15. ACTION OTTAWA
REQUEST FOR PROPOSALS 2004 – STATUS AND OPTIONS
DEMANDE DE PROPOSITIONS DE 2004 D’ACTION OTTAWA - ÉTAT
That Council approve that staff proceed with Action Ottawa 2004 Requests for Proposals for up to $7.3 million city funding to support the development of up to 220 units of low-income affordable housing.
Recommandation du comité
Que le Conseil demande au personnel de présenter les demandes de propositions d’Action Ottawa pour 2004, moyennant une contribution financière municipale pouvant atteindre 7,3 millions de dollars, afin d’assurer la construction d’un nombre maximal de 220 logements abordables pour les ménages à faible revenu.
City Manager's (Community and Protective Services) report dated
07 July 2004 (ACS2004-CPS-HOU-0006).
ACTION OTTAWA REQUEST FOR PROPOSALS 2004 -STATUS AND OPTIONS
DEMANDE DE PROPOSITIONS DE 2004 D’ACTION OTTAWA - ÉTAT ET OPTIONS
That Corporate Services and Economic Development Committee recommend to Council that staff proceed with Action Ottawa 2004 Requests for Proposals for up to $7.3 million city funding to support the development of up to 220 units of low-income affordable housing.
Attachment 1 - Deputy City Manager, Community and Protective Services report dated 7 July 2004 (ACS2004-CPS-HOU-0006)
That the Health, Recreation and Social
Services Committee rethe Corporate Services and Economic Development Committee recommend
Recreation and Social Services Committee recommend that Corporate Service and
Economic Development Committee recommendto Council that staff
proceed with Action Ottawa 2004 Requests for Proposals for up to $7.3 million
city funding to support the development of up to 220 units of low-income
RECOMMANDATION DU RAPPORT
Que le Comité de la santé, des loisirs et des services sociaux recommande au Comité des services organisationnels et du développement économique que le Conseil demande au personnel de présenter les demandes de propositions d’Action Ottawa pour 2004, moyennant une contribution financière municipale pouvant atteindre 7,3 millions de dollars, afin d’assurer la construction d’un nombre maximal de 220 logements abordables pour les ménages à faible revenu.
In 2002, Council adopted a comprehensive Affordable Housing Strategy (AHS) to address pressing housing needs in our community. As part of this strategy, Council set a development target of 240 affordable housing units per year over four years through the use of direct capital investment and other city incentives.
Action Ottawa is the City’s primary vehicle for supporting the development of these affordable housing units. The program provides one-time capital funding combined with fee relief and, in some cases, City-owned land to reduce the cost of development with the expectation that the housing units be targeted to low-income households. Since its creation in 2002, 368 units have been approved for funding through Action Ottawa.
At this time, the Housing Branch would like to move ahead on new development through Action Ottawa for the remainder of 2004 in order to bring us closer to Council’s target of a total of 720 units by the end of this year.
This report recommends approval to proceed with Requests for Proposals (RFP’s) to develop a maximum of 220 units of affordable housing through the Action Ottawa Program on two priority sites; 80 units on Albion Road and 140 units on Beaver Barracks. It is proposed that the Albion project would proceed with or without federal / provincial funding and the Beaver Barracks project would be contingent on receipt of federal / provincial funding.
En 2002, le Conseil a adopté une stratégie exhaustive sur le logement abordable dans le but de répondre aux besoins pressants constatés dans notre milieu. Dans le cadre de cette stratégie, le Conseil s’est fixé pour objectif d’assurer la construction de 240 logements abordables par année sur une période de quatre ans, au moyen d’immobilisations directes et de diverses mesures d’incitation.
Action Ottawa est le principal outil dont la Ville s’est dotée afin d’assurer la construction de ces logements. Le programme offre des subventions d’immobilisations ponctuelles combinées à une dispense de droits et, dans certains cas, à des terrains municipaux, afin de réduire les coûts de construction. Les logements doivent être destinés à des ménages à faible revenu. Depuis son instauration, en 2002, Action Ottawa a permis d’approuver le financement de 368 logements.
