I finally had a little time to condense down a bunch of thoughts and notes about the Opening Doors report that was delivered to the Provincial Government last year. I read the report when it came out last summer, and noted how it landed in an overstuffed news cycle to be almost ignored by anyone who wasn’t already a housing wonk. I might have winged a bit on line at the time, but I was not overall as critical as some of my neighbours across Tenth Ave.
Last month we held a Workshop at New West Council to talk through the report recommendations with staff support, and prepare a more formal response to the provincial government (you can watch a video of that meeting here and see the report and presentation City Staff prepared to inform that workshop here). This brings me to my regular warning that the comments that follow are mine, not the official position of New Westminster City Council or anyone else, and you might want to watch that video to see some of the more nuanced discussion other Councilors brought to the discussion.
The report needs to be put into the context of how and why it was created. It was an Expert Panel put together to provide advice to the BC and Federal Governments (delivered to the respective Ministers of Finance, notably) so it weighs heavily on things senior government can do. The Experts on the Expert Panel were, perhaps shockingly, bereft of municipal experience, and their decided expertise in finance and property development resulted in their firm application of Maslow’s Hammer. I also chagrin that the progressive *economic* quick wins proposed were the only part of the report that the senior government Ministers of Finance rushed to make comment on – and that was just to say no to them at the moment they were proposed.
But I’m already getting ahead of myself. Let’s look through the major policy directions proposed, from the municipal perspective. There were 5 major themes, and 23 recommendations, and you can read through them all if you like, but much like the conversation we had at the Council workshop, I’m going to summarize by order of government, because we all have work to do to address what is a national crisis at this point.
Things the Feds can do:
The roots of our current homelessness crisis are found in the early 1990s when Paul Martin looked at the comparatively modest housing cuts under a decade of Mulroney, and decided he could do better. The 1994 Martin budget got the federal government right out of the business of building housing. When a rapidly growing and urbanizing country like Canada goes from building 15,000-20,000 social housing units a year to less than 1,000 there are going to be devastating effects. And here we are.
So, with the Feds having the, by far, deepest pockets, it is not surprising that the one thing the Feds could do first is start using those funds to build housing. To quote directly:
the federal government make long-term funding commitments, as was done until the mid-1990s, rather than offering short-term capital grants. We recommend that the scale of these funding commitments reflects what is required for the construction of new social housing units to return to historic levels, when nearly 10% of all national housing starts were social housing units
There are also great recommendations here about making Federal Lands available for housing in high-demand communities, giving the non-profit housing sector more tax incentives, harmonizing programs that may speed housing being brought on-line (like federal/provincial/municipal building codes, fire codes, energy efficiency codes, etc.). But, still, someone has to pay for the housing that the market is not going to provide.
There is also a recommendation around incentives that stands out to me:
federal and provincial governments create a municipal housing incentive program rewarding the creation of net new housing supply wherever demand occurs… their primary purpose is to recognize municipal costs incurred in growing the housing stock and reward growth of housing supply where it is needed.
This addresses straight-on a significant downloading concern all Cities have in investing in affordable housing. Given an historic lack in Federal and Provincial funding (only beginning to be abated now), creative cities looking to be proactive have tried to leverage local powers to get housing funded. This means directly spending on housing, giving our limited land base up to affordable housing projects, or leveraging affordable housing as a community amenity attached to new market housing. This last one definitely has populist appeal, because it makes people feel we are making the “greedy developers” pay for it, but the reality is we are simply taking money that would have otherwise been used to pay for other community amenities – parks and recreation centers and libraries – and as we dip into those resources, we lose public support for growth, because we cannot provide amenities that assure a denser City is livable and full-service.
So this recommendation seems to suggest that Cities that meet housing growth targets are prioritized for federal funding. I actually hoped it would go a little further and suggest that federal infrastructure granting programs like ICIP should specifically hinge on high-demand communities like New Westminster meeting their housing targets.
Things the Province can do:
When Martin/Chretien gutted federal funding for housing in the early 1990’s, BC stayed in the business of building housing for another decade or so, until the Liberal Government of Gordon Campbell put an end to that in 2002. Though programs are now coming back in a meaningful way, we are left with a big gap of 20 years of underbuilding to our needs.
