Engineering reviews account for the largest gap in Carleton Place development fees
Carleton Place is preparing to review the fees it charges for development-related applications following a comprehensive study of the costs associated with processing them.
Council received the second phase of a Comprehensive Development Fees and Charges Study at its June 9 committee of the whole meeting. The study, prepared by Watson & Associates Economists Ltd., examined whether current planning, engineering and building permit fees accurately reflect the cost of providing those services.
The review was undertaken as part of the town’s commitments under the federal Housing Accelerator Fund received in 2025.
Consultant Tina Chitsinde told council the first phase of the project focused on reviewing existing development-related fees, while the second phase assessed whether those fees are recovering the municipality’s actual costs.
“Very high level objectives for this phase of the assignment were to validate that the full cost of delivering those services, reviewing planning applications, getting those approvals, building permit fees, building permits, and then engineering review, was being captured,” Chitsinde said.
Using an activity-based costing model, the study analyzed staff time, administration, overhead and capital costs associated with development approvals. It found the town spends approximately $1.56 million annually processing applications and permits while collecting about $1.31 million in fees, resulting in a shortfall of roughly $249,000.
Engineering reviews showed the largest gap, recovering only 33 per cent of costs. Planning application fees recover about 70 per cent of costs, while building permit fees recover approximately 107 per cent.
Chitsinde cautioned that setting development fees involves more than maximizing cost recovery.
“It’s a balance between cost recovery, as well as having an understanding of the impacts of whatever decisions that are made will be on affordability,” she said.
She noted that fees can influence behaviour and should be set carefully.
“It’s a balancing act of understanding what the costs are, what cost recovery is, as well as ensuring that you’re not inadvertently triggering or incenting the wrong kind of behaviours,” Chitsinde said.
The study recommends increasing several planning and engineering application fees, including those related to development permits, subdivision approvals and engineering reviews. Some fees that currently exceed the cost of providing the service, such as part-lot control applications, could be reduced.
If implemented, planning application cost recovery would increase from about 70 per cent to 82 per cent, while engineering review cost recovery would rise from 33 per cent to approximately 65 per cent.
The report also recommends establishing a Building Department reserve fund equal to three years of direct operating costs to help maintain staffing and service levels during economic downturns.
Director of Development Services Niki Dwyer emphasized that council was not being asked to approve fee changes at this stage.
“My intention in writing the recommendation tonight was for you to receive the report, and then we will bring forward the separate changes to the fees and charges bylaw, as part of the budget,” Dwyer said.
She added that any future adjustments would need to comply with legislative requirements.
“Engineering is a little bit more flexible, but on the other two, there is some legislation that we do need to follow,” she said.
Council received the report for information. Staff are expected to use the findings to help inform the town’s 2027 budget process and future development fee structure.
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