Edmonton (Alta.) - 1980-1981 - Annual housing report (1981-10-15)

SD LIBRARY

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ANNUAL HOUSING-REPORT EDMONTON -REAL-ESTAT

H010/0468/1981

AL

SI

etionton TY

REAL ESTATE AND HOUSING

ilanning Departmew

LIBRARY. Th. City, of Edmon•or

1981 ANNUAL HOUSING REPORT

Prepared By: Policy, Planning and Control Branch Real Estate and Housing Department 1981 10 15

TABLE OF CONTENTS

PAGE

EXECUTIVE SUMMARY

Chapter I

Chapter II

i - v

INTRODUCTION

1

1.1 Purpose of the Report

1

1.2 Organization of the Report

3

OVERVIEW OF THE EDMONTON HOUSING MARKET

4

2.1 Housing Market Indicators

4

2.2 Conclusion

9

Chapter III

PROGRESS ON 1980 ANNUAL HOUSING REPORT'S ACTION PLAN

10

Chapter IV

HOUSING ISSUES AND CONCERNS

25

4.1 Real Estate and Housing's Diminishing Social Housing Land Inventory

25

4.2 The Negative Effects of the (p) Designator Policy

25

4.3 The Inappropriateness of the Current "Equitable Distribution Policy"

27

4.4 The Ineffectiveness of the Five Percent Purchase Policy to Ensure That Land Purchased Under the Department's Social Housing Land Program is Suitably Located and can be Disposed of Within the Federal Government's Maximum Unit Price Guidelines

28

4.5 The Need for the Province to Pay a Grant-In-Lieu of the Municipal Portion of Property Taxes Foregone on Senior Citizen Housing and Housing for Disabled Persons

28

PAGE Chapter V

Chapter VI

SOCIAL HOUSING TARGETS AND FUTURE MUNICIPAL LAND AND BUDGET REQUIREMENTS

30

5.1 Introduction

30

5.2 Social Housing Targets (1981-83)

30

5.3 Impact on Inventory (1981-83)

33

5.4 Impact on Capital Budget (1981)

35

5.5 Impact on Current (Operating) Budget (1981)

36

5.6 Conclusion

37

1981/82 ACTIVITY PLAN

38

6.1 Real Estate and Housing's Diminishing Social Housing Land Inventory

38

6.2 The Negative Effects of the (p) Designator Policy

38

6.3 The Inappropriateness of the Current Equitable Distribution Policy

38

6.4 The Ineffectiveness of the Five Percent Purchase Policy to Ensure That Land Purchased Under the Department's Social Housing Land Program is Suitably Located and can be Disposed of Within the Federal Government's Maximum Unit Price Guidelines

38

6.5 The Need for the Province to Pay a Grant-In-Lieu of the Municipal Portion of Property Taxes Foregone on Senior Citizen Housing and Housing for Disabled Persons

39

LIST OF FIGURES, MAPS AND TABLES

PAGE

EXECUTIVE SUMMARY Table I

Social Housing Land (Acquisition) Program

Table II

Past Social Housing Program Operating Subsidies Paid by City and Estimated Future Subsidies to be Paid by City

REPORT Figure 2.1

Housing Cost Indicators

5

Figure 2.2

Availability of Housing

6

Table 3.1

Cost of Land Acquisition in 1980

10

Table 3.2

Social Housing Production

11

Map 3.1

1981 Social Housing Target Areas

12

Table 3.3

Total Subsidy Paid by City for Community Housing Program Projects Administered by Edmonton Housing Authority

14

Table 3.4

Estimated Future Total Subsidy to be Paid by City for Community Housing Program Projects Administered by Edmonton Housing Authority

15

Table 3.5

Total Subsidy Paid by City and Estimated Future Total Subsidy to be Paid by City for Housing Projects Administered by Greater Edmonton Foundation

16

Table 5.1

Social Housing Targets (1981-83)

32

Figure 5.1

Impact of Development Targets on Current Inventory

34

Table 5.2

Impact on Capital Budget (1981)

36

EXECUTIVE SUMMARY

EXECUTIVE SUMMARY

This summary provides a brief overview of the report entitled 1981 Annual Housing Report, prepared by the Real Estate and Housing Department. The report is divided into six chapters. These are entitled: I. II. III. IV. V.

Introduction; Overview of Edmonton Housing Market; Progress on 1980 Annual Housing Report's Action Plan; Housing Issues and Concerns; Social Housing Targets and Future Municipal Land and Budget Requirements; and VI. 1981/82 Activity Plan.

Listed below are the major findings, achievements and expenditures of the Real Estate and Housing Department as they relate to the provision of social housing in Edmonton.

A.

EDMONTON HOUSING MARKET 1. Although residential sales prices increased at rates below those of the annual inflation rate in 1979 and 1980, indicators in 1981 suggest that prices are now increasing at a rate above that of inflation.

2. During the first half of 1981, residential building starts were up about 34% over the same period of 1980. However, starts in the first half of 1981 were still significantly below the levels achieved in 1978 and 1979.

3. While the inventory of new houses in Edmonton has been higher than the nation's average (8 month supply compared to 6.5 months for all Canadian metropolitan areas), the inventory of newly completed and unoccupied rental housing has dropped, with vacancy rates for apartments standing at 2.4% in April 1981 compared to 3.0% in April 1980.

B.

REAL ESTATE AND HOUSING DEPARTMENT ACTIVITY - 1980 1. Social Housing Land Program During 1980, the Real Estate and Housing Department acquired land for 540 units of social housing, and is committed to acquiring land for a further 705 units in 1981.

2. Social Housing Program Subsidy Involvement The City contributes a subsidy to offset the operating deficits of both the Community Housing and Senior Citizen Lodge Programs. a)

In 1980, the City contributed $545,000 to the Community Housing Program. This represents a decrease of 9% compared to the 1979 contribution.

b)

During 1980, the City contributed $272,663 to the Senior Citizen Lodge Program, a decrease of about 13% from 1979. This decrease was largely the result of Alberta Housing Corporation assuming responsibility for 25% of the total deficit.

c)

The City also foregoes taxation on senior citizen housing projects and non-profit housing projects for disabled persons. The Assessment Department estimates that in 1980 the municipal portion of the total property tax levy foregone from such projects amounted to about $993,000.

3. Review of City's Current Housing Policies and Programs During 1980, the Real Estate and Housing Department undertook reviews of the "Five Percent Purchase Policy" and the Land Use Bylaw's "Community Housing Designator". In early 1982, the results of these analyses will be forwarded to City Council with recommendations.

4. Communication and Coordination with the Private Sector, Housing Sponsors and Other Governments In 1980, the Real Estate and Housing Department initiated the following three courses of action:

C.

a)

Development of a City-wide Housing Services Telephone Directory,

b)

The preparation of an audio-visual presentation, and

c)

The establishment of a liaison committee between Alberta Housing Corporation and the City.

HOUSING ISSUES AND CONCERNS The Real Estate and Housing Department identified five areas of concern that relate to the delivery of social housing in Edmonton. These are: a) The diminishing Social Housing Land Inventory; b) The negative effects of the "(p) Designator Policy";

iii

c) The inappropriateness of the current "Equitable Distribution" Policy; d) The ineffectiveness of the Five Percent Purchase Policy to ensure that land purchased under the Department's Social Housing Land Program is suitably located and can be disposed of within the Federal Government's Maximum Unit Price guidelines; and e) The need for the Province to pay a grant-in-lieu of the municipal portion of property taxes foregone on senior citizen housing and housing for disabled persons.