La Direction du logement aimerait donner suite dès maintenant aux projets prévus dans le cadre du programme Action Ottawa pour le reste de 2004, afin que nous puissions nous rapprocher de l’objectif de 720 logements que le Conseil a fixé pour la fin de la présente année.
Le rapport recommande d’approuver la présentation d’une demande de propositions en vue de la construction d’un nombre maximal de 220 logements abordables en vertu du programme Action Ottawa sur deux emplacements prioritaires, soit ceux du chemin Albion (80 logements) et du Casernement Beaver (120 logements). Il est proposé de réaliser le projet du chemin Albion avec ou sans la participation financière des gouvernements fédéral et provincial, tandis que la concrétisation du projet du Casernement Beaver serait conditionnelle à une participation financière fédérale ou provinciale.
The Housing Branch’s development mandate is currently supported by an allocation of funds from the Social Housing Reserve, fee relief and the contribution of some City owned land. Since 1999, an average of $1 million/year of the Social Housing Reserve funds has been allocated to new development.
The Housing Branch has maximized the effectiveness of this limited capital resource by leveraging funds from senior levels of government and community organizations to build housing. Most recently the City’s capital funds were paired with Federal and Provincial dollars through the Federal-Provincial Affordable Housing Program (the “Community Rental Housing Program, or CRHP)
Ottawa’s allocation under the pilot phase of this program was 300 units of housing ($7.5 million Federal, $600,000 Provincial). This allocation, in combination with $3.8 million City capital, 120 rent supplements enabled the 329 units of affordable housing approved by Council in May 2004. The Province is undertaking a stakeholder consultation and subsequent negotiations with the federal government to improve the terms of the program. A new round of the CRHP is anticipated sometime before the end of the year.
The subject of this report is a request for approval to proceed with RFP’s to develop a maximum of 220 units of affordable housing through the Action Ottawa Program. This involves the commitment of adequate capital resources to meet the affordability requirements of Action Ottawa, and the use of City owned land.
The intent is to go forward with separate Requests for Proposals as soon as possible. Staff anticipates an RFP on the Albion Road site in September and, subject to confirmation of Federal funding, another RFP for up to 140 additional units for the Beaver Barracks site. Staff will bring recommendations resulting from these RFP’s to Council for approval.
Albion Road (155 and 343 Parkin Circle) was acquired in March 2004 from the federal government for $1 for the purpose of developing affordable housing. The agreement with the federal government stipulates that construction must begin on the site no later than March 2007, or the City risks losing possession of the property. Pre-construction development work on the site, including the RFP process and development approvals, is anticipated to take 12-18 months. Therefore, it is important that the City commit the resources for this development as soon as possible so that the RFP can proceed in a timely manner. The maximum number of units that could be developed on this site is estimated at 80.
Beaver Barracks was acquired in a land swap with the federal government by the former Region of Ottawa-Carleton. The land was to be developed for affordable housing development under the former social housing programs. When these programs were cancelled in 1995, the land continued to be held for affordable housing until the resources could be found to develop the site. The estimated number of units that could be developed on this site is 140.
An estimated $60,000/unit direct capital investment is required to meet the affordability targets of Action Ottawa. In previous RFP’s the City has committed approximately $25,000/unit in conjunction with the allocation of rent supplements to achieve affordability targets. There are no rent supplements currently available, and no expectation of new rent supplements from the Province to pair with this development program. This means that additional capital investment is required in order to reduce the operating costs of the new units to achieve sustainability and affordability.
