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TO: |
Mayor and Members of Council |
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FROM: |
Andy Taylor, Commissioner,
Corporate Services Jim Baird, Commissioner,
Development Services |
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PREPARED BY: |
Barb Cribbett, Treasurer Murray Boyce, Senior Project
Coordinator |
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DATE OF MEETING: |
2003-Sept-8 |
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SUBJECT: |
Ling-Liang Church – Conditional
Grant |
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RECOMMENDATION:
THAT Council authorize a conditional grant
equal to Town of Markham development charges and cash-in-lieu of parkland
payable, estimated at $197,888, to be paid on eligible affordable housing units
in the proposed Ling Liang World Wide Evangelistic Mission, Toronto Ling Liang
Church (Bread of Life), under the Community Rental Housing Program (CRHP).
THAT the funding for the conditional grant be
provided from the Corporate Rate Stabilization Reserve.
THAT the grant be conditional on the execution
of an agreement between the Toronto Ling Liang Church and the Town of Markham,
respecting affordable rental rates, to the satisfaction of the Town Solicitor.
THAT the grant be conditional on the Ling Liang
proposal receiving approval for a CRHP unit allocation, pursuant to the
requirements of the Region of York Request For Proposal.
PURPOSE:
To
obtain Council’s approval to provide a conditional grant to Toronto Ling Liang
Church for an affordable rental housing project under the Community Rental
Housing Program (CRHP).
BACKGROUND:
At its meeting of June 17, 2003, the
Development Services Committee received the report entitled “Toronto Ling Liang Church”
and adopted Official Plan and Zoning By-law amendments and approved a site plan
to permit a 55 unit retirement building at 288 Clayton Drive. The Town Clerk has advised that there were
no appeals and the Official Plan and Zoning By-law amendments are now in
effect.
The
Ling-Liang World Mission, Toronto Ling-Liang Church, is proposing a rental
apartment complex for early retirement and seniors residents in the 50-75 year
age bracket with moderate incomes. The
project will consist of 55 units; 53 one-bedroom units, and 2 two-bedroom units
with proposed rent levels of $829 and $982 respectively. In order to qualify as an affordable housing
project, the rental rate cannot exceed the average rent for unit types in
Markham as stated in the latest published Canada Mortgage and Housing
Corporation (CMHC) Rental Marketing Report. The proposed rent levels are
equivalent to the average private apartment rent in Markham by bedroom type as
determined by CMHC in October 2002.
Ling
Liang has been a registered charitable organization since 1975. The Toronto Ling Liang Church will be
applying as a private non-profit group for Community Rental Housing Program
(CRHP) funding under the joint Federal/Provincial Affordable Housing Program.
The Province has designated the Region of York as the Consolidated Municipal Service Manager (CMSM) to manage
the Request for Proposal process for the CRHP.
In total, 300 units have been allocated to York Region for the first
phase of the CRHP. An additional second
phase allocation of 300 units has yet to be confirmed. Matching funding, which
may be provided from the Region, area municipalities, and the private
sector/community groups, is necessary to obtain the full CRHP funding
allocation.
In
its role of CMSM, the Region has been delegated responsibility for the policy,
planning and financial management and service delivery of housing. The Region’s Housing Supply Strategy
establishes the Region’s role as lead and sponsor, but in partnership with the
area municipalities and other stakeholders.
Markham has the option to engage with the Region in
pursuing/implementing affordable housing opportunities, as Council deems
appropriate.
On February 4, 2003, Council
confirmed its role in support of the provision of rental and affordable housing
by, among other things, endorsing the Region’s Housing Supply Strategy and
working in partnership with the Region on the application of policy and
financial incentives to encourage rental and affordable housing. Council also requested that staff fast-track
a review of opportunities, and determine options available and the financial
incentives and impacts, to ensure Markham receives a share of the 300
affordable housing unit allocation under York Region.
The
Region has identified targets for its total 600 unit allocation in accordance
with the CRHP guidelines. Up to 25%
(150 units) of the total units will be allocated for delivery by the
Region. Another 20% (120 units) will be
allocated to private non-profit housing providers. The remaining 55% (330 units) will be allocated to private
development proposals. The Region has
assumed that 75% of the units will be developed in the southern municipalities
with the remaining 25% being developed in the northern part of the Region. It
is also assumed that 75% of the units will be developed as low-rise apartment
units and the remaining 25% as townhouses.