D.

SOCIAL HOUSING TARGETS AND FUTURE MUNICIPAL LAND AND BUDGET REQUIREMENTS 1. Social Housing Targets (1981-83) In 1981, it is estimated that Alberta Housing Corporation may develop 396 units of Community Housing on land made available by the City.

Project figures for 1982 and 1983 are 430 and 500, respectively. Municipal Non-Profit Housing units are estimated to be 279 in 1981, 200 in 1982, and 200 in 1983. Other third sector housing is projected to account for 30 units in 1981, and 40 units each for 1982 and 1983.

2. Impact on Inventory (1981-83) If no new acquisitions are undertaken, all municipal land for Community Housing will be exhausted by 1983. Municipal Non-Profit Housing Program land will be eliminated by 1982, as will the inventory for Private Non-Profit Housing and Non-Profit Cooperative Housing.

3. Impact on Capital Budget (1981) In order to avoid the elimination of social housing sites by 1983, the Real Estate and Housing Department is currently pursuing an acquisition program for sufficient land to provide for an additional 650 units under the Community Housing Program, the Municipal Non-Profit Housing Program and other third sector housing.

While it is estimated that total land acquisition costs in 1981 will be approximately $11,050,000, due to the carry over of the unspent capital budgetary allocation for 1980 the Department was authorized to spend $16.2 million in 1981. However, current estimates are that the Department will be able to only spend a maximum amount of $950,000 or approximately 6% of the 1981 authorized total allocation by year-end 1981.

iv

E.

FUTURE SOCIAL HOUSING INVOLVEMENT 1. Policy Development The first five chapters of this report provide a background and analysis of the variety of problems associated with the availability and cost of housing, and in particular social housing, over the next few years in Edmonton.

Chapter Six, the report's final chapter, summarizes the five social housing policy issues identified by the Real Estate and Housing Department in 1980 and early 1981 as being those areas most in need of amendment. In detail, these five policy issues relate to the following: a)

The City's diminishing Social Housing Land Inventory;

b)

The Land Use Bylaw's (p) Designator Policy;

c)

The General Municipal Plan's equitable or "Fair-Share Distribution" Policy;

d)

City Council's Five Percent Purchase Policy; and

e)

The need for the Province to pay to the City a grantin-lieu equal to municipal property taxes foregone from senior citizen housing and housing for the disabled.

In each policy area the Real Estate and Housing Department will prepare a report during the next year to City Council recommending either the approval of new policies or amendments to existing policies to enable the Department to better respond to these particular concerns.

It is the opinion of the Department that, when each of these policy issues have been resolved, the City will have succeeded in removing the major impediments to its effective and responsible involvement in the area of social housing development and financing.

2. Budgetary Implications The following tables summarize both the actual and anticipated budgetary implications resulting from the City's expected future involvement in the development and operation of social housing. The background on this information is provided in Chapters Three and Five.

TABLE I SOCIAL HOUSING LAND (ACQUISITION) PROGRAM 1980 Budget Actual Total Cost ($000) 8,569 2,331 of Units 615 155 Total No. 14 15 Total Cost per Unit ($000) SOURCE: Real Estate and Housing Department

1981 Budget Actual 11,050 650 17

TABLE II PAST SOCIAL HOUSING PROGRAM OPERATING SUBSIDIES PAID BY CITY AND ESTIMATED FUTURE SUBSIDIES TO BE PAID BY CITY PROGRAM Senior Citizen Lodge Total Subsidy ($000) Total No. of Beds Total Subsidy per Bed

1979*

1980

1981

1982

1983

1984

332 763 $435

276 763 $362

409 763 $536

534 918 $582

623 983 $634

672 983 $684

Community Housing 545 830 1,142 1,414 597 Total Subsidy ($000) 2,720 Total No. of Units 2,608 3,218 3,648 4,148 $200 $258 $313 $341 Total Subsidy per Unit** $227 821 1,239 1,676 2,037 TOTAL ANNUAL SUBSIDY ($000) 929 TOTAL ANNUAL SUBSIDY AS A 1.1 0.9 1.1 1.0 1.0 PERCENT OF THE MILL RATE*** SOURCE: Real Estate & Housing and Finance Departments * Figures for 1979 are actual amounts, while figures for all other years are estimates. ** Operating deficits incurred by projects turned over from Alberta Housing Corporation to the Edmonton Housing Authority, after October 1, are carried over to the following year. *** Mill rate figures for 1979, 1980 and 1981 are approved budget figures while figures for 1982, 1983 and 1984 are from the Local Policy Plan 1982-1986.

1,710 4,648 $368 2,382 1.0

CHAPTER I

INTRODUCTION

CHAPTER I - INTRODUCTION

1.1 PURPOSE OF THE REPORT

Over the past two decades, housing has been a concern of Edmonton City Councils. Since the late 1960s, in particular, the rapid growth rate in the Edmonton Metropolitan Area has been accompanied by rising housing costs and low apartment vacancy rates.

In 1973, City Council established an interdepartmental Housing Task Group to review the housing situation and report back with recommendations.

Upon completion of its review, the Housing Task Group recommended that a specific department be established to deal with all matters pertaining to housing, that a full study be undertaken to determine the need and demand for social housing, and that the City build up to 1,000 units of social housing per year.

Subsequently, the Real Estate and Housing Department was formed, public housing production was increased, and a study was initiated to review the need and demand for social housing in Edmonton. The study, entitled Housing In Edmonton: Directions For The Future, was prepared by the Planning Department and presented to City Council in 1976. The report stated that the problem of social housing assistance was complex and difficult to measure and that, in order to ensure effective utilization of City resources, overall housing policies and priorities were required.

After considerable public involvement, and discussion within the Administration, City Council was presented with a report entitled A Housing Strategy for the City of Edmonton, prepared by the Real Estate and Housing Department, and approved on 1979 06 26. This report provided the City with policy directions for future housing activities and confirmed that City Council would continue to play a direct role in the area of social housing. In addition, the report recommended that the Administration

2. prepare an annual housing report in order to outline social housing production targets and costs. On 1980 06 24, City Council received as information the Department's first annual housing report.

The objectives of the 1981 Annual Housing Report are as follows: (1)to review the existing local housing market; (2)to review housing assistance programs in which the City is actively involved; (3)to analyze Administration and City Council policies which affect the delivery of social housing; (4)to present assisted housing production targets and costs over the next three years; and (5)to propose a plan of activities to address specific housing problems during the next year.

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Edmonton Non-Profit Housing Corporation made Primrose Place available for initial occupancy in September 1981. The 48 units provide rental accommodation for low and moderate income families in city's west end.

Cedar Garden Apartments in Steele Heights is a medium density suburban rental housing development designed for fatally accommodation.

It is financed under the Province's Core Housing Incentive Program.

3.

1.2 ORGANIZATION OF THE REPORT

This introductory chapter has identified both the mandate and objectives of the 1981 Annual Housing Report. Chapter Two provides an overview of Edmonton's housing market during 1980 and the first half of 1981. Chapter Three reviews the progress the Department has achieved in response to the Action Plan contained in the 1980 Annual Housing Report. Chapter Four is a discussion of problems and issues that were identified during work on the 1980 Action Plan. Chapter Five outlines the proposed social housing land acquisition and land disposal program for 1981. The sixth and final chapter pertains to research activities that are proposed to be carried out by the Department in the remainder of 1981 and 1982.