This total amount of City capital required per unit could be reduced based on a couple of factors:
o Input of Federal/provincial funds
o Access to Rent Supplements
o Building less units than anticipated due to site development constraints
o Leveraging more resources from the community than in previous RFP’s
Additional funding is expected from the Federal/Provincial Community Rental Housing Program under the existing agreement with the Province for the Pilot Phase of this program. There are approximately 8,200 unallocated housing units under this program in Ontario, and staff are negotiating to obtain additional units and an extension to the end of the year to allocate these units through the RFP process. We have asked for up to 140, but expect the approved amount to be lower. This number of units is not sufficient to proceed with both Albion Road and Beaver Barracks by September. Staff expect the Province to have the revised program in place by the end of the year, which will presumably give access to another 300 units. At that time, staff will be ready to immediately proceed with an RFP for Beaver Barracks in early 2005.
The Housing Branch has considered a number of scenarios with respect to the proposed Action Ottawa RFP’s. These scenarios are summarized below, and reflect the range of possibilities with respect to accessing Federal funding via the Province. Our key consideration is to find the most cost effective way to get as close as possible to our affordable housing target of 240 units per year, which we are currently not meeting. Also of concern is the timeframe for development on the Albion Road site.
If the City is unable to access matching Federal funding, $7.3 million would support 121 units; up to 80 of which would be for Albion Rd ($4.86 million) due to the timeline to achieve construction. Remaining funds ($2.44 million) would be held to use to match eventual Federal funding to support 70 units on other sites.
Scenario 2: Matching Federal Funding (assuming current $25,000 per door plus $2,000 PST rebate). If the City were able to access the F/P program, our $7.3 million would support up to 220 units; 80 at Albion Rd and 140 at Beaver Barracks.
With an allocation of 140 units from the Community Rental Housing Program or less, we would proceed with Albion Road in September, and follow with Beaver Barracks once the Province has brought forward the revised Program.
If the Province does not agree to allocate additional units under our current agreement, we would wait until the new program is available, hopefully by year end, and do both projects together in early 2005.
Staff will bring forward a report to Council in the Fall of 2004 that will define a 5 year plan for capital funding for affordable housing under the Action Ottawa program. The intent is to support the development of up to 500 units per year. Funding will be contingent on continued contribution of savings from social housing subsidies to the Social Housing Reserve, access to City-wide Capital project funding, and continued participation by the Federal and Provincial governments.
A community consultation respecting the Albion project was held in January in preparation of obtaining the Albion property from the Federal Government. Concerns were expressed respecting: the scale of the project; increases in crime, vandalism and traffic as well as a negative impact on property values. Staff explained that all development would be considered through the normal planning approval process with appropriate opportunity for community review and input.
Consultation occurred in 2003 respecting rezoning of the Beaver Barracks site. Upon Council’s approval to proceed, but prior to release of an RFP, staff will develop and confirm the guidelines for development respecting NCC requirements, heritage considerations and site conditions. The proponent will be required to accommodate a community garden located at the site. Discussion with the NCC will be required to respect design guidelines and development approvals in accordance with a covenant that the NCC has on the site.
Housing Branch staff recently began a community consultation on Affordable Housing Development to discuss lessons learned and new directions. A forum on June 15th attracted 75 people from both the private and non-profit development communities as well as special needs service providers, financial lenders and City staff. Over the summer staff will prepare a report on the ideas generated. A follow-up session with the community is scheduled for September 9th. Feedback on the consultation was positive and participants indicated a desire and willingness to continue dialogue on new approaches and enhancements to affordable housing development in Ottawa. These recommendations will be incorporated as much as possible into the upcoming RFP’s.
City contributions to development at Albion Road and Beaver Barracks will be up to $7.3 million. With the recent contribution of savings from social housing subsidies for 2003, there is currently $7.3 million available in the Social Housing Reserve Fund.
The Albion Road site was obtained for $1 from the Federal government. The value of the land is appraised at $811,800. The City is liable for the value of the land if it is not developed for affordable housing in a timely manner.
Housing Branch will issue RFP’s through the Action Ottawa program with a target release date in September 2004 for Albion Road and December 2004for Beaver Barracks.
Recommendations resulting from the RFP’s will be brought to Council for approval.