Special to Ontario Construction News
Below is a transcript of GOHBA executive director Jason Burggraaf’s remarks to the Standing Committee on Finance and Economic Affairs at Queens Park on Jan. 9.
Hello, my name is Jason Burggraaf, executive director of the Greater Ottawa Home Builders’ Association.
Thank you for the opportunity to speak with you today, it is much appreciated.
I have circulated a written submission detailing our recommendations for the Budget, and while I won’t be able to touch on all of them in my remarks, I’d be pleased to answer any questions.
First, I’d be remiss if I didn’t acknowledge and celebrate Tuesday’s announcement of $10.9 billion over 12 years in new funding for energy efficiency, and especially the new Home Renovation Savings Program.
GOHBA has been a long-time advocate for incentives for renovations – which I have brought to this table before – and I expect this new program will help address our mutual environmental and climate change priorities.
This will improve the energy efficiency performance of homes and reduce greenhouse gas emissions, while at the same time reducing hydro bills and – somewhat unsung – reduce demand on the electrical grid.
And while we would love to see a tax credit that applied to all renovations across the board, there is a measure that the government could introduce that would boost the effectiveness of its new Home Renovation Savings Program.
And that is to require energy performance labeling through the EnerGuide Rating System for every home sold – both new and resale.
Universal energy labelling would improve consumer choice by allowing home buyers to compare two similar homes by their energy performance, as well as their aesthetics and location.
Now, it would be odd for me to come to this committee and not speak about infrastructure, so I’m definitely going to do so, but you’ll see our submission does more than ask to maintain and enhance housing-supportive infrastructure investment.
We have two further recommendations that really speak to focusing DCs (development charges) on growth-related projects, ensuring the DCs collected are actually spend on the projects they were collected for, and focusing provincial infrastructure investment on specific municipal projects with reporting that shows the relative reduction in cost to home buyers and/or tax payers.
Let me provide you with an example. One of the projects in Ottawa’s DC Background study is a new Olympic-level swimming pool that’s intended to draw swim meets and new tourists to Ottawa.
It’s estimated to cost $55 million to build and new home buyers are paying for the majority of the cost for that project – $30 million.
Now, there’s no authority that can say “hey, wait a minute, that’s an unreasonable expense to new home buyers that’s not related to growth”, other than GOHBA bringing it to the OLT (Ontario Land Tribunal) under an appeal, which we have.
But it is an appropriate role for the provincial government to make that determination – and that’s the focusing DCs on growth-related projects aspect of our recommendation.
Now, while the city is collecting money for this pool, it can actually borrow those funds and spend it on other capital projects, which delays the construction of the pool, sometimes for years, sometimes even into the next DC cycle. Not to mention the increase in cost.
And the city has no obligation to pay back the funds, only to keep a record that its moved money from one project to another.
So DCs being collected are sometimes not actually spent on the projects they were collected for.
Finally, the city of Ottawa gets $37.5 million through the Building Faster Fund that’s supposed to be directed toward housing-enabling infrastructure and other related costs that support community growth.
Ideally the province would now turn around and say “here’s the money for achieving your housing goals, but we want to see proof of the equivalent reduction in your DC Background study and the subsequent rate.”
This would show how provincial infrastructure investment is directly leading to more affordability in housing.
Ottawa, like every municipality across the province, faces a pressing need for enhanced infrastructure for housing to accommodate its growing population. While the full impact of provincial investments will be seen down the road, it’s critical to invest in infrastructure today in order to facilitate the construction of housing in the future.
Our potential for growth, and especially intensification – which is happening in communities of all sizes – hinges on the adequacy of our supporting infrastructure. Therefore, ensuring the right infrastructure is in place for new housing becomes imperative, and this will address a critical aspect of housing supply and affordability.
Finally, we have a series of recommendations related to Planning, Building Code amd Red Tape reduction, but the one I want to focus on is harmonizing and streamlining the approvals process and ensuring consistency and effectiveness in every municipality across the province.
We have taken a critical first step by standardizing municipal population and employment growth forecasts across the province by using Ministry of Finance projections in the Provincial Planning Statement.
There is no reason why Ottawa and Carleton Place should not use the same criteria and methodology to project their growth and future housing demand.
And in the same way, there’s no reason why Ottawa and Carleton Place should have vastly different development applications and processes for the same type of house.
All this does is increase costs, increase construction timelines and impede the productivity of home builders, because they have to work through a different system every time they want to build in a different community.
There is regulatory consistency in the production of virtually every consumer good, except homes.
And, implementing this measure would not result in an expenditure or loss of revenue for the province.
Our recommendations today – some budgetary but most regulatory – illustrate the scope of measures that can be utilized to support the construction of more housing, and make housing more affordable, across Ontario.
It is sound fiscal policy:
- To improve the current housing stock through renovations to be safer, to be more energy
- efficient, and to accommodate more people;
- To ensure DCs are collected and spent appropriately; and,
- To have an efficient and consistent development application process across the province.
As I mentioned the last time I had the opportunity to appear before you: Housing policy is fiscal policy.
Again, thank you for your time this morning and I’m happy to answer any questions.
