Item - 2021.PH25.16

The Planning and Housing Committee recommends that:  

1. City Council communicate to the Province and Cadillac Fairview its expectation that consideration of the updated East Harbour proposal will include robust and timely engagement with the local community and local Councillor, to be led and paid for by Cadillac Fairview and with input and direction from City staff, and that such engagement will be a component of all subsequent planning approvals required for the site.

2. City Council direct the Chief Planner and Executive Director, City Planning and the Executive Director, Transit Expansion in consultation with other affected City divisions to engage with the Province and Cadillac Fairview on the modified East Harbour development proposal, subject to the following conditions:

a. the City will be the planning approval authority for any required changes to the Official Plan and Secondary Plan, the subsequent plan of subdivision and future site plans;

b. any agreements that may be required between the Province and Cadillac Fairview, or that involve the City related to modifications to the approved land use planning framework for East Harbour will address the interests of the City, the Province and Cadillac Fairview;

c. initial negotiations will address City interests and focus only on those matters deemed essential for concluding the Transit Oriented Communities commercial transaction between the Province and Cadillac Fairview, including any agreement required on how to advance design and construction of the Broadview Avenue extension and the Broadview Eastern Flood Protection landform;

d. the development of the East Harbour site will be phased to ensure employment development happens prior to or concurrently with any residential development that may be added, and the advancement of each  phase will be subject to all conditions being met for earlier phases;

e. the residential development of East Harbour will include a significant component of affordable housing, consistent with City policy and practice, and to be confirmed as part of the negotiations on the essential matters for the Transit Oriented Communities commercial transaction;

f. Cadillac Fairview will cover the normal costs of development, including servicing, transportation network requirements and public realm elements associated with the development;

g. hard and soft services, including parkland and community services and facilities will be augmented beyond that secured in prior approvals, to be provided at a level appropriate to now also serve the additional residential density proposed and be appropriately built and allocated as phases of residential development advance, and the Province and Cadillac Fairview will make contributions appropriate to ensure the development and sustainability of a complete community;

h. streets, boulevard setbacks, parkland, POPS and open spaces which together create the public realm will be augmented beyond that secured in prior approvals, to be provided at a level appropriate to now also serve the additional residential density proposed, and be appropriate built and allocated as phases of residential development advance, and the Province and Cadillac Fairview will be expected to build out the public realm at an appropriate scale to ensure the development and sustainability of a complete community;

i. the City will not assume financial costs for hard and soft infrastructure, parks and services required solely to serve the new East Harbour residential community, and any financial contributions from the City related to infrastructure improvements, services and facilities will be related to costs associated with benefits to the broader community and City.

3. City Council direct the Chief Financial Officer and Treasurer and the Chief Planner and Executive Director, City Planning, in partnership with other affected City divisions, to undertake detailed financial analysis of the proposed Transit Oriented Communities development proposal and report back to City Council on the financial implications of a proposed agreement for the City.

4. City Council direct the Executive Director, Transit Expansion and the Chief Planner and Executive Director, City Planning to conclude negotiations with the Province related to establishing a dedicated team to address the East Harbour Transit Oriented Communities proposal, both the initial negotiations and the longer term planning review and approvals process.

5. City Council direct the Chief Planner and Executive Director, City Planning to report back to City Council at the December 15, 2021 meeting on the progress on negotiated conditions related to the Province's and Cadillac Fairview's request to establish zoning certainty, including any financial terms, and the next steps on planning approvals for East Harbour.

6. City Council direct the Chief Planner and Executive Director, City Planning in consultation with the Acting General Manager, Economic Development and Culture, to confirm the South of Eastern Employment Area boundaries as part of the Municipal Comprehensive Review in light of the possible loss of employment lands resulting from the anticipated Ministerial Zoning Order and conversion request on the East Harbour Transit Oriented Community.

7. City Council request the Chief Planner and Executive Director, City Planning and the Acting General Manager, Economic Development and Culture, report to a meeting of the Planning and Housing Committee in first quarter of 2022 on:

a. Relevance of the South of Eastern Employment Area and;

b. High level overview of the critical features of core employment districts and their contributions to Toronto's economy.

As directed by City Council in May 2021, this report provides an overview of the Provincial government's new proposal for mixed use development at East Harbour.  The report also outlines City staff recommendations on parameters for engaging with the Province and Cadillac Fairview on the proposal, in order to protect and advance City interests related to the proposal.  City staff are seeking direction to report back to Planning and Housing Committee in November and Council in December 2021 with the outcomes of that engagement with the Province and Cadillac Fairview.

