it was basically charging a DCC to new development and then using those funds in the general funds just for general infrastructure maintenance. And so that was viewed by the courts to be like, no, no, that's. That's a tax, but you can't charge a tax that is not a property tax to some people and not to others. But so it did overturn that DCC as. As it was, but at the same time, it also confirmed that the city could charge a DCC if it wanted to, as long as it wasn't implemented as a tax. So it's basically, the city is allowed to charge a fee, but what the city was charging was not a fee. Right? And the fee, the difference between a tax and a fee in general, like, it's a fee if the money can be linked to a specific purpose. So, for example, like a fee for an application for rezoning or admission to a swimming pool. That's a fee, right? Or it's also a fee if it's something that's used to try to alter behavior. Right? So think of here of like, fees for late books at the library or congestion charges or that kind of stuff. Those are fees and those will be allowed. Right. Otherwise, it's just a way to raise revenue, which would be a tax. And it's, you know, unless it's, you know, attributed to a specific thing. And so for. I think that ties in really nicely to what Dan was talking about. Incentives, right? Is. Is, you know, we. We look at DCCs and how they're not even coming close to covering the fees that they, you know, the costs that they're. That they're looking to cover, you know, in that $107,000 per housing unit is, you know, as you mentioned, it does include, you know, pools and libraries and all of that stuff. But when you look at, like the breakdown in the FCM study is. Is 87% of the infrastructure is just the roads and the pipes, right? It's just water, sewer, roads and bridges. Right? That is, that. Is it 87%. And that's. And that's the Canadian average. But, you know, Winnipeg's specific numbers I think is 88%. And I think in Calgary it's 85. But like, basically throughout Canada, we're like 85 to 90%. It's just swords and pipes. It's where we put stuff and how we travel between it. Right? And so that's how, like, we could reduce the cost, the infrastructure costs required for every new housing unit. If we build a certain way, if we build in a certain place. And that's where DCCs I think could be really powerful in that sort of incentive kind of way. Right. That we could use it to direct as a planning tool. Right. A little bit like a congestion charge, but for housing. Right. To sort of disincentivize the types of housing in the places that we don't want and then redirect those funds to the places we do want for the types of housing we do want. So I think that's where the DCCs have real actual potential to be beneficial to cities. Right. Where they can. Yeah, I don't know. Dan, do you have anything more on that?

[A]

I think, I think you've hit the nail on the head. I mean, even in Kelowna, while I love to knock the, the cost charge structure, here they have decided there are lower fees in the urban cores than there are where urban sprawl is happening. Because, you know, it costs a lot of money to push water uphill and the city is smart enough to acknowledge that. I think the other thing that is, and, and Norm, you mentioned this kind of in the intro question. Okay, if there's going to be a shortfall, how are we going to make up for it? I think the other thing that we need to realistically have two conversations. Number one is if you're replacing a single structure with 4, 4 or 6 units, you're going to be collecting, you know, 4 or 6x the property tax for the next 70 years for the livable life. And if we're building high performance in British Columbia, step code compliant housing, this is going to be more climate resilient housing that should stand the test of time a little bit longer. And we don't need to look too far for comparative examples as to where, where we could be able to apply some best practices. I mean, the, because the second angle of this is we do need to have a conversation about our property taxes or implementing some sort of a land value tax. And Montreal is a great place to look for that. I mean, generally across Canada, the higher the property tax, the lower the housing costs. And it's super important to acknowledge that. But you know, I, I like to pretend that I'm still young sometimes and I've definitely kind of compared it to, you know, going to a club. Like if you live in Vancouver, you pay a cover charge to get in through high housing prices and DCCs, but the drinks are cheap and that's your Low property taxes on your annual basis in Ontario, it might be the reversal and it's, it's ultimately still an acquisition strategy. We have to decide what is the, you know, how do we balance these spinning plates, so to speak.

