The Agenda with Steve Paikin (Audio) - How Will Ontario's Housing Crisis Be Solved?

Episode Date: September 20, 2024

Two-and-a-half years ago, the Ontario government identified that we would need 1.5 million new homes over the next decade to meet demand. What will it take to solve Ontario's housing crisis? Mike Moffat, the Founding Director of PLACE Centre at the Smart Prosperity Institute; Lisa Helps, the Executive Lead of BC Builds; Neil Rodgers, Strategic Advisor for the Ontario Home Builders Association; and Jag Sharma, Deputy City Manager of Development and Growth Services for the City of Toronto join Steve Paikin to discuss possible solutions. See omnystudio.com/listener for privacy information.

Two and a half years ago, the Ontario government identified that we would need 1.5 million new homes over the next decade to meet demand. What has happened since? The answer is not enough. What will it take to solve Ontario's housing crisis? Let's ask. Mike Moffitt, founding director of Place Centre at the Smart Prosperity Institute. Lisa Helps, the executive lead of BC Builds,

a housing program delivered by BC Housing. Neil Rogers, strategic advisor for the Ontario Home Builders Association. And Jag Sharma, deputy city manager of development and growth services for the city of Toronto. And could we please welcome them here to AMO this year, everybody? Thank you.

I do have to say a little housekeeping off the top. First of all, Mike, you didn't come that far to join us, did you? No, I walked here. You didn't have to. You walked here. You walked here. Okay, yeah, you live in Ottawa. You two on the end there flew from Toronto, yes?

Yes. You are the winner. You flew from Victoria, British Columbia. I did. Okay, that's very impressive. Thank you for making such a sweat to get here to join us. You have, I should also say, the best name of anybody in politics. How'd you like to run for office and your name is Lisa Helps? Is that great?

What was your slogan? Well, it's interesting. We were chatting about this back room. So my team, when I ran for mayor, at the white board saying, okay, how about this, how about that? And someone said it helps to vote. And then someone else saying, OK, how about this? How about that? And someone said, it helps to vote. And then someone else said, no, voting helps. And that's what my election sign said. Voting helps.

Voting helps. Because it actually drove voter turnout as well. Excellent. Well done. Neil, you and I have to do a bit of a full disclosure thing here. We do. Who is your favorite pagan? Jeff.

Exactly. That would be my brother, who's a home builder in southern Ontario, so we put that on the record in the interest of full disclosure. And away we go. Mike, a little background first. 1.5 million homes over the ensuing decade when they made the announcement. How did they come up with that number? I actually don't know, to be quite honest.

They released this number, and we did a report at Playcenter. And we were actually trying to debunk it. At the time, we thought it was too high. So we looked at demographic change, population growth. We built this big Excel model. And it spat out $1.498 million. So our paper quickly changed from a debunking to a, yeah, that sounds about right.

And the challenge is now that the population has continued to grow faster than the Ministry of Finance and others have forecasted. So we did a follow-up last summer and found it was about 1.7 million that we need instead. If I did one now, I think we're probably closer to 1.9 million. Now, we have to understand there's

a lot of uncertainty about that. We don't know what's going to happen with things like international students, non-permanent residents, other temporary foreign workers. But it is an accurate figure. I think one caveat is we have to realize that a unit is not a unit is not a unit. We are building a lot of one bedroom apartments

in this province. Those are helpful. But what we're lacking is a lot of those larger family size units. So if we actually took the unit size into account, we might even need more than two million. Lots to follow up on there, which we will. Jag, when you heard the number, 1.5 million, what was your reaction?

There's one. It's a large number. And certainly from a Toronto perspective, there's two other numbers that we pay very close attention to, 285,000 for our 10-year goal. And of the 285,000, 65,000 affordable homes and that was up from the original 40,000. It's – they're large numbers, but to Mike's point, not enough. The challenge I think that we – that I – that we find ourselves in is that even at 65,000

units and 285,000, like just for the 65,000, we're estimating between 33 to $36 billion in order to accomplish that goal. It's a lot of money. And certainly capacity is somewhat a challenge as well. And so when we reflect on what Mike was saying to say, maybe it's closer to 2 million, and let's say those numbers need to be higher the cost goes up as well and this is you know an

incredibly challenging time but an incredibly important time for us to take as many actions as possible because I think history is is teaching us that indecision is costing us more. Neil when you heard the number was your first reaction ain't no way in hell we're gonna be able to do that. 1.5 million indecision is costing us more. Neil, when you heard the number, was your first reaction, ain't no way in hell we're going to be able to do that. 1.5 million homes is good for business. It's good for our economies, no matter where you are in the province of Ontario.

But it is a consequential number. Even in our most robust years of housing production, we were meeting 50% of that. So to double that, you had to ask yourself the question, where do we find the skilled labor? How do we source the materials? How do we keep it affordable? So we applauded as an organization, as an association,

the target. It represented years and years of undersupply of bringing production, housing to the marketplace. We thought and think still it can be part of the equation of delivering housing affordability, but we'll talk more about that later. Yeah, Lisa, I don't want to unnecessarily embroil you in Ontario politics, given that you're not from here, but you know, this province has never done better than 700,000 homes, and now they're going for 1.5 million. That's the target.

