Section 37 Community Benefits for 23-storey tower at 421 Brant St coming to council April 23; alternative tool - CBAs - provide better outcomes for residents

Analysis & Insight — At our April 23 meeting, council will be considering community benefits under Section 37 of the Planning Act for the 23-storey tower at 421 Brant St. These benefits can be negotiated when extra height and/or density above the existing Official Plan and Zoning Bylaw are approved.The tower was approved by council last November at almost double the existing OP heights of 12 storeys (on the James/Brant corner of the property only) and 4-8 storeys on the balance of assembled lands.I did not support the tower — it is overdevelopment of the site — and will bring several motions to council to modify staff's proposed Section 37 Community Benefits.This issue raises the larger question of the use of Section 37 Community Benefits. Are residents getting a good deal? In my mind, no, for several reasons outlined below. There is an alternative model we should explore called Community Benefits Agreements. A recent study explored how they are used in Toronto and elsewhere in Canada and the United States. I support using CBAs instead of Section 37 as they give residents a seat at the table to plan our community, among other benefits.In the sections below, you'll find my proposed motions for the April 23 council meeting, the drawbacks of Section 37 agreements, and a summary of the study on the alternative tool of Community Benefits Agreements. As always, I'm interested in Your Take. Let me know your thoughts on these issues by leaving a comment below.

Motions for April 23 Council meeting

Council ran out of time at our April 10 Planning & Development Committee meeting to discuss and bring motions related to the proposed Section 37 Community Benefits Agreement for the extra height/density on 421 Brant St, so I will be bringing the following motions to the April 23 Council meeting. Residents can attend (starts at 6:30 at City Hall) or Register as Delegation to speak up to 5 minutes, or by phone 905-335-7600, x7805. If you can't attend you can send written correspondence to council via the clerks office at clerks@burlington.ca or directly to council members here: Council Contact InformationMotions:

1. Shift $150,000 for public art to affordable housing.

Rationale: Residents in Ward 2 do not want Section 37 benefits going to public art, feedback I shared with staff when I was consulted on the benefits for this project. In my view, public art should be properly funded during budget, not via an add-on to development that requires increases to height/density to achieve.

1. Add the following criteria to the affordable housing benefit:

a) That the housing units be located within the urban growth centre.Rationale: This ensures the affordable housing benefits negotiated for 421 Brant St stay in the community impacted by the project. City staff and the developer support this motion.b) That staff report back to committee and council on how the money has been allocated, the number of affordable units secured, and the location.Rationale: This provides accountability and transparency back to the community on what happened with the affordable housing benefit. City staff support this motion.The balance of the community benefits are "in-kind" or non cash, with one exception:

• Car share space (value $50,000) and vehicle (value $50,000)
• Expansion of civic square ($50,000 - direct cash contribution) and 128msq public easement on the corner of Brant/James (value $75,000)
• Eight visitor parking spaces for visitors to the residential or business units (value $400,000)
• Increased setbacks and widened sidewalks on Brant/James/John (value $250,000)
• Comply with LEED certification or the city's Sustainable Building Guidelines (value $300,000)
• Streetscape improvements including expanded setbacks areas as open space easement as outlined above (value $150,000)

In my view, the car share, visitor parking, increased setbacks, widened sidewalk and sustainable building should all be development requirements under zoning or other provisions; we shouldn't have to grant extra height/density to get them through Section 37. They should apply to all future developments whether or not they require an Official Plan or Zoning Bylaw amendment. In addition, the public easement can be achieved through a combination of daylight triangle (to assist turning movements on a corner) and parkland dedication. Again, we shouldn't have to give away height/density to get these; they should simply be considered a part of good planning and development applicable to all projects.