CHAPTER II

OVERVIEW OF THE EDMONTON HOUSING MARKET

4.

CHAPTER II - OVERVIEW OF THE EDMONTON HOUSING MARKET

2.1 HOUSING MARKET INDICATORS

Edmonton's "Average Residential Sale Price" in December 1980 increased 5% from December 1979, compared to an annual increase of about 7% from December 1978. From December 1980 to June 1981, it increased about 10%.

In

1980, the "All-Items Consumer Price Index" increased approximately 107 from 1979, and about 9% in 1979 from 1978. From December 1980 to June 1981 it increased about 6% (see Figure 2.1). House prices still remain high when compared to the rest of Canada. According to the 1981 06 01 edition of the Royal Trust Survey of Canadian House Prices, with the exception of Vancouver, Calgary and Toronto, a house in Edmonton generally costs more than anywhere else in Canada. In June 1981, the Edmonton Average Residential Sale Price was about $91,700. With a 15% downpayment and conventional mortgage financing, the purchase of this average residence by a first time home buyer required an annual income of at least $49,000. However, it is estimated that in June 1981, in the Edmonton Metropolitan Area, only 20% of family households earned in excess of $49,000 annually.

In Edmonton in 1980, overall residential construction activity was down from 1979 levels. Total residential starts were down roughly 13% from 1979. Similarly, total residential completions were down about 35% in 1980 from 1979. However, over the first half of 1981, total residential starts exceeded the levels that occurred during the same period in 1980, but were still below the number of starts that were recorded in the first half of both 1978 and 1979 (See Figure 2.2).

In 1980, starts for singles and doubles (single detached, semi-detached and duplex units) were down about 23% from 1979 (see Figure 2.2). Completions were down approximately 28%. Yet, while starts and completions were considerably lower, by year-end 1980 the newly completed and unoccupied inventory of single and double units had more than tripled

FIGURE 2.1

HOUSING COST INDICATORS 1976 -1981 TREND E DMONTON 300 CONSUMER PRICE INDEX 200

100

1976

1977

1978

1979

1980

1981

SOURCE: Statistics Canada

($000) 95 AVERAGE RESI DENTI AL SALES PRICE 80

65

50 1976

1977

1978

1 979

1 980

1981

SOURCE: Edmonton Real Estate Board

(%) 20.0 CONVENTIONAL MORTGAGE LENDING RATES 16.9

13.3

10.0 1976

1977

1978

197 9

1980

1981

SOURCE: Bank of Canada

FIGURE

2.2

AVAILABILITY OF HOUSING

b.

1976-1981 TREND CUMULATIVE QUARTERLY RESIDENTIAL BUILDING STARTS EDMONTON

NO. OF UN ITS — 9000

— 8000

— 7000

—6000

7 — 5000

— 4000

'77

— 3000

—2000

— 1000

1976

1977

Singles and Doubles

A

Multiples

SOURCE Canada Mortgage and Housing Corporation

1978

1979

1980

1981 (Ist HALF)

7. from 1978 levels in the Edmonton Metropolitan Area. In their April 1981 edition of Alberta Housing, Clayton Research Associates Limited noted that this oversupply is gradually being reduced, primarily in response to falling production rather than an increase in absorptions. By February 1981, the unoccupied new house inventory in the Edmonton Metropolitan Area had dropped to about an 8 month supply, still considerably higher than the 6.5 month supply for all metropolitan areas across Canada. Due to high mortgage lending rates, continued recovery is not expected to be rapid (see Figure 2.1).

The oversupply of ownership accommodation that developed in Edmonton over 1980 is in sharp contrast to changes which occurred in the local rental market in the same year. In Edmonton in 1980, starts for multiples (row and apartment units) dropped approximately 5% from 1979 (see Figure 2.2).

Completions also dropped by about 40% in 1980 from 1979. By year-end 1980 the inventory of newly completed and unoccupied row housing and apartment units in the Edmonton Metropolitan Area had dropped approximately 32%.

The overall decrease in production of multiples in Edmonton over the last few years is a reflection of the significantly reduced capital investment potential for developing apartments, primarily due to high mortgage lending rates. Since the fall of 1979, mortgage lending rates have been volatile and continue to escalate. Investment potential is further aggravated by the lengthy development process inherent to high density residential projects and the rising cost of serviced land in Edmonton.

Recognizing the "backlog" of rental housing demand and the rental housing availability problem occurring in Edmonton and Calgary, the Alberta Government phased out rent controls in July 1980. This action was intended to increase the viability of new rental construction activity by allowing market rents to adjust from controlled levels. In addition, to further stimulate capital investment in new residential construction, in the spring of 1980 the Province introduced its own tax shelter program, the Alberta Rental Investment Incentive Program, to replace the Federal Capital Cost Allowance Program on Multiple Unit Residential Buildings

8.

(MURB) which was terminated at the end of 1979. In October 1980, the Federal Government re-introduced its own residential capital cost allowance program. In spite of evidence that market rents have increased substantially since the removal of rent controls, there has been no perceived major increase of private capital investment into new rental residential construction.

In fact, by April 1981, the vacancy rate for

apartments in the Edmonton Metropolitan Area had fallen to 2.4%, well below the healthy 4% vacancy level. The combined effect of high and volatile mortgage lending rates, and high land and construction costs, have effectively eroded whatever increased viability decontrolled rents and the combined Federal and Provincial tax shelter programs may have provided.

It is therefore not surprising to observe that it is only with the aid of a variety of Federal and Provincial housing assistance programs providing tax shelters, preferred interest mortgage financing, and direct subsidies that the private sector in Edmonton is currently involved to any extent in the development of new rental housing.

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Elm Park Place in City View was the first project completed by the Edmonton Non-Profit Housing Corporation. It comprises 28 units.

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2.2

CONCLUSION

The current problem associated with the ownership market in Edmonton is one of affordability and not supply. However, all indications are that Edmonton is on the verge of a serious rental shortage, especially for smaller one and two bedroom accommodation. It has been observed that by year-end 1980, overall housing market conditions in Edmonton had significantly worsened over the previous 12 month period.

Furthermore, it

appears that 1981 housing production will be close to the low 1980 level.

With an inflation rate around 12%, and assuming mortgage lending rates continue to exist at current levels, government housing assistance programs will continue to play essential roles in meeting the bulk of Edmonton's additional rental housing requirements in the near future.

Chapter Three discusses the City's attempts, in 1980, to alleviate the effects of Edmonton's adverse housing market conditions.

CHAPTER III

PROGRESS ON 1980 ANNUAL HOUSING REPORT'S ACTION PLAN

10.

CHAPTER III - PROGRESS ON 1980 ANNUAL HOUSING REPORT'S ACTION PLAN

3.1 INTRODUCTION

On 1980 06 24, City Council approved the 1980 Annual Housing Report. The report contained an Action Plan outlining six specific objectives to be implemented by Real Estate and Housing over an estimated three-year period.

3.2 OBJECTIVE ONE "UNDERTAKE AN ACQUISITION PROGRAM TO ASSEMBLE A SUFFICIENT SUPPLY OF LAND IN ORDER TO ACHIEVE HOUSING TARGETS." Acquisition of Land for Social Housing

In late 1980, in response to the "Action Plan" objective noted above, the Department established an "Implementation Team" charged with the responsibility of undertaking a land acquisition program for social housing.

