Construction projects in Waterloo Region could get more expensive in the coming years as regional councillors consider increasing development charges to offset the cost of light rain transit.

"Transit is a big portion of the region's budget and, as we all know, the LRT is a big capital project – the largest capital project in the region's history," said Sean Strickland, chair of the region's finance committee.

The region currently charges developers about $18,000 to build in the area, and uses the money to pay for public transit projects, as well as regional infrastructure, police and ambulance.

The region hopes to cover some of the costs of LRT construction by raising development charges. (Melanie Ferrier/CBC News)

Now, it wants to increase the rate to cover LRT construction, which is estimated to cost the region more than $200 million.

"In order for us to put that into place, we have to open up a portion of the bylaw, examine it, and have a discussion about – if we are going to increase it – how much are we going to increase it by," Strickland said.

The region will also have to decide whether the increase will apply to developments throughout the region, or just to developments in the cities.

'There could be an argument made that the townships are benefitting from the LRT and any new development they have in the townships should pay for a portion of LRT.' - Sean Strickland, Region of Waterloo councillor

"I think it's going to be an interesting discussion about cost and benefits," he said. "If the benefit of the LRT is for the entire region, then I think you can make the case that the entire region should be bearing an equal share of its cost."

Townships shouldn't pay

North Dumfries Mayor Susan Foxton opposes that idea, saying the townships should not have to pay for a service that their residents will not use.

"I'm not going to drive for 40 minutes to get on the LRT. No, it doesn't make any sense at all," she said.

"I'm sorry that the region needs this much more money for the LRT. I understand where they're coming from. But this is not the solution, to put the costs on the backs of people coming into our townships that are probably never, ever going to use it."

Strickland says rural developers should help pay for LRT construction because the project indirectly benefits the townships. (Allan Weeks Real Estate Co.)

Strickland argues that the townships will benefit indirectly from the urban transportation project, as it concentrate future development in the region's core, thereby protecting farmland from urban sprawl.

"So quality of life in the rural areas has been maintained and protected through the development of the LRT," he said, "and so there could be an argument made that the townships are benefitting from the LRT and any new development they have in the townships should pay for a portion of LRT."

But Foxton isn't buying that argument. She said farmland is already protected by the region's official plan, as well as by the province's Places to Grow legislation.

Township mayors are not convinced that they will benefit from the LRT, even if it does reduce urban sprawl. (Andrew Vaughan/Canadian Press)

Costs of preserving farmland

Wellesley Mayor Joe Nowak is also concerned about the suggestion that the LRT will indirectly benefit the townships by protecting the rural landscape.

Although he agrees that it is important to preserve farmland, he said that protection comes at a cost to the townships.

"The assess value of farmlands is roughly 25 per cent of that of residential areas," Nowak said. "So, all those beautiful acres of fields that we have out there, we don't receive a significant amount of assessment."

Nowak said higher development charges would also make it more difficult for Wellesley to attract new businesses and residents, because the neighbouring township of Perth East does not charge any development fees.