The historical evolution of development charges in Toronto

What is it about?

This paper traces the evolution of development charges to finance urban infrastructure in Toronto during the 20th century. Currently politically contested as adding to the cost of housing, development charges were the result of political compromises between the 1940s and 1990s. Local governments valued them as much needed infrastructure finance, developers were happy to pay until relatively recently because this system allowed rapid growth with good infrastructure, and the province was happy because it was able to offload the costs of growth-related infrastructure.

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Why is it important?

Urban infrastructure is expensive, but is essential particularly when cities are growing rapidly. Good infrastructure allows large-scale capital investment in cities, while estabilishing or preserving a quality living environment. Different jurisdictions have come up with highly varied approaches to financing urban infrastructure. Those differences have a major impact on quality of life, the distribution of the costs and benefits of urbanization between actors, and the long-run fiscal soundness of local government.

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