As a result, several sites have been transferred to its inventories, acquisitions have been made from private offerings, and several other sites are in the acquisition process. Table 3.1 indicates the distribution, by program, of these acquisitions in the 1980 budgetary year.

TABLE 3.1 COST OF LAND ACQUISITION IN 1980 ($000) COMM. HOUSING MUN. NON-PROFIT OTHER THIRD SECTOR* Budget** Budget** Actual Actual Budget** Actual $1,869 $1,355 $ Suburbs $ $ 2,000 76 2,100 Inner-City 2,600 900 $ 76 $4,469 $2,255 $2,000 $77TU TOTAL SOURCE: Real Estate and Housing Department Other third sector housing includes Private Non-Profit Housing * and Non-Profit Cooperative Housing. ** Budget figures are from the 1980 Annual Housing Report.

In 1980, the majority of actual acquisitions occurred in suburban areas (see Map 3.1). Prohibitive land costs combined with restrictive "Maximum Unit Price" guidelines and difficulties related to districting have hindered acquisitions in older established neighbourhoods.

Table 3.1 illustrates the absence of acquisitions for third sector housing in 1980. This is because new properties, particularly for Private NonProfit Housing and Non-Profit Cooperative Housing, are not purchased unless specific groups request lands or sites beyond those currently in City inventories.

Achievement of Housing Targets

In 1980, the Real Estate and Housing Department was able to meet land requirements for social housing from its current inventories, supplemented by acquisitions to meet specific requests. Table 3.2 below illustrates the "actual" versus "target" number of units for which the City provided land.

Discrepancies between these two figures for 1980 are the result not of short-falls in property inventory, but rather of developing agencies requesting either more land, as in the case of Community Housing, or less, as in the case of the latter two social housing programs.

TABLE 3.2 SOCIAL HOUSING PRODUCTION (UNITS) 1981 1980 Actual PROGRAM Target* Target* Committed Community Housing 160 321 Suburbs 330 393 88 Inner-City 75 248 396 330 393 TOTAL Municipal Non-Profit Housing 100 129 Suburbs 102 Inner-City 200 100 150 102 200 TOTAL 200 279 Other Third Sector Housing 25 45 Suburbs 50 10 60 60 20 Inner-City 45 110 85 30 TOTAL All Programs 355 438 310 460 Suburbs 245 260 102 248 Inner-City TOTAL 615 540 558 705 SOURCE: Real Estate and Housing Department * Target figures are from the 1980 Annual Housing Report.

MAP 3.1 SOURCE Edmonton General Municipal Plan

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REAL ESTATE AND HOUSING

1981 SOCIAL HOUSING TARGET AREAS

13.

Conclusion

The Real Estate and Housing Department has met the housing targets set for 1980 through provision of sufficient developable sites. In 1981, it is expected that once again continued availability of appropriate lands in inventory will permit the Department to meet targets set for it in the 1980 Annual Housing Report. As pointed out in Chapter Five, this favourable position will be reversed if depleting inventories are not replaced in the near future. However, in 1981 the Department will not be able to reconcile the problem of a depleting Social Housing Land Inventory.

According to current estimates, by year-end 1981 only about 6% of the total 1981 authorized capital budgetary allocation for social housing land acquisition will have been utilized. As a result, the Department will be required to furnish sites to the variety of social housing delivery agencies in Edmonton from a diminishing Social Housing Land Inventory.

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Clareview II shown under construction in the spring of 1981, was developed

by Alberta Housing Corporation under the Community Housing Program. The project is unique as it is designed to utilize innovative passive solar heating techniques.

Queen Alexandra Community Housing Project is one of the few housing projects that provides subsidized housing for low income families in Edmonton's inner city.

14.

3.3

OBJECTIVE TWO "REVIEW THE FISCAL IMPACT ON THE CITY OF EDMONTON AS A RESULT OF ITS INVOLVEMENT IN GOVERNMENT-SUBSIDIZED HOUSING PROGRAMS."

City of Edmonton's Social Housing Program Subsidy Involvement There are two social housing programs for which the City of Edmonton currently shares in providing a subsidy to offset total annual operating deficits, namely the Community Housing and Senior Citizen Lodge Programs.

Under the Community Housing Program all annual project expenses, including debt retirement costs and operating expenses, are included in the calculation of the total operating deficit. The City contributes 10% of the program's total annual operating subsidy. The total Community Housing subsidy paid by the City decreased from $596,692 in 1979 to $545,000 in 1980 representing a decrease of about 9% (see Table 3.3).

Table 3.4 provides the projected City subsidy to be paid each year, up to and including 1986.

TABLE 3.3

TOTAL SUBSIDY PAID BY CITY FOR COMMUNITY HOUSING PROGRAM PROJECTS ADMINISTERED BY EDMONTON HOUSING AUTHORITY Developed No. of Units Cumulative No. of Units

1976 126 1,570

1977 306 1,876

1978 548 2,424

1979 184 2,608

Total City Subsidy* $174,261 $220,498 $484,078 $596,692 $114 $124 $212 $227 City Subsidy/Unit*** SOURCE: Real Estate and Housing Department * The City's payment is 10% of the total government subsidy needed to offset the operating deficits of the Edmonton Housing Authority. ** The 1980 figure is an estimate. *** Operating deficits incurred by projects turned over from Alberta Housing Corporation to the Edmonton Housing Authority, after October 1, are carried over to the following year.

1980 112 2,720 $545,000** $200

15.

TABLE 3.4

ESTIMATED FUTURE TOTAL SUBSIDY TO BE PAID BY CITY FOR COMMUNITY HOUSING PROGRAM PROJECTS ADMINISTERED BY EDMONTON HOUSING AUTHORITY 1983 1981 1982 PROPOSED ACTIVITY Developed No. of Units 498 430 500 Cumulative No. of Units 3,218 3,648 4,148 Total City Subsidy ($000) 830 1,142 1,414 City Subsidy/Unit $258 $313 $341 SOURCE: Real Estate and Housing Department

1984

1985

1986

500 4,648 1,710 $368

500 5,148 2,039 $396

500 5,648 2,389 $423

The existing Senior Citizen Lodge Program requires the City to assume primary responsibility for ongoing project operating expenses. The total Senior Citizen Lodge Program subsidy requested for City payment decreased from $311,609 in 1979 to $272,663 in 1980, a decrease of about 13%. This was largely due to Alberta Housing Corporation assuming 25% of the total subsidy in 1980. Table 3.5 below illustrates the annual operating subsidy paid by the City to the Greater Edmonton Foundation in past years as well as the projected City subsidy to be paid each year up to and including 1986.

The total annual operating subsidy for the Community Housing and Senior Citizen Lodge Programs is forecasted to remain at about 1% of the mill rate until at least 1984 (see Table II).

16.

TABLE 3.5 TOTAL SUBSIDY PAID BY CITY AND ESTIMATED FUTURE TOTAL SUBSIDY TO BE PAID BY CITY FOR HOUSING PROJECTS ADMINISTERED

BY GREATER EDMONTON FOUNDATION Actual Est.Subsidy Cumulative No. Average Annual Subsidy/Bed Year Subsidy ($000) of Beds* 1974 $ 73,767 $117 633 1975 131,357 633 208 1976 186,618 633 295 1977 242,536 698 347 1978 277,430** 763 364 1979 332,243** 763 435 1980 276,022** 763 362 1981 409** 763 536 1982 534** 918 582 1983 623** 983*** 634 1984 672** 983*** 684 1985 721** 983*** 733 779** 1986 983*** 783 SOURCE: Real Estate and Housing Department * The cumulative number of units assumes: 1 bed per single hostel unit; 2 beds per double hostel unit; and 1 bed per self-contained unit. ** After 1977, the annual City subsidy includes the subsidy payments for the 3 City-owned "cottage" Lodge projects developed prior to the Senior Citizen Lodge Program's inception in Edmonton in 1960. *** Estimates of the number of new units that will be added to the cumulative inventory beyond 1983 have not been forecasted.

