Item - 2023.EX9.3

The Executive Committee recommends that:  

Financial and Implementation Considerations

1.  City Council request the Executive Director, Housing Secretariat to develop a new community housing sector strategy aimed at protecting existing non-profit homes and co-operative homes on City land that are approaching end of lease terms, end of mortgage, and/or end of operating agreement terms, and to increase the stock of net new non-profit and co-operative homes, and report back by the fourth quarter of 2023.

2.  City Council request the Executive Director, Housing Secretariat to review the Open Door Affordable Rental Program in light of Council’s revised HousingTO Plan targets that include both affordable rental (including Rent-Geared-to-Income) and rent-controlled market units as set out in Part 1 of Item 2023.EX7.2, and to report back by the first quarter of 2024 with recommendations in respect of the program to support the delivery of a full range of rent-controlled purpose-built rental homes.

3.  City Council request the Executive Director, Housing Secretariat to review the City’s Affordable Home Ownership Policy and Program Framework, with consideration of the Auditor General’s recommendation in Item 2020.AU6.3, an assessment of the value of funds held in existing affordable home ownership programs and the value of affordable ownership revolving loans to be repaid, and the impacts of the Government of Ontario’s More Homes Built Faster Act, 2022 (Bill 23), and to report back with recommendations to amend the City’s program by the second quarter of 2024.

4.  City Council direct the Deputy City Manager, Development and Growth Services, in consultation with appropriate Divisions Heads, CreateTO and the Toronto Community Housing Corporation, to advance early due diligence work on the list of potential housing sites outlined in Confidential Attachment 1 to the report (October 17, 2023) from the Deputy City Manager, Development and Growth Services, and to report back by end of the second quarter of 2024, with a prioritized list and recommendations, including any financial implications, to advance appropriate sites for housing purposes.

5.  City Council direct that Confidential Attachment 1 to the report (October 17, 2023) from the Deputy City Manager, Development and Growth Services remain confidential in its entirety, as it pertains to a proposed or pending acquisition or disposition of land by the City of Toronto, Toronto Community Housing and/or Build Toronto Inc./CreateTO, as it deals with a position, plan, procedure, criteria or instruction to be applied to any negotiations carried on or to be carried on by or on behalf of the City, and it contains financial information, supplied in confidence to the City of Toronto, which, if disclosed, could reasonably be expected to prejudice the competitive position or interfere significantly with the contractual or other negotiations of a person, group of persons, or organization.

6.  City Council direct the Deputy City Manager, Development and Growth Services to:

a.  advance a City-led development model at five ‘housing ready’ sites (Attachment 2 to the report (October 17, 2023) from the Deputy City Manager, Development and Growth Services) located at 405 Sherbourne Street, 150 Queens Wharf Road, 1113-1117 Dundas Street West, 11 Brock Avenue and 35 Bellevue Avenue, whereby the City leads all aspects of the delivery of these sites under a ‘public builder model’ including undertaking all due diligence, and report back by the third quarter of 2024 with a status update and to identify any tools and new approaches needed to expand this model to additional sites; and

b.  identify opportunities to accelerate delivery of the 47 other City-owned ‘housing ready’ sites (Attachment 2 to the report (October 17, 2023) from the Deputy City Manager, Development and Growth Services) and the 31 non-profit owned sites, in partnership with federal and provincial governments, as well non-profit and private sector development partners.

7.  City Council request the Executive Director, Housing Secretariat, in collaboration with the Chief Planner and Executive Director, City Planning, to engage with the Toronto Alliance to End Homelessness, Miziwe Biik Development Corporation, the Co-op Housing Federation of Toronto, Kindred Works, community land trusts and others as deemed appropriate, to identify lands owned by Indigenous, non-profits and co-op housing providers and faith-based groups, that can be activated to create new homes and report back by the second quarter of 2024.

