Lots of problems with Rental 100, not city councillors!

condominium-2903520_640Carlito Pablo, who has been doing a great job covering Vancouver’s Rental 100 program and its shortfalls for a while, recently reported in the Georgia Straight that city manager Sadhu Johnstone is concerned that Vancouver city councillors are “causing a lot of problems” by pushing for more affordability in the program.

But the problems are with the Rental 100 program, not the other way around.

Under Rental 100, as it currently stands, developers are entitled to a number of financial “rewards” including the complete exemption of all development cost levies (or DCLs) if, in return, they build rentals as opposed to condominiums. The problem is these rental units are very unaffordable. For instance, based on last year’s Rental 100 guidelines, starting rents are $3,700 for a 3-bedroom unit. To make matters worse, the developer can raise rents as much as she or he wishes each time a tenant moves out.

A number of councillors have taken very good positions against the Rental 100 program. COPE’s Jean Swanson has been voting consistently against these market-rate rentals since she was elected to council last fall.

The Green Party’s Pete Fry, also newly elected last November, has consistently questioned the way the city uses subsidies from taxpayers to support Rental 100 projects, and has been voting against them, too. And last June, the Green’s Adriane Carr asked for an audit of the Rental 100 program due to affordability concerns. She will also be putting a motion forward to freeze all new applications under the Rental 100 program until it can be reassessed.

Note that the waiver of DCLs alone typically saves the developer — and costs city taxpayers —hundreds of thousands of dollars on each project. For one Rental 100 development at 1906 West 4th Ave., the developer saved nearly $800,000 on the DCLs for the residential part of the building. For another project on Commercial Drive, the DCL savings were about $644,000.

This is not a wise use of city funds if the net result is unaffordable rentals. Much better would be a policy that ties rents in the new development in perpetuity to the income of the tenant. CMHC guidelines recommend that rents for affordable housing be calculated at 30% of a tenant’s income.

It’s time the rest of city council supported councillors Swanson, Fry and Carr in their efforts to rethink Rental 100, and create a truly affordable rental program in the city.

As a former city councillor and current lawyer, I also think that the city manager’s comments were out of line. This is a city council where 9 of the 11 members are brand new to the job. Mr. Johnstone, whom I will point out was a Vision Vancouver appointee, needs to recognize that it is not his job to go to bat for developers.

Voters elected the city councillors they did to do the thinking in such situations.

 

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