Section 37, Affordable Housing, and Why We Can’t Have Nice Things

It’s a constant source of rage and despair for me to see glass condos and “luxury townhomes” going up around town while the affordable housing waitlist stretches to record numbers. (161,266 people total [PDF] as of January, in case you were wondering.) And, as you know, Bob, since all those new developments mean more Section 37 funds,

—oh, what’s Section 37? Basically, the zoning rules say what kind of stuff you’re allowed to build, and if they say you can only build a tower 6 storeys high, and the developer wants to build one 12 storeys high, Section 37 of the Planning Act says they have to pay some extra money that offsets the extra load on local infrastructure, or goes to benefit the community.* Like, streetscaping, or a daycare, or something.

It’s not a tax because that’s not allowed; the money doesn’t go into some citywide pot because that would make it a tax**; the exact amount, and the nature of the benefit, gets worked out with the city councillor for each development. Anyway—

I naturally wondered if we couldn’t kill two birds with one stone and use Section 37 money for affordable housing. It’s totally an approved use. They can build it elsewhere in the neighbourhood, or they can set aside units in their condo. Because the current rules about it are kind of restrictive, the Planning & Growth Management Committee asked the city planners to revise them so it’s easier to do.*** And today, yes, today, they are talking about it at the committee meeting!!!****

I went to a very interesting open house on this back in November, where the planners explained the upcoming changes. You can read the report yourself to see what bits they’ve added (bolded here). From the list of possible incentives:

i. purpose built rental housing with mid-range or affordable rents, land for housing, affordable ownership housing, or, at the discretion of the owner, cash-in-lieu of affordable rental or ownership units or land;
j. a maximum of 20 individual affordable rental units, located in a registered condominium, provided the units are owned and operated as rental housing by a registered non-profit housing provider satisfactory to the City and meet established criteria, including securing through an agreement the maintenance of affordable rents for at least 25 years and rental tenure for at least 50 years. Such units will be deemed to be rental housing notwithstanding the definition of rental housing that would otherwise exclude condominium-registered units.

(However, after public consultation they’ve decided to remove the cap on rental units, and take another look at the 25- and 50-year requirements (some people think that’s too long; others, not long enough). None of this is written in stone yet.)

So, what’s the problem here? Why aren’t we all jumping for joy? What are some of the possible drawbacks of this approach?

The York Quay Neighbourhood Association thinks that “the affordable housing shortage in Toronto is so acute that we foresee all future Sec. 37 funds flowing towards this desperate need” (PDF), which is painfully adorable, you just want to ruffle their hair. WHO’S A GOOD CONCERNED CITIZEN. YOU. YES YOU ARE. GO FETCH. As a planner present at the open house told me, affordable housing, which calls up stereotypes of bedbug-ridden welfare scroungers bringing down property values, is “poison” to developers. The councillor has to push for it, and the developer has to agree to it, and because it’s something negotiated rather than mandated, you can’t make either of them do any particular thing. Developers make less money if they have it on-site, and they think it’ll bring down the property value if it’s built off-site. Councillors are inclined to side with developers as well; nobody wants to be seen as unfriendly to business. There are a few councillors who consistently negotiate for more housing in their wards (Vaughan, Wong-Tam), but that is entirely because they feel like it. There is no way to make, say, Doug Ford get a developer to opt for affordable housing rather than daycare.

(Can’t we make rules about this stuff? you might ask. Short answer: it’s called “conditional zoning” and “inclusionary zoning” and it’s up to the province, which has taken absolutely no action on it despite the fact that they’re theoretically in favour of it and people do keep putting forward motions and such. Write your MPP.)

Similarly, you can’t say how many units have to be set aside. Nor, it seems, can you add a clause saying “not all of the crappiest units, either”. That all is settled on a building-to-building basis. There’s nothing keeping anyone from setting aside a handful of terrible condo units for the non-profit and calling it a day. It’s too scattershot an approach to help the vast numbers of people who are inadequately housed.

The even deeper problem, which City staff are totally not rushing to point out, is that “affordable”, as the city planners are using it here, doesn’t actually mean, you know, affordable. Most of us hear “affordable housing” and think something like 30% of gross income, TCHC waitlist, bedbugs, etc. LOL NO. Note the inclusion of “mid-range” rent and “affordable ownership”***** in the guidelines. And “affordable ownership” doesn’t mean, like, those programs at Regent Park. “Affordable ownership”, as we were told at that meeting, means average sale price. Dear everyone, do you think the average Toronto home’s sale price is affordable?******

And lest you think I’m just pulling shit out of my ass, ACTO (Advocacy Centre for Tenants Ontario), who are slightly more in touch with reality than the YQNA, also point this out in their letter (PDF). They also note that over the past sixteen years, only 1,589 “affordable” units have been secured as rental housing. And over half of those were “mid-range” rent rather than, you know, actually affordable. If you think that slightly expanded guidelines will dramatically change that…I’ve got a bridge to sell you. They’re not gonna make a dent in the affordable housing waitlist, which is sitting at about 87,300 applications.

This is the main problem with using a planning tool never intended for the purpose to secure, you know, a basic fucking human right: case-by-case negotiations relying on individual goodwill (but mostly capitalism) will never, ever, ever replace legislation, policy, and investment in infrastructure. Like, ever.

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* If you’re wondering how a community benefit takes the weight off local infrastructure, the Federation of North Toronto Residents’ Associations feels your pain (PDF).

** It would be wonderful if all city councillors understood this but they don’t.

*** They mentioned two cases where condo units were set aside for affordable housing:

• The Charlie, a condo near King and Spadina, where four units throughout the building are to be owned and operated by Kehilla, a Jewish affordable housing nonprofit

• Artscape Triangle Lofts in Liberty Village, where 20 of the live/work artist spaces are rentals and the rest for sale

Such cases didn’t count as Section 37 benefits at the time, but under the new rules, they would. This would ideally allow more affordable housing to be created.

**** Ideally I would have finished this post in, like, November, but ehhhhhhhhhhh~

***** Who the hell is the affordable ownership lobby? Who’s in their pocket? I really want to know.

****** If your answer is “yes”, 1. fuck you and 2. shouldn’t you be reading Toronto Life?