Item - 2016.LS15.3

The Licensing and Standards Committee recommends that:

1.  City Council approve a new regulatory by-law for rental apartment buildings that requires property owners to:

a. register the building with the City of Toronto and submit required information;

b. have a process for receiving, tracking and responding to tenant repair requests;

c. notify tenants of service disruptions, property standards appeals, work orders and cleaning plan;

d. install notification board in central location;

e. have a comprehensive pest management plan that includes the use of licensed pest management professionals;

f. have a waste management plan;

g. have a cleaning plan;

h. use contractors with certification from Ontario College of Trades to conduct maintenance of HVAC and plumbing systems;

i. have a state of good repair capital plan; and

j. pay all applicable fees.

and direct the Executive Director, Municipal Licensing and Standards to report to the March 6, 2017 meeting of Licensing and Standards Committee with the new regulatory by-law.

2.  City Council direct that the program be funded as follows:

Program budget of $4,442,904, funded:

-45% recovered from a $8.00 registration fee per unit per year ($2,028,542)

-15% recovered through revenues from enforcement action ($637,200)

-40% recovered from the tax-base ($1,777,161)

and direct the Executive Director, Municipal Licensing and Standards to report to Budget Committee, during the 2017 Operating Budget process, on the program budget and the six additional Full-Time Equivalent (FTE) staff required to implement the program proposed.

3.  City Council direct the Executive Director, Municipal Licensing and Standards to report in October, 2017 to Licensing and Standards Committee through the Tenant Issues Committee, on:

a. the proposed Administrative Penalty by-law, and increased set fines which would apply to violations under the Rental Apartment Building By-law; and

b. the proposed policies and operating procedures, organizational changes and financing requirements to enhance the capacity of Municipal Licensing and Standards to undertake remedial action.

4.  City Council request the Province of Ontario to:

a. Introduce regulations that would exempt the registration fee from eligibility for an Above Guideline Increase (AGI); and

b. Amend the Building Code Act or other necessary legislation to authorize the City of Toronto to establish a system of Administrative Monetary Penalties for property standards violations

5.  City Council direct the Executive Director, Municipal Licensing and Standards to establish guidelines for when the Property Standards Committee can grant time extensions on work orders and to limit those criteria to situations that are only extraordinary circumstances.

6.  City Council direct the Executive Director, Municipal Licensing and Standards to include in the new regulatory by-law for rental apartment buildings an offence for renting out vacant units if the property owner is in breach of City by-laws, including a confirmed property standards order.

7.  City Council direct the Executive Director, Municipal Licensing and Standards to develop standard operating procedure service standards for 2018, subject to annual review, for Municipal Standards Officers which provide targeted timelines by violation category to bring landlords into compliance with City by-laws from the date an order is issued, and make the standards available to the public on the City website in Q4, 2017.

The report responds to City Council directives to consult on a proposed licensing framework for rental apartment buildings and recover the costs of an enhanced MRAB program. The report details the findings of staff research and public consultations that took place from August to October 2016.

Staff evaluated the regulatory option of licensing rental apartment buildings based on stakeholder expectations and the goal of improving the City's enforcement capacity. Findings confirm that a regulatory approach through licensing does not present any advantages over other regulatory tools authorized by the City of Toronto Act, 2006 and may actually create additional complexities that would not contribute to the programs goals of bringing rental apartment buildings into compliance.

The evaluation confirmed that the enactment of a regulatory bylaw, instead of a licensing bylaw, would provide the City with the necessary authorities to accomplish the City's mandate of consumer protection, safety and wellbeing of its citizens, and fulfill public expectations, while avoiding potential hindrances to obtaining compliance.  

The report proposes improvements to existing enforcement activities and regulations that will help:

• strengthen enforcement of city by-laws
• enhance tenant engagement and access to information
• promote preventative maintenance in rental apartment buildings to prevent the deterioration of standards
• recover program costs  

The improvements include the creation of a regulatory by-law, which would impose legal requirements for rental building owners, improved access to information about the quality of rental apartment buildings and new opportunities for higher fines.

The report also identifies additional inspection activities to help benchmark the quality of the housing stock in rental apartment buildings and enhance the proactive enforcement of property standards.  Lastly, the report outlines a process for recovering the costs of existing and proposed inspection and enforcement activities based on a combination of tax revenues, rental apartment building registration fee and user fees for non-compliant building owners.

The proposed changes build on the successes of the existing MRAB program and represent the next building block in an evolving municipal approach to improving living conditions for tenants in Toronto.

Legal Services, Shelter Support and Housing Administration (SSHA), Toronto Fire Services, Solid Waste Management Services, Toronto Public Health, and Tower Renewal Steps Program were consulted in preparation for this report.

The Tenant Issues Committee, on November 2, 2016, considered Item TD4.1 regarding the Proposed Framework for a Multi-residential Rental Property Licence - Results of Public Consultation and Proposed Regulations.