Development Cost Charges (DCC)

In British Columbia, local governments derive their authority to impose Development Cost Charges from the Local Government Act (RSBC 2015, c. 1), which permits municipalities and regional districts to collect DCCs from developers to help fund off-site infrastructure required to service new development. The specific enabling provisions set out the types of infrastructure that DCCs may cover, including roads, water, sewer, drainage, and park land acquisition. Each local government must adopt a DCC bylaw that establishes its own rates and applicability rules within the framework the Local Government Act provides.

Under the Local Government Act, DCC revenues collected by a BC local government may only be used to fund capital costs associated with specific categories of off-site infrastructure: roads, water supply systems, sewer systems, drainage systems, and the acquisition or improvement of park land. DCCs cannot be used for general operating expenses or for infrastructure unrelated to servicing growth generated by the new development. This restriction ensures that DCC funds are directed specifically toward growth-related capital needs.

In BC, the obligation to pay DCCs typically arises at the time a building permit is issued by the local government, as this is the trigger point specified in most DCC bylaws adopted under the Local Government Act. The developer or property owner applying for the building permit is generally responsible for paying the applicable DCCs before the permit is released. Because timing and the responsible party can vary by jurisdiction and project type, parties should confirm the specific requirements with the relevant local government.

Not all development is subject to DCCs in BC; applicability depends on the local government's DCC bylaw, which is adopted under the Local Government Act. Many jurisdictions exempt or provide reduced rates for certain development types, such as small-scale residential additions, non-profit rental housing, or developments below a specified threshold. Because DCC applicability and any exemptions vary significantly from one municipality or regional district to another, developers and buyers should review the specific bylaw of the relevant local government.

Yes, the Local Government Act permits local governments in British Columbia to reduce or waive DCCs for eligible affordable housing or non-profit rental housing projects through their DCC bylaws. The Province of BC may also provide a latecomer charge or DCC reduction assistance program; parties should consult current BC Ministry of Housing and local government guidance for any active provincial programs. Any reduction or waiver must be expressly authorized in the applicable DCC bylaw and is not automatically available to all affordable housing developments.

DCCs are a cost borne by the developer during the construction and permitting phase, and developers commonly pass these costs on to purchasers by incorporating them into the sale price of new homes or strata lots. As a result, DCCs indirectly contribute to the overall purchase price of newly built properties in BC, though they are not typically itemized as a separate line item in the purchase contract. Buyers of newly built homes should also be aware of separate tax considerations, such as GST and the Newly Built Home Exemption under the BC Property Transfer Tax Act, which may apply depending on the purchase price.

No, DCCs and Community Amenity Contributions (CACs) are distinct mechanisms in BC. DCCs are statutory charges imposed under the Local Government Act to fund specific off-site infrastructure categories, whereas CACs are negotiated contributions—often cash or in-kind amenities—that local governments may request from developers as a condition of rezoning, typically under policy frameworks rather than a fixed statutory formula. Both can affect development costs, but they arise from different legal bases and serve different purposes.

DCCs are levied on the development of a strata project at the building permit stage, not on individual strata lot purchasers at the time of resale. Under the Strata Property Act (SBC 1998, c. 43), strata corporations manage common property and shared expenses through strata fees and special levies, but DCCs are not a strata corporation charge—they are a one-time cost incurred by the developer who built the strata. Pre-sale buyers of new strata units may see DCC costs reflected in the purchase price set by the developer.

The Local Government Act provides a framework for DCC bylaw adoption, and developers may make representations during the public consultation process before a DCC bylaw or rate amendment is finalized. If a developer believes a DCC has been improperly imposed or calculated contrary to the bylaw, legal recourse may be available through the BC courts; however, general disagreement with the policy rationale for a DCC rate is not itself grounds for a statutory appeal. Developers seeking to challenge a DCC imposition should obtain independent legal advice regarding the specific grounds and procedures available.

Licensed real estate professionals in BC are regulated by the British Columbia Financial Services Authority (BCFSA) under the Real Estate Services Act (RESA) and its Rules, which require licensees to act in their clients' best interests and to disclose material information affecting a transaction. While a licensee should flag the potential impact of DCCs on development costs or new home pricing as a material consideration, they are not qualified to provide legal or tax advice and should direct clients to the relevant local government for current DCC rates and bylaws, and to legal counsel for specific advice. Licensees must not misrepresent or omit material facts regarding DCC obligations when known.