As somebody who, well, politics, as Bill Davis used to say, is about the art of the possible. Is this even possible? It has to be possible. I think in Ontario, in British Columbia, across the country, it has to be possible for us to come together to rally to build these homes because otherwise, not to start off on a really negative note, but otherwise our communities and our country are going to crumble. Our economy is going to crumble. Our neighbourhoods are going to crumble. We're

going to have more people living outside on our streets in our parks. So I see that there is no option for Ontario not to meet its target, for BC not to meet its target. We must. And I think the question, and I know we're going to dig into this here, the question is how? How can we? And I think we've got to put some things together differently than we've been doing in order to meet those targets. From a political point of view though, Mike, you know, every time a minister has a press conference about housing, the issue of targets comes up and the issue of you're not going to meet your target comes up. Should the government set a quote unquote more realistic target at this point? No. just for the reasons that Lisa suggests.

I don't think failure is an option here. We're seeing, we had a report of over 200,000 persons experiencing homelessness here in Ontario, and we can quibble about whether or not that's too high or too low an estimate, but it seems reasonable to me. We're hearing 25 international students living in a three-bedroom home in Brampton,

and that's very common across the province. So unless something's happening on the population growth side, we have to house these people. There really isn't an option, so we've got to figure out how to get there. Let me do a follow-up with you. How did we get into a position

where we suddenly, a couple of years ago, realized, oh my goodness, we need an historic amount of housing built that we are not prepared to do? How did that happen? Well, I think before the pandemic, there were a lot of reasons that people were giving about why, you know, home prices and rents were so expensive and, you know and some of which had some merit to it. We said, OK, well, this is kind of an interest rate phenomenon. And when the interest rates normalize, so will home prices. Well, they did, and they haven't.

We've heard people talk about short-term rentals and all kinds of things, and those can play a role. But I think we weren't really paying attention to population growth. That in Ontario, historically, the population grows by about 120,000 people a year, and had so for about 20 years. After 2015, that ramped up substantially,

and that was partly due to the oil price collapse in 2015. We had people moving from Ontario to Alberta. They started coming back. But the big thing that happened was that our colleges and universities started bringing in more and more international students because of deregulation from the federal government as a way to pay some of those bills.

And what happens is those students need a way to pay some of those bills and what happens is those students you know need a place to live but often stay after graduation you know obtain a work permit and gain permanent residency so when you go from consistently growing at about 120,000 people a year to overnight doubling and tripling that number you know that's gonna cause some tensions and I think we weren't paying enough attention to that as a province or as a society. Neil, I'm not advocating this, but I

want you to consider the other side of the coin, which is to say, if we can't build enough to accommodate all of this demand, what about looking at the other side of the coin? Like, don't come to Ontario anymore. Or if you live in Ontario, why don't you think about moving to a different province? Is that an option?

No, not for Ontario. This government, the Ford administration, has put a lot of money on the line, record investments in car manufacturing, EVs, the tech sector, the mining sector. We're at the point of no return. We can't say stop. People have made investments, people have made choices, municipalities are gearing up their systems and their staffing, so the solution is not just shift the problem to another province.

the solution is not just shift the problem to another province. Although people are making decisions with their pocketbooks to go to other places, and that's regrettable. And maybe some smaller municipalities in Ontario will benefit from an ex-urban shift to small-town rural communities, and that's great but moving to another province it's a consequential move and unfortunately far too many individuals and families are having to do that because they simply can't afford it. Jag is that an option do you think in I mean I understand that difficult it's a difficult political lift but on the other hand if you can't keep up with the demand do you maybe have to try to reduce the supply of people coming here? So I don't think it's a good strategy

to reduce the number of people coming. I think it's, to what all of my peers here are saying, is we need to address more of the challenge. And one of the things that politically is being very strongly stated from a Toronto perspective and otherwise is government has been absent in the building of affordable homes for many decades. And as a result, we're seeing this crisis of affordability and options for individuals.

And I'm not just talking about individuals who need deeply affordable units, but I'm talking about professionals that are coming, whether they're planners or working within the police service or otherwise, they're struggling to find accommodations that are appropriate that are close to where they work. And it's creating significant tension within the system, but what we can say with, with, from an evidence-based

approach is that, you know, for 30 years we've had a significant deficit of, of government being involved in building affordable homes. Now that's not to disrespect our private sector partners. They very much value not only our partnership, we have to walk hand in hand in getting this accomplished, but government needs to be much more active in the building of affordable homes. What's your view on that Lisa? Well I work for a Crown Corporation called BC Housing which builds homes that are affordable and interesting you mentioned the police service and planners. The government of BC earlier this year launched BC Builds, which is the program that I helped to deliver,

which is exactly for that demographic of people, police officers, teachers, nurses, paramedics, transit operators. And so in BC, and again, there's always more to do, and we're not in much of a better circumstance than Ontario for sure. But since the NDP government took over in 2017, there's been a significant investment, billions and billions of dollars in affordable housing. And again, you know, after decades of neglect, it takes a while to catch up. But what I can say from my perspective is that government investment not only in deeply affordable housing, which is absolutely necessary, but the BC Builds program that I'm helping to deliver,

we look for partnerships with municipalities to use public land. Are you building a new community center, a new library, a new fire hall, a new whatever? And BC Builds then comes in as a partner to say, OK, you build your infrastructure and let's put housing on top. So we're really maximizing the use of public land

to deliver housing for the people who serve our communities, at the same time as other BC housing programs are working on that in that deeply affordable space. So yes, there needs to be massive government investment in housing, but we also need the private sector. And sometimes there's this either or, and that's really not helpful.