Section 37 Community Benefits not always a good deal for the community

There is a larger question at stake here on the use of Section 37 Community Benefits. Are residents getting a good deal? In my mind, no, for several reasons.First, Section 37 Community Benefits are only available if council grants height and density beyond what is in the Official Plan and Zoning Bylaw. Residents have repeatedly stated that they want council to stick to existing OPs and Zoning permissions, and I support that position. The exception would be to gain assisted housing — something the market can't deliver on its own.Second, Section 37 Community Benefits represent only a fraction of the value uplift of the extra height and density granted to the developer. The calculation of benefits is based on the difference in value of the land at the current OP/Zoning permissions, and the amended OP/Zoning permissions.  Then a factor of about 25% of that value is applied, to represent the city share. Community benefits are not based on the market value of the new units.Third, Section 37 Community Benefits can be either cash or "in-kind" benefits, both of which are used for 421 Brant. What gets included in the in-kind benefits are often things that in my view should be a standard part of any application — for example visitor parking — or be provided via the city's budget — such as public art — rather than having to exceed our OP/Zoning to get these items.Fourth, the cost of Section 37 Community Benefits are often passed on to purchasers. This has happened in at least two developments I am aware of: the ADI mid-rise on Guelph Line, and the Molinaro development on Maple, where residents were required to pay $1 million to buy the Geo Thermal System. This pass-through of costs erodes affordability, something we're told is a goal of highrises in the first place.Fifth, residents don't have a seat at the table when negotiating Section 37 Community Benefits. These discussions take place behind closed doors between staff and the developer. The Ward councilor is consulted, but also doesn't have a seat at the table, and their input can be ignored. Staff develop a proposal for benefits for council consideration, at which point the public consultation kicks in when the report comes to Committee and Council for approval. But by this point, residents are forced into a reactive posture, rather than working together to get the best outcome. During the public discussion residents can ask for changes; council members can bring motions for changes.Sixth, granting extra height and density on any property fuels land speculation, which increases property values and tax assessment. That's because properties become priced not at the current OP/Zoning permissions, but at the new height/density granted. This erodes the value uplift used to calculate Community Benefits, as land is priced assuming whatever was granted under an OP/Zoning amendment will be granted in future. So residents get a smaller amount of the pie.In addition, the Municipal Property Assessment Corporation takes land value into account when assessing properties for tax purposes, so residents and businesses face spiraling tax assessments. In the downtown, that is passed on to business owners, increasing their cost of doing business. This has happened in Toronto, where there is discussion about softening the dramatic tax increase sdue to development through a tax capping tool. (Links to articles below)Seventh, Section 37 Community Benefits are voluntary — a developer does not have to agree with them — and can be renegotiated later via a council vote. We've already seen this occur with the Carriage Gate development at Caroline/John/Maria/Elizabeth (the same developer as for 421 Brant St). The original proposal included a community benefit of roughly 75% affordable units, calculated at Halton Region's affordable housing rate. This was later renegotiated via a council vote of 6-1 to roughly 25-30% affordable units (I did not support this change).With all these drawbacks, Section 37 Community Benefits aren't the community benefit they propose to be. But there is an alternative — private Community Benefits Agreements, detailed below.

Community Benefits Agreements as an alternative to Section 37

The Atkinson Foundation and Mowat Centre teamed up to explore ways to build community wealth  and economic innovation during public infrastructure projects that prompt private investment in development (as an example, think of the public investment in GO train service prompting private development around stations). The end goal is for all members of the community to benefit from these public and private development projects.The study found there can be a growing gap in high and low wage neighbourhoods to enjoy the benefits of these public and private investments. Community Benefits Agreements aim to address that gap for businesses and residents.Community Benefits Agreements are formal agreements between a real estate or infrastructure developer and a coalition that reflects and represents people who are affected by a large development project. The agreement outlines the benefits the community will enjoy from the project. These benefits usually include some combination of jobs, training or apprenticeships, business opportunities as well as neighbourhood improvements.Where the development includes residential construction, affordable housing can be a benefit negotiated through this process. Most agreements reflect the interests of people who are not already benefiting from economic growth, such as young workers, newcomers, foreign-trained professionals and low-income communities, and send opportunities their way.CBAs are represented by legally binding contracts that contain the following elements:

• Description of the parties involved;
• Description of the project affected by the agreement;
• List of the agreed-to commitments on the part of the developer; and,
• In the U.S., a clause pledging the coalition to not oppose (and generally to actively support) the completion of the project.

The key differences between Section 37 Community Benefits and CBAs are that residents have a seat at the table throughout the process to negotiate the best outcomes; CBAs ensure the whole community benefits from the projects, regardless of wealth and income; and the agreements are legally binding in court, rather than subject to a future council vote.CBAs first emerged in the United States in the 1990s, forming coalitions that differed from what are known as NIMBY groups (Not In My Back Yard) who oppose large-scale development outright. By contrast, these coalitions see themselves as advocates for successful developments implemented through a more equitable and inclusive process. In exchange for the developer making a commitment to the delivery of particular benefits, the coalition often pledges to support the approval of the development.The developer is not usually legally compelled to negotiate a CBA. If they agree to enter into one, it is because the coalition successfully demonstrates that this kind of development promises a better outcome – a shorter approvals process, a better project in the end, and a stronger, more appealing brand.This is still a new model in Ontario, although Metrolinx and the Toronto Community Benefits Network have signed a Community Benefits Framework based on the CBA model. The framework is a first for Ontario, and is supported by the inclusion of community benefits in the passage of provincial regulation Bill 6: Infrastructure for Jobs and Prosperity Act.The bill requires the public sector to consider community benefits when making decisions about infrastructure investments.The CBA study also briefly touches on Section 37 Community Benefits, and recommends policy change in this area.I believe we should explore the CBA model as an alternative to Section 37 agreements. What do you think? Let me know below. 

Links & Resources

Staff recommendation report: Section 37 Benefits for 421 Brant St.Read the CBA study: Community Benefits AgreementsToronto Property Tax hikes:Yonge St Businesses face huge tax hikesCouncillor calls for tax reform for businessesEditorial: Capping small business taxes a start