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Yes, development can be turned off but should hopefully take over and modify player ratings when players' historical stats run out in the database. It didn't do this properly in the past, but I believe it has been addressed in more recent versions of OOTP.
By the way, I recommend 3-year recalculation with doubling the weight of current-season stats. It's a good balance between a single-season replay approach and some smoothing of the ratings to help address anomalies such as a one-off injury or a one-year slump dramatically altering a player's historical stats and therefore his ratings for a given season.
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