Foregone Municipal Taxation Revenue on Senior Citizen Housing Projects and Housing Projects for Disabled Persons On 1973 05 10, the Province exempted from municipal assessment land and improvements owned and operated for senior citizens or disabled persons by non-profit organizations, including the Greater Edmonton Foundation. The Assessment Department estimated that in 1980 the municipal portion of the total property tax levy foregone from such housing projects amounted to about $993,000. In 1980, the Commissioner of Economic Affairs, as directed by City Council, twice approached the Minister of Municipal Affairs regarding the payment of a grant-in-lieu of taxes to compensate for foregone taxation. In response to both of the inquiries, the Minister of Municipal Affairs rejected the City's request for a grant-in-lieu, arguing that such exemptions do not create a financial hardship for the City.

17.

The City had expressed the position that, although the municipal taxation revenue foregone does not pose extreme hardship, it still contributes to the annual pressure on the City's property tax base; so as a matter of principle a Provincial grant-in-lieu of lost municipal taxation revenue is justified.

On 1981 05 12, City Council, as recommended by the Assessment Department, supported a 1981 Alberta Urban Municipalities Association resolution regarding a Provincial grant-in-lieu of municipal tax on senior citizen exempt accommodation. The resolution is stated as follows:

NOW THEREFORE BE IT RESOLVED that the provincial government pay annually to the municipality in which it is located any properties exempted under Section 25(1), sub clauses 27 and 28 of the Municipal Taxation Act, a grant in lieu of taxes in an amount equal to the municipal portion of the property taxes on land and improvements as if the property were not exempt.

The Chinese Elders Mansion was developed in the Boyle Street area under the Province's Senior Citizen SelfContained Housing Program.

Good Samaritan Manor is operated by a non-profit society which provides rental accommodation for senior citizens. Located in Strathcona, the walk-up apartment was purchased by the society in 1975 through Canada Mortgage and Housing Corporation's Private NonProfit Housing Program.

18.

3.4 OBJECTIVE THREE

"REVIEW AND PROPOSE AMENDMENTS TO THE CITY'S CURRENT HOUSING POLICIES AND PROGRAMS." During 1980, Real Estate and Housing undertook thorough analyses of two City social housing policies. The policies reviewed are the "Five Percent Purchase Policy" and the Land Use Bylaw's "Community Housing Designator".

In 1981 or early in 1982, the Administration will be presenting these analyses to City Council with recommendations. A more complete discussion of the various issues and concerns identified by the Department during 1980 and early 1981 is provided in Chapter Five.

3.5 OBJECTIVE FOUR

"EVALUATE AND IMPROVE THE EFFECTIVENESS OF OVERALL HOUSING RESPONSIBILITIES OF THE CITY OF EDMONTON." Social Housing Land Program Review

During 1980, the Real Estate and Housing Department continued to assist the development of housing under the Municipal Non-Profit Housing, Community Housing and the other third sector housing Programs in Edmonton by identifying, acquiring and disposing of building sites for a variety of local social housing delivery organizations. For a review of the Department's specific 1980 activity in this area, see Chapter Five of this report.

The rationale for the City's continued involvement in the Social Housing Land Program is as follows: First, by providing building sites for social housing purposes, the City is able to exercise a greater level of control over the future siting and distribution of social housing projects throughout Edmonton. Secondly, by providing sites at generally less than market value to social housing delivery agencies, project capital costs, and in turn, annual project operating expenses, are reduced. In this way,

19.

the Department's Social Housing Land Program enables the provision of more lower-rent units and consequently, reduced social housing program subsidy requirements.

Review of City Involvement in Social Housing Programs

In 1980, the City of Edmonton continued to have a major role in the delivery of:

(1) the Community Housing Program;

(2) the Senior Citizen

Lodge Program and (3) the Municipal Non-Profit Housing Program. The nature of the City's involvement in 1980 and the cumulative number of units available for initial occupancy to the end of 1980 under these programs is summarized below.

(i) Community Housing Program

As part of Real Estate and Housing's Social Housing Land Program, in 1980, the City continued to lease sites from its Social Housing Land Inventory for Community Housing projects. Under the City's current leasing policy, sites are leased to Alberta Housing Corporation on a cost-recovery basis, in accordance with acquisition costs, carrying costs and costs of local improvements incurred by the City prior to transfer. Land is leased from the City for 60 years, at the end of which time both the land and improvements revert back to the City.

As discussed in Section 3.3, the City also pays 10% of the subsidy required to offset the total annual operating deficit of Community Housing projects.

In 1980, 112 new units were made available for initial occupancy, resulting in a total Community Housing portfolio by year-end 1980 of 2,720 units.

20.

(ii) Senior Citizen Lodge Program

By the middle of 1981, the portfolio of Senior Citizen Lodge accommodation in Edmonton comprised a total of 763 lodge beds and self-contained apartment units. Of this total 69 self-contained units were located in the 3 City-owned cottage lodge projects built before the introduction of the program in 1960. The remaining 694 beds and units were located in 10 Senior Citizen Lodge projects built by Alberta Housing Corporation after the signing of the existing Master Agreement in 1960.

Prior to 1980, on several occasions, City Council had expressed concern about the Lodge Program in Edmonton, particularly with regard to the program's rising operating deficits which, as a result of the 1960 Master Agreement and The Senior Citizens Housing Act, were the total responsibility of the City of Edmonton.

However, 1980 marked a year of transition for the Lodge Program in Edmonton. It was during this year, in response to City Council directives, that the Real Estate and Housing Department negotiated with the Province to have the program amended to relieve the City of its 100% subsidy involvement.

Also during 1980, the Department conducted an internal review of the program in Edmonton. Results of this analysis indicated the Lodge Program had evolved considerably since its inception in 1960. The most significant observation was that it was becoming more of a social service program with a larger proportion of residents requiring greater levels of nursing and domestic care. It was also noted that rising care costs were the primary reason for the program's dramatic increase in operating deficits since 1974. As a result, the Department's conclusions were the Province should become more involved with the funding of the program's operating deficits.

In response to the Department's negotiations in this regard, in April 1981, Alberta Housing Corporation provided the City with a Cabinet-

21.

approved proposal to have the Province assume 25% of total annual operating deficits (where these were within 30% of total Foundations' operating expenses). At the same time, the Province submitted a proposed new Master Agreement to replace the existing Master Agreement.

In response to the Department's review of this proposal, City Council rejected the proposed new Master Agreement as it contained no guarantee that the Province's 25% participation would exist in the future.

Subsequently, the Department submitted to Alberta Housing Corporation a City Council-approved proposed Amending Agreement to authorize the future construction of two new Senior Citizen Lodge projects and to permit the City to contribute toward all outstanding program subsidy claims. As of the writing of this report, no formal response had been received to this proposal.

Sunset Homes is made up of 18 duplex "cottages" originally developed by the Lions Club in the 1930's and subsequently donated to the City.

