Item - 2020.PH14.3

The Planning and Housing Committee recommends that:

1. City Council authorize the Executive Director, Housing Secretariat to offer the Open Door incentives valued at $15,436,241 over 99 years for up to 200 additional affordable rental housing units on the Phase One Sites (3,900 units in total), and to exempt the affordable rental housing, including any applicable ancillary and related, parking and amenity space from the payment of development charges and provide a waiver of all planning and building permit fees and parkland dedication fees.

2. City Council exempt the up to 200 additional affordable rental homes anticipated to be developed on the Phase One Sites, from taxation for municipal and school purposes for the term of the municipal housing facility agreement, with the property tax exemption having an estimated net present value of approximately $5,836,458 over 99 years.

3. City Council authorize City staff to cancel or refund any taxes paid after the effective date of the municipal housing facility agreement.

4. City Council direct the Executive Director, Housing Secretariat, in consultation with the Chief Executive Officer, CreateTO, to administer the market offering process for all Phase One Sites designated exclusively for non-profit participation, and to negotiate the leases, purchase agreements and other contracts with the successful non-profit development partners.

5. City Council request the Executive Director, Housing Secretariat and the Chief Executive Officer, CreateTO to explore options to maximize the involvement and participation of non-profit and co-operative housing organizations, including Indigenous groups and communities, in future market offerings for the Housing Now sites, and provide greater consideration to submissions from non-profits that are financially viable, meet all other program requirements under the Housing Now Initiative and provide greater levels of affordability.

6. City Council request the Executive Director, Housing Secretariat and the Chief Executive Officer, CreateTO, to ensure that, in addition to requiring that Housing Now sites achieve a minimum of 20 percent accessible affordable rental units and 15 percent accessible market rental units plus fully barrier-free common areas, greater consideration is provided to future proposals that provide a greater number of accessible units, and include as many universal design features as possible in both in the market and affordable rental housing components of each site.

7. City Council direct the Executive Director, Housing Secretariat, in consultation with the Chief Executive Officer, Create TO, to:

a. negotiate with proponents for future Housing Now sites to include limitations on annual rent increases for market renters, with annual increases in rent not to exceed the Provincial Guideline amount plus 2 percent, with a goal of achieving the lowest possible annual rent increases for market renters while maintaining the economic feasibility of each project, including securing the affordable rental housing targets established for the Housing Now Initiative;

b. include a process in the negotiated agreements with proponents, similar to the provincial Above Guideline Increase process under the Residential Tenancies Act, 2006, by which landlords of future Housing Now Initiative sites can apply to the Deputy City Manager, Corporate Services, for approval to impose additional limited rent increases in exceptional circumstances for costs incurred as a result of:

1. an extraordinary increase in property taxes (i.e. an increase greater than the guideline plus 50 percent of the guideline);

2. extraordinary or significant eligible capital expenses (including extraordinary or significant renovation, repair, replacement or new additions, the expected benefit of which extends for at least five years) with respect to the residential building/component; and

3. extraordinary operating costs as a result of new security service or an existing security service necessary to maintain the safety of renters.

c. seek approval from City Council for proposals that do not comply with the recommendations in 7(a) and 7(b) above; and

d. report to City Council immediately upon the conclusion of any market offering process that does not result in a viable bid.

8. City Council request the Executive Director, Housing Secretariat in consultation with the Chief Executive Officer, Create TO, to report to Council in the third quarter of 2021 with the second annual update on the Housing Now Initiative including outcomes of negotiations with proponents, status of all sites, and any recommended changes to ensure continued successful delivery of the program.

9. City Council authorize the public release of Confidential Attachment 1 to the report (June 1, 2020) from the Executive Director, Housing Secretariat following the closing of all lease and/or purchase transactions for sites approved under the Housing Now Initiative.

10. City Council direct the Executive Director, Housing Secretariat and the Chief Planner and Executive Director, City Planning to convene a working group with not-for-profit housing providers, co-ops, and land trusts to increase to their role in delivering Housing Now sites.

11. City Council direct the Executive Director, Housing Secretariat and the Chief Planner and Executive Director, City Planning to convene a working group with not-for-profit housing providers, co-ops, and land trusts to develop a strategy for land acquisition for affordable housing.