That is not going to get us to 1.5 million in Ontario and a million in BC. It's all in together. It can't be public versus private. Mike, can you pick up on that? Are the governments of Ontario and Canada as invested in building the housing we need today as they were say post-World War II? No. I think we're getting there. And I couldn't agree more with Lisa. This has to be an end conversation, that we need deeply affordable housing. We need government involved, but also the private sector.

But I'd also say we need better planning, right? That we make international student decisions. Individual university and colleges make their decisions there in one silo, you know, the immigration department up here makes another decision in a silo of, you know, what are we going to do to immigration targets. And then we have housing made in a completely different silo. We need to integrate these things. So we make sure that our housing supply is keeping up with our population growth and we're making these decisions together, not making one first and then going, okay, well, how do we then affect the second policy to

counteract our first one? You're a planning guy. Is there enough good planning going on here? I think there's great planning happening. Once again, the challenges is keeping up with decisions and the policy changes in all. So there's, you know, from a density perspective, as a right perspective, there's a number of not only initiatives but policies being put in place to ensure that we can keep up as well as possible. So from a, I'd say from a planning perspective, we are strong. It is better coordination that's going to be required.

And I would come back to the fact that, and it's not going to be cheap. We're gonna need continued investment, alignment, and simplification wherever we can, whether it's stacking incentives or stacking programs or you know aligning them from a funding perspective such that you know we don't have to make multiple applications because it all takes resources time and money and the more that we can simplify

we all have one objective which is to deliver more homes the right mix of homes and if we can simplify as much as possible it helps us get that much further. Neil I'm told we need a hundred thousand workers to build these new homes and we haven't got them so where are we going to get them? We have to promote skilled trades as a legitimate and successful and rewarding career for both men and women. You know, the challenge will be can we grow them domestically? Do we have to import them? Which, you know, creates some additional challenges. But there are a lot of interesting individuals out there who are curating this next generation of trades. So with equal amount of effort and pressure, Ontario has to respond to creating the space, the rooms, the services to build this next generation of workers. How have we dealt with that?

Yeah, I just want to, well, we're in no better shape. We've got massive numbers of trades retiring and not enough people coming in. But I think one of the things that we're kind of tiptoeing towards, and I know that there's work in this across the country, we can do two things. Well, we need to do many things. One is let's get a new generation of trades trained up for sure. And also we need to think about how we're building housing. And we have built housing in this country without substantial innovation for the last

hundred years. The way that homes are built today, pretty much, I mean there's been, but if you look at mining, if you look at farming, if you look at agriculture, if you look at I guess farming and agriculture all the same, other industries there's been massive innovation and generally homes are built by construction workers showing up on site swinging a hammer. Sometimes now there are panels and it's done the same way and that takes the same amount of labor. What we're starting to do in BC and I know there's been some efforts, again,

across the country, is looking at factory-manufactured housing. And the first thing that people think of when you think of factory-manufactured housing is an Atco trailer. That is not what is meant by factory-manufactured housing. But if you think about how cars are built, we don't go to someone's driveway and bring all the parts and build the car. We do it in a factory.

And when you look at kitchens and bathrooms and even wall panels, there's massive, massive innovation in the way we build housing. That's going to require, A, less labour, but also, B, better jobs. It doesn't mean that there won't be people on-site assembling the homes, but if we can shift our heads towards manufacturing homes in factories and really having an I know you touched on this in the the housing the National Housing Accord an industrial strategy what is Canada's industrial strategy for housing there's massive economic opportunity it takes care of some of the trade pressure and it allows us to innovate. Why has your industry not

embraced that? It's been a challenge. I can speak from personal experience. I was one of a group of partners who tried to execute in the City of Toronto a six-storey all wood. The very, very first one in the City of Toronto, perhaps in the province of Ontario. It took six months to build. It took two years to approve. So the building it, the skilled trades is not the issue. We still have an approval process system that is perhaps out of sync with getting this done. So you know if you want to if you want to create housing quick and quick and quick Quick and quickly, panelization modular is the way to go. But you have to have a process and systems that is aligned

to deliver that expectation. Because if you talk to housing manufacturers across the province, they can scale up really, really quickly. But they need scale. It's like Ford is not going to build one car they want to build a hundred and fifty thousand cars so if municipalities can embrace that and deliver on that scale there's no shortage of pent-up demand it would be a great model for assisted and affordable

housing that many municipalities have housing corps who need delivery of this, it's the way to go. I can't disagree with Lisa. Jag, I need to get you. Sorry. Mike, let me just get this Jag on this, which is I hear about scale issues from developers. And I hear that it takes 10 years from the time you have an idea to buy a piece of land