Kiwanis Place located in Oliver and developed in 1971, was the first high-rise apartment project developed for senior citizens in Alberta. It is financed under the Senior Citizen Lodge Program.

22.

(iii) Municipal Non-Profit Housing Program

In 1980, the City made available to the Edmonton Non-Profit Housing Corporation, interim funding to cover their project design costs and administrative costs prior to the availability of mortgage financing from Alberta Home Mortgage Corporation. The intent is to have interim funding payments recovered from project revenues over time.

Funding was made available from proceeds received by the City through the Federal Municipal Incentive Grant Program.

Also in 1980, the City continued to provide sites for the development of housing projects under the Municipal Non-Profit Housing Program.

In all cases, at such time as the City sold or leased land to the Edmonton Non-Profit Housing Corporation, the Corporation was charged the greater of 50% of the land's market value or the City's cost of originally acquiring the property, plus carrying costs.

In 1980, Edmonton's first housing project was made available for initial occupancy, under the Municipal Non-Profit Housing Program. The project consists of 28 units and is located in the City View area.

3.6 OBJECTIVE FIVE "IMPROVE COMMUNICATIONS AND COORDINATION WITH THE PRIVATE SECTOR, HOUSING SPONSORS AND OTHER GOVERNMENTS, WITH THE VIEW TO INCREASING CITY INVOLVEMENT IN HOUSING DECISIONS." In response to this directive, in 1980, Real Estate and Housing initiated three specific courses of action. These are:

(1) the development of a

City-wide Housing Services Telephone Directory; (2) the preparation of an audio-visual presentation to be shown to community groups, service agencies and other government departments; and (3) the establishment of a liaison committee between Alberta Housing Corporation and the City. All three of these actions are described in more detail below.

In addition to the above, Real Estate and Housing has, on a less formal level, communicated regularly throughout 1980 with other housing agencies,

23. such as Alberta Home Mortgage Corporation, Alberta Housing and Public Works, Canada Mortgage and Housing Corporation, the Greater Edmonton Foundation, the Edmonton Non-Profit Housing Corporation, community groups, and local community-based resource organizations.

Housing Services Telephone Directory

During 1980, Real Estate and Housing received a significant number of inquiries from the general public relating to the delivery of housing services in Edmonton. In an effort to respond more effectively to future inquiries, the Department has compiled a telephone directory of housing services in Edmonton.

The directory's primary purpose will be that of a reference document to be used by the Administration to assist in referring future inquiries by the public to appropriate housing service agencies.

Housing and Research Section Audio-Visual Presentation

The Housing and Research Section of Real Estate and Housing is often queried by other City Departments as well as other levels of government, various non-government agencies and community groups about its specific responsibilities and goals as the primary "housing arm" of the Administration.

To facilitate a better understanding of the Section's role, in 1980 a short audio-visual presentation was produced by the Section with the assistance of the Public Relations Department. It summarizes Real Estate and Housing's perspective of how it should interrelate with other governments and the private sector in the development of policies and programs to facilitate the provision of both social and market housing in Edmonton.

Alberta Housing Corporation/City of Edmonton Liaison Committee

This Committee was established in July 1980 by the Commissioner of Public Affairs to make recommendations on the distribution and construction of

24. projects developed by Alberta Housing Corporation in Edmonton under the Senior Citizen Self-Contained Housing, Community Housing and Senior Citizen Lodge Programs. Problems anticipated in general program implementation are discussed, such as the reconciliation of difficulties Alberta Housing Corporation has with development requirements and constraints as well as redistricting applications. Meetings are held on a monthly oasis. Both the Real Estate and Housing and Planning Departments have membership on the Committee.

3.7

OBJECTIVE SIX

"DEVELOP A PROGRAM OF RESEARCH AND INVESTIGATION IN ORDER TO DETERMINE THE CITY'S FUTURE RESPONSIBILITIES IN THE PROVISION OF HOUSING." In 1980, Real Estate and Housing conducted detailed reviews of a variety of housing assistance programs that have a major impact on the Edmonton housing market. The list of programs analyzed includes the Core Housing Incentive, Limited Dividend Housing, Municipal Non-Profit Housing, Senior Citizen Lodge, Community Housing, Senior Citizen Self-Contained Housing, Non-Profit Cooperative Housing and Private Non-Profit Housing Programs.

\ , \ \

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This townhouse project in Mill Woods was developed by the Intermet Housing Society on land provided by the City. Financing for the project was obtained through the Private Non-Profit Housing Program.

The project provides rental accommodation for law and moderate income family households.

CHAPTER IV

HOUSING ISSUES AND CONCERNS

25.

CHAPTER IV - HOUSING ISSUES AND CONCERNS

4.1

REAL ESTATE AND HOUSING'S DIMINISHING SOCIAL HOUSING LAND INVENTORY

The Real Estate and Housing Department estimates that its current inventory of properties designated for the development of social housing projects in Edmonton can potentially accommodate 1,175 housing units in the City's suburban areas and 290 in the inner-city (see Figure 5.1).

Given the Department's expected land requirements for social housing, it is forecast that by 1982, the current inventory of properties in the inner-city will be totally absorbed. By 1983, given the same conditions, the Department's current suburban inventory of social housing sites will also be depleted.

Without the implementation of amendments to current land acquisition and disposition policies, within the next two years, the City will lose the level of control it presently exerts over the location and ultimate distribution of social housing in Edmonton.

4.2

THE NEGATIVE EFFECTS OF THE "(p) DESIGNATOR POLICY"

The requirement for a (p) designator to denote properties proposed for Community Housing developments has resulted in a marked inflexibility in the administration of the Department's Social Housing Land Program. Even with the correct districting in place, the Department and Alberta Housing Corporation can anticipate a minimum six month delay while the (p) designator is attached. Once attached, the Department cannot lease these particular sites for the development of third sector housing as, from that time on, these sites are only available to Alberta Housing Corporation for development under the Community Housing Program.

26.

This policy also inhibits the efforts of the various social housing delivery organizations as well as the Real Estate and Housing Department to better integrate social housing throughout the wider community. These efforts include increasing maximum income ceilings and developing small, scattered housing projects designed to be as compatible as possible with surrounding neighbourhoods.

The (p) Designator Policy acts to signal attention to preconceived notions of "Community Housing" and its residents, long before the specifics of project size, design and physical compatibility are known to local property owners. Furthermore, following construction completion, the (p) Designator Policy continues to emphasize the difference between the residents of the Community Housing project and the neighbourhood in general.

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•\ ' „‘ Castleview Village was developed by the City in 1979 for Adalca• Hbbile Home Cooperative Limited. It is the only mobile home park cooperative in Alberta and provides a lower cost housing alternative while maintaining high standards of landscaping and building appearance.

River Valley Development Limited located in Gold Bar is a low income apartment complex developed under the Federal Government's Limited Dividend Housing Program which was discontinued in 1975.

27.

4.3

THE INAPPROPRIATENESS OF THE CURRENT "EQUITABLE POLICY"

DISTRIBUTION

City Council has expressed a commitment under its General Municipal Plan to have Community Housing provided on the basis of an equitable or "fairshare distribution" throughout the City in accordance with the demand for such housing.

There are several factors inhibiting the successful implementation of this policy.