All of the points above about what the Feds can do also apply to the Province – they can provide funds, land, and incentives. Though their pool of funds is somewhat smaller, they are in the right place to note and be proactive about regional needs, and indeed the money saved by giving people safe, secure homes comes right back to the Province through savings in health care and other social support spending.
One aspect of this that is somewhat missed in the panel report is the opportunity for the Province to get back into the business of supportive housing. By the current model, the Province may provide funding to private developers to include affordable housing in their market housing proposals and/or provide funding for the not-for-profit sector to deliver and operate the housing. This is based on the neoliberal idea that government saves money by paying someone else to do something instead of doing it themselves. This is the model that brought us disastrous results when a pandemic hit the care home sector, and a model we still somewhat resist for healthcare. But this is still an operating assumption for housing that adds complication and uncertainty to the delivery of housing, and makes it harder to get housing built.
This report skates around the demand side of the equation. I know this is a politically charged discussion in a growing country with ambitious population and economic growth models, and I am not going to delve into the fanciful economics of a certain UBC landscape architect or the xenophobic ravings of familiar populists. Instead, I would suggest the place where demand management comes in is the federal and provincial taxation structures that reward the commodification of housing, while at the same time providing no benefit to renters or those who are unhoused. For whatever reasons these various structures (homeowner tax credits, capital gains exemptions for housing, etc.) were developed years and decades ago to encourage people to buy and stay in houses, they no doubt provide a perverse incentive during a housing crisis where most cannot afford the ticket to entry while taking hundreds of millions of dollars out of the government’s coffers that could be better applied to providing housing to those in need. This is the part of the Expert Panel Report that senior governments rushed to say they were not going to enact. See recommendations 21 and 23:
21.…make changes to tax programs to bring the treatment of renters and homeowners into closer alignment. This would include reviewing the impact of the capital gains tax exemption on principal residences… and extending comparable support to other forms of wealth building;
23. …phase out the Home Owner Grant. Monies saved from this should be used to fund social housing in addition to the commitments made in the 10-year plan.
Alas, the Culture of Contentment assures that no government, no matter how progressive their campaign, will be willing to address this disparity any time soon.
Another important piece missing from this report is the need to protect renters and keep people from becoming homeless in the first place. Again, the Province has made tentative steps in the right direction here, but is not where the City of New Westminster and other local governments have been asking them to be in stopping renovictions and demovictions.
Things for Local Gov’t to do?
I’m going to mix together our Regional and Local government parts here, and only note that the Expert Panel Report skips regional government altogether, though they are a significant provider of affordable housing in the Lower Mainland and other regions of the province. They are also the level of government that sets regional land use and housing policy, but we’ll get to that.
The part to remember is that this is a report to senior governments, and the question here is more “what can senior governments to do to either compel or make local governments approve more housing faster?”. This might sounds strange to many in New West, where we are meeting (and slightly exceeding) our regional growth strategy targets for housing, rental and affordable housing, and population growth. If anything, I feel people are starting to feel a bit of growth fatigue related to construction impacts. However, we are one of the few municipalities hitting these targets (as I talked about at length here), and housing demand is still far outstripping availability – so what can the province do to get those other municipalities to keep up?
Right off the bat, we know the first recommendation doesn’t work:
the B.C. government impose statutory time limits to all stages of the property development process, municipal or other, for all types of development. Similar limits imposed
in Ontario and Alberta can serve as examples
Putting an artificial timeline of, say 90 days on a Rezoning application as Ontario did, fixes nothing. The arbitrary nature of the limit belies the complexity of many rezonings, ignores that even the Province cannot commit to providing referrals within that time limit (in the case of EMA freeze-and-release provisions, or MOTI approval for development near highways as only two examples), effectively undermines the ability for an elected Council to do what the Community elects them to do. It reduces a local government’s ability to evaluate and benefit from land lift related to rezoning, and undermines any principle of meaningful community engagement over development. The net effect is that most rezoning applications would be turned down, not that most would get approved faster. It does this all while adding a new layer of bureaucracy – the tribunal through which applications not meeting timeline could be appealed.