to actually getting City Hall to approve things. And surely that cannot persist if you want to deal with this 1.5 million. You know, and you're absolutely right and I wouldn't dismiss those comments. They are reflective of what the industry tells us. What I can tell you is that's the reason why Toronto made the decision to invest in development and growth services. It doesn't often create a separate service area, and it's aligned everything from the housing secretariat to planning to our buildings department in one area,

as well as components of our, we were commenting divisions from engineering so that we can bring all the key decision makers into one area under one umbrella. And we've created a separate stream within planning. So I have two direct reports now. It's chief planner and the executive director of development review. So it's a little bit of parting of the planning team, but what it's doing is it's accelerating

our reviews of planning applications. Now I don't want this to be You know essentially saying that hey, we've done it, but we've got examples now of three Non-for-profit and two private sector projects that we've done That would have traditionally when we look at our average timelines Taken five to six hundred days, and they've been delivered as far as zoning or NOAC in less than 90 days. And so this is where you know the the city is making the investments in order to start to change the narrative around the timelines. But just to pick up off of the idea of whether it be

modular housing or mass timber and otherwise, I do very much agree that they are great solutions. Right now they're penciling though, in a way that makes them sometimes even more expensive than traditional builds. And that does speak to, it's similar to automotive where whether you get a new product line, whether EVs or otherwise, until you get to scale, you won't necessarily see the benefit.

There absolutely is a case though to say we need to move in this direction because once you've adopted that type of approach and you can accelerate decision-making and even standard designs, which I know other levels of government are referring to as well, then you can really build on speed of delivery because now, you as long as the site is Is appropriate and whether it's lab on grade or you have to have foundation and it's a standard design This gives the the supply chain the the manufacturers the confidence to say they're building something that they know they can turn around quickly Mike jump in yeah Well, I think the automotive example is a really good one. And I think there's three challenges that make modular housing different than building cars.

But they're all things that the government can address. One is just differences in regulations, right? That you build a car, you can buy it in London, or Kingston, or Winnipeg, or wherever, and it allows for that scale. But because our rules tend to be different across provinces or across municipalities, it can make it challenging to do the kind of same standardized designs.

The second thing, if you are, let's say, Cami Automotive or one of our automotive assemblers here in Ontario, you can build extra cars, even if the demand's not quite there yet and park them in a parking lot somewhere. You really can't do that with modular housing that has a foundation. It's the ultimate just-in-time business.

And one of the challenges is if there are, if the time for approvals is uncertain, then if you don't know when you're gonna be able to lay that foundation, you're gonna get these homes that are kind of sort of backed up in the factory and then manufacturing just has to stop. So it's critically important that we have these timelines that are fixed and predictable.

And the third thing that the challenge that we've had going back to the 40s is we've had a lot, both in the United States and Canada, we've had a lot of great startups who are in this space, but they don't survive recessions. Because home building is a very, very sort of hot and cold type industry. It really moves with the business cycle

even more than making cars. But government can help with that. Government can act as a buyer of last resort. That if we're going into a recession and starts are going way down, government can say, you know what, we'll take some of those homes. And we'll turn them into social housing or other things like that.

So there are challenges here in the modular approach. But there are solutions out there. We just need government to kind of work together and address those bottlenecks. Neil, have you put that idea to the government of Ontario? And if so, how have they reacted? I have not. But I will take Mike's advice and try to pitch it.

Never thought of it that way. It's a unique solution. But the City of Toronto Mayor Chow has pledged to provide, deliver 65,000 supportive housing units. You add that up in other major urban centers in the province, you know, Hamilton, or even medium-sized municipalities. There is a ton of inventory that can be done.

There was a great story in the Globe and Mail a couple of months ago about the federal lands that are held, and the numbers are massive. We can really punch the gut of 1.5 if we look to innovation and innovative ideas, not just on the build, you know, the bricks and mortar or the penalization side, but we really need to solve other problems, other processes, the costs that are incurred. And whether or not you're a private sector developer, you're a not-for-profit, there are certain cost lines that are shared.

So you can't get away from the problem simply by building yourself out of the problem. That's not going to solve the problem. Lisa, you doing much of this in BC? Much of? Modular housing, timber housing, alternative ideas to try to get the numbers down? We are, in terms of mass

timber we are I think ahead of the curve there. There are something like and this doesn't sound like very many but a number of I think 20 mass timber buildings. Our building code recently changed to allow it used to be maximum 12 stories with mass timber. It's recently changed to 18 stories mass timber. What what we're doing right now at BC Housing and we've got some funding from CMHC to do this and this goes to your point about standardizing not just the design but we're working with 11 municipalities to standardize their approval process so

that if this standardized design comes to their municipality it's already pre-approved and that same design can also be panelized. So it's a standardized design, it's a prefab design. We had a good slogan, it was something like, prefab, pre-approved, anyways. And then, but then the other piece that we haven't talked about yet is, the financing system also has to change.