Because of the difficulty of successfully integrating these projects, especially into the more affluent areas of the City, the policy's social acceptability is brought into question. Also, in Edmonton's inner-city areas, where the demand for social housing is greatest, the market price of land is almost invariably well in excess of the land component of Maximum Unit Price guidelines, which negates social housing program approval. The result is that the bulk of Edmonton's existing social housing stock is located in suburban areas developed within the past decade. Finally, the physical limitations posed by the developed nature of most of Edmonton's inner-city areas usually require the use of infill and redevelopment. Due to increased levels of development uncertainty and risk in these areas, inner-city areas are proving undesirable to many social housing delivery agencies. It is the Department's opinion that the present equitable distribution policy is unimplementable and undesirable for the above reasons. It is believed that a more achievable policy with the same general objectives that recognizes the variety of economic, social and environmental constraints would better assist the Administration in ensuring the best locations for the future development of social housing in Edmonton.

28.

4.4

THE INEFFECTIVENESS OF THE FIVE PERCENT PURCHASE POLICY TO ENSURE THAT LAND PURCHASED UNDER THE DEPARTMENT'S SOCIAL HOUSING LAND PROGRAM IS SUITABLY LOCATED AND CAN BE DISPOSED OF WITHIN THE FEDERAL GOVERNMENT'S MAXIMUM UNIT PRICE GUIDELINES The Five Percent Purchase Policy was originally approved by City Council in 1971 to enable the Administration to purchase a minimum quantity of land for public housing and, furthermore, that this land would be evenly distributed throughout all new outline plan areas of the City.

This policy was the major tool used by the Administration to acquire land for the development of "Public (Community) Housing" in Edmonton from 1971 to 1979. However, in 1979, a Court Order was delivered which declared that the City was neither entitled nor empowered to require any landowners to provide land for public housing at less than market value.

Since this Court Order, the City has found that, as a general rule, land cannot be leased or sold to the variety of social housing delivery agencies in Edmonton within the Federal Government's Maximum Unit Price guidelines for the capitalization of land costs for social housing program development.

This is the primary reason why, since 1979, the Real Estate and Housing Department has been unable to meet its annual social housing land assembly targets.

Unless policy amendments are approved to enable the Administration to acquire and dispose of its future social housing development sites at greater than Maximum Unit Price guidelines, the Administration will continue to experience a diminishing Social Housing Land Inventory.

4.5

THE NEED FOR THE PROVINCE TO PAY A GRANT-IN-LIEU OF THE MUNICIPAL PORTION OF PROPERTY TAXES FOREGONE ON SENIOR CITIZEN HOUSING AND HOUSING FOR DISABLED PERSONS On 1973 05 10, the Province amended The Municipal Taxation Act, exempting from municipal assessment land and improvements owned and operated for

29. senior citizens or disabled persons by non-profit organizations, including the Greater Edmonton Foundation. The Assessment Department estimated that in 1980 the municipal portion of the total property tax levy foregone from such housing projects amounted to about $993,000.

The Real Estate and Housing Department is concerned that although this figure does not represent a significant tax loss for the City, it still contributes to the annual pressure on City's property tax base. As a matter of principle, the Department is of the opinion that a Provincial grant-in-lieu of taxes equal to the total annual amount of foregone municipal taxation is justified. Such payments should be regarded as fair return for the variety of municipal services provided equally to all residents of the City, including senior citizens and disabled persons.

—

With the aid of funds previded under the Federal Government's Neighbourhood Improvement Program, the Canora community purchased the future site of Canora Gardens, a housing project for senior citizens developed under the Senior Citizen Self-Contained Housing Program.

CHAPTER V

SOCIAL HOUSING TARGETS & FUTURE MUNICIPAL LAND & BUDGET REQUIREMENTS

•

30.

CHAPTER V - SOCIAL HOUSING TARGETS AND FUTURE MUNICIPAL LAND AND BUDGET REQUIREMENTS

5.1

INTRODUCTION

The objective of this chapter is to outline the current and proposed level of municipal involvement in the acquisition and disposition of land for social housing programs.

The chapter is divided into four main components: 5.2 Social Housing Targets (1981-83), 5.3 Impact on Inventory (1981-83), 5.4 Impact on Capital Budget (1981) and 5.5 Impact on Current (Operating) Budget (1981).

5.2

SOCIAL HOUSING TARGETS (1981-83)

The City of Edmonton currently provides land for three major social housing programs. These are Community Housing, Municipal Non-Profit Housing and other third sector housing (Private Non-Profit Housing and Non-Profit Cooperative Housing).

(i)

Community Housing Program

As indicated in Table 5.1, it is anticipated that 321 units of Community Housing could be developed in Edmonton suburbs during 1981 on sites made available for development through lease agreements signed between Alberta Housing Corporation and the City of Edmonton in 1981.

The inner-city development target is based on a request made by Alberta Housing Corporation to the City to provide sufficient land for the development of 75 inner-city housing units.

Ongoing discussions are being held between Alberta Housing Corporation and the City with the objective of being able to provide inner-city land for development at economically feasible costs.

31.

Additionally in 1981, Alberta Housing Corporation committed itself to the concept of blending the lower cost of property already held in the City's inventory with market-priced land to assist in increasing the supply of available land for future social housing.

(ii) Municipal Non-Profit Housing Program

The Edmonton Non-Profit Housing Corporation has scheduled a total of 279 housing units for development during 1981, on sites made available to the Corporation from the Real Estate and Housing Department's Social Housing Land Inventory. As outlined in Table 5.1, the majority of units (150) will be developed within the innercity area. These figures are based on information provided by the Edmonton Non-Profit Housing Corporation.

The development targets for 1982 and 1983 are based on anticipated development activity by the Edmonton Non-Profit Housing Corporation in order to maintain its annual development target of 200 housing units.

Sundance Cooperative, located in Riverdale, was developed under the Federal Government's Non-Profit Cooperative Housing Program.

It was made available for initial occupancy in 1978 and provides 59 townhouse units for low and moderate inc9p1 families.

Located near the university, Pax Natura House was purchased by a non-profit society in 1975 with funds made available through the Private Non-Profit Housing Program.

The house serves as a residence for deaf men undergoing rehabilitative training.

32.

(iii) Other Third Sector Housing

The third sector housing development figures for 1981 outlined in Table 5.1 are based on the amount of land requested by Private NonProfit Housing and Non-Profit Cooperative Housing groups during the first half of this year.

It is expected that any additional land

requests received during the remainder of the year would be made available for development during 1982.

The projections for 1982 and 1983 are based on the following considerations. The 1982 suburban development figure of 20 units is based on anticipated development activity. The inner-city figure of 20 units in 1982 and 1983 again is based on maintaining the status quo.

With the price of inner-city land at current levels, increased third sector housing activity within this area is not anticipated.

In

considering that third sector housing requests for land constitute only a small portion of the demands made on the Social Housing Land Inventory by comparison to the two former programs, it is expected that any additional land requests could be met by, the immediate purchase of property in response to a specific site request.

TABLE 5.1 SOCIAL HOUSING TARGETS (1981-83) PROGRAM

PROJECTED NO. OF HOUSING UNITS 1981 1982 1983

Community Housing Suburbs 321 Inner-City 75 TOTAL 396 Municipal Non-Profit Housing Suburbs 129 Inner-City 150 TOTAL 279 Other Third Sector Housing Suburbs 10 Inner-City 20 TOTAL 30 All Programs Suburbs 460 Inner-City 245 TOTAL 705 SOURCE: Real Estate and Housing Department

350 80 430

400 100 500

120 80 200

100 100 200

20 20 40

20 20 —CT

490 180 670

520 220 740

33.

