BALTZ: Upzoned developments are no place for a shell game

According to City of Ottawa plans, the windfall profit that developers get when their property is rezoned will soon have to be shared with the nearby community.  Under Section 37 of the Ontario Planning Act, municipalities can require a property owner to provide “community benefits” in exchange for agreeing to rezone a property to allow a bigger building.  Toronto has been doing this for more than decade, but Ottawa is just now getting around to it.  Sure, the enabling language was written into Ottawa’s 2003 Official Plan, but it doesn’t really count unless it’s implemented.  They’ve now, however, decided it’s time, and there is a big rush: consultations were announced about two weeks ago, and final comments are due from the public by May 20, with Planning Committee deciding on the issue June 14.  The easiest place to find the materials provided by the City is on the Federation of Citizens’ Associations (FCA) website (http://fca-fac.ca), where the draft Section 37 policy can be found as well as an excellent analysis by Centretown Citizens Community Association president Charles Akben-Marchand, who travelled with Councillor Diane Holmes to Toronto to learn about their longstanding Section 37 program.

The way it works is this:  A developer proposes to have a property rezoned, say from 6 to 12 stories.  Without Section 37, the increased value of the rezoned property goes to the developer alone. Instead, under this new scheme, the increase in value is calculated, and an agreement put in place for a percentage (usually about 20-30%) of the increase to be provided for benefits that must be in the nearby community. The amounts can be large, with the funds coning from a large condo building amounting to several million dollars.  Possible benefits include tangibles like renovating a park, public art, conserving a heritage building, public streetscape improvements, artist live-work space, affordable housing, daycare space, and specific projects listed in a Community Design Plan for the area.

Frankly, it is about time that the communities in Ottawa where most of the intensification is taking place shared more concretely and immediately in the benefits.  While the overall long-term benefits to the City of more transit-oriented development and intensification are well-established, a disproportionate burden is borne by many urban neighbourhoods in achieving these goals.  In addition, the Planning Department in Ottawa has been routinely supporting extremely large increases over the current zoning, which has mainly benefitted developers savvy or connected enough to purchase properties with relatively low zoning knowing that they can be upzoned substantially.  As the Ontario Planning Act acknowledges, it is appropriate that a relatively small portion of the immediate profit given by the City to a developer in the form of increased heights and densities be plowed back into the community where the intensification is happening.  It is certainly time that Section 37 Community Benefits are implemented in Ottawa.  Citizens should clearly signal their support now, to ensure that the only voice heard is not the the development lobby’s opposition.

However, as good as the possibility of our communities benefitting directly from intensification may sound, Section 37 community benefits will only really work if the City’s policy is absolutely clear and has the necessary safeguards to prevent abuse.  Section 37 benefits cannot simply be another instance of business as usual at the Ottawa City Planning Department.  “Community benefits” must not ever be decided behind closed doors by a planner and developer before the public even knows about the proposed rezoning, as currently happens with rezoning decisions.  A minimum requirement is a precise set of rules for deciding what the community benefits will be, and how the community must be consulted in making this decision transparently and in the open.

Furthermore, the benefits must be real and they must specifically improve conditions in the nearby community. Although the draft guidelines correctly say that any Section 37 agreement between a developer and the City must result in benefits that would not otherwise be expected as part of the development, the inevitable “but not limited to” clause in the list of possible benefits provides a potentially huge loophole.  Many things that are not what residents would understand to be a real benefit could be used by the City to justify rezoning decisions, limited only by the creativity of developers and planners.  This cannot be allowed to happen.

Even some things that sound good at first are not appropriate to include An example would be development of environmentally contaminated land.  Old buried industrial contamination normally does not affect the nearby community at all. Cleanup of contamination is just a prerequisite for development, not an extra benefit.  Another example is building environmentally sustainable buildings, which we all want.  It would be too easy, if high environmental standards were to be considered a community benefit, for developers to play a game where a building of minimum standards is proposed first and then the “Section 37 benefit” is that they will instead build a “green” building—the one that they had always actually intended to market to customers who are increasingly demanding it.

Section 37 should absolutely be implemented in Ottawa as soon as possible.  The City must, however, be very careful to ensure that community benefits are real, tangible, local to the community, and not anything that should always be expected for a good development project, including environmental remediation, green buildings, good architecture, and compatibility with the existing community.  If not, this will be seen as another giveaway by the City to developers—a shell game in which fake “community benefits” are used as just another excuse.

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