In
view of the Region’s targets, it is not likely that Markham would receive more
than a 55-60 unit allocation from the first 300 unit phase of the CRHP. If Council were to provide financial
incentives in support of a Markham based affordable housing project that proves
successful in obtaining a funding allocation from the CRHP, the financial
impact of the incentives would likely be limited to up to 60 units for the
first phase.
At
its meeting of June 12, 2003, the Regional Council authorized staff to issue a
Request for Proposal for the first 300 unit allocation of the CRHP; to identify
potential affordable housing projects to be funded under the program; and to
report on the results of the RFP in the fall of 2003. Regional Council also requested municipalities to support the
success of the CRHP by providing local incentives such as the waiver of fees and
charges to support affordable housing development and assist the Region in
achieving the required matching of funds under the program. Grants in compensation for fees and charges
may also serve as an incentive
In
support of its application for CRHP funding, the Toronto Ling Liang Church is
requesting public/private partnership support from the Region of York and the
Town of Markham in the form of a financial incentive for the project.
At
its meeting of June 12, 2003, Regional Council authorized a conditional grant
equal to the value of the Regional Development charges applicable to the Ling
Liang project estimated at $231, 477.
The grant is subject to the proposed development receiving all municipal
approvals and the Ling Liang Church entering into a Municipal Housing Project
Facilities Agreement with the Region to ensure all the provisions of the
Municipal Housing Facilities by-law respecting projects rents, etc. are secured
as a condition of the grant. In
approving the grant request, the Region requested the Town of Markham to make a similar
contribution demonstrating their support for affordable housing development in
their community.
A
letter dated August 8, 2003 requesting the waiving of Town development charges,
parkland cash in lieu charges and building permit fees was received by the Town
of Markham from the Toronto Ling Liang Church (Appendix B).
OPTIONS/DISCUSSION:
The
CRHP program has been structured by the Federal government to be 50% cost
shared. The Federal Government’s
contribution will be $25,000 per unit. The CRHP program requires that the
province, municipalities and community groups match funds of up to an average
of $25,000 per unit. The Province will
contribute up to $2,000 per unit by foregoing PST on the construction of new
units. The Region of York’s contribution,
as a result to the conditional grant equal to the value of the Regional
Development Charges, is $4,123 for apartments with less than 2 bedrooms, and
$6,479 for apartments with 2 or more bedrooms, or an average of approximately
$4,200 per unit.
The
Toronto Ling Liang Church, in their letter dated August 7, 2003, requests that the Town waive the following
fees:
There
are a several options that Council could consider to provide financial relief
to Ling Liang.
1.
A
loan with interest to Ling Liang – the fees and charges would be paid with the
proceeds of the loan, and Ling Liang would pay the Town back over time (e.g. 10
years) with interest.
2.
An
interest free loan to Ling Liang – the fees and charges would be paid with the
proceeds of the loan, and Ling Liang would pay the Town back the principal only
with no interest.
3.
Conditional
grant based on a portion or all of fees and charges due.
4.
Conditional
grant on an arbitrary basis, e.g. a
flat rate per unit.
Option
1 and 2 would provide relief to the Ling Liang project by deferring payment of
the fees and charges through a loan arrangement. The loan from the Town would be provided to Ling Liang, from
which the fees and charges would be paid.
Ling Liang would then repay the loan over a number of years, either with
or without interest. Option 1 and 2 would not, however, provide a contribution
to the matching funds required by the CRHP program and would not assist Ling
Liang with their application for CRHP funding. Therefore, this option is not
recommended.
Option
3-
Conditional Grant Equivalent to Fees and Charges
The
Region of York has adopted a policy whereby the Region provides the applicant
with a conditional grant equal to development charges. Thus the development charges are paid, and
no exemption is allowed, but the applicant receives an equivalent payment as a
conditional grant. In considering this option, staff recommends a similar
approach.
The Development Charges that will be payable on the Ling Liang project are approximately $164,893. An equivalent conditional grant would result in a contribution to the CRHP matching funding of $2,998 per unit on average. Staff is in support of a conditional grant based on equivalency to development charges.