[B]

Yeah. Lars with the center for Economic Studies has said, you know, it's very simple. You wouldn't even need to change much of the code. You can just offer a universal building a exemption so that when you go to do the assessment, you just conveniently don't assess the value of the building and you then do a like, for like comparison and you say all right, but what is the general property worth? And without respect to the building, it's actually easier because then you're not asking does it have dormer windows or other things like that. You're, you're not looking at conditions, you're looking at, at location and context. And that can be really valuable in that, in that setting. And I guess Dan, if you, you know, part of your work is advising local leaders and coaching them in considerations that they really want to, you want them to have in mind, especially as you think about how do we recultivate that ecosystem of small scale development in our communities in that context, what would you advise if your federal government and provincial government came in, said hey we, we're going to do something similar to what Ontario is looking to do here?

[A]

If I'm, if I'm sitting there as a municipal government or if I'm advocating to a municipality government, I'm lobbying for the type of housing that is hardest for developers to build. So we've seen a glut of micro condos and one and two bedroom high rise and a great amount of purpose built rental thanks to the CMHC MLI select program come online. But you know what you always see in those housing needs reports and housing needs assessments? 3 bedroom family sized units close to you, close to urban resources such as schools, grocery stores, doctors and whatever it might be. So, so I mean I'm sitting in the seat of advocating for gentle density. I believe in the value of it to my core. And I think we need to be thinking about how we build multifamily units and even, you know, it doesn't have to be gentle density, it doesn't have to be part nine. But let's talk about single egress stair buildings as well. But how do we get more of these three plus bedroom family sized units closer to our urban cores? I think that's what we should exclusively focus on incentivizing and we should be considering single Family homes and custom homes taxed more so, like cigarettes.

[C]

Hmm.

[B]

That's interesting because from a, from a national strategic perspective, you want to achieve certain goals. And that goal is more productivity, healthier, sort of better situated workforce, the capacity for people to be upwardly mobile, for people to be able to age in place. All of those things all reach a sort of a zenith if you can unlock the types of housing that you're talking about. So that way people aren't forced out or pushed away or driven crazy by the high cost of rent or the inability to purchase something. Mitch, you wrote a whole book on how to advise local leaders across Canada in particular, that have picked up your book, but also folks around the United States and other countries as well. What are some of the things that you would offer as guidance?

[C]

Well, so I'm always one to say that we can't get too lost in the weeds. You know, it's important to zoom out and look at the big picture to see what are we trying to achieve. And so it's, you know, it's easy when you're really talking about, you know, whether it's transit, to really get really into the inner workings of transit. And it's easy when you're talking about housing, to get really into inner workings of housing. But you gotta step back sometimes to see, like, how does this all fit together? How does it all, you know, connect into a place where people can live and thrive and, you know, get groceries and take their kids to, you know, soccer or whatever it is, but live their lives, right? And, you know, it's easy to fall into sort of this trap when we talk about housing to say, like, oh, yeah, well, we need more multifamily, closer to city centers, or, you know, we need to get more focused on more density, right? More housing density, which is true, but you can't have housing density on its own, Right? And in a lot of our cities in North America, you know, the problem is not just a lack of density, it's a lack of mixing of uses, right? And so if you have all the houses over here and all the businesses over there, adding housing density is not really helping you. It's actually making things worse for everybody, right? Because people still need to drive to get a jug of milk, or in Ontario, a bag of milk. But, you know, you still need to drive everywhere. And so adding that housing density actually makes it worse for the people living there because you've also, you've added more people, but you also added a whole bunch more cars, right? And so now you Run into parking issues, you run into traffic issues, you run into all kinds of stuff that make life unpleasant in that neighborhood. It's no, it's no wonder that people push back against that because, yeah, it's, it's, it's gross, right? It's not what people want in their neighborhoods where they live, right? And so a lot of it has to focus on how do we add that density of housing, but we also need to start adding that density of services, right? We need to add these grocery stores. We need to be able to add coffee shops and sporting recreation and all the things that make up a life. We have to put that close by so that people can get there without necessarily having to set aside a whole bunch of land for parking or for whatever it is, right? So part of it, and that again, is to bring it back to the finance part of it. It's those roads and pipes that make everything so, so, so expensive, right? And so the more we can, we can make it possible for people to meet all their needs, you know, in as little space as possible so that they can walk to, to get whatever they need. We are reducing our infrastructure costs by a huge amount, right? 87% is roads and pipes. And so it's all about where we put stuff and how we travel between them. And so it's important to have more housing density, but it's also important to have like, you know, bakery density, right? You need to be able to get your bread close to where you're putting that density. So, so there's that whole, I feel, missing part of a lot of the policy discussion. It's really like Blunt Instruments, you know, again, we're talking in Canada, this whole, you know, federal money is delivered through cmhc, Canadian Mortgage and Housing Corporation, right? It's not Living Corporation, it's not Neighborhood Corporation. They're not, they're not looking at the big picture. They're focused on housing. So you can't fault them for focusing on housing. That's literally what they exist for. But there is no equivalent federal or provincial department that looks at, like, how do we get, you know, more local entrepreneurs to start, you know, a local bakery out of the front of their house or, you know, whatever, whatever it is, how you start to develop these, these walkable neighborhoods, right? You can add 10 new housing units to a neighborhood and you've added density, but if you add eight new housing units and two commercial units now, you've started to have, like, the ingredients for what is a walkable, thriving, financially sustainable neighborhood, right? So I think it's part of the. What's missing.