12. City Council request the Executive Director, Housing Secretariat, to form a working group comprised of staff from City Planning, Buildings and Create TO as well as stakeholder organizations representing the disability community and the development industry, to explore the options and feasibility to increase the percentage of accessible units and units with universal design features to be delivered through Housing Now Initiative and report back to the Planning and Housing Committee in the second quarter of 2021 with findings and recommendations; in addition to City staff, the membership of the working group should include, but not be limited to:

a. The Accessible Housing Network;

b. The Centre for Independent Living;

c. Toronto Senior's Forum

d. Citizens With Disabilities – Ontario

e. Alliance for Equality of Blind Canadians Toronto;

f. Older Women's Network;

g. R-Path

h. BILD; and

i. RESCON

13. City Council request the Executive Director, Housing Secretariat and the Chief Executive Officer, CreateTO  to consult with the Chief Executive Officer, Toronto Community Housing Corporation on opportunities to incorporate the Toronto Community Housing Corporation lands at 1080 Eastern Avenue into the proposed Housing Now Phase Two redevelopment at 1631 Queen Street East, and consult with all neighbouring landowners on opportunities to partner and maximize the amount of affordable housing delivered on this site. 

14. City Council request the Toronto Office of Recovery and Rebuild to address recovery federal funds being directed to non-profits to fully fund their participation in Housing Now sites when meeting goals in Housing Plan.

15. City Council request the Executive Director, Housing Secretariat and the Executive Director, Corporate Real Estate Management to identify any smaller city sites that could be set aside for non-profit housing and to establish an optimal size of such a sites and report back in the fourth quarter of 2020. 

The Planning and Housing Committee:

1. Referred the presentation from HousingNowTO.com to the Executive Director, Housing Secretariat, the Chief Planner and Executive Director, City Planning and the Chief Executive Officer, CreateTO for their consideration in setting site specific targets and that the appropriate staff be requested to meet with the group to review the analysis presented.

2. Referred the following motion by Councillor Gord Perks to the Executive Director, Housing Secretariat in consultation with the Chief Executive Officer, CreateTO for further analysis and report back to the Planning and Housing Committee meeting on September 17, 2020:

"Amend Recommendation 7.a by adding to the end “and rent controls will be tied to each rental unit, not tied to individual tenants”" 

The Executive Director, Housing Secretariat gave a presentation on Housing Now Initiative Annual Update.

Increasing the supply of affordable and market rental housing, while creating complete communities with new community facilities and increased access to transit, services and employment, is a key priority for the City of Toronto.

The Housing Now Initiative, approved by City Council on December 13, 2018, activated 11 City-owned sites (the "Phase One Sites") for the development of affordable housing within mixed-income, mixed-use and transit-oriented communities. In January 2019, Council approved the implementation strategy for the Housing Now Initiative which established the organizational structure, investments and financial impacts, authorities and estimated unit yields for the Phase One Sites.

Phase One of the Housing Now Initiative was initially estimated to create approximately 10,000 new residential units with approximately 3,700 affordable rental units. Based on work done to-date to advance the first four priority sites, Phase One is now estimated to create approximately 10,750 residential units, with 7,800 being purpose-built rental housing, including almost 3,900 affordable rental units. The Housing Now Initiative is also delivering the essential community infrastructure that will support future residents and communities across Toronto. The Phase One Sites will introduce new child care facilities, new or expanded public parks, community space, employment opportunities, improved public realm and new public streets will also be developed at these sites.

Recognizing the urgent need to increase affordable rental housing options for residents, which has become more acute due to the COVID-19 pandemic, on May 28, 2020, City Council approved an additional six sites (the "Phase Two Sites"). Phase Two is estimated to add an additional 1,455 to 1,710 new residential units, including approximately 1,060 to 1,240 purpose-built rental units with approximately 530 to 620 being affordable rental units.

This report provides Council with the first annual update on the Housing Now Initiative including the current status of the Phase One Sites. It highlights the early successes, lessons learned and provides the development status of the Phase One Sites. The report also recommends that Council authorize an estimated $15,436,241 in Open Door incentives to support the creation of up to 200 additional affordable rental units to be delivered through Phase One of the Housing Now Initiative.

In addition, this report recommends enhancements to the Housing Now Initiative that will improve the lives of future residents of the sites. Some of these enhancements include limiting annual rent increases on market rental homes, maximizing the involvement of non-profit organizations to increase affordability, and through the market offering process, increasing the number of accessible homes plus incorporating universal design features to create housing that is suitable for everyone.