Report to: General
Committee Report
Date:
SUBJECT: Financial Incentives
for Affordable Housing -
PREPARED BY: Barb Cribbett, Ext 4735
RECOMMENDATION:
THAT
Council authorize a conditional grant equal to Town of Markham development
charges estimated to be $664,989.90 and reduced cash-in-lieu of parkland contribution
(equivalent to 5% of the land value) payable, estimated at $90,000.00, to be
paid on 120 eligible affordable housing units in the proposed East Markham Non-Profit Homes Inc. affordable rental housing project
under the Canada Ontario Affordable Housing Program (AHP);
THAT the
funding for the conditional grant be provided from the Corporate Rate
Stabilization Reserve;
THAT the
grant be conditional on East Markham Non-Profit Homes
Inc. providing written confirmation of a Canada Ontario Affordable
Housing Program (AHP) funding allocation
of not less than $8,400,000 to the Commissioner of Development Services and the
Commissioner of Corporate Services;
THAT the
grant be conditional on the execution of an agreement between East Markham Non-Profit Homes Inc. and the Town of
THAT it be
acknowledged that the Region of York will consider at their June 5, 2008
Finance and Administration Committee making a similar grant of regional
development charges for this affordable housing project to demonstrate the
Region’s commitment to partnering with senior and local municipal levels of
government in support of affordable rental housing development in Markham and
York Region;
THAT the
September 2003 conditional grant approval for the Ling Liang Church be revoked,
pending a future application for affordable rental housing and reconsideration
of a conditional grant by Town of Markham Council;
THAT the Clerk
be direct to forward a copy of this report to the Minister of Municipal Affairs
and Housing, York Region MPPs and the Region of York:
AND THAT Staff be authorized and directed to do all things necessary to give effect to this resolution.
EXECUTIVE SUMMARY:
Not applicable
PURPOSE:
The purpose of this report is to seek Council approval to provide a conditional grant to the East Markham Non-Profit Homes Inc. equivalent to Development Charges owed and cash in lieu of parkland owed.
BACKGROUND:
On
“That the presentation from East Markham Non-Profit
Homes Inc. (EMNPH) regarding the proposal for affordable housing be received;
and
That the financial incentive request be referred to
That the fee deferral request, LEED alternative
request, and servicing allocation request, be referred to the planning staff to
be addressed in a report to the Development Services Committee regarding site
plan application in June 2008.”
East Markham
Non-Profit Homes Inc. (EMNPH), which was formed by the Markham Interchurch
Committee for Affordable Housing (MICAH), is a not-for-profit organization
established to provide and operate residential accommodation for low and
moderate-income families. On
In 2006, the Region of York issued a Request for Proposal Pre-Qualification (RFPQ) for proponents interested in applying for capital funding to construct up to 235 units of affordable rental housing under the Community Rental Housing Program (CRHP) funding of the joint Federal/Provincial Affordable Housing Program. In 2007 the Region issued a Request for Proposal to organizations that qualified under the prequalification process.
EMNPH was
successful in being selected by the Region of York as one of the projects to
receive funding under the Affordable Housing Program – Rental and Supportive
Component, which provides capital funding from the Federal and Provincial
governments in the form of a grant of up to $70,000 per unit. The contribution agreement was signed with
the Region of York in March 2008. In addition, on
All projects
under the Affordable Housing Program must be built and occupied by
OPTIONS/ DISCUSSION:
In September 2003, Council approved a
request from the
The conditional grant equivalent to development charges was based on the 2003 development charge rate times the number of units. The grant equivalent to cash-in-lieu was based on the difference in the cash-in-lieu payment that had already been made on the Ling Liang property at the industrial/commercial rate of 2%, and the 5% required for residential properties.
The resulting grant per unit would have
been $3,598. At the time, the Federal
Government provided a grant of $25,000 per unit, the
EMNPH Request
EMNPH is requesting from the Town:
- Provision of conditional grant equivalent to the Town’s portion of the development charges for the property, estimated to be $663,104, and
- Reduction of alternate parkland dedication charge to 5% of land value, rather than 1 hectare of parkland per 300 units and provision of conditional grant equivalent to cash-in-lieu of parkland dedication at $90,000
The proposed project financing information that has been provided by EMNPH is as follows:
|
|
Total |
Per Unit |
|
Estimated Capital Costs |
$24.6 million |
|
|
Financing & Grants |
|
|
|
$13.0 million |
$108,333 |
|
$3.2 million |
$26,667 |
|
$5.2 million |
$43,336 |
|
$1.38 million |
$11,500 |
|
$.5 million |
|
|
$.5 million |
|
|
$.75 million |
$6,250 |
Providing a Town grant equivalent to development charges payable is the same approach as that taken by the Region of York, and was also the approach taken by the Town for the Ling Liang Church affordable rental housing proposal. Again, staff are in support of providing the grant equivalent to development charges as an incentive to build affordable rental housing.
The request for a reduction in cash-in-lieu
of parkland charge from 1 hectare per 300 units to a 5% of land value is similar
to the approach taken by the Town of Markham on the Ling Liang Church proposal (affordable
rental) and the Old Kennedy Cooperative Development Corporation project (affordable
ownership). In both of these cases, Council approved a recommendation to reduce
the cash-in-lieu of parkland requirement to 5% of land value. The only difference is that for the
FINANCIAL CONSIDERATIONS:
Staff recommends that Council provide a
conditional grant equal to the Town of
The Town of
It is also recommended that the estimated conditional grant of $754,989.90 be funded by the Town’s Corporate Rate Stabilization Reserve. The Corporate Rate Stabilization Reserve currently has a balance of $14.1 million. In order to return the Corporate Rate Stabilization Reserve to its current level, it is further recommended that, during the 2009 budget discussion, consideration be given to first directing operating budget ramp-up funding equal to the EMNPH conditional grant to the Corporate Rate Stabilization Reserve.
It is not currently anticipated that there will be other requests for financial incentives for affordable rental housing that will meet the criteria of the Canada Ontario Affordable Housing Program for a number of years.
ENVIRONMENTAL CONSIDERATIONS:
Not applicable.
ACCESSIBILITY CONSIDERATIONS:
Not applicable.
ENGAGE 21ST CONSIDERATIONS:
Not applicable.
BUSINESS UNITS CONSULTED AND AFFECTED:
RECOMMENDED BY:
________________________ ________________________
Treasurer Commissioner, Corporate Services
Att: Report –
Letter from