[B]

One of the trends was live work units. And you would see these, you know, tranches of industrial areas that are all of a sudden like up zone. So that way they can be like mixed use. And yeah, they're live work. And so there's a studio on the ground floor. But actually when we, you know, if we pick up Jane Jacobs that new ideas require old buildings, where live work is best applied is actually in existing neighborhoods. As people adapt their structures, they can cash flow the renovation, they can get themselves going. And yet one of the things that I see is there's this like almost a readiness to say let's let a lot of new things happen in new neighborhoods. And then the old neighborhoods are still actually guarded from any kind of new introduction of front yard businesses or admitted, you know, low impact retail, that sort of stuff. Somebody setting up something more than just a single chair cutting hair in a neighborhood. And I think that's something really that we want to, you know, if I could recommend an article at the Strongtown site is about like growth should be a good party, that when someone new shows up, it gets better, that the host doesn't have to tightly control everything for it to work and that the energy in a neighborhood starts to grow as more people participate. And as we think of that for neighborhoods, that's like the. Each business that's added should add value, which means actually creating the conditions for that to be adaptable so that you don't just get plunked a bunch of new homes and have to contend with now a big change in the neighborhood. It can't be rigid. You have to anticipate that you're going to respond as the changes occur. It has to happen naturally without breaking or requiring like major reinvestment to occur. Because the suburban development, if you build it all at once to a finished state, then why would you ever accept new entrants? If anybody else comes in, it just becomes more crowded or more stressful or more dysfunctional. And I think that is in the background of some of the efforts on the politics of development cost charges. Dan, you, I think you moderated a debate. Oh no, that was Yuta Lee about here moderated a debate last year at the Small Housing or Gentle density summit on should growth pay for growth. And we had a suburban mayor saying, yep, absolutely, new projects are basically the reason why the neighborhood is disrupted. So they should be covering virtually. You know, he wasn't saying virtually or all of the costs. But much of the responsibility has to be on the development industry. And part of his pitch was because they're the ones that are willing to pay it. And so there was that recognition. It is in their business models that they can expect high enough sales prices to basically cover the chunk of money that we're going to extract from them out of this process. And a very cold sort of logic. You're like, well, okay, that makes sense. But the trouble is that the orange that's getting squeezed is people. Like you're. You can only get so much juice out of that orange. And it's people's lives, it's people's wellbeing, it's our local economy, it's our regional economy, it's our provincial economy that's definitely impacted when we're just like, you know, we could get more if housing was just way more costly. And so that is a bigger challenge. And we'll come back to this. But as we do in the UpZone podcast, we're going to move to the down zone. We don't want to down zone our neighborhoods, but we do want to down zone our discussions. So, Mitch, what's in the down zone for you?

[C]

Oh, man, so many things. I've got, like four different books on the go jumping between them. I've got a couple of shows I'm streaming right now. I don't even know which one to pick, but all of it.

[B]

Let's do all of it.

