2022 Toronto Development Policy & Process Changes

2022 is a critical year for planning and development in the City of Toronto. In addition to an OPA review and its ancillary requirements, the City will be implementing Community Benefits Charges, Inclusionary Zoning, and a series of other development-related policies and procedures. In the midst of all of this, we are seeing housing policy become a much more pressing issue at the ballot box and there will be both a provincial (June 2, 2022) and municipal (October 24, 2022) election this year that will help set the stage for even more disruption and opportunity in the development sector.

The following is a number of policies and changes that are coming this year. As always, Sussex is prepared to assist our clients with up-to-date information, insights, and strategic guidance to navigate the policy and political landscape over the next 12 months and through both elections.

1. Municipal Comprehensive Review (MCR) Extension Request by Toronto

What it is

Under the Ontario Growth Plan (2019), municipalities were given a deadline of July 1, 2022 to review their Official Plans (OPs) to ensure that they have a plan to accommodate growth. This requires that many policies be reviewed and updated, including employment land designations. While staff set out to achieve the Province’s deadline, they have reported challenges in doing so with various Provincial policy changes and remote working arrangements. Last week, Toronto’s Planning and Housing Committee endorsed a request for the Province to extend the deadline to July 1, 2023. Other municipalities are considering making similar requests of the government.‍

Why it matters

An extension to the MCR would present certain opportunities. As proposed by City staff, there would be an opportunity for supportable conversions to go ahead on schedule, while sites that might yet get to a supportable outcome could be given more time. On the other hand, this would also push out final decisions on sites that the City expects to ultimately refuse and could cost developers additional time and money.‍

How we can help‍

Sussex can advocate at the City and the Province for an appeal process and for the extension in order allow staff more time to consider your application. ‍

2. Mandatory Pre-Application Meeting Requirements

What it is

The City of Toronto is likely to approve mandatory pre-application consultations as part of the development review process later this month. The direction was approved at the Planning & Housing Committee this week and amendments were made to require additional pre-application meetings with Councillors, resident groups, and other local stakeholders. If approved at Council, it will come into effect on November 1, 2022.‍

Why it matters

While pre-application meetings with Planning staff are routine for many developers, the step does require additional time to be spent before making a submission. That can represent a challenge for applications that are being submitted under tremendous time constraints and with workforce disruptions along the lines of those seen with the COVID-19 pandemic and City staff attrition it is not obvious that these meetings will be available on-demand in the future. Amendments proposed this week, adding in pre-application consultation checklist requirements for meetings with Local Councillors and community stakeholders, will also mean that many sites will require a politically-sensitive engagement plan much sooner in the process.‍

How we can help

Sussex has extensive experience helping to shepherd planning applications through the City, especially where they hit impasses with administration or political offices. Sussex can help provide guidance on a Ward-by-Ward basis on how best to approach the pre-application process to manage political risk when this change goes into effect and how to feed the relevant meetings and engagements into applications’ public consultation strategy reports. Our team has facilitated stakeholder engagement across the City in order to obtain actionable information and to create productive working relationships.

3. Community Benefits Charges (CBC) Implementation

What it is

This September, the City of Toronto will begin implementing its Community Benefits Charge (CBC) strategy. CBCs will be replacing Section 37 benefits agreements with a more transparent and predictable system for establishing financial contributions to the City. The regulations, set out by the Province, set a maximum 4% of land value for the CBC. The CBC framework also allows for transparent reviews should there be disagreements between developers and City officials on valuations.‍

Why it matters

Section 37 funds have long been negotiated directly with developers by Local Councillors and have been a means to fund neighbourhood and community projects that they choose to advance. While Councillors will continue to identify key local projects for CBC funding to support going forward, there will no longer be financial negotiations involving them. This reduces the risk of an unfair City position resulting in a refusal, but it also lessens the ability of projects to address political concerns at the eleventh hour financially.‍

How we can help

It will be more important than ever to understand City Councillors’ and local communities’ needs and concerns from the outset of new development applications, such that they can be addressed early or so that collaborative relationships can be established quickly. Sussex has strong understandings of the community and political considerations important to Members of City Council and can assist with helping to proactively plan for applications that will fall under the CBC framework. Sussex can also assist with helping submit feedback to the City on what types of public benefits and infrastructure should qualify for CBC funds, as feedback is still being accepted and the final report is anticipated this coming Spring.

