Housing Now: Big, bold . . . but can it be bolder?

Now here’s the sort of “big thinking” Toronto needs.

The City of Toronto has mobilized the resources at its disposal — its land, waived taxes and fees, a $20 Million revolving fund to staff up and hire consultants, and expedited planning and legal approvals — to create more affordable housing on 11 City-owned sites.

Toronto needs this “whole of government” approach if we hope to achieve Mayor Tory’s target of 40,000 new affordable homes in 12 years. Housing Now started the ball rolling with the sites they own, but this inter-divisional approach is needed for all affordable housing development.

Over the past decade, affordable housing development is virtually at a stand-still. The City’s Open Door Program announced in 2014 has approved only 1807 rental units, and many of these have not yet been built. Even modest infill projects fully supported by the neighbours have been stalled for two or more years in the planning approvals process. And with every month’s delay, the price of construction goes up, sometimes by millions of dollars on even a small project. The Housing Now approach could be exactly what these sites need.

Now, are we ready for something bolder?

At this week’s Executive Committee meeting, deputant after deputant called for a plan that reflected Toronto’s desperate need for more affordable housing. Under the current proposal, only 1/3 of the homes will reach an average 80% of CMHC’s Average Market Rent. And at a time when homelessness is rampant, only 1/30th of the homes — that’s only 300 units — will be affordable to people leaving the streets. The remaining 2/3 of units will charge whatever the market will bear.

Why so few affordable homes? The rationale offered at Executive Committee is that mixed-income development is a best practice. So it is. But let’s not forget that the St. Lawrence neighbourhood – the model cited repeatedly at Executive Committee — is 57 per cent affordable. The lesser known Frankel-Lambert site near Christie and Davenport is comprised of four housing co-ops and a non-profit seniors building. These developments have stood the test of time, with rents falling behind the market with every year of operation.

Is it because we can’t afford it? The report does not speak to the price the City will put on the 11 sites, nor to any direct municipal costs beyond a $20M revolving fund used — wisely in my opinion– to dedicate City staff to facilitate the process. (The $280 Million over 99 years outlined in the report is an estimate of foregone revenue, not a direct expense. If you think about it, any city-owned site that has not been developed to its maximum market potential — including these 11 sites over the years — could be described as foregone revenue.)

But I can’t help noting what other cities have achieved. The City of Vancouver has dedicated 20 City-owned sites for affordable rental, including over 600 units dedicated to people who are street homeless. In May 2018 Vancouver took another step forward by transferring seven city-owned sites to Community Land Trust to develop 1000 new affordable units. All the housing will be operated by non-profit organizations.

Calgary recognized that its affordable housing supply lagged behind other Canadian cities. They have recently transferred 7 City-owned parcels to non-profit organizations. These cities have the same federal government Toronto does. True, the BC provincial government has sustained funding for housing since the 1990s — something Ontario has failed to do. But both Vancouver and Calgary have made significant contributions to move these projects forward.

Non-profit ownership is the key

You will note that all of these success stories — St. Lawrence, Vancouver, Calgary — put non-profit ownership at the core.

Toronto should do the same. According to the Housing Now report, the City is “open” to non-profit sector proponents and has offered a $1 Million Capacity Fund to strengthen the non-profit sector’s proposals.

But why are we setting up a competition between non-profit operators and for-profit developers? Developers develop. It’s what they’re good at, and even a $1 Million fund won’t turn non-profit organizations into experts.

The non-profit sector’s expertise is operating affordable housing, offering a management approach tailored to vulnerable populations. They also bring with them public funds such as the National Housing Strategy’s Co-Investment Fund and Ministry of Health housing allowances that create deeper affordability than Toronto could do on its own.

Developers develop. Non-profits keep homes affordable

To enable everyone to do what they do best, the City should require all affordable housing to be operated by the non-profit or co-op sector. Two recent examples from the Ontario Government point the way.

Infrastructure Ontario (IO) contracted with DundeeKilmer to design, build and finance the development of the Pan Am Athlete’s Village. But when it came to converting athletes’ apartments into permanent housing, IO called for proposals exclusively from non-profit organizations.

Twenty providers responded to the call, with Wigawmen Inc. and Fred Victor chosen as the winning partners. Because IO had established robust design standards, the new owners inherited quality buildings. Both proponents were able to bring with them their own operating subsidies to create deeply affordable housing. And because non-profits guarantee perpetual affordability, they could be trusted to own rather than lease the properties.

In the sadly cancelled Thistletown redevelopment, the Ontario Government called for a mixed affordable and market proposals. To be successful, the proponent was required to partner with a non-profit owner for both its affordable rental and affordable ownership components.

Because the City is undertaking much of the pre-development work, they have ample opportunity to tailor the procurement process. If the City wanted to create an innovative supportive housing model, for example, it could issue an RFP for the operator first, and then seek a developer able to meet the specific design criteria for the building. Or if the City wanted to maximize public good, it could require proponents compete to create the greatest level of affordability.

Boldness begets boldness

In a recent article, John Lorinc searches for Housing Now’s “Big Idea”that would create momentum beyond whatever the City can muster on its own.

We’ve all seen the power of a big idea in action. For twenty years TCHC begged every level of government to repair the aging Regent Park and got nowhere. Once they announced the Regent Park Revitalization, everything changed. Public and private money for infrastructure, parks, community and aquatic centres, clinics, grocery stores, arts centres and restaurants poured in. There are lots of reasons why, but I think the biggest one was hope. People could see that their investment could make a difference.

With over 10,000 homes in play, we have the opportunity to do that now. We could set more ambitious affordability goals, like Vancouver has done. We could engage the philanthropic sector, as the Calgary Homeless Foundation did, raising $74 Million to house 1850 homeless or vulnerable people. Or we could demand universal design for entire buildings — not just for the common spaces — that would set the standard for all new development.

The City has taken a big step toward a more affordable Toronto. Let it be a bold one as well.