Canada: Implementing the Open Door Affordable Housing Program
Introduction:
This report fulfills City Council’s December, 2015 request for the City Manager to report on the financial and administrative implications of the Open Door Affordable Housing Program. Open Door is a program where the City contracts/secures affordable housing through a co-ordinated approach to financial incentives, funding, planning approvals and activation of public and private land. Implementation matters addressed in this report are a multi-year affordable housing investment plan to meet targets, The streamlining of application processes for City affordable housing funding and incentives, Expanded planning supports, such as the new Open Door Service application review process, and Annual reporting on performance toward achieving targets.Concurrent reports recommend the approval of a number of Open Door pilot projects that were reported to Council in December 2015. The program’s success is premised on ongoing federal/provincial housing investments and the scaling up of the capacity of the non-profit and private housing sectors to participate and produce affordable housing. In this regard the recent 2016 federal and provincial budgets provide important new funding sources for affordable housing.
Financial Implications:
As directed by City Council in December 2015, the Director, Affordable Housing Office in collaboration with the City Manager’s Office, will coordinate a corporate-wide annual report to the Affordable Housing and Executive Committees on the progress and results of Open Door. These annual reports will provide updates on Open Door implementation and investment plans including actual developments supported by the program. The annual reports will also detail affordable housing contributions from Build Toronto or other City Agencies, Boards or Corporations, including the value of any land contributions. An annual report for the Open Door 2016 results is recommended for the 2nd quarter of 2017.
City’s Affordable Housing:
The City’s affordable rental housing incentives include one-time fee exemptions from development charges, planning application fees, building permit fees, and parkland dedication fees, and multi-year relief in the form of property tax exemptions. The City also makes direct capital contributions primarily from the Development Charges Reserve Fund for Subsidized Housing and the Capital Revolving Fund for Affordable Housing. Finally, City contributions may also include City land, Section 37 contributions, and Build Toronto contributions from land sales.
2016 Proposed Developments:
In 2016, there are nine affordable rental and 10 affordable ownership developments approved, awaiting approval, or with proposals in development, totaling 748 homes. Total federal/provincial program funding is projected to be $19.1 million, with the City and Build Toronto contributing $18.2 million in funding and an estimated $14.8 million in in-kind incentives.
Equity Impact:
Access to safe, secure, affordable housing in all parts of Toronto is a fundamental goal of the City’s Housing Opportunities Toronto Action Plan 2010-2020. The provision of affordable housing is also a goal of the City’s Poverty Reduction Strategy. The new affordable homes realized through Open Door will provide a mix of housing opportunities for low- and moderate-income households, including singles, couples and families. Open Door will provide housing stability for equity-seeking groups such as lower-income individuals, couples and families, homeless people, aboriginal households, victims of domestic violence, seniors and people with disabilities.
City Financial Contributions Affordable Rental Housing:
The City has for well over a decade provided funding and financial incentives for the development of affordable rental housing. As referenced in the Financial Implications section of this report, the City’s menu of affordable rental housing incentives includes, on a Council approval basis, the waiving of development charges, planning fees and property tax, at a current estimated value of $35,000 per home in foregone revenues. These waivers are essential ingredients in driving down the cost of construction and delivering affordable rents.
Affordable Home Ownership Housing:
The City has since 2008 delivered the federal/provincial home ownership component of the Investment in Affordable Housing Program and in 2010 complemented this work by providing loans from the Development Charge Reserve Fund for Subsidized Housing through the Home Ownership Assistance Program. Over the past eight years, more than 800 families, couples and individuals have been assisted.
City Planning Open Door Service for Affordable Housing:
The City’s Gold Star Service for Business program for industrial, office and institutional development projects is a case-management approach that shortens internal circulation timelines and helps businesses navigate the planning and building approval process. Modelled on this service, City Planning is implementing an Open Door Service for Affordable Housing development projects.
Conclusion:
Open Door will accelerate the construction of affordable housing by making more surplus public land and incentives available, by implementing the Open Door planning service and by seeking greater contributions from the federal and provincial governments and the public and private sectors.
Also Read: Strategic Approaches and Delivery of Affordable Housing in Nairobi City County, Kenya