Levy Consultant Review Services

The vendor is required to provide to develop a robust, transparent, and sustainable offsite levy framework that:
• Aligns with provincial legislation and industry best practices, 
• Appropriately balances risk and benefit between the community and developers, in particular, the offsite levy approach should link the level of debt risk taken by the community to the value that the community places on growth. 
• Maintains or enhances the city’s off-site levy financial forecasting and debt management capabilities. 
• Defines the rate-setting process and levy collection processes 
• Provides clear guidance on cost attribution and development-basin-based levies. 
• Supports growth and infrastructure investment in a fiscally responsible manner.
1. Current state assessment and comparative analysis
• Review the city’s current offsite levy approach, including financial forecasting, debt risk management, and rate setting. 
• Compare city approach to other state municipalities, with a focus on those similar in size and growth patterns (e.g., medicine hat, red deer), noting key differences, especially regarding the integration of levy rates and debt risk. 
• Identify best practices and innovative approaches in state and beyond. 
• Consider how various approaches manage challenges and risks, developing a tailored approach for city. 
• Assess general compliance with current municipal government act (MGA) requirements and regulations. 
• Identify legal risks and weaknesses in the current bylaw, with recommendations for alignment with best practices and legal defensibility (note: legal review to be completed by city legal counsel). 
• Consult with city infrastructure and financial staff and the director to understand the current issues and concerns faced by the community and the desired direction for the offsite levy. 
• Provide recommended options for exploration during the subsequent city bylaw rewrite, including discussion of risk allocation and growth incentives.
2. Growth trends forecast
• Review and extend the city’s existing population, housing, and land development projections for two horizons (e.g., 5-, 25- and 50-year horizons). 
• Analyze how projected trends in immigration, natural growth, housing affordability and density will affect infrastructure needs and levy revenue. 
• Consider how federal and provincial housing initiatives will impact land development in city. 
• Examine how growth will consume infrastructure capacity and how that will inform investment order and timing, as well as the collection of off-site levies. 
• Provide advice on forecasting growth (as an input to off-site levy revenue projections) in the context of post-pandemic city. 
• Assess the impact of various growth strategies on development and municipal debt risk. consider the implications of different strategies extending from focused growth to balanced growth to growth on developer demand.
3. Updated project list and database
• Coordinate revised database design with staff from finance and utility services.
• Review with engineering services list of growth projects
• Support updating of cost estimates.
4. Development basins analysis
• Analyze the merits and challenges of moving from a single development basin to multiple regions.
• Recommend the optimal number and configuration of development basins, considering administrative complexity, fairness, and financial sustainability.
• Explore and contrast the one development basin approach with at least:
o North, south, west (or subdivided west)
o Project catchment-based basins.
o Outline plan level basins
• Provide advice on methodologies for predicting project timing for each basin approach and informed by likely growth rates and adopted growth strategies.
• Assist with project and growth front priority ranking. as a mechanism to measure the value proposition for growth investments and the staging of basins.
• If a change is proposed, provide recommendations for transitioning from the current regime, including:
o Calculation and allocation of residual capacity and outstanding debt to beneficiaries,
o Methods for recovering existing offsite levy debt from beneficiaries.
• Provide support to negotiations on development basin changes with land developers
5. Cost allocation framework
• Review and recommend improvements to the allocation of project costs among community, offsite levy, and direct developer costs. 
• Analyze and clarify which projects and costs should be included as offsite levy projects versus direct developer responsibility. 
• Provide examples and rationale for cost attribution, with specific attention to transportation infrastructure. 
• Provide support to negotiations of cost allocation changes with land developers
6. Levy collection methodology
• Explore alternative approaches for collecting offsite levies:
o That addresses the decreasing size of lots.
o That better link levy payment to capacity used
o Shift risk appropriately to land developers
• Include exploration of at least the following mechanisms in comparison to the current area-based approach:
o Population based,
o Land use based
o Per unit and by door.
o Generation based (e.g., sewage generation as proportion of trunk capacity)
• Discuss the costs and risks associated with different approaches:
o Look at the administrative burden associated with an approach
o Risk and cost or errors
o Potential gaps between costs and collection
• Consider how the area-based approach could be adapted to account for decreasing lots sizes, increased density over time.
7. Levy rate calculation framework
• Inputs and processes for rate calculation, this will be required for each infrastructure type including water, sanitary sewer, storm water and roads. 
• Inputs and background information needed for the addition of firehalls to the offsite levy regime. 
• Integration of financial forecasting and debt risk management, 
• Accommodation of multiple infrastructure types and development regions, 
• Clear linkages between land development rates, levy revenues, level of debt risk and the degree of community benefit of growth 
• The city of will maintain responsibility for the creation and maintenance of the cash flow forecast model.