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The Sidewalk Master Innovation and Development Plan (MIDP) correctly states that: “No issue is more pressing in Toronto right now than housing affordability”.

In order to support the Plan’s vision for housing affordability, Sidewalk Labs proposes a set of private funding sources that it projects to generate or unlock over $1.4 Billion for below-market housing by 2048. These three sources include a 1% condo resale fee applicable within the Quayside and River District; a modular factory approach to construction that would accelerate timelines and reduce costs; and, ‘affordability by design’ - using efficient design to enable more total units, thus creating value that could flow to affordable housing.

Importantly, these three funding sources are also used as leverage to advance Sidewalk Labs’ arguments for an expanded scope that extends beyond Quayside into the Port Lands, encompassing the 62-hectare River District. Throughout the MIDP, there are frequent reminders that the scale of the River District is necessary for the MIDP’s innovations to maximize their impact and become financially viable. In fact, only one of the three private funding sources (the condo resale fee) is modeled as being viable at the scale of Quayside.

Even at the scale of the River District, however, what is achieved in terms of affordable housing is not enough. After the expansion of geographic scope from Quayside’s 5 hectares to the 77-hectare IDEA District. After the application of the three new private revenue sources. After the contribution of public land. After the use of other traditional public sources of funding for affordable housing. After all of this, only 20% of built units are planned to be affordable, at or below 100% of average market rent (AMR), and only one quarter of those - 5% of all residential units built - would be deeply affordable, at or below 60% of AMR. In total, based on these shares, the full build-out of Quayside and the River District would yield just 1,700 deeply affordable rental units. Not enough.

Consider that as of Q1 2019, the City of Toronto’s social housing waiting list stands at 102,049 households, and that it has grown by 7,977 households over just the past year. Consider that approximately one out of five Toronto households (2016) would not be able to carry a one-bedroom apartment at 60% of AMR within the CMHC threshold for affordability (spending less than 30% of gross income on shelter costs). Against this backdrop, yielding only 1,700 deeply affordable units from the build-out of Quayside and the River Districts is not progress - it is losing ground.

To be clear, this is not simply a criticism of the Sidewalk MIDP - it is also a criticism of the ambition of the Precinct Plans and Planning Frameworks with which the MIDP complies. The River District is unique, a large contiguous block of mostly public land close to the employment centre of the downtown core. There is no other block of public land like it. Its potential is also being unlocked by the investment of three levels of government in a $1.25 billion flood protection project. If it is not possible to achieve more, in terms of housing affordability, in this context, how will progress be made on this issue?

What if, instead of relying on private sector innovation, we did it ourselves?

Speak with enough people about affordable housing, and you will hear reference to either the Vienna model or the St. Lawrence Neighbourhood. In Vienna, over 60 percent of residents live in social housing, and about 25% of the city’s housing stock - 220,000 units - are owned and managed by the city, and intended for lower-income households. A similar number of units are built and owned by limited-profit developers, selected and regulated by the city, who direct future profits into cyclical refurbishment and the construction of more housing. The St. Lawrence Neighbourhood is a local success story - widely seen as a best practice in urban redevelopment, having resulted in a high density, socially- mixed community. The land (56 acres) was assembled by the City, and 16 different developers - as well as public housing authorities - participated in the development. Almost 60% of the units built in the St. Lawrence Neighbourhood were various forms of non-profit co-operatives or non-profit rental. The strong presence of non-market, non-profit housing anchors local affordability, providing units suitable for both low- and moderate-income households. Imagine the Port Lands built out as a ‘little Vienna’. Imagine if, at long last, the City built another St. Lawrence Neighbourhood.

No, Toronto is not Vienna, and the landscape for co-op housing is not the same in 2019 as it was in the 1970s, but consider the endowments that the City already has, and some of the tools that are already at its disposal:

• The land is already publicly held - it does not need to be purchased or expropriated.
• The City has access to cheap debt for capital projects, and is able to borrow at rates near 3%, far below what any developer could access for construction financing.
• The City has no profit motive, and without the need for a developer’s profit, would be able to build more units or offer higher levels of affordability.
• The condo resale fee proposed in the MIDP is essentially a form of land transfer tax, a tool that the City has already implemented, and that could be calibrated and applied to directly fund the build-out of affordable housing on the waterfront.
• By 2021, the City also expects to collect $75 million annually from a City Building Fund levy. Imagine if the levy was increased, and the additional revenues directed to financing a continually growing supply of affordable units.
• There is an existing ecosystem of sophisticated non-profit affordable housing providers in Toronto; development of the Port Lands could be an opportunity to scale up this sector, and grow its capacity to deliver affordable housing options across Toronto.
• The location, along the waterfront near downtown, and future plans for green space and adjacent development such as East Harbour, means that there will be ample opportunities for cross-subsidizing affordable units with market development, and that the City would almost certainly benefit from significant land lift on any lands that it holds for the long term.

The point is that more so than innovations, on the matter of affordable housing, what this city requires is ambition and political will. Given the scale and immediacy of the affordable housing crisis, and the enormous potential of the unique public asset that is the Port Lands, the City must achieve far more from their development than what it being proposed. But it would require taking a different direction on this part of the waterfront - maximize public benefit from the public asset, and make the significant production of enduring affordable housing a central priority for development of the Port Lands.