In June 2018, City Council adopted the Unilever Precinct Secondary Plan and associated Zoning By-laws to establish a major new employment area at East Harbour.  The approved plan allows for 10 million square feet of commercial development for up to 50,000 jobs, in an area well served by expanded transit service.  In May 2021, City Council reaffirmed its position that the lands south of Eastern Avenue form an important employment area for the City.

In April 2021, the Province announced a Transit Oriented Communities (TOC) partnership with Cadillac Fairview, the owners of the East Harbour site, to design and construct the East Harbour Transit Hub (SmartTrack and Ontario Line stations).  The partnership also includes a Cadillac Fairview contribution toward related capital costs of development in the area, contingent on changes to the City's approved planning framework to permit the addition of 3.25 million square feet of residential development to existing development permissions.  The partnership is also based on an expectation that the design and construction of the Broadview Avenue extension and the Broadview Eastern Flood Protection landform will be advanced and implemented in concert with the construction of the Transit Hub.

City staff received a detailed submission on the updated East Harbour TOC proposal in late May 2021.  Discussions between the Province and the City leading up to this were focused largely on general parameters that would guide the City's ability to consider the proposal.  The full engagement of the City on the proposed changes to East Harbour was premised on a public process and the submission of a more detailed proposal, including the rationale for the land use changes. The detailed submission that was provided in May 2021 enabled City staff to begin understanding and reviewing the proposal in more detail. 

In order to conclude their commercial arrangement and advance the construction of the East Harbour Transit Hub, the Province and Cadillac Fairview are seeking "zoning certainty" for these changes by the end of 2021.  To meet timelines for the transit projects and achieve zoning certainty, City staff expect the Province will advance a Minister's Zoning Order (MZO) to put in place the necessary zoning.  The Province has made a number of changes to planning legislation and introduced the Transit Oriented Communities Act that give the Province additional authorities to advance this proposal.

Adding residential permissions to the East Harbour area represents an employment land conversion.  Although this proposal is following a separate process from the City's process for receiving and reviewing employment land conversion requests in the Municipal Comprehensive Review ("MCR") of the Official Plan, the proposal does constitute a conversion request and the City should consider this proposal in the context of the ongoing MCR. The Growth Plan (2020) and the City's Official Plan contain policies for the consideration of conversions of Employment Areas. These policies should be addressed as part of the proposal to inform staff's review of the potential conversion of Employment Areas.

In addition, the City and Province have entered into an MOU on Transit Oriented Development.  This MOU outlines a partnership approach to considering transit oriented development proposals associated with Provincial transit projects.  The SmartTrack draft Agreement in Principle covers the City's investment in the SmartTrack component of the East Harbour Transit Hub, an investment aimed at unlocking the economic development potential of the East Harbour site.

To develop a new community of the scale proposed for East Harbour requires careful planning to ensure the required hard and soft infrastructure, including but not limited to parks, servicing, roads, schools and other community services and facilities, are in place to support the new residents.  The City has a strong interest in ensuring the East Harbour development is well planned, and that the true costs of development are covered by Cadillac Fairview and the Province.  City staff also want to ensure sufficient time is allotted to undertake the kind of due diligence necessary to plan for a complete community, following the conclusion of the transaction between the Province and Cadillac Fairview.

City staff are seeking Council direction on a proposed approach to engage with the Province and Cadillac Fairview to ensure the City's and community's interests are protected and advanced in this TOC proposal.  In discussions with the Province, City officials have been careful to distinguish between those conditions that will be necessary for the Province and Cadillac Fairview to conclude a TOC agreement, and the broader planning review and approvals that will be required to follow beyond the end of 2021.  The City will also seek to ensure its interests are reflected in any agreements that may be required coming out of this process of engagement.

Given extensive community engagement previously undertaken for the Secondary Plan and private applications for the site, staff are also recommending that Cadillac Fairview and the Province undertake a full and robust engagement process with the local councillor and community.  The consultation process should extend beyond the end of 2021, given the significance of the proposed changes and the time that will be required to fully address all planning issues.

The report recommendations include parameters to guide City staff in negotiations with the Province and Cadillac Fairview.  The parameters relate to planning and financial conditions that will need to be addressed in the negotiations to reflect City interests.  The report also proposes an approach to a fiscal impact assessment of the TOC proposal for the City.

The City has discussed the need for additional dedicated staff for the East Harbour project with the Province.  The report seeks authority for staff to conclude negotiations with the Province about supporting the costs of the dedicated staff team.  The issue of staffing requirements across Divisions for the broader TOC program will be addressed in a Fall report to Council.

Staff are seeking Council direction to report back in December 2021 with an update on negotiated conditions for advancing zoning certainty, the conditions for the transaction, the fiscal impact assessment and the further planning work that will follow.