Burnaby, B.C.’s affordable rents are under threat because of new provincial legislation designed to keep costs reasonable for developers, says Burnaby’s chief planner.
The city had set the bar with an inclusionary rental scheme that requires one-for-one replacement of units that are lost due to redevelopment as well as a robust tenant relocation policy. Twenty per cent of a new rental building’s units must have below-market rents, defined as being 20 per cent below the median rent as set by Canada Mortgage and Housing Corporation.
Tenants protected by the Tenant Assistance Policy are given right of first refusal to return to the new building at the same rent. Other municipalities followed suit and have a version of the policy, including Vancouver’s Broadway Plan area.
The city was seeing promising results. Displaced tenants have returned to one new rental building so far in Burnaby, and another 500 units will soon be ready for occupancy, says Ed Kozak, general manager of planning and development.
However, new provincial legislation threatens to upend their affordable rental housing efforts because, by next year, the policies must meet a test of financial viability for developers. That will jeopardize not only the low rents but the number of below-market units, says Mr. Kozak, and not just for Burnaby, but for all local governments.
“If a municipality wishes to continue its inclusionary housing practices, it now has to do it the way the province prescribes,” says Mr. Kozak. “One of those requirements is that it has to be financially viable for the [developer].”
A staff report proposed a scaled-back rental use zoning policy in response to the new provincial legislation. It was scheduled to go to council on Oct. 7.
“In order to comply with provincial requirements, that 20 per cent [below market unit requirement] will likely be closer to 10 or maybe even sub 10 per cent, and the rents will likely be much closer to the CMHC median as opposed to 20 per cent below that. So, it’s not only affecting our ability to secure numbers of units, it’s affecting our ability to secure more deeply affordable units,” he says.
“I don’t mean to criticize the province, but they took a very supply-sided approach to the housing crisis without paying much attention to affordability and the inclusionary housing,” says Mr. Kozak. “Our rental use zoning policy was our one way that the city itself could provide, or at least require, to be provided a level of housing affordability. And it’s been an effective tool. We have close to 10,000 units in the pipeline at that rent. And the province is basically eliminating our ability to continue that,” says Mr. Kozak.
“They understand this, but they’re taking an approach that is very developer-centric,” he said.
Now, he says, they are in a scramble to comply with the new provincial legislation.
Meanwhile, other provincial legislation requires greater density around transit-oriented areas, and tenant displacement en masse will continue.
“I think [the province is] trying to remove obstacles to development as much as possible in an effort to try and solve the housing crisis on the supply side,” says Mr. Kozak. “And, you know, I think that’s part of the equation – but I think they’re sacrificing affordability to do it.”
Mr. Kozak says the city had been reviewing its Tenant Assistance Policy to better serve displaced tenants. Although it has gone mostly smoothly in the five years since Burnaby created TAP, there has been one recurring problem for tenants at the former Madiera building that stood at 4330 Maywood St. Since they were evicted two years ago, the nine or so tenants who chose to relocate at interim housing with a rent top-up have found the process highly stressful. Developers are required to top up the rents at the interim apartments for displaced tenants. Burnaby requires developers to pay into a bond to ensure tenants have funds for those top-ups. The developer who purchased the Madiera stopped making payments, says displaced tenant Marcella Zimmer, and the city had to use the bond money to cover their interim rents. The property was then sold to another developer, and tenants have again been notified that their top-up will be paid out of the bond, says Ms. Zimmer.
Mr. Kozak could only confirm that the new developer had paid into the bond in full.
Ms. Zimmer, who was paying $949 in rent at her old place and receives almost $1,200 in top-up money, is not convinced the new building will ever get built. She is a senior on a fixed income and can’t afford to pay $2,100 a month. She’s applied to BC Housing for subsidized seniors’ housing, but she’s been on the list for about 10 years, she says. Her biggest fear is homelessness if the bond money runs out.
“We have never missed a top up only because we sent emails and talked to people in government, stuff like that. We eventually do get it. But we are stressed from one month to the next month, to the next month. I have high blood pressure now. It’s distressing.”
So far, the only other complaint Mr. Kozak has received is that the replacement units are too small. It’s a worry shared by tenants facing displacement in Vancouver’s Broadway Plan.
Tenant Teresa Alfeld and her husband have been given notice that their building at 1270 W. 11th Ave. and the building at 1290 next door, will be replaced by a 155-unit rental tower. Ms. Alfeld says that although they had been shut out of the ownership market, they’d made a good life at their affordable older apartment building. Now they will lose that.
“It’s a really good little compromise, I guess, compared to anyone’s dreams of home ownership,” she says.
She adds that they weren’t surprised at the eviction, knowing they are within the Broadway Plan area. What she didn’t expect was the lack of transparency and information. They still don’t know who the developer is, and she says a video call with city staff and a representative from a development lender didn’t answer any of their questions. For most of the call, she says, the representative wouldn’t allow them to keep their cameras or microphones on. She said the meeting turned into “chaos,” and left tenants more uncertain and fearful than assured.
“I think one of the major complaints though is our eviction is not for charity or policy or to enable affordable housing, of which we know we have a crisis and a lack of,” she says. “We are being asked to leave to make way for a multimillion-dollar development, of which less than 20 per cent is going to be priced at below market rent, and that just leaves us feeling like we are really the losers in this situation.”