[C]

All of it, yeah. Well, so I'm reading the Master in His Emissary, which is a very thick read, and so I can only do it in little chunks, but it's on. On neuroscience and how the brain works. Yes, I do this for fun, but I'm also reading another fun one on. On the link between serial killers and industrial pollution. So that one also another light read. And then, yeah, I mean, I'm streaming a bunch of stuff right now. I'm actually watching a show that your wife recommended to us called. What is it called? Shrill, I think, which has been very, very enjoyable. Very enjoyable so far. About two, three episodes in and yeah, just lots of fun.

[B]

That's with Amy Bryant from SNL, right?

[C]

I believe so, yeah.

[A]

80.

[B]

80, yeah. Sorry. Yeah.

[C]

Yeah.

[B]

Awesome. Yeah, that's good stuff, Dan. Well, you have to meet Mitch's standard. We need lots of recommendations. Now, normally we hold ourselves to one, but Mitch has led us. So what's in your down zone?

[A]

Well, after the intro of immediately going to my down zone is going to be picking up Mitch's book. I need to get. I need to read this and educate myself a little bit further. So I'm really looking forward to that. You know what, at the end of the day, I am, when I'm not advocating and living this housing life. I am a huge sports fan and springtime is the dream season for sports fans. So I'm crying about the Jays losing streak. I'm going to be tuning into the Masters all weekend. I'm going to be seeing if the Raptors can hold on over the playoffs. I'm excited that Bayern Munich beat Real Madrid this week. That was a great day for me. So. And of course I'm following my beloved Toronto FC out here from the west coast. So it's. It's all day sports all. All day long. And my wife is going to murder me.

[C]

I don't know.

[B]

The pollution state of Colona, though, that's fantastic. Yeah, I mean, we, we're spoiled for choice and definitely getting to enjoy a great deal of it. I am. I recently found a BBC show called Bookish that I'm really enjoying. It's a detective sort of series of sorts. And it just, I was like, I had been on my list for a while, you know what that's like. And all of a sudden it was like, I'm gonna read it or I watch it. And then what I'm reading is by Daniel Silva. It's called An Inside Job. I found it on my public library and I'm really enjoying it. Although it has this weird thing where I can't tell if it's a. Like it's gonna make me a snob or it's gonna drive me to just put down the book. But it has so many Italian words in it, as if I should know what they mean.

[C]

And I don't speak.

[B]

I'm just trying to pretend my way through it. But it's about an art restorer and it's a crime thriller and stuff. So if anyone is interested, there's an inside job out there for you by Daniel Silva is what it's called. So, you know, this has been awesome. Dan, welcome. Mitch, I think you might have broken the ice as a first time Up Zone guest as well. Or have you been on upzone before with us?

[C]

I have not been on upzone. This is my first time.

[B]

All right, new format, new faces. Part of the reason we had to go with three people as participants is just to be able to broaden our reach and broaden our scope. Dan, it's been fantastic to have you on. I really appreciate you joining us. Dan Weiner again with smallhousingbc.org is the website that you can go to. They've got great toolkits, tons of resources. We're going to continue to collaborate with them. And then Mitch Duranwood of dearwinnipeg.com Also one more quick plug you'll pay for. This is the book through Great Plains Press and we might be even pushing them to have to do another reprint. Mitch I hope that Mitch is going to be a speaker at the national gathering. So if you are planning to come to Fayetteville, Arkansas, do plan to get your tickets. It'll be a huge gathering of Strong Town's advocates. Really helping to connect together. So yeah, with that it's been fantastic. Thanks everyone for dropping in. Thanks Dan. Thanks Mitch for participating today.

[C]

Thanks Norm.

[A]

Thank you Norm.

[B]

Yeah. And go Bayern Munich for Champions League. And go Team Canada for the World Cup. I'm allowed to say that because I'm not. We've had an all Canadian lineup today, so I hope this has been enjoyable. Thanks folks for listening to upzone. Take care and take care of your places.

[A]

Let me show you what I'm about to do.

[B]

This episode was produced by Strong Towns, a non profit movement for building financially resilient communities. If what you heard today matters to you, deepen your connection by becoming a Strong towns [e-mail] membership.