Because generally, if you're doing, if you're building housing, the construction draw process, your lender gives you money when you hit certain milestones. Well, if you're doing factory manufactured housing, there's a big amount of money that's required upfront just to hold the space on the factory floor. So we're looking in BC through this funding from CMHC, we're looking at the entire process

from municipal approvals all the way through to financing. And we going to pump out, I know the federal government, someone mentioned it, working on standardized design catalog for smaller homes, three and four units. What we're working on in BC is standardizing a design for four to six story wood frame buildings that can also be prefabbed and then having the municipalities as partners standardizing their approvals process. So we're early days on that, but again, five, six years from now, if this goes well, we should see a significant increase in production.

Jack, in Ontario's capital city, what's the maximum number of stories you can do in timber right now? I think it is capped at 12 at this point. Is that adequate to the task? I couldn't speak. I can't say one we can I know in other countries they're going much higher than 12. And so certainly it's possible. As far as the factors certainly there's the different environmental factors that we need to consider. So I don't want to speak out of my expertise. But I think we will be kind of pushing that in the near future. We've got to do the same thing from a modular perspective as well, because this

is part of the challenge is what type of built form are you looking for, what is it that you need, and we need to make sure that those options that can help us accelerate putting something in the ground are viable options and can give us the built forms that we need. And so we are challenging everywhere. And to Lisa's point, our buildings department is working with different development organizations so that when it comes to, say, mass timber,

we're thinking ahead of the game and giving them the best advice as possible so that we can streamline decision making and successful Pulling successful building permits as quickly as possible Michael let me follow up with you again on the capital city for the longest time probably for half a century Toronto has loved to think of itself as a world-class city and The reality is if you look at world-class cities anywhere in the world they are outrageously expensive housing is outrageously expensive they're all dealing with the same things we are I don't want to sound completely defeatist

here but is this just a battle that if you're playing in that league you cannot win well I certainly think it is going to be an expensive place. I think what worries me is it's not just Toronto anymore. Right now, it costs more to buy a home in Tilsonburg than it does in Tokyo. And I love Tilsonburg. I got Tilsonburg.

And people might say to me, well, Mike, that's not a fair apples to oranges comparison, because the home in Tilsonburg's larger. And I'm like, OK, yeah, fine. But how's the subway service there? It's a little bit different. So yeah, downtown Toronto's probably always going to be expensive. But what concerns me is that it's all of southern Ontario.

That this is, 40 years ago, you might have been living in an apartment in downtown Toronto. Baby comes along the way, and you move to Etobicoke, which at the time was a different community. 20 years ago, you might have moved to Mississauga. Where are you moving to now? You have to move to North Bay or somewhere.

And again, nothing against North Bay. Yeah, there we go. But the challenge is we can't have all the patients living in Toronto and all the nurses living in North Bay. That just doesn't work. So we have to find a way to create middle class housing. And yes, that might not be in downtown Toronto. it might not even be in the city of Toronto but it's got to be somewhere in commuting distance so we can have the nurses and

the patients you know all being able to interact with each other. Based on what I've seen Vancouver it's even worse I mean have you had to throw in the towel on Vancouver and to say we're not going to be able to build affordable housing to let those nurses buy homes in the towel on Vancouver and just say, we're not going to be able to build affordable housing to let those nurses buy homes in the city anymore? Yeah, well, I think, no, we're not giving up. And I think that's precisely why the government created this BC Builds program, which is deliberately

focused on middle income workers. It recognizes that our health care is having trouble recruiting workers. Our schools are. And again, I think if we had, when you were talking about planning, you asked do we have good planning? I think we ought to be completely honest, right now we have really good reacting.

If we had truly planned, we would be in a different situation right now, and so I think what we're doing now, at least in BC with BC Builds, is we're still reacting to this crisis of essential workers, you know, living very, very far. And just a really concrete example. So one of our first BC Builds projects is actually an 18-story mass timber building in the city of North Vancouver. And I was talking with the mayor there, wonderful, amazing mayor Linda Buchanan, and their principal right now, at one of their elementary schools, lives in Surrey. Now, Surrey is like a long drive from the city of North Vancouver.

And if a principal job came up in Surrey, they lose their principal just like that. Right, so there are real issues that need to be thought through and accounted for. And your example is good, if all the nurses are in North Bay, the patients are here. So we are just dipping our toe into how do we begin to solve for this and what is the role of government in partnership with our municipal partners. Woodward and Bernstein used to say, follow the money.

So let's follow the money here, shall we? Neil, the province passed a law to waive development charges in certain circumstances in order to spur on growth. Was that the right move? Well, they actually repealed that in the last piece of legislation in Bill 185. So we're not there anymore. We're not there anymore.