5.3

IMPACT ON INVENTORY (1981-83)

Figure 5.1 has been included to indicate the effects the social housing development targets will have on City of Edmonton Social Housing Land Inventory. It should be noted that the first evidence of inventory deficiency for all three programs occurs within the inner-city area.

As indicated in Figure 5.1, there is sufficient land in inventory to provide for Community Housing development targets in the suburbs until 1983, at which time there would be a shortage of units if no new acquisitions are undertaken. The deficiency of land in the inner-city area will occur in 1982. There will be a deficiency of developable suburban land available to the Edmonton Non-Profit Housing Corporation by 1982, and the lack of units within the inner-city area will occur in 1981. The current acquisition program's primary objective is to eliminate this immediate shortage. There is sufficient land available in inventory to accommodate the needs of Private Non-Profit Housing and Non-Profit Cooperative Housing groups until 1982, at which time a shortage of inventory is expected to occur in the inner-city area.

FIGURE 5.1

34.

IMPACT OF DEVELOPMENT TARGETS ON CURRENT INVENTORY NUMBER

Current Inventory

1981 Development Targets

OF

UNITS

1982 Balance in Development Targets Inventory

Balance in Inventory

1983 Development Targets

Balance in Inventory

-SUBURBS

— 1-116 — .

634 Community Housing

7.7i .7

—

-INNER-CITY

7

= 1-143 _J

-SUBURBS

Municipal Non-Profit Housing INNER-CITY

Other Third Sector Housing

SUBURBS

[ INNER -CITY

= 1 -73

V? 47

-8

=1 38

= C=== —

142

L_

10 20

SOURCE : Real Estate and Housing Department

20 —

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14

20

—4

20

=7.

16

20

= = = =

-6 = ==== - 24

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35.

5.4 IMPACT ON CAPITAL BUDGET (1981)

With the objective of eliminating the shortage of social housing units anticipated by 1983 (see Figure 5.1, "Balance in Inventory" for 1983), the Real Estate and Housing Department is currently pursuing an acquisition program which will attempt to purchase sufficient land for 650 housing units under the three major social housing programs.

Based on previous experience, the Department estimates there to be a minimum two-year lead time between the purchase of land and the ultimate disposal of suitably districted and serviced sites to the various social housing delivery agencies. As such, the Department's proposed 1981 Social Housing Land Acquisition Program includes the purchase of future sites to be disposed of (and developed) by 1983 at the latest.

Community Housing Program The deficiency of Community Housing units anticipated for 1983 is 259 units. Based on the Maximum Unit Price guidelines established

by Canada Mortgage and Housing Corporation, the budget requirement for the land component to meet this target is approximately $4,403,000 (see Table 5.2). In the event that the City of Edmonton is unable to provide sufficient land to allow for the development of the projected number of units, it is anticipated that Alberta Housing Corporation will initiate its own land acquisition program.

This would eliminate any City involvement in the Community Housing Program other than the contribution made by the City towards the operating deficit, as outlined in Section 5.5.

(ii) Municipal Non-Profit Housing Program In order to eliminate the anticipated shortage of inventory for the Municipal Non-Profit Housing Program by 1983, the 1981 land acquisition program must provide sufficient land to develop a minimum of 361 units, at a budget figure of about $6,137,000.

36.

(iii) Other Third Sector Housing The third sector housing component of 1981 land acquisition is the smallest of the three programs at approximately $510,000. This amount is required to acquire sufficient land for the development of 30 housing units in 1983.

TABLE 5.2 IMPACT ON CAPITAL BUDGET (1981) PROGRAM

LAND TO BE ACQUIRED (In No. of Units)

LAND ACQUISITION COST ($000)

Community Housing Suburbs 116 Inner-City 143 TOTAL 259 Municipal Non-Profit Housing Suburbs 173 Inner-City 188 TOTAL 361 Other Third Sector Housing Suburbs 6 Inner-City 24 TOTAL 30 All Programs Suburbs 295 Inner-City 355 TOTAL 650 SOURCE: Real Estate and Housing Department

1,972 2,431 4,403 2,941 3,196

-671-37 102 408 510 5,015 6,035 11,050

5.5 IMPACT ON CURRENT (OPERATING) BUDGET (1981)

In addition to the monies required to purchase the properties for targets set out above, any increase in the inventory of social housing units in Edmonton also impacts upon the City's current (operating) budget. In particular, the City provides a subsidy to offset the total annual operating deficit of projects developed under Alberta Housing Corporation's Community Housing and Senior Citizen Lodge Programs. Increasing the number of units operating under either program results in future increases to the required subsidy and hence to the current budget of the municipality.

For a complete discussion on the fiscal impact of the Department's current and projected operating budget, refer to Section 3.3.

37.

5.6

CONCLUSION

The Real Estate and Housing Department is experiencing increased difficulty in acquiring land to maintain its Social Housing Land Inventory.

The source of the problem is two-fold. First, the Maximum Unit Price guidelines established by Canada Mortgage and Housing Corporation are insufficient when compared with the increasingly high cost of land in Edmonton. Secondly, land acquired during 1981 for development in 1983 incurs carrying costs at a rate of approximately 16% compounded annually.

Action will be taken by the Administration toward the resolution of these issues to ensure the effective implementation of City Council policy to provide sufficient land to meet the social housing requirements within its boundaries.

Located in Oliver, this high-rise apartment project was developed in 1980 under the Core Housing Incentive Program. With half of the units subject to controlled rents, this project is particularly attractive to young singles with moderate incomes who work downtown.

"

A

CHAPTER VI

1981 /82 ACTIVITY PLAN

38.

CHAPTER VI - 1981/82 ACTIVITY PLAN

6.1

REAL ESTATE AND HOUSING'S DIMINISHING SOCIAL HOUSING LAND INVENTORY 1. Undertake a program of policy review and amendment to remove impediments to the acquisition and disposition of properties for social housing. This will include a re-examination of the method and extent of writing down the market cost of land to within acceptable Maximum Unit Price guidelines.

6.2

THE NEGATIVE EFFECTS OF THE (p) DESIGNATOR POLICY 1. Prepare a report to City Council with a recommendation to have the (p) Designator removed from the Edmonton Land Use Bylaw.

6.3

THE INAPPROPRIATENESS OF THE CURRENT EQUITABLE DISTRIBUTION POLICY 1. Develop a set of criteria to be used in the assessment of potential Community Housing sites.

2. Prepare a report to City Council recommending a revision to the current policy.

6.4

THE INEFFECTIVENESS OF THE FIVE PERCENT PURCHASE POLICY TO ENSURE THAT LAND PURCHASED UNDER THE DEPARTMENT'S SOCIAL HOUSING LAND PROGRAM IS SUITABLY LOCATED AND CAN BE DISPOSED OF WITHIN THE FEDERAL GOVERNMENT'S MAXIMUM UNIT PRICE GUIDELINES 1. Prepare a report to City Council recommending a revision to the current policy.

39.

6.5

THE NEED FOR THE PROVINCE TO PAY A GRANT-IN-LIEU OF THE MUNICIPAL PORTION OF PROPERTY TAXES FOREGONE ON SENIOR CITIZEN HOUSING AND HOUSING FOR DISABLED PERSONS 1. Prepare a report to Commission Board recommending a response to the issue of foregone taxation. This report will include reference to the Province's response to the Alberta Urban Municipalities Association's endorsement of this issue in 1981.