The long awaited report from city staff on what to do with the Social Housing was released yesterday. There were a few surprises. On one hand it recommends proceeding as before with half of the units offered as social housing and half to be rented at or near market. This was a surprise to many people who didn't realize that only half the units were actual social housing units. (Something I noted in my recent Vancouver Sun letter to the Editor)
However, to 'dress up' the idea of renting some units as market units, one former city councillor told me the city has 'adopted' my suggestion that priority be given to housing emergency workers...however, whereas I argued the housing should be offered for SALE, these units are to be offered for RENT. I strongly disagree with the staff recommendation. But I have greater concerns with the way the staff report is written.
First some background. For 10 years I worked for CMHC and the Ministry of State for Urban Affairs. During this time, I was involved in the preparation of numerous Management Reports and Submissions to Cabinet. One of the challenges of writing these reports was to set out the various options from the perspective of a community planner and ‘housing expert’ in a fair and objective manner. Each option was then evaluated from the perspective of various considerations…planning considerations, financial and social considerations, and yes, political considerations. However, I did not write out the political considerations…that was left to others, including people in the Minister’s office. Although sometimes it was hard for us staff to refrain from offering political advice.
I’ll never forget the time I was briefing my Minister Andre Ouellette on the Toronto Harbourfront Cabinet document. At one point he stared me in the eye and said “Geller, you’re the planner, I’m the politician. You give me planning advice. I’ll make the political decisions.”
I share this because when I read the report on the options for the Olympic ’social housing’ it immediately struck me as overly biased and very unfair, in terms of setting out the pro’s and cons of the various options. It seemed that the authors had made up their mind on which option to recommend, from a political perspective, without a fair consideration of the pros and cons of each options from a planning, social and fiscal perspective . Especially the options related to selling the units, something many people, including myself have been recommending.
Given that the city went significantly over budget on this housing, and significantly over budget on the other SEFC community elements, including the shoreline, community centre, daycare etc. and faces the possibility of not receiving the full land payment from Millennium (to cover these costs) , or even full repayment of its loan to Millennium (according to some sources), and given other financial challenges facing the city and its taxpayers, this option should have been fully explored. But it wasn’t.
Instead it is given short consideration as Option 3 c) on p11. The charts show the estimated sales prices at $600 a square foot and $800 a square foot (They range from $384,000 to $1,184,000) There is no discussion on where these revenue estimates come from, and whether they are considered realistic, particularly in relation to the proposed sale prices of the Millennium units.)
However, assuming these numbers do represent a realistic range, the potential sales revenues are up to $153 million….in other words, if sold at this price, the city could recover all its costs, and have $73 million to put towards social housing, (the profit from the sales, along with the $30 million from VANOC).
So how is this analyzed? Well there is a reference to having to pay DCL’s of $7.7 million (the city would pay these to itself) resulting in a net return in the range of $28.5 to $66.8 million.
Now, I would like to think that most reasonable people would say an option that returns up to $66.8 million, rather than require a further expenditure of $32 million would be given some serious consideration, from a staff perspective, but it isn’t.
There are three bullets describing where alternative affordable housing could be built, but it’s obscure.
If I had been asked to draft this report, I would note that this option will
a) allow an increased number of social housing units on sites immediately adjacent to the Olympic Village; or
b) allow an increased amount of social housing to be built on lands that have been lying vacant for a number of years within the False Creek North and Coal Harbour developments (that’s right, some of the social housing in these communities has not been built out since the city doesn’t have the funds to acquire the sites);
c) allow for a significant response to the housing needs for the homeless, etc. etc.
The report briefly discusses Option 3(c) under ‘risk analysis’.
It notes that this option will require a rezoning and ODP amendment. Is this a risk? Guess who decides if the rezoning would be approved.
The report then goes on to say “IMMEDIATE LIQUIDATION (My capitals) of the units as strata units may result in lower overall prices within the village, potentially putting the city at risk as the lender to the developer.”
I find this wording extremely unfortunate and innappropriate. Who is suggesting LIQUIDATION? or IMMEDIATE for that matter.
Staff are correct in noting that any sale would have to give consideration to the sale of Millennium’s units. (Just as they should note that any market rental of units should give consideration to Millennium’s market rental units.)
However, if staff had been doing their job they would have pointed out that one option to address this risk would be to sell the units as Leasehold, (as distinct from Freehold) with conditions to avoid competition with the sale of the Millennium units. They could have referenced the Whistler Housing Authority model, or Verdant at SFU, two local examples where this was successfully accomplished. But instead, they ignored these options.
Instead, they did ‘adopt’ the suggestion that priority be given to emergency workers and other city employees, but only as renters, not as buyers.
So, to put this in perspective, the city is now going to spend $62 million in subsidies ($30 from VANOC and $32 million from other sources) rather than receive up to $66.8 million. That’s right, in order to accommodate 126 core needy households, and 126 market renters, we are spending $62 million, instead of receiving $66.8 million. That’s a difference of $128.8 million. $128.8 million.
This is wrong! And I’m very disappointed with the staff for not giving the Councillors a fair description of the options. Hopefully they will ask some questions when the report goes to Council on Thursday. However, the decision has been made. As France Bula just stated on CBC, the Mayor has already announced his agreement with this approach. What an unfortunate situation.