4. Toronto’s Implementation of Major Transit Station Areas (MTSAs)

What it is

MTSAs are areas within an approximate 10-minute walk (approximately a 500-800 metre radius) of a transit station. The Ontario Growth Plan (2019) prescribes that Toronto establish minimum density targets around subway, light rail, and GO Transit rail stations. A subset of MTSAs, Protected Major Transit Station Areas (PMTSAs), will delineate the areas where the City’s new Inclusionary Zoning policies can be applied. The broad intent of MTSAs is to support transit-oriented development so that jobs and residences can be located and built near supportive public transportation infrastructure. While the City of Toronto has brought forward several reports as part of this work, the Planning and Housing Committee have approved densities as low 0.6 FSI or 3 units. In other cases, MTSA and boundaries are being drawn arbitrarily, omitting sites suitable for development and intensification that are walkable and transit-accessible.‍

Why it matters

While this body of work is intended by the province to help facilitate well-serviced development, the City’s work is setting targets that will not easily facilitate the types of applications necessary to build housing and employment at an economically viable scale. What should be an opportunity to facilitate much-needed housing and jobs growth is being squandered.‍

How we can help

Sussex can assist with positioning applications in the best possible way to make the case for inclusion within MTSA boundaries. Our team is also able to assist with developing relationships with Members of Council to explore partnership opportunities that could help to achieve political buy-in for expanded boundaries. Furthermore, Sussex is prepared to help developers and builders make the case for better policy and a review of the MTSA process through the upcoming provincial election, which will likely be heavily focused on housing.

5. Inclusionary Zoning Implementation

What it is

The new Inclusionary Zoning policies and by-law will apply to complete planning applications filed after September 18, 2022. IZ is a policy that allows for the City of Toronto to require affordable housing set-aside rates in new higher density development applications within PMTSAs. Toronto City Council adopted its IZ policy, including an OP Amendment, ZBA, and implementation guidelines, at its November 2021 meeting.

Why it matters

IZ will secure 5-10% of condominium development units (over minimum unit thresholds) as affordable housing, increasing gradually to 8-22% by 2030, depending on where in the city the development is located and whether the units are intended for rental or ownership, with the highest requirements in the Downtown core, followed by Midtown and Scarborough Centre. The City of Toronto is providing no offsets or incentives with this policy, so the new policy represents a significant new financial obligation that private developers will need to satisfy in the fastest-growing neighbourhoods in the city.

How we can help

Between now and the time of implementation, section 37 agreements and OLT settlements in many neighbourhoods will be heavily informed by the new IZ policy, with the City positioned to lose out on on-site affordable units, should agreements not be reached on completed applications until such a time as the new CBC framework comes into effect. Sussex can assist with scenarios like these, in order to move stuck files forward.

Sussex will be closely monitoring the upcoming Ontario Provincial Election, which will likely see housing as a major theme. Briefings and outreach can be arranged to ensure that clients are aware of the specific risks and opportunities that emerge in the lead up to, and throughout, the campaign period. The planning and housing policies that follow will invariably impact the Municipal Election period and Sussex can also assist with ensuring that new and emerging public policy conversations do not unfairly impact certain types of developments or sensitive applications in contentious neighbourhoods.

6. Implementation of the One-Stream Preliminary Review Program for Building Permit Applicants

What it is

If adopted, the new system will come into effect on March 1, 2022. At its meeting on February 2 and 3, 2022, Council will be considering recommendations to simplify preliminary zoning reviews for proposed plans that are currently covered by two programs (the Preliminary Project Review Program and the Certificate Program). In the one-stream preliminary review program, clients would be provided with a detailed review of a proposal confirming compliance with the City's Zoning By-law and applicable law related to the proposal.‍

Why it matters

Industry feedback to the City has strongly indicated that the current review streams cause confusion amongst permit applicants, time-consuming errors, and additional costs. The streamlined process should improve the overall client experience, while also providing a flat fee structure. ‍

How we can help

While this program is likely to generally improve the building permit application process, there may be some rough edges during early implementation. Where clear answers to questions are not available, Sussex can assist by escalating to senior staff and helping to avoid related delays.