The elephant in the room remains affordability. If a nurse, if a teacher, those individuals who are not, by the way, making a lot of money, can't afford a home, we don't have a start. You don't have economic growth in your communities. And it's all levels of government. I'm not laying blame on the municipal sector here. Federal, provincial, municipal, 33%

of the cost of an average home in the greater golden horseshoe is taxes, fees, and charges. HST, land transfer tax, and the municipal realm of everything from permits, application fees, to development charges. The feds took the HST office that only on rental housing on only on rental housing Has that and HST only applies to new home construction is it is not applicable to? to resale $500,000 of that 1.3 give or take numbers here You know that's like a couple of thousand dollars

just to service that mortgage for a lifetime. So we cannot have a conversation in our respectful opinion about housing supply if we don't start to have the conversation. And it will be a a difficult and painful conversation, but we are in this together. Municipalities, provincial governments, municipal governments, the development industry, not-for-profits, you name it. The spectrum is long. I think we ought to have the conversation quickly, otherwise we will lose this opportunity to build to meet 1.5 and the problem is only getting worse as Michael mentioned Well, if we had your side of the conversation, what would you be saying back to Neil when it comes to?

Forgoing revenue for the city. So I think we need to consider all options and I think we need to work collaboratively Neil and I were speaking earlier where I think we need to almost have an open Neil and I were speaking earlier where I think we need to almost have an open book exercise and do the math because what I don't, I know our development industry, our private sector partners are struggling as well and we need both of us to be actively invested in these solutions and making sure that we are challenging each other to deliver to the best of our abilities. Municipalities are certainly going to continue to focus and Toronto is going to continue

to focus on affordable housing and making sure we're putting as much money to help kind of balance the supply that is so desperately needed for those who can't afford a condo or something of that sort. But we also need our private sector partners to help us with challenging our assumptions, looking at the cost factors of what it is that we believe it's going to take and challenging government to say, well, wait, that doesn't make sense, or we need to think about it differently in order to make it pencil better because it's it's a struggle Affordable housing projects our housing secretariat and development review team They're having to rerun the numbers all the time

Virtually on a weekly basis because things are moving so quickly and our private sector partners We're having active discussions with them in in the same way to say they can't make their projects pencil. And that's a bad scenario for all of us, because we need not only the affordable housing, but we need the private sector bill development as well in order to keep industry going. You want to come back on that, Neil? Yeah.

And for the record, I want to be clear to this group. I'm not talking about waiving development charges or not paying development charges. I think we need a more modern look at how the construct of municipal service delivery of critical infrastructure is paid for and financed. I cannot believe there are not solutions out there

if we bring the right people to the table, whether that's through broadening municipal service utility corporations or municipal service corporations, whether that's allowing, we have some of the wealthiest pension funds in the world in Ontario, OMERS, teachers, HOOP, right? Are they allowed to participate in this conversation? They must. They must. So

what I'm suggesting, I think what our association is also suggesting is we need to have a modern conversation about housing support of infrastructure, roads, bridges, community centers, et cetera. And it all falls under the veil of development charges. And there has always been some friction between the sector and municipalities on that. But I think if we come together with a common purpose that we need to solve this problem, we will find a solution. Lisa. Well, and just to jump in on this one, I think also at the table, and I agree

we need a modernization of the municipal finance system. And part of that also involves the provincial and federal governments. And just when I heard your new president giving her remarks and the four topics that you focused on over the last few days, the opioid crisis, housing and homelessness, infrastructure, and economic development, when Canada was founded in 1867, maybe economic

development, maybe was the only one of those things that cities were working on. The financial situation and financial position of cities and the way that cities have been allowed to generate revenue literally hasn't changed since 1867. Like almost like maybe a little bit but literally though the only municipal the only ways that municipalities can generate revenue is property taxes, services and fees, development cost charges, parking revenue. Like for the all of the things that municipalities are asked to deliver there is very little source of revenue and and so what we really need to have is a conversation with the provincial and federal governments about maybe it's 1% of PST that is generated

in cities goes back to cities, something like that, so that cities have some nondiscretionary funding, so they don't have to live in the house. That's the housing story. Anyway, it's a larger conversation than just housing, but we need to kind of modernize the financial system for municipalities in this country. I think we saw at the Bear Pit session here,

the mayor of Burlington, Marianne Meade Ward, say this organization is 125 years old, and the way in which municipalities, their financial relationship with the province hasn't changed in 125 years. You want to show us the shirt? Yeah. There you go.

There you go. Just playing us the shirt? Yeah. There you go. Yeah. It's plain to the class. Yeah. Yeah. Yeah. No, I mean, it absolutely should. I bought my first home 20 years ago, and 20 years ago across the province

for a single detached home, development charges were about $5,000. They are now over $100,000. Let's fast forward 20 years from now when my kids are going to buy a home. At this rate, development charges will be $2 million by 2044. And you're all laughing, oh, Mike, that's ridiculous.

If I told you in 2004 that development charges would have been six figures, I would have been laughed out of this room. So I think we need to reexamine these things. And I recognize that a lot of that, or almost all of that, can't be done by municipalities. But I think we need to question our assumptions. We always talk about growth pays for growth.

But what is that growth in? A lot of that growth is in roads. Why don't cars pay for roads instead of houses pay for roads? I think we need to look at that. If I'm living in a condo or an apartment in downtown Ottawa in a walkable community, why the heck am I getting charged all these development charges to build arterial roads out in the suburbs?

