Thursday, 5 December 2013


Frances Bula recently called the Affordable Housing report “the Strangest Report  (approved Tuesday) I’ve seen in a while.”

She is right. The report, to coin a phrase, uses statistics as a drunk uses a lamp-post--- for support rather than illumination.

Ms. Bula noted that the rents — $1,440 for a studio and up to $2,500 for a three-bedroom — seemed not anywhere near affordable, which the city’s persistent critics have noted. But the numbers in the report on actual completed projects indicate that, of the projects built or planned so far, the actual rents are way above the proposed rents.

Here is what happened

The West End Neighbours  sued to set aside two bylaws, one of which they said illegally delegated the power to the City Manager to create affordable housing. She set up quite a system. The Developer would submit an application for a building and estimate the proposed monthly rents. For example, the developer estimated that the proposed average rents for the 400 ft2 units at 1142 Granville Street would be approximately $960 a month. The Manager considered these rents consistent with the 
Short Term Incentives for Rental Housing (STIR) program, and the program’s successor, Secured Market Rental Housing PolicyRental 100.

The May 3, 2010 Staff report,  on the apparent assumption that the rents would be as proposed, states at pg. 7:

"The developer estimates that the units will rent on average for $960 a month. Given the finishing, unit size and design features in this location, staff find the rent levels proposed for this project to be consistent with STIR program and the City Manager has determined that there is a measure of affordability for this housing".

Some measure!  Some affordability!

Since the average rent downtown for a bachelor unit is about $1,047 per month, the rent may appear to have some "measure of affordability.” There was, however, a Catch 22. Once the project was completed, the rents for furnished 400 ft2 units were actually $1,495 per month.

The link below shows shows the hugely subsidized tiny unit in all its sartorial splendour.

Somehow or other the City Manager’s office failed to require the developer to stick with the proposed rents. This was simply not regulated. So, after getting a generous density bonus and having his or her Development Costs Charges and Amenity Contributions waived, he would rent the units for whatever he wanted. “Affordability” was ultimately not a requirement or even a factor.

The Councilors decided to set standards for affordability themselves and take away the City Manager's discretion thus agreeing to one of the orders sought in WEN's judicial review application. 

They seemed to think that the whole Judicial Review Application was a mere technicality. They hoped that Council  could take whatever developments the the Manager had approved, apply her standards and enact all of it as a bylaw. They expected nothing would change. 

Staff therefore came up with numbers that they thought would confirm the wisdom of the Manager’s determination that the rent was affordable.

When they produced their report, they discovered that they screwed up. It is not clear from their public comments that they really understand to this day what they did. The actual rents were not as proposed and approved by the City Manager as being affordable.   That is why the City has now set the maximum average rents at the present exorbitant figures. They have to set them high to legitimize previous approvals and current in stream proposals.

The shocking fact is that the City has been approving these developments, from the start without any regard to ultimate affordability. As WEN  (West End Neighbours) suspected, Council rezoned the properties, provided density bonuses and waived applicable levies on the theory that by so doing they were lowering the cost of housing. They did it for nothing. The City and tax payers are out of pocket. 

There are many morals to the story, one of which is, "Never believe your own lies." Another is that the spoils system of government with a politicized bureaucracy may be American as apple pie but can produce absolutely terrible government. On this point have a look at today's Vancouver Province Newspaper explaining why a civil service must be apolitical.

Don’t blame the developers. Presumably acting fully within their contractual rights, they saw to it that fools and our money were soon parted. It was the Council, not the developers,  that broke the law when it improperly delegated their responsibility to the Manager, contrary to the express requirements of the Vancouver Charter.

When Councilor Louie, the Chairman of the Finance Committee, was interviewed by Frances Bula, he noted that he found it difficult to explain.

I bet he did.

1 comment:

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