8.  City Council authorize the Executive Director, Housing Secretariat to negotiate and enter into, on behalf of the City of Toronto, a Memorandum of Understanding and funding agreement with the Toronto Alliance to End Homelessness, to advance the parties’ shared objectives including increasing deeply affordable rental and supportive housing and provide funding in the amount of up to $115,000, included in Housing Secretariat’s approved 2023 operating budget, on such terms and conditions outlined in Attachment 4 to the report (October 17, 2023) from the Deputy City Manager, Development and Growth Services, and on such other or amended terms and conditions acceptable to the Executive Director, Housing Secretariat and in a form satisfactory to the City Solicitor.

9.  City Council request the Deputy City Manager, Development and Growth Services to engage with United Way Greater Toronto, the Atkinson Foundation and others as deemed appropriate, to explore collaborative opportunities that support non-profit led affordable housing development and acquisition projects and create new affordable and Rent-Geared-to-Income homes, with a particular focus on community service infrastructure needed for equitable and complete mixed-income communities, and to report back to City Council by the second quarter of 2024 with an update on this initiative.

10.  City Council request the Deputy City Manager, Development and Growth Services to engage with the federal and provincial governments, Indigenous organizations, non-profit and co-op housing organizations, financiers, academic institutions, philanthropic organizations and private sector organizations (including large employers), to explore the establishment of a sustainable ‘Toronto Housing Affordability Fund’ as well as loan guarantees to support non-profit and public-led housing developments, and to report back to City Council by the second quarter of 2024 with recommendations to advance this initiative.

City-wide Alignment Considerations

11.  City Council request the Board of Directors of Toronto Community Housing Corporation to direct the President and Chief Executive Officer, Toronto Community Housing Corporation, in collaboration with the Deputy City Manager, Development and Growth Services, to review the Board’s current strategic plan mandated by its shareholder direction and identify opportunities for enhanced alignment to support delivery of the City’s housing plans and targets.

12.  City Council request the Board of Directors of CreateTO to direct the Chief Executive Officer, CreateTO, in collaboration with the Deputy City Manager, Development and Growth Services, to review the organization’s current mandate and identify opportunities for enhanced alignment to support delivery of the City’s housing plans and targets.

13.  City Council request the Deputy City Manager, Development and Growth Services, in collaboration with appropriate Division Heads, the Chief Executive Officer, CreateTO and the Chief Executive Officer, Toronto Community Housing Corporation, to report to the December 5, 2023, meeting of the Executive Committee, with recommendations to ensure alignment of the strategic plan of Toronto Community Housing Corporation and the mandate of CreateTO, with the City’s housing plans and targets.

14.  City Council request the Board of Directors of Toronto Community Housing Corporation to request the President and Chief Executive Officer, Toronto Community Housing Corporation, as part of a continued effort, to work with the City’s Deputy City Manager, Development and Growth Services and explore options to enhance the financial viability of Toronto Community Housing Corporation in-flight and planned revitalization and infill projects, including exploring both public and private options for financing, while delivering a wider range of net new rent-controlled affordable, Rent-Geared-to-Income and market rental homes and other City-building uses.

15.  City Council direct the Deputy City Manager, Development and Growth Services, in collaboration with the Deputy City Manager, Corporate Services, appropriate Division Heads, the Chief Executive Officer, CreateTO and the Chief Executive Officer, Toronto Community Housing Corporation, to harmonize all housing programs to reflect the City’s income-based definition of affordable housing, as defined in City of Toronto By-Law 944-2021, to adopt Amendment 558 to the Official Plan for the City of Toronto respecting Affordable Rental and Ownership Housing Definitions, for all projects on a go forward basis.

16.  City Council request the Deputy City Manager, Development and Growth Services, in collaboration with appropriate Division Heads, to combine the tracking, implementation and reporting of the HousingTO and Housing Action Plans, including cost estimates, required investments and financial commitments made to-date from the City, Government of Canada and Government of Ontario, and provide a comprehensive annual update to City Council by no later than the first quarter of each following year.

