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What our planning system can learn from the CRA

Are planning thresholds "magic" numbers? 

Why are rates and policies applied across the board for all developments as soon as the "magic" number is hit? 

Here are a few of those across-the-board planning thresholds that trigger the city’s rates and policies: 

  • 5 If a development has five or more residential units, development charges apply to each unit. So does The Green Standard (TGS) (Version 4).
  • 6 If demolition of six or more rental units is needed for a new development, a rental demolition permit is required. Then each unit needs to be replaced, in the new development, like-for-like. 
  • 11 A new development with 11 residential units now triggers the requirement for Site Plan Approvals (SPA). 
  • 20 If a development has 20 or more units, amenity space is required; at least four square metres per unit, with at least two square metres of indoor amenity space per unit and 40 square metres of outdoor amenity space, in Residential Area zones. Growing Up guidelines apply, too, and require, among other things, a unit mix of 15 per cent two-bedroom units and 10 per cent three-bedroom units.
  • 30 If a development has 30 or more residential units, a Type G loading space and on-site waste management are required. 
  • 100 If a development has 100 or more residential units, inclusionary zoning applies, requiring that a particular share be affordable, depending on the site.  

What do you notice?

Development intensity rates and policies are applied indiscriminately once a development hits a magic number.

For example, only six rental replacement units are required regardless of whether a development comprises 10 units or 160 units.

The effect is to place small or moderate developments at a disadvantage.

The same thing would happen if Canada had a system of flat taxes rather than marginal tax rates. Believe it or not, the Canada Revenue Agency’s (CRA) approach has something to teach us in planning.

What do taxes have to do with it?

The CRA’s marginal rate system divides taxes into brackets, where the bracket rate only applies to the number above a threshold.

If our planning system used the same approach, rental replacement rates would be 10 per cent for up to 10 units, 20 per cent for 11-20 units, and 30 per cent for 21-30 units. This would mean:

  • at 10 units, one rental unit would be required,  
  • at 20 units, one rental unit would be required for the first 10 per cent, plus two rental units for the 10 additional units, and
  • at 30 units, one rental unit would be required for the first 10 per cent, plus three additional rental units would need to be provided.

What’s magic about it?

If the city was to adopt this approach, planning threshold rates and policies would be applied proportionally to the scale of development, so those developments that are small or moderate would not be unnecessarily burdened. 

While you can’t have half a loading space, or be subject to half of the TGS (Toronto Green Standard) or SPA requirements, they might be simplified to make small- and mid-scale projects more feasible.

I suggest looking at new ways for the city to achieve its intent like a marginal approach that meets broad, holistic goals for development, but one that is applied proportionally.

Say, for example, that rather than calculating amenity space the same way for all developments, it could be calculated at different rates for those between 20 to 50 units, 51 to 150 units and greater than 150 units.

At 30 units, a developer would need to provide amenity space only for the 10 units over 20. 

The effect would be to lessen the burden on small- and moderate-scale developments while letting developers consider what rate their developments can afford and sustain.

And, they would not be punished for breaking through a bracket as only the additional units would be subject to the higher marginal rates. 

Intent versus Impact 

Our planning policies have been crafted with intent: to have development pay for itself and lessen the burden on citizens, to fund capital works associated with intensification, to support housing affordability and to plan for complete communities and families.

The problem is that the greatest intentions don’t always have the best impacts – and the impact is what is experienced by residents of the city. 

Take the rental replacement policy, for example, which is intended to maintain the existing stock of affordable housing and protect renters from displacement.

While many would generally support this intent, the existing policy makes it very hard for developers to get the numbers working and ensure rental units are replaced.

The impact? A surplus of aging rental buildings that reinforce their stigma.

Angular planes, too, present a useful example, as an urban design tool. The intent is great: to ensure articulation and to prevent slab towers from popping up on our vibrant avenues.

But staircase buildings are hard to build, costly and have much fewer units than boxier forms of development.

The impact? Fewer affordable units and more expensive units. 

Working with the current planning thresholds involves more hard work than magic, but it’s time to start looking to other models where well-intentioned rates and policies are workable, proportionate and make it easier to reach the city’s broad public policy goals. 

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