So not only is it expensive, but it's really not good for our climate. So instead instead I think we need to better align you know what we are the infrastructure we're building and the revenue source right that you know for water and wastewater it should be water and wastewater he's paying for that for roads it should be cars rather than just dumping everything onto housing and then wondering okay well why is our housing is so expensive right because we're making housing pay for absolutely everything

even at times where again you're living in a walkable community downtown somewhere but you're paying all of these development charges to build a bunch of roads arterial roads that you'll never use it just doesn't make any sense let me focus on one of those things, the land transfer tax. What percentage of the average house does the land transfer, first of all, do you all charge land transfer taxes? Every municipality in Ontario? No. Only Toronto. Toronto does, big time, right? Twice. Twice. 2%. 2%. Yeah. And that's on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% on top of the development charges. So it's about 10% in a GTA Golden Horseshoe average. 10% of the house. The average house price today is a million? Million three for a single family. So $130,000 in land transfer tax.

Big chunk of change. Can you do anything about that? I'm going to start with the short answer, no. But the longer answer is that it really is around identifying revenue sources to continue to make the investments that are needed from a Toronto perspective. So whether it's a portion of the tax or something of that sort, the different revenue sources are needed in order to continue not only the growth but like when and I'm speaking you know to some of my peers portfolios but when we look at some of the

aging infrastructure and the cost and and making sure that it is sized appropriately for the growth and the density that we're looking for it's it's not cheap and the funds have to come from somewhere and it's And it's one of those sources of funding that is necessary from a Toronto perspective. We heard the Minister of Municipal Affairs and Housing, Paul Kalandra, say, there is no stone we will not turn over. I mean, we're going to break some eggs. We're going to look at every possible alternative

in order to get housing more underfoot. Mike, you've looked at this. Does he really mean it? It doesn't, not yet, no. I mean, there's certainly, you know, there are some good things, I think, that came out of the PPS. PPS?

The, I'm sorry. Provincial planning statement. Provincial planning statement, that gets horrible with acronyms. I do like the fact that we're trying to integrate Ministry of Finance population projections with planning. I think that's smart. I think that's exactly what I was talking about earlier

about stopping making all of these decisions in silos. But I think we need to go further, right? I think we haven't really examined how to take all of these things off of development charges and still pay for the infrastructure that we need. So we're kind of tinkering around the edges, but these big kind of transformative changes really don't seem to be on the table right now.

Lisa, is a gut, and again, I'm not trying to get you embroiled in Ontario politics here, but does a government which on the one hand says no stone unturned, look at every option, break some eggs, but on the other hand says in existing neighborhoods we're not going to do more than fourplexes, or what do they say? Is it four stories or fourplexes? Four to six stories. Four to six stories. Is that a government that's serious about getting to 1.5 million homes?

Well, I'll speak to British Columbia. I don't want to criticize the Ontario government, because I think what our government has done, and very ambitiously in a very, very, very quick period, and not all municipalities have been happy with this, but a number of things. So mass timber from 12 stories to 18 stories, anything that was previously zoned single-family home anywhere in the province, almost anywhere in the province with few exceptions, as of right you can now build

four units or six units if you're near transit. They have created transit oriented development zones so if you're within transit. They have created transit-oriented development zones. So if you're within 200 meters of transit, 400 meters of transit, 800 meters of transit, as of right. And again, municipalities are leaping to catch up because the province hasn't given them much time to adapt.

All of the 10 stories, 16 stories, 20 stories, as of right. So and outlawed Airbnb, like it's been a very, very, very fast-paced aggressive, I would say money where mouth is, this provincial government in BC is very serious about not tinkering around the edges. So there's been a seismic shift. And one of the things I think we haven't quite figured out kind of

They've also outlawed public hearings if something fits with your official community plan. No public hearing is allowed It's it's you know the staff get to approve it and off we go. Is that a good idea? It's a great idea. You know I as mayor I sat so late into the night listening to people tell us why they don't want housing in their backyard. I think, I mean, and not every, not every municipality thinks it's a great idea, but I think the most radical move, and again, this I think going back to planning, I think is good planning. What the provincial government in Ontario has said is every municipality, well, they started this in 2018, every municipality has to do a housing needs assessment. That was first.

Now every municipality in Ontario, and the government is actually giving money to municipalities for this, but every municipal government in Ontario has to do a housing needs assessment, needs to figure out what their population growth is for the next 20 years. They need to have their official community plan,

which is the local planning document, have enough density to accommodate all of those people and then third step by the end of 2025, they need to up zone their entire municipality to accommodate that density. So that is a radical approach because what it means is the table is set for the future. We got about 10 minutes to go here and I don't want to leave this audience with the impression that nothing good is happening out there. I mean earlier this year the City of Toronto announced that it overshot its housing targets by more than 50%. How'd they do that? A lot of it was pent up from the pandemic so certainly I don't want to you know misrepresent in any way so we had a

number of projects that were in the pipeline that we were able to successfully move. We've, of course, like most municipalities, seen a significant reduction. We're still on track to hit our minimum of 80%. We're at about 52% based on CMHC data. But it's a more challenging year. So that pent up, we overshot by 51%, which is fantastic. But we're certainly feeling the challenge this year.

And we're working hard to kind of continue the momentum, but we just won't hit that same level as last year. We are improving our processes substantially. I refer to a few of the projects that we've accelerated considerably. And we're looking at making sure our internal processes are ready for when the industry continues to bounce back and making sure that we're going to move things quickly.

