As mayor celebrates program, critics say definition of affordable housing needs review
An analysis of Toronto’s Open Door program shows that although multiple projects have received preliminary approval, none have been completed.

TheStar.com
Oct. 2, 2017
Jennifer Pagliaro and Emily Mathieu

Mayor John Tory declared a victory on the affordable housing front earlier this month.

Tory said, thanks to his signature housing plan called Open Door, the city is on track to meet an annual target to create 1,000 new affordable rental homes.

“Over the past three years, we have been working to knock down each of these barriers and finally create housing for those in our city who need it most,” Tory said in an opinion piecein the Star Sept. 15. “We are finding ways to say ‘yes’ to developers who want to work with the city.”

But an analysis of the program to date shows that while multiple projects have received preliminary approval, none of the projects approved under Open Door have been completed, thus failing to meet the target set by council back in 2009.

Of the official tally of 1,200 rental units counted as new affordable housing under Open Door in 2017, staff say about half “pre-qualify” with plans far from finalized.

Council is expected to vote on matters related to those units and other aspects of the program this week.

While there is also a string of agreements to create affordable housing in the future, experts also say that much of that stock won’t be for the people most in need and the city needs to re-examine what affordable means in the midst of a housing crisis.

In Toronto, more than 181,000 people are waiting for subsidized housing and at least 5,300 are in the emergency shelter system.

Sean Gadon, the director of the city’s affordable housing office, said the Open Door program “plays a vital role in providing new affordable rental housing that would otherwise not exist.”

“The private rental market will not deliver rents that are affordable on a consistent basis without the intervention and support of government. Won’t happen,” Gadon said.

Open Door was first announced by Tory in April 2015, standing on the contaminated city-owned lands at 200 Madison Ave., near Spadina Rd. and Dupont St.

For Open Door developments, the city forgives building fees, development charges, planning fees, parkland dedication and provides tax relief totalling about $40,000 per rental unit.

In exchange, the city secures a portion of units at or below the city’s average market rent. Those rents are controlled for at least 25 years, so if a tenant moves it can’t be jacked up.

The Madison Ave. property, after a request for proposal was put out by the city, was sold to developer Madison View Homes Inc. last year for a toonie. In exchange, they will provide 82 rental units at 77 per cent of average market rent for 50 years.

Those rental units are part of a total 653 approved in 2015 and 2016. Construction is well underway at just 7 per cent of projects approved for Open Door incentives since 2015.

City council approved the provision of $222.8 million worth of investments over five years towards the program with a goal of creating 5,000 new affordable rental units and 2,000 new home ownership units.

To date, the city has spent $121.86 million over the last three years to encourage the creation of 1,869 rental units and 596 ownership units.

It was 2009, when the city set the goal of the “creation” of 1,000 new affordable rental homes every year. With 600 units just pre-approved as part of this year’s tally, the city will fall far short of that goal this year.

“These units will help keep Toronto affordable for families that want to live and work right here in our city,” said the mayor and affordable housing advocate Councillor Ana Bailao in a joint statement to the Star Friday.

“It’s unfortunate that some would try to pick away at this progress rather than join us in advocating for more investment by all governments and the private sector.”

Council will consider authorizing $27.9 million in incentives for two developments of “up to” 600 units on unlocked provincial lands in the West Don Lands and at Grosvenor and Grenville streets. But staff are requesting to return in 2019 with updated numbers. As part of the land deal the province mandated that 600 of the 2,000 to be developed units be affordable and the cost of rent. Of the total, 300 must be offered at average market rent or less, 240 at 80 per cent or less and the rest at 40 per cent or less, the ministry confirmed.

Greg Suttor, a senior researcher at the Wellesley Institute said if the goal was the creation of 1,000 units each year then counting 600 yet to be fully approved units into the annual target is a bit premature.

“It’s like they are mixing the early fruit and the fall fruit and counting it as the harvest,” said Suttor.

However, he said, “that is not to discredit genuine steps and resources being put into making those units happen” and the provincial and federal governments need to boost their financial commitments to making Toronto affordable.

“I don’t think it should be on the city’s shoulders.”

Open Door, a city report reads, is meant to provide options for “low- and moderate-income households.”

But the city’s official plan defines affordable as monthly rent at or below average Toronto rent. In 2016, the average monthly market rent for a one-bedroom apartment, according to the Canada Mortgage and Housing Corp., was $1,137 and $1,341 for a two-bedroom.

In central Toronto, the average market rent for a one-bedroom apartment is $1,336 and a two-bedroom $1,932.

The provincial and federal standard for affordable rent is 80 per cent of market value.

Kira Heineck, the executive lead with the Toronto Alliance to End Homelessness, said for lower-income earners, people on social assistance or those at risk of becoming chronically or episodically homeless even 80 per cent is an “impossible” rent, without additional supports.

Heineck said as development plans continue to roll out and investments are made, council has a unique opportunity to lead a discussion on what is truly affordable.

“It is not just the job of the affordable housing office because their mandate to provide affordable housing in the way it is currently defined leaves out a lot of people who can’t afford affordable housing.”

According to data provided by city staff, the Open Door program has secured 855, or 46 per cent of all rental units acquired, at average market rent. Another 704 units were gained at around 80 per cent average market rent, while the rest are 60 per cent or below.

“Affordable housing staff, with that limit in mind do excellent work to find good projects, but in some instances we’re probably going to be paying developers to build something they’re probably going to build anyways. And that’s always troubled me,” said Councillor Gord Perks, a member of the city’s affordable housing committee.

“They’re coming up with some announcements,” he said. “They should not be feeling like its job done.”

There are other paths for the city to secure affordable housing through the standard development application process.

As part of those negotiations, which involve compromises on height and density, councillors have been able to secure agreements for affordable units either on-site or elsewhere through what’s called section 37 agreements.

The province has yet to commit to a timeline for inclusionary zoning, which would give the city the power to mandate a certain number of units in a development be set aside as affordable housing.

“We are taking some additional time to carefully consider how inclusionary zoning fits into the broader housing agenda. . . we are well-aware of how crucial a difference this tool can make,” Myriam Denis, press secretary for Housing Minister Peter Milczyn, said in an email.

Between 2015 and Sept. 22 of this year, the city could have created 2,619 affordable units if 10 per cent of all units in developments of 300 units or more were declared affordable, under inclusionary zoning rules.

Data from the Canada Mortgage and Housing Corp. also shows rental units are being built regardless of the city’s incentives. The number of rental units built rose steadily from 2013 to 2016, averaging 2,000 units a year. That does not include condo units put on the market as rental.

Though new builds slowed earlier this year, according to the firm Urbanation, following the expansion of rent control rules, experts argued it was not yet cause for concern.

Kenneth Hale, with the Advocacy Centre for Tenants Ontario, said projects developed through significant public subsidies should be designated as permanent, affordable rental housing.

Those units are only a small offering compared to what is needed.

“The people who we really should be focusing our efforts on are those people on the social housing waiting list because those are the people who we’ve recognized are in the greatest need,” said Hale.

“Whether its average market or 80 per cent of market, none of those people are going to qualify to go into those units.”