The city will have to put a number of affordable housing projects on hold as soon as this summer, unless the province commits to reimbursing it for millions of dollars in lost revenue that is expected to result from its decision to slash some development fees.
A report that goes before the city’s planning and housing committee today warns that if Queen’s Park does not commit to a “multi-year reimbursement of lost revenues” related to Bill 23, the city will not be able to continue to advance work on any Housing Now sites, including the ones earmarked to proceed to construction in 2023 and 2024.
That, the report notes, could in turn threaten the city’s ability to meet its housing target of 285,000 new homes by 2031.
“While macroeconomic factors, provincial legislative changes and changes to CMHC programs are making it increasingly difficult for the city to deliver the Housing Now Initiative and other housing supply programs, the need for safe, adequate and affordable homes for current and future residents continues to grow,” staff write. “As such, immediate and coordinated action across all orders of government is urgently needed to remove hurdles and unlock housing supply, especially purpose-built rental projects that are 'shovel ready.’”
The city’s Housing Now plan was approved by city council in 2019.
The intention of the program is to make city-owned land and other financial incentives available to developers in exchange for the development of thousand of market-rate and affordable housing units.
Staff, however, acknowledge in the report that while 10 sites have been re-zone to date “construction has not yet started on any site.”
Staff are recommending several initiatives to “to help unstick Housing Now projects that can be quickly activated.”
But they say that without a commitment from the province to make the city whole for $120 million in annual lost revenue arising from Bill 23, work on the projects will have to be halted in the third quarter of this year.
“Without coordinated and sustained action across all orders of government and an urgency to act, the City of Toronto, the Government of Ontario and the Government of Canada will be challenged to meet their respective housing supply, economic and population growth targets, and, most importantly, to provide the type of housing needed for individuals and communities to thrive,” the reports notes.
Municipal Affairs and Housing Minister Steve Clark has previously said that the province will make Toronto “whole” for any lost revenues as a result of Bill 23 but has not provided any further assurances.
However, Premier Doug Ford has said that he doesn’t believe the revenue loss will hurt municipalities like Toronto “at all” because there is "waste" that can be eliminated to make up the difference.
