Cities protest ‘staggering’ losses Ford government’s Ontario housing bill could cause

Globalnews.ca
Nov. 22, 2022
Isaac Callan

Big cities across the Greater Toronto Area are convening council meetings -- some of them unscheduled emergency events -- to table blistering criticism of housing legislation tabled by the Ford government.

Planning staff at local governments, including Markham, Mississauga and Toronto, have lambasted the province’s Bill 23, tabled at the end of October, for the crippling financial impacts it could have on local governments.

At the heart of the criticism is a fear the proposed changes will lead to dramatic property tax increases or a gutting of public services.

“Without other funding sources to make up this shortfall, the financial burden will fall on the property tax base,” a Markham staff report said, estimating property taxes could increase between 50 and 80 per cent just to maintain existing services.

The proposed legislation -- named the More Homes Built Faster Act -- was tabled on Oct. 25, the day after municipal elections were held across Ontario and has wide-ranging implications for cities.

In an effort to reduce the time and cost of building new housing, it reduces the money and land developers are required to give to cities when they build housing.

The current system of costs for developers, cities argue, ensures that homebuilders pay the costs of providing services for new residents, instead of existing communities footing the bill.

It has passed its second reading and is in committee, meaning changes can still be made to the document that has startled so many municipal governments.

“Our Housing Supply Action Plan is creating a strong foundation on which 1.5 million homes can be built over the next 10 years,” Minister of Municipal Affairs and Housing Steve Clark said in media release.

“Our government is following through on our commitment to Ontarians by cutting delays and red tape to get more homes built faster.”

The proposed new rules would mean the amount builders will need to pay in development fees -- designed to ensure new roads, libraries, sewage and other local services are paid for by developers -- will drop for many types of building.

The amount of parkland -- or money to build new parks -- is also set to fall away.

“The province is incentivizing the building of housing on the backs of municipalities, quite frankly,” Mississauga Mayor Bonnie Crombie told Global News.

“This is incentivizing profitability to the development community on the backs of municipalities. We won’t be able to pay for infrastructure -- roads, sewers, bridges, etc. -- and it doesn’t address making housing more affordable.”

The mayor’s stinging words come ahead of a special meeting, where her new council will consider the new bill. A staff report estimates Mississauga could lose as much $885 million in revenue over the next decade as a result of the legislation.

Staff highlighted a “staggering” potential loss of $560 million through changes to parkland rules as a key issue.

The proposed legislation would also compel cities to allocate or spend 60 per cent of the money developers give them for parks within a year. That change, Crombie said, could make finding park space with the drastically reduced funds even harder.

“When you think about the purchase of parkland with the cash-in-lieu funds we have, those are very opportunistic purchases that aren’t available each year -- it depends on when land becomes available,” she said.

Planning officials in Toronto say the changes could even slow the supply of new housing.

A report that will go before councillors predicts starving municipalities of funds could make it impossible to build.

“The proposed Bill could also have the unintended effect of slowing the supply of housing or lowering City service levels, such that the City cannot provide new services to support growth,” the report warned.

“Alternatively, it could place upward pressure on property taxes.”

That sentiment was shared by the Association of Municipalities of Ontario, which said in a statement that the proposed changes “may contradict the goal of building more housing in the long term.”

Mayor John Tory has expressed support for many aspects of the Ford government’s overhaul which has handed him strong mayor powers

A stark report from municipal staff in Markham suggests the legislation could lead to divided cities.

Weighing the potential need to reduce local services, staff warned cuts “will impact how new communities in Markham are planned and would create inequities across the City, with ‘have and have not’ neighbourhoods.”

Planning staff in Oshawa came to the same conclusion, saying that “many of the proposed amendments to the Development Charges Act will result in the general taxpayer paying for growth, rather than growth paying for growth.”

Outspoken urbanist and former Toronto mayoral candidate Gil Penalosa said the implications of the legislation could last centuries.

“We are creating the communities for the next 100 to 300 years, not just solving a 10-year housing crisis,” he told Global News. “So, we cannot go crazy and do dumb things.”