Intergovernmental Considerations

17.  City Council request the Government of Canada to support delivery of the updated HousingTO Plan new homes target, which is also necessary to support delivery of the National Housing Strategy targets, by:

a.  urgently allocating land to develop new purpose-built affordable and market rental homes;

b.  allocating between $500 million and $800 million per year in grant funding to Toronto over the next seven (7) years;

c.  allocating $6.5 billion and $8 billion in low-cost financing/re-payable loans to Toronto over the next seven (7) years;

d.  amending the National Housing Strategy programs and establish lending criteria tailored to the unique risk profile and requirements of municipal governments and non-profits;

e.  investing in future phases of the Rapid Housing Initiative and amend the program criteria to allow projects to access financing through the Co-Investment Fund to manage cost overruns due to factors beyond control (e.g., market conditions);

f.  launching the Co-operative Housing Development Program which was promised as part of Budget 2022;

g.  launching the federal Urban, Rural and Northern Indigenous Housing Strategy and immediately allocate a fair share of funding through a regional approach that respects the existing and established community-based infrastructure of the Aboriginal Labour Force Development Circle and Miziwe Biik Development Corporation;

h.  providing loan guarantees for non-profit and public led purpose-built affordable and market rental projects;

i.  establishing a requirement that as part of any future federal land sales, at least 30 percent of the gross floor area be allocated for affordable housing for 99 years;

j.  adopting the City of Toronto’s income-based definition of “affordable housing” and harmonize all federal housing programs to create certainty and predictability; and

k.  developing targeted and joint immigration and housing plans to attract individuals in the skilled trades, prioritizing their applications through the immigration scoring and selection process, and ensuring available job and affordable housing opportunities upon arrival in Canada.

18.  City Council request the Government of Canada to protect existing renters and rental stock by:

a. establishing a property acquisition fund, or providing funding to augment the City’s Multi-Unit Residential Acquisition Program;

b.  increasing investments to support the renovation and retrofit of existing multi-unit residential properties, including multi-tenant houses (rooming houses);

c.  urgently increasing investments in the Canada Housing Benefit program to meet unmet demand, to support newcomers and to assist Torontonians living in severe housing need;

d.  funding eviction support and prevention programs that build on successful City of Toronto’s programs including the Eviction Prevention in the Community, Toronto Rent Bank, Housing Stability Fund and Toronto Tenant Support programs, or to provide funding to the City to enhance these programs to address the growing rate of evictions;

e.  enhancing the Reaching Home program (and pairing with the Rapid Housing Initiative) to create new supportive housing;

f.  increasing investments and leading an intergovernmental approach to fund, streamline and enhance access to critical mental and physical health care, as well as addictions supports, to help people exit homelessness and achieve housing stability long term;

g.  amending the Income Tax Act to require landlords to disclose in their tax filings the rent they receive pre-and post-renovation and to pay the taxing authority a proportional surtax if the increase in rent is excessive;

h.  introducing an anti-flipping tax on residential properties sold within the first 12 months of ownership;

i.  reforming the tax treatment of Real Estate Investment Trusts; and

j.  developing policies to curb excessive profits in investment properties while protecting small independent landlords.

19.  City Council request the Government of Ontario to support delivery of the updated HousingTO Plan new rent-controlled homes target, which is also necessary to support delivery of the More Homes Built Faster plan targets, by:

a.  urgently allocating land to develop new purpose-built affordable and market rental homes;

b.  allocating between $500 million and $800 million per year in grant funding to Toronto over the next seven (7) years;

c.  allocating $6.5 billion and $8 billion in low-cost financing/re-payable loans to Toronto over the next seven (7) years;

d.  immediately waiving the Provincial Sales Tax on all purpose-built rental housing projects;

e.  providing loan guarantees for non-profit and public led purpose-built affordable and market rental projects, as well as for affordable homeownership projects;

f.  establishing a requirement that as part of any future federal land sales, at least 30 percent of the gross floor area be allocated for affordable housing for 99 years;

g.  allowing zoning with conditions to enable the City of Toronto to secure purpose-built rental housing as part of individual site-specific zoning by-laws;

h.  limiting appeals of municipally-initiated Official Plan and Zoning By-law Amendments for purpose-built rental projects;

