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The cash-strapped Thames Valley District school board would suffer crushing debt if it started buying up land for new schools rather than waiting for funding from Queen’s Park to do so, officials told trustees at a debate this week.
A proposed plan would involve charging so-called education development charges to builders on surrounding land to recoup the initial money spent purchasing an eventual school property – but the time lag is too long and the set cap on such fees too low to make it worthwhile, officials said.
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Trustees agreed and scrapped the idea. The board has no cash reserves for land buys, either, as it wrestles with a $16.8-million deficit on an annual budget of roughly $1.2 billion.
“It would take us years and years to recoup the cost to purchase the land,” said Geoff Vogt, superintendent of capital planning and facilities services with the London-based board.
Education development charges are similar to municipal development charges and they’re collected from both residential and non-residential new developments around schools as a way for boards to recover the money spent acquiring land in high-growth school districts.
While such a fee would end the board’s reliance on Queen’s Park for money to buy land – and let it build needed schools more quickly – the amount they can charge is capped and Vogt said the board would be in a “deficit situation around land acquisition for years.”
In March 2023, trustees approved studying the proposal in conjunction with the London District Catholic school board.
Ben Puzanov is the Thames Valley board’s director of planning. At this week’s meeting, he told trustees the key benefit would be speeding up the board’s ability to build and open new schools. But the debt required may crimp the board’s ability to use its lines of credit “for potential other needs.”
Developers had also complained about the proposed new charge, saying the fees would be passed on to homebuyers.
Twenty-seven of Ontario’s 72 school boards have bylaws in place allowing them to charge such fees.
HRivers@postmedia.com
@HeatheratLFP
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