Earlier this month, the government of Ontario announced its intention to give municipalities the ability to increase affordable housing units for lower to middle income households. Through the newly released inclusionary zoning measures, municipalities will have the option to mandate that developers include a percentage of affordable housing in new residential developments. Inclusionary housing programs provide a regulatory solution to address the booming real estate market and the lack of affordable housing throughout Canada.
Currently, Ontario operates an incentive-based system designed to induce developers to build more affordable housing units. Section 37 in The Planning Act allows Ontario municipalities to pass zoning bylaws increasing the height or density of a building in exchange for “facilities, services or matters” that cater to community needs. In 2014, the City of Toronto conducted a review of Section 37, to determine how this legislation has actually impacted communities across the city, given issues relating to clarity, consistency, and transparency. The review found that Section 37 has raised $300 million for communities since 1998. However, it remains unclear how much of the $300 million was invested in affordable housing, as “Section 37 policies do not explicitly include affordable ownership housing as a community benefit”.
Nevertheless, the City of Toronto has attempted to utilize Section 37 to fuel new affordable housing projects through its Large Sites Policy, which requires any development site greater than 5 hectares to provide 20 per cent of its residential space for affordable housing units. This policy is meant to capitalize on Section 37 by requiring any project requesting increased height or density amendments to comply with the Large Sites policy. Unfortunately, there are several factors that hinder the effectiveness of this policy. Sites need to be quite large, with 5 hectares being the equivalent length of approximately five sports fields. Affordable units also cannot be created unless increases in density are approved. Furthermore, developers have the option to create new units or to dedicate land towards the development of new units. Because most developers opt to provide land, this fails to increase the number of affordable units, leaving the responsibility of funding and constructing units with the city.
Therefore, inclusive zoning laws are a tool that guarantees increased affordable housing to communities across Ontario. New zoning laws have been recommended by a number of institutions, including the Wellesley Institute for Urban Health through its 2007 Blueprint for Ending Homelessness in Toronto, as well as the Canadian Policy Research Network’s 2009 study, which estimates that approximately 556 to 1,840 inclusionary units could have been created in Toronto based on 2007 and 2008 data, if the province had enacted inclusionary zoning laws for those two years. Many of these advocates cite key benefits to inclusionary zoning, including new partnerships with private developers, as well as providing affordable housing units within market housing developments to create mixed income neighbourhoods. These mixed income communities create benefits beyond merely fulfilling housing needs, by improving productivity, welfare and overall living standards, and reducing neighbourhood segregation.
Inclusionary zoning policies are not new and actually are being implemented in several jurisdictions. In Montreal, firms creating new residential developments greater than 200 units are expected to earmark a minimum of 30 per cent of their units as affordable housing. Likewise, in Vancouver, private developers who wish to change zoning laws to create residential properties must demarcate at least 20 per cent of the units as affordable housing, with half of those units dedicated specifically for families. These policies also apply to developments exceeding 200 units. Unsurprisingly, Toronto’s Large Sites Policy is severely underdeveloped compared to those implemented in Montreal and Vancouver. Inclusive zoning has also been utilized in numerous American cities, including New York, Chicago, and San Francisco.
Although the benefits of inclusive zoning are many, there are disadvantages. Mixed income communities have often resulted in a “poor doors” phenomenon, in which market rate tenants enter buildings through separate entrances.
Poor doors have been especially prominent in New York, although the New York Mayor’s Office has passed regulations banning these distinct entrances. In addition, developers in Vancouver have also been accused of creating poor doors, effectively labeling lower income residents as having a “second class status”. Regardless, there are arguments for separate entrances: they could provide convenience to residents and are legally easier to define and maintain. When asked about the possibility of poor doors coming to Toronto, the Minister of Municipal Affairs and Housing, Ted McMeekin, stated, “We haven’t contemplated the ‘poor door’ concept being part of this…That would run counter to what we’re trying to do”.
Currently, Ontario has committed to developing a framework for inclusionary zoning through consultations with municipalities, developers. and other relevant actors. This policy still needs to be passed both at the provincial and municipal levels, making it unclear when inclusionary zoning will actually be implemented in Ontario. Though a step in the right direction, we still need to remember that this is not a quick fix, and that it will take time to reap the benefits of this new strategy.
Alyssa Wali is a 2016 Master of Public Policy Candidate at the University of Toronto’s School of Public Policy and Governance. She holds a Bachelor of Arts from Queen’s University, where she completed a major in Global Development Studies, and a minor in Political Studies. Alyssa’s main areas of interest include environmental policy, educational policy, and labour policy.