i.  allowing for Inclusionary Zoning to be applied across the city and approve the City’s Protected Major Transit Station Areas delineations, require the homes to meet the City’s income-based definition of affordable housing and ensure that affordability is secured for 99 years;

j.  adopting the City of Toronto’s income-based definition of “affordable housing” and harmonize all provincial housing programs to create certainty and predictability;

k.  introducing a time limit on planning approval entitlements related to purpose-built rental projects to incent development-ready sites to advance to construction;

l.  removing right of appeal for projects with at least 30 percent affordable housing in which units are guaranteed affordable for at least 50 years;

m.  increasing investments to help the Ontario Land Tribunal speed up case resolution, improve customer service and accelerate housing creation;

n.  creating an Affordable Housing Trust from a portion of Land Transfer Tax Revenue to support projects that deliver new affordable housing for Indigenous and equity-deserving groups;

o.  modernizing the Ontario Building Code and other policies to remove any barriers to affordable construction and to ensure meaningful implementation;

p.  reviewing the requirements of the Ontario Building Code Act with respect to applicable building permit fees for affordable housing projects; and

q.  developing targeted and joint immigration and housing plans to attract individuals in the skilled trades, prioritizing their applications through the immigration scoring and selection process, and ensuring available job and affordable housing opportunities upon arrival in Ontario.

20.  City Council request the Government of Ontario to protect existing renters and rental stock by:

a.  increasing investments in the Canada-Ontario Housing Benefit program to meet unmet demand, to support newcomers and to assist Torontonians living in severe housing need;

b.  allocating additional funding for eviction support and prevention programs that build on successful City of Toronto’s programs including the Eviction Prevention in the Community, Toronto Rent Bank, Housing Stability Fund and Toronto Tenant Support programs, or to provide funding to the City to enhance these programs to address the growing rate of evictions;

c.  establishing a property acquisition fund, or providing funding to augment the City’s Multi-Unit Residential Acquisition Program;

d.  maintaining the City’s ability to require rental replacement, including any associated conditions, as part of any rental demolition project;

e.  re-introducing rent control to cover units occupied after November 15, 2018;

f.  identifying tenants in need of housing support services through the eviction process and provide these services for every household that is evicted through the Landlord and Tenant Board, with a goal of timely re-housing;

g.  providing and funding emergency temporary accommodation and related supports for households evicted through the Landlord and Tenant Board, at no cost to municipalities, until long-term housing can be provided for those households;

h. reforming the process that allows Landlords to levy Above the Guideline rent Increases for basic maintenance or cosmetic improvements; and

i. significantly increasing the number of provincial Residential Tenancy Act inspectors or make the necessary legislative changes, and provide adequate funding, to allow the City of Toronto to address fraudulent evictions and other Residential Tenancy Act infractions through the RentSafe program.

21. City Council re-iterate its request to the Government of Ontario to improve the adequacy and structure of social assistance programs, based on data and evidence, so that recipients are better able to meet their basic needs, including the high cost of housing in Toronto, and to equalize the benefit rate across the Ontario Works and the Ontario Disability Support Program.

22. City Council request to the Government of Ontario to reduce the financial burden on the City of Toronto related to provincial social assistance programs, which is estimated to be $125 million annually, by eliminating the Housing Services Act Rent Scales to equalize the shelter benefit components of Ontario Works and the Ontario Disability Support Program for rent-geared-to-income households residing in City-administered community housing, with those residing in the private market housing.

Other

23. City Council request the Board of Directors of Toronto Community Housing Corporation to request the President and Chief Executive Officer, Toronto Community Housing Corporation to work with the City’s Deputy City Manager, Development and Growth Services to report back to the Executive Committee by the second quareter 2024 on a strategy to accelerate the implementation of the Lawrence Heights Revitalization Phases II and III.

24. City Council request the City Manager to write to the Government of Ontario and the Government of Canada to re-engage on a priority basis to negotiate funding contribution agreements to expeditiously move forward on the implementation of the Lawrence Heights Revitalization Phases II and III.