We were chatting earlier, and I think timing is everything. And if the efforts that are being put in now were in place call it four years ago or pre-pandemic the impact that it potentially could have had so they I come back to the cost of indecision and how quickly we need to move in order to really deal with this crisis because every year will just continue to drive the cost right through the roof. Well let's give some free advice to the people in this room, to the Minister of Municipal Affairs and Housing, to consumers, to everybody. If you want things to work better, go ahead Neil, what do you want to see done? Greater consistency across

municipalities because our members operate in multiple jurisdictions and they go to Grimsby or they go to Kincardine, very different processes. Their systems, their offices are set up kind of like a small manufacturer. They expect to have a very streamlined and consistent process. So Minister Calandra made a veiled comment

about consistency and conformity that doesn't necessarily have to be done through legislation. I think he's looking to municipalities to make best efforts to do so. But I also got the impression that he wouldn't be afraid to do something if he's not seeing measurable progress. I'm tempted to ask this audience whether you would be open to being legislated on that. Yeah I'm seeing heads going like this in the front row.

Yeah okay interesting. Let me give you an example. Green development standards. There's about 26 municipalities who are in the process of doing green development standards. There is not one that is consistent. There's 26 different standards. Let's say there's not a high degree of consistency or conformity. Okay. We are not denying that green development standards play a significant role in the climate change and the climate crisis. And some of our builders are already doing it. They're going beyond the norm.

And let's also remind ourselves that we have a brand new building code that has elevated the standards on energy efficiency and effectively, Ontario and BC are leading the way nationally on that. But imagine the frustration and added costs that it takes. And there are some municipalities who are withholding subdivision approval and site plan application because of some of these discretionary standards.

So we want to have a conversation with the government. We want to have a conversation with municipalities about how can we create greater consistency. Because again, if we don't start a home, we're not getting closer to 1.5, 1.7, whatever the number is. Gotcha. Lisa, some advice? For these folks, these fine community-serving folks in the room, Well, I think, first of all, thank you for your service. I know it's really, really, really hard work. I was mayor of Victoria for eight years,

and through the pandemic, so really challenging work that you all do. I guess my advice, and I was out the door as mayor and working in the Premier's office last year when all of these changes were happening, that I think have the political courage to make the decisions that are really, really difficult to make, even when sometimes small groups of people

in your communities are very vocally opposed to those. So when I, I think that's one piece of advice really and this one's really hard. But try and squint and look 50 years down the road and see what your community needs then because that's ultimately your responsibility at the same time as taking care of your communities now really looking 50 years down the road and setting the table for the future. And then the final thing, and this is complicated, but when I was Mayor of Victoria, I was also the co-chair of the BC Urban Mayors' Caucus, which was 13 of us that represented 55 percent of BC's population.

And we weren't all in agreement all the time but one of the things that we were collectively almost collectively grateful for is when the province started to come out with some of these big moves like getting rid of public hearings again not everyone was in favor of that but what that does for local governments is it gives you political cover you can say well the province has mandated this and we have to build this housing, right? And so there's a tension there for sure, but if you can kind of lean into that and think about what that could mean

to align yourself with some big moves that the province might make, yeah, I think those are the things that I would say. Jack, some advice for this audience. Very similar to say, continue with a very strong collaboration. We're enjoying great collaboration with our peers at other levels of government and we're exploring opportunities to move quicker, whether that be with CMHC financing and looking at

where we're discussing a portfolio approach at this point in time so that it's not quite as intensive as far as looking at individual buildings and things of that sort We're looking to streamline wherever possible because the cost of delay like we have one modular project in in Toronto that got delayed for two years as a result of hearings the cost more than doubled for what was Intended to be there. And of course, there's substantial community feedback around it as well. And so all of the, I guess, from a process perspective, the funding perspectives,

we need to find ways to streamline and accelerate, because as we do, we'll be able to deliver housing much faster. Last word to Mike Moffitt. Oh, well thank you. So I would concur. We need to have more as of right, more up zoning. I know that's difficult, but there's no way to get to 1.5 without it. I'm going to channel my inner JMM.

The one thing that we haven't talked about is building code. There's no solution here that doesn't involve building a lot of apartments, and right now, the building code makes it very difficult to build family-sized units, like three bedrooms plus. So that's a lot of stairway reform, elevator reform, a variety of reforms that are difficult. There are stakeholders who will challenge that with some very real concerns, particularly firefighters.

But I think we need to work with them, figure out how to fix that building code. Because even if we hit 1.5 million units, if we're getting there by building a bunch of studio condos and nothing else, we're still going to have a housing crisis. Gotcha. Thank you. condos and nothing else, we're still going to have a housing crisis. Gotcha.

Well, let me just say a couple of things in wrapping up. I know that you all want to join me in thanking these four from coming very near and very far for today's discussion. Thank you very much, everybody, and it's great to be with you again here at AMO in Ottawa. Thank you. Thank you. Thank you. Thank you.

Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. I'm going to be with you again, here at Ingo in Ottawa. you you