North Cowichan council has decided to financially contribute to the affordable housing project that is planned at 3191 Sherman Rd.
At its meeting on June 15, council voted that the Community Land Trust, which is building the facility, submit a permissive tax exemption application to the municipality for an amount equivalent to half the annual property tax, submit a grant-in-aid application for up to $432,000, and North Cowichan will commit $75,000 from its affordable housing fund to the project.
North Cowichan donated 2.1 acres of land to the project, which is a currently designed for 95 dwellings comprised of townhouses and apartment units, in 2017 and the CLT was expected to obtain funding to build and operate the project through the Canada Mortgage and Housing Corporation and BC Housing.
But BC Housing said in 2018 that further changes would be required to comply with funding parameters.
In a staff report, Rob Conway, North Cowichan director of planning and building, said the CLT has been working with BC Housing since that time to adjust the project to better comply with funding criteria, but has been unable to secure the funding necessary for the project to proceed.
“Staff have [since] been advised that the Sherman Road project is being re-assessed and have had indications that it could receive approval through the BC Housing’s executive committee if the operating subsidy amount for the project can be reduced through municipal fee waivers and/or property tax exemptions,” Conway said.
But Conway said that, although there has been no formal notification, the sister project to Sherman Road, an affordable housing project the CLT is planning for 9800 Willow St. in Chemainus, is unlikely to get the same consideration by BC Housing at this time because of the high operating subsidy it would require.
Coun. Rob Douglas said the role of municipalities in providing affordable housing has seemed to have evolved over time.
He said five years ago, a municipality’s role was mainly to provide the land and senior levels of government would provide the funding for construction and ongoing operations.
“But I think if you look at what’s actually being funded through the province and CMHC over the last few years, land on its own hasn’t been enough,” Douglas said.
“The standard of practice that we’re seeing now and moving forward is that [municipalities] are to waive all or part of their development cost charges, building fees, provide cash contributions and give permissive tax exemptions.”
But Douglas urged council to keep in mind that the cost of the land, fees that are being waived and the other contributions add up to between $2 million and $2.3 million, and that could be leveraged to acquire up to $40 million from other funding sources.
Coun. Tek Manhas said all council members know that affordable housing in badly needed.
“But when this came to light six years ago, there was a public meeting about it at Mount Prevost School and 99 per cent of those who attended were against this project at this location, and there is still overwhelming opposition to it,” he said.
“I also think that granting all these concessions to this group is unfair to our local builders and developers. I have talked to many developers over the years and I think that if BC Housing was actually willing and was sincere about working with our local developers and builders, we would probably already have some of these projects built.”
Mayor Al Siebring said he’s frustrated that the municipality is being forced into this position.
“We are talking about what traditionally has been a federal and provincial responsibility in the funding of housing,” he said.
“That’s not to say that I’m going to oppose this motion because…the reality is that we have to do it. This sucks and this should never have happened this way.”
The motion to provide the financing passed, with only Manhas opposed.