25. City Council request the Chief Planner and Executive Director, City Planning, in the report requested in MM11.16 - Rental Demolition Permits and Market Rentals, to also report on the feasibility of requiring that as a condition of approving any rental demolition application for purpose-built rental buildings with more than 100 units, owners/landlords be required to increase the rental space in replacement buildings, subject to planning approvals, by adding at least 10 percent net new purpose-built rental units, 8 percent gross floor area or cash-in-lieu where it is not possible to increase units or gross floor area on site, in addition to rental replacement requirements.

The Executive Director, Housing Secretariat and the Director, Housing Secretariat gave a presentation on Generational Transformation of Toronto’s Housing System to Urgently Build More Homes.

Despite the City of Toronto taking an increased role in the delivery of new affordable homes in recent years, Toronto’s housing and homelessness crisis has worsened and now demands an even more robust range of actions across the housing continuum to adequately address the needs of current and future residents. Increasing the supply of new homes across the full continuum is necessary to reduce pressures throughout the entire housing system, improve housing affordability and access particularly for lower- and middle-income households, and to support growth.

In recognition of the urgent need to expedite efforts to transform Toronto’s housing system, at its meeting of September 6, 2023, City Council adopted Item EX7.2 and directed the City Manager, in consultation with the Deputy City Manager, Development and Growth Services, to work with agencies, boards, corporations and divisions to assess preliminary cost estimates and create a plan, including an implementation framework with timelines, to achieve 25,000 new rent-controlled homes, including new affordable rental, rent-geared-to-income (RGI), and market rental homes. City Council also requested staff to identify current, suitable parcels of land owned by the City, co-operative (co-op) and non-profit housing providers, government organizations and other partners, that can be immediately activated for housing development. Further, Council requested an update on the financial contributions required from both the federal and provincial governments to enable successful delivery of the new homes.

The new targets identified in Item EX7.2  amend and increase the City’s previous HousingTO 2020-2030 Action Plan (HousingTO Plan) target of approving 40,000 affordable rental homes by 2030 (now 65,000 rent-controlled homes, comprising 6,500 RGI, 41,000 affordable rental and 17,500 rent-controlled market units). The new targets also support delivery of the  Housing Action Plan 2022-2026 (Housing Action Plan), which is focused on enabling both market, non-market and mixed income housing production in order to achieve or exceed the provincial housing target of 285,000 new homes over the next 10 years (see Figure 1 on page 20).

This report responds to Council’s requests and outlines several recommended actions, as well as highlights initiatives underway, which will make a generational change to transform and strengthen Toronto’s housing system and expedite delivery of the HousingTO and Housing Action Plan targets, including:

1. Dedicating more City-owned land to create new affordable homes - advancing due diligence on 40 additional City-owned sites (including sites owned by agencies, boards and corporations) that have been identified as potential future housing sites (Confidential Attachment 1);

2.  Accelerating the delivery of ‘housing ready’ projects on City and non-profit owned land – this includes almost 19,000 net new affordable rental, RGI and rent-controlled market homes on land owned by the City and the non-profit sector (Attachment 2);

3. Streamlining and Optimizing People, Processes, and Technology to Expedite Approvals and Housing Delivery, including:

a. organizational and resource re-alignment;

b. process improvement (including a new Toronto Building Citywide Priorities Team to streamline the building permit process); and

c. utilizing new and enhanced technology solutions to improve efficiencies and expedite the planning and building application review and approval processes.

4. Developing New and Sustainable Funding Models – exploring new and sustainable funding models to expand the delivery of affordable and RGI homes within mixed-income and sustainable communities; and

5. Supporting the Non-profit and Co-operative Housing Sectors - additional measures, including City development support, to support the non-profit sector.

