Fees for Municipal Infrastructure

Posted by Johannes Schenk on November 3rd, 2006 — Posted in Municipal Law

Ridley Bros. Development Co. Ltd. et al. v. City of Colwood, 2006 BCSC 1141 is an interesting case on cost sharing in relation to the construction of muncipal infrastructure. In this case a sewer system.

Here the petitioners had paid the City of Colwood for the construction of a segment of the municipal sewer system. Other developers who later built on adjacent properties were allowed by the City to connect to the already built municipal sewer system for a fee. The issue turned on whether the fee could be used by the City for purposes other than a contribution to the capital costs of the original sewer installation.

Interestingly, the later developers paid a disproportionately high fee for their sewer system connection. Not surprising considering the value of developed property in the Colwood area. The City claimed that the fee was in the nature of a gift. The Court saw through this argument and found that what the City of Colwood had actually done was sell municipal services and infrastructure for a profit. There was no statutory power to accept fees of this nature and the Court declared that all accepted monies be applied to the capital cost of the original muncipal sewer system.

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