Surrey City Council Announces 2025 Development Cost Charges Bylaw Updates to Bolster Infrastructure Amid Housing Challenges

On March 10, 2025, at its regular council meeting, Surrey City Council approved updates to the city’s Development Cost Charges (DCCs) Bylaw. The revisions include the introduction of a new Fire Services DCC and a rollback of residential unit rates to 2023 levels to qualify for federal infrastructure funding, along with other changes. This restructuring is designed to maintain a “net freeze” on residential fees, a measure intended to address the ongoing housing affordability crisis while streamlining infrastructure funding.

DCCs are fees charged on new developments to fund infrastructure like roads, water, sewer, drainage, parks, and now fire protection. The City reviews these rates annually to ensure they cover growth-related costs.

The rollback of residential DCCs was necessary to meet the eligibility criteria for the federal Canadian Housing Infrastructure Fund (CHIF), which provides funding for essential infrastructure to support housing development. This rollback could reduce DCC revenue by $12 to $20 million over three years, but the City hopes to offset this loss with a projected $49 million in CHIF funding, which would more than compensate for the shortfall.

The revised bylaw adds a fire protection charge estimated to generate between $5 to $6 million annually. However, the increase is balanced by corresponding reductions in other DCCs, ensuring that developers face no overall hike in residential fees until at least 2027. 

Other changes include maintaining 2024 DCC rates for commercial, industrial, and institutional developments, simplifying DCC categories based on housing type, and introducing new rates for small-scale multi-unit housing (SSMUH) following provincial zoning changes. Despite potential revenue fluctuations due to economic conditions, the City believes that keeping DCCs stable will encourage development and help achieve long-term growth goals.

Other changes in the bylaw include maintaining stable rates and simplifying categories. The DCC rates for commercial, industrial, and institutional developments will remain frozen at 2024 levels amid current market conditions. At the same time, adjustments in the classification of DCCs based on housing type, with new rates set for small-scale multi-unit housing in response to recent provincial zoning changes.

City Manager Rob Costanzo noted that these measures are expected to e sustainable due to robust growth projections over the next decade and higher than average collections anticipated in 2024. He also highlighted that Surrey’s overall DCC rates are comparable to other major municipalities, and these adjustments were a strategic response to both market conditions and federal funding opportunities.

Surrey Council also recently approved its pilot program to accept surety bonds as security for DCC installments. The Surety Bond Pilot Program increased the number of eligible land development projects from 30 to 50. Launched in 2016, the program allows developers to use surety bonds instead of traditional securities, improving liquidity and reinvestment opportunities, with an aim towards fostering infrastructure improvements and economic growth. The expansion targets projects near Rapid Transit corridors and those offering significant community benefits. Eligible projects must meet financial criteria, including a minimum A+ rating for Surety companies and securities between $3 million and $15 million.