The actions outlined in this report will build upon and align the City’s recent and ongoing initiatives to increase housing supply, remove regulatory barriers and support a housing system shift. These include: implementation of the Open Door, Housing Now, Modular Housing, and Rapid Housing Initiative programs; zoning by-law amendments to eliminate most minimum parking standards; as-of-right zoning permissions for multi-tenant housing, secondary suites, garden and laneway suites; multiplexes and establishing minimum densities in Protected Major Transit Station Areas (PMTSAs), along with accompanying affordable housing requirements through Inclusionary Zoning, subject to approval of the PMTSAs by the Government of Ontario. Staff will continue to report to Council periodically on implementation progress, as well as to highlight key risks associated with delivery of the City’s housing objectives.

Additionally, all actions and investments will centre around:

- People – ensuring that there are a range of new homes for a range of incomes, with a focus on low-and-middle income households, including people experiencing homelessness and renters; promoting housing stability for renters long-term; and increasing access to support services.

- Equity and Reconciliation – supporting Indigenous residents and those from equity-deserving groups, including racialized people, seniors, youth, 2SLGBTQ+ persons, people with disabilities, and women and gender diverse people to access and maintain safe, adequate, affordable homes.

- Strengthening and shifting the housing system to deliver more non-market housing – a renewed focus on the public delivery of sites; increasing public and non-profit owned housing stock (including new co-operative homes) through new development as well as acquisitions; increasing the supply of net new rent-geared-to-income (RGI) homes; increasing the supply new affordable and rent-controlled market rental homes; and increasing access to affordable and attainable homeownership opportunities.

- Sustainability and Predictability – creating sustainable, mixed-income buildings within complete communities; and mechanisms for more predictable funding.

- Climate action – creating new energy efficient homes and improving the condition of existing homes.

- Urgency - expedited delivery of new homes, particularly RGI and affordable homes.

The City of Toronto, with its partners, stands ready to quickly build more affordable homes. The City will continue to leverage its limited resources and tools to support the delivery of new affordable and RGI homes, within mixed-income, complete communities. As outlined in Attachment 2, with the support of the federal and provincial governments, between 17,000 and 18,000 homes on City lands can be expedited, with a over half of these delivered within the next three to four years. Pending further due diligence, a number of additional City-owned sites in Confidential Attachment 1 can also be added to this pipeline.

Of the overall 65,000 new rent-controlled homes target, funding has already been secured to deliver 4,455 homes. The estimated cost to deliver the remaining 60,545 homes is between $28.6 billion and $31.5 billion. However, the estimated contribution/funding required from each order of government over the next 7 years is between $500 million to $800 million per year, net of repayable loans/financing (see Financial Impact section). With access to low-cost financing, the contribution/grants required from each order of government can be further reduced. The City will also work with developers on a site-by-site basis to identify additional opportunities to reduce cost. These required financial investments, although significant, are necessary to restore some level of affordability after decades of insufficient public investments in housing.

As all orders of government focus on building new affordable homes, efforts must equally concentrate on protecting the existing supply of homes to ensure net growth of the affordable housing stock. To highlight this need, for every 1 new affordable unit built in Toronto, it is estimated that 15 existing private affordable units are lost. City Council has ramped up efforts in this regard, and at its meeting on October 11, 2023, through Item 2023.EX8.7, voted to increase investments in the City’s Multi-Unit Residential Acquisition (MURA) program which is focused on acquisition of existing private rental stock to convert to permanently affordable non-profit homes. These investments will help curb housing speculation and tackle its downstream social and economic impacts including housing market price escalations, weakened protections for renters, and increased rates of evictions and homelessness.

Addressing the current housing crisis is critical to supporting the social, cultural and economic growth and prosperity of Toronto, the region and rest of the province, and the country. While the City is committed to taking every possible action within its jurisdictional and financial capacity to tackle the housing crisis, strengthened partnerships with the federal and provincial governments are needed to complement Toronto’s efforts. Specifically, new and enhanced policy, program and financial tools are urgently needed to meet Toronto, Ontario and Canada’s respective housing supply targets. This includes a new fiscal deal to support the structural changes that will put Toronto on a path to long-term financial sustainability plus a commitment from the federal and provincial governments to invest in the HousingTO Plan. Collaboration across governments and sectors will also be essential to increase the labour market capacity in the skilled trades needed to significantly scale up the production of new homes.