Fortunately, more of the recommendations around introducing “affordability adjustments” to the Housing Needs Reports, aligning our OCP updates with these needs reports, provincial streamlining of development permitting processes province-wide and the such, are doable, reasonable, and would likely have wide-spread buy-in by municipalities, though they may take some work on behalf of all parties.
An identified theme is that Municipal and regional housing targets actually have to come with some force. We are dealing with a regional problem, and need to solve it regionally. There are a variety of sticks and carrots the Provincial Government can apply, and a lot of funding incentives for infrastructure to better support the pressures cities face as they densify. Indeed, changing how the province incentivizes growth would also result in significant greenhouse gas reductions and reductions in the cost of many different forms of service delivery. There is a big win in here, but it would require some political courage to step into what local governments (and regional governments) see as their turf. When half the mayors in the region are elected on straight-up or veiled promises to curb growth, political battles would no doubt ensue, but a crisis like this does not allow half of the region to say “not our problem” as has been the reality for a decade. They know who they are.
There are two aspects of how Cities approve housing that the Provincial government can definitely influence, as they are regulated at least in part but Provincial regulations: how Cities finance growth, and how our permitting programs work.
On the financing side, the report includes this recommendation:
conduct a full review of local government revenue sources and spending responsibilities… includ[ing] consideration of additional or enhanced funding sources for infrastructure and amenities that are more predictable and do not rely on rezoning or the development process. Preference should be given to means that capture land value through taxation, rather than homebuilding
To frame this a bit, Municipal governments collect Development Cost Charges (“DCCs”) on new growth, Voluntary/Community Amenity Contributions (“VACs” or “CACs”), and a whole raft of different fees and changes on development. It’s a bit of a complex mess, and outside of DCCs, not particularly well regulated. This creates not just cost, but uncertainty and complexity for builders and great variances across the province and region. One recommendation would be for the Province to clean some of this up. perhaps by expanding the DCC program to make it more flexible and reduce the reliance on VACs/CACs. This sounds easy, but is actually something that would have to be addressed with great care, as the balance between community and private benefit from growth (never mind the public perception of that balance) is precarious and dynamic, and Mencken warned us about seemingly simple fixes to dynamic human problems.
The second aspect of change could be in the permitting processes themselves. Given the financing issue is managed (see above),then strategic pre-zoning takes a lot of risk away from builders, and reduces the time taken to get from planning to occupancy. This type of strategic pre-zoning probably doesn’t want to occur until we have a funding model established to assure the community knows it is getting its share of the inevitable land lift (and Cities have a way to fund the parks, playgrounds, roads, theatres and libraries that make the community livable), and stricter and clearer design control is in place, as the City will functionally be ceding much of that control when it gives away zoning. There are incremental changes Cities can make in the short term (like New West, where we have given Development Permit authority to staff without an extra trip to Council), but some major shifts in the permitting process that are recommended (like reforming the problematic Public Hearing) would require changes to provincial legislation.
We have a housing affordability crisis because we are not building enough homes to meet demand. We have a homelessness crisis because we are not building enough non-market and supportive housing to provide appropriate shelter for people who are forced out of the bottom of the market as prices rise. These are two overlapping crises that require parallel approaches to fix.
The first problem is related to a complex mix of jurisdictional and political roadblocks, some easier to overcome than others, but even with the existing legislative framework and tax structure, municipalities can build to meet demand now. some of us are. If the Regional Growth Strategy is any guide, Municipalities like the City of North Vancouver and New West have shown that the solutions are available, but some municipalities simply don’t want to take part. We need to level that playing field.
The second problem is much easier to solve. Build housing for people who cannot afford to be in the market, like this country and this province did in the decades between WW2 and Mulroney/Chretien austerity, or as the Baby Boom generation calls them, the Good Old Days. Fortunately, this easier-to-solve problem can go first, and even the most reluctant local government can’t stop it if the senior governments are committed to fixing it. As a bonus, it takes the pressure off of the harder to solve supply/demand problem of market housing. But to solve that second problem, we first need senior governments to be more honest about the goals of our economic policies, while local governments need to be more honest about whether they actually want to solve the problem.
This report, for its strengths and weaknesses, could open doors to some of those more truthful conversations.