The City of North Vancouver has taken steps to stimulate the development of housing for tenants. At the December 6 council meeting, a narrow majority voted in favour of a 50-percent reduction in development cost charges for market rental housing.
“We’re rescuing the provincial government, yet again, and the federal government in their roles in housing,” Mayor Darrell Mussatto told the Georgia Straight in a phone interview. “If you look at the Constitution, they’re responsible for housing—not the municipalities—yet we’re stepping in to be a partner with them.”
Mussatto said that the entire council supported a motion to waive development cost charges for nonprofit housing. However, he added that three councillors—Pam Bookham, Rod Clark, and Guy Heywood—voted against cutting development cost charges in half for market rental housing.
The municipality surveyed eight developers who work in the city, according to a staff report written by community planner Cheryl Kathler. She wrote in a report that “the deeper the incentives, the more attractive market rentals will be to developers”.
However, even with reduced development cost charges, a “substantial density bonus” would be necessary, especially to promote construction of units rented at below-market rates. “It’s very difficult for the development community to build market or nonmarket rental housing because there’s no incentive for them,” Mussatto said. “There’s no money for them.”
The motion stipulates that if any market-rental units become stratified, the city will then impose development cost charges at the rate applicable for new construction. Kathler stated in her report that recent amendments to the Local Government Act have allowed municipalities to waive collection of development cost charges.
“In consulting with City legal counsel regarding the level of detail required in the DCC Waiver Bylaw criteria and requirements, staff was advised that DCC waiver bylaws must be very clear and specific with respect to what constitutes and eligible development and what the rate of reduction for DCCs is for an eligible development,” she wrote.
She added that a few municipalities have done this, citing Parksville and Langford as two examples. In Parksville, council approved a 100-percent reduction for market rental housing as long as the units are made available for those earning 80 percent or lower than the median household income.
According to Kathler’s report, Langford offers a 25-percent reduction for market rental housing in the city centre, and 30 percent in other areas of the municipality. “There are no subsequent requirements of the developer or the municipality in terms of reporting back or monitoring and enforcing, although a simple housing agreement to the rental tenure of the units is required to be registered on title.”
Similar to the City of North Vancouver, the development cost charges become due in Langford if the property is stratified.
Kathler’s report cited staff’s belief that smaller developers who are already “undertaking” market rental housing will be most interested in the discount. “While limited, it can, together with other types of City support and tools, have a positive impact on rental housing projects,” she wrote. “Moreover, the offer of a DCC discount will state the City’s support for and priority of increasing and renewing the rental housing stock in our community.”