Town records confirm that cash in lieu of parkland dedication (parkland fees) was provided for the Ling Liang development site at the time of registration of the plan of subdivision at the industrial/commercial rate of 2%. The Manager of Parks and Open Space Development has confirmed that under Markham's Parkland Dedication By-law, No. 195-90, a 5% requirement would be appropriate to this affordable rental residential project. The 2% dedication rate (already provided) valued in 2003 dollars would be $21,996. The 5% dedication rate in today's dollars would be $54,991. The difference between these two sums is $32,995 ($600 per unit) which would be the amount of money owed by Ling Liang for cash in lieu of parkland attributable to the proposed seniors residence. Development Services staff could support a one time only conditional grant equal to the amount of cash in lieu of parkland now owing, as part of the Town’s contribution to this project under the Community Rental Housing Program.
The
building permit fees are estimated to be $53,066. An equivalent conditional
grant would result in a contribution to the CRHP matching funding of
approximately $965 per unit on average. However, staff do not support any cost
reduction or grant pertaining to building permit fees. The applicant has been
advised of this position from the onset of discussions.
Option
4 –
Arbitrary Conditional Grant
An
arbitrary amount may be provided to the Ling Liang project. The amount could be a flat rate per unit, at
Council’s discretion.
Should
Council approve a grant(s) in compensation for fees and charges for the
Ling Liang proposal, it would be advisable to have the grant conditional on the
execution of an appropriate agreement between the Toronto Ling Liang Church and
the Town, respecting affordable rental rates, to the satisfaction of the Town
Solicitor. Also, any grant(s) should be
conditional on the Ling Liang proposal receiving approval for a CRHP unit
allocation, pursuant to the requirements of the Region’s RFP
Staff recommends that Council provide a conditional grant
equal to Town of Markham development charges and cash in lieu of parkland
payable for the Ling Liang project. This approach would be similar to the adopted by the Region of
York. Staff do not recommend providing
an additional grant amount equal to building permits, as the Town’s permit fees
are based on a cost recovery principal for real costs incurred for staff review
of the project plans. The loan options are not recommended as a loan will not
provide any funding that will assist Ling Liang in qualifying for the CRHP
funding.
FINANCIAL CONSIDERATIONS:
The loan option with interest will have no impact on the Town of
Markham, as the loan would be structured to recover interest based on
investment rates the Town would be obtaining through our investment
program. The loan option without
interest would have a cost equal to the lost interest. Over a 10 year period, with a loan of e.g.
$200,000, the lost interest income would be approximately $65,000 in total.
This would impact the Town of Markham’s investment income results over the 10
year period.
Conditional Grant Equivalent to Fees and Charges
(Option 3)
Staff proposes a one time conditional grant
estimated at $197,888 be provided to Ling Liang. The grant will be equal to
development charges and cash in lieu of parkland payable for the project and is
equal to approximately $3,598 per unit.
Staff recommends the funding be provided from the Corporate Rate
Stabilization Reserve, which currently has a balance of approximately $26
million.
Increasing the conditional grant to include an
amount equal to the building permit fees would result in a one time conditional
grant payment of approximately $250,954 but is not recommended.
There is potential that more affordable housing
developments in Markham may seek funding under the CRHP program, thereby
approaching the Town for a contribution to the matching funding. However, the
number of such requests will be limited by the Region of York. Each request
will be brought forward to Council for consideration.
Status of CRHP Matching Funds:
Federal Government – Potential 50%
Funding $25,000
Province of Ontario Contribution
$2,000
Region of York Contribution
$4,200
Town of Markham Proposed
Contribution
$3,598
It is
expected that additional funding will be provided from Community Groups.
ENGAGE 21ST CONSIDERATIONS:
“The
Town will pursue programs, services, facilities and employment and housing
opportunities. This will meet the needs
and expectations of different age, income and ethnic groups.”
ATTACHMENTS:
·
Region of
York Report
·
Letter
from Toronto Ling Liang Church
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Barb Cribbett, Treasurer |
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Andy Taylor, Commissioner, Corporate Services
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Jim Baird, Commissioner, Development Services
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Q:\SHARED\2003FinAdminCtteeReports\0365LingLiangChurch.doc
