2021 Belleville Community Improvement Plan

The $50,000 2021 Community Improvement Plan (CIP) was initiated by 2018 Belleville Council’s 2019 Housing Summit to address the City’s housing crisis by incentivizing rental housing development through tax and fee rebates. They were approved in December 2020 and applications were first accepted in Spring 2021.

Goals

A major goal that emerged from the Housing Summit was for the City to approve 1000 new rental units (both affordable and market rate) by the year 2025.

Financial analysis determined that the CIP could incentivize the creation of 544 new affordable rental units, which will assist Council in reaching its target of 1000 new rental units (both affordable and market rate) by 2025 with an estimated $13 million investment over 10 years for an average cost per new housing unit created of $24,568.53.

The land use, economic, social and environmental goals for the CIP programs, which are aligned with the City’s Official Plan:

• Increase the supply of affordable rental units city-wide
• Increase the supply of rental units downtown
• Revitalize the downtown building stock
• Remediate and redevelop brownfield sites

Funding

The overall budget planned and promised for the housing and downtown programs was $13M. Budget allocations would start with $850k (+$85k for facade programs) in year 1 and increase annually:

• The Year 1 cost to the City would be $1,341,303;
• The peak cost to the City would be $1,731,376 in Year 9;
• The average cost to the City over the 19-year period would be $708,962;
• The grand total cost to the City would be $13,470,282; and
• The average cost per new housing unit created (an assumed total of 544 new units) would be $24,568.53 (excluding the costs associated with non-residential unit based incentives).

In June 2021, Council voted to start only 1 out of the 3 programs designed to create affordable housing units based on input from senior Finance Department staff and a recommendation from the Finance Committee, leaving out the programs that provided building permit and development charge rebates (1, 2, 7, 15, 16), severely limiting the potential number of units the CIP could create.

Council actually allocated around $1.3M, or 10% of the funding to housing CIP programs out of that promised $13M:

• *Pre-funded reserve fund
• **In 2023, Council originally initially approved the same $500,000, however, the CIP funding was reduced to $0.
• ***For 2023, the Brownfield programs were allocated usual amount, but the Facade programs funding was reduced to $35,000.
• There is $112,000 in Facade reserve funding

The 2021 Affordable Housing CIP was defunded by Council in the 2023 Operating Budget in an effort to reduce the increase in property taxes for homeowners. Mayor Neil Ellis had campaigned on a 0% tax increase in the 2022 Municipal Election.

Programs

The Plan had 17 programs, including:

• 3 for affordable rental units
• 5 for new rental units
• 4 for downtown businesses to improve their storefronts
• 5 for the rehabilitation of industrial lands

Belleville Council only ever greenlit 1 of the 3 affordable housing programs and only ever allocated $1.35 million in funding out of the $13 million that was promised before the housing programs were defunded by Council in the 2023 Operating Budget in an effort to reduce the increase in property taxes for homeowners.

With only Program 3 opened and less than half the promised incentive available ($10,068.18 per unit instead of $24,568.53), 88 apartment rental units were approved for CIP funding – 81 of which would be held “affordable” (no more than Average Market Rent) for a period of 10 years – between the first intake in Spring 2021 and September 1, 2022. This cost the City was $886,000 in reduced property tax revenues via Tax Increment Equivalent Rebates, which works out to $10,068.18 per unit over 10 years.

Results

Between 2021 and 2025, the CIP programs have approved $1,251,555 to date across nine programs focused on housing, downtown revitalization, or brownfield redevelopment. Of this amount, project approvals totalling $48,780 have been closed out without payment due to approval expiry or lack of owner agreement.

Between the first intake in Spring 2021 and September 1, 2022, 88 apartment rental units had been approved for CIP funding, 81 of which will be held “affordable” (no more than Average Market Rent) for a period of 10 years.

The 81 affordable units will mean the City will forego $886,000 in property taxes via Tax Increment Equivalent Rebates, which works out to $10,068.18 per unit over 10 years.

Open Council had to file an FOI request to access the results shown in the table below because Belleville did not voluntarily or proactively publish information regarding the applications, funding recipients or results of the Community Improvement Program (or most other programs for that matter).

Belleville did not report the results of the CIP programs until after Open Council filed an FOI request.

Downtown programs have proven to be most popular, with 27 total projects compared to nine approved housing projects. Only one project has received funding from the programs addressing brownfield redevelopment, with $40,000 distributed under Program 13: Brownfield Environmental Site Assessment Rebate.

The program that has received the most uptake is the Façade Improvement Renovation Rebate (Program 11), with 17 approved applications totalling $152,665.54 since 2021.

• Program 3: Affordable Rental Housing TIER. – 100% Municipal Portion with $886,000 distributed over 3 projects,
• Program 5: Accessory Dwelling Units in Existing Housing Rebate with $15,000 distributed over 3 projects,
• Program 6: Accessibility Top-Up Rebate with $105,000 provided across 3 projects,
• Program 8: Downtown Residential Above Commercial TIER – 100% Municipal Portion with $18,000 distributed over 2 projects,
• Program 9: Downtown Fire Retrofitting Rebate with $1,000 distributed over 1 project,
• Program 10: Façade Improvement Design Rebate with $3,000 provided to 1 project, and
• Program 12: Façade Improvement Renovation Rebate – Rear Façade with $29,890 of funding provided across 5 projects.

March 18, 2019 – Belleville holds a Housing Summit

Belleville convened a Housing Summit in response to an identified affordable housing crisis in Belleville. A major goal that emerged from the Housing Summit was for the City to approve 1000 new rental units (both affordable and market rate) by the year 2025.

The Housing Summit concluded that there is a need to increase the supply of affordable rental units and Council passed a number of resolutions that represented 7 action items to prioritize the development of affordable housing across the city.

$50,000 was allocated in the 2019 Operating Budget to develop the 2021 Affordable Housing Community Improvement Plan, which would be combined with updated versions of the existing Brownfields CIP and Downtown CIP.

The intent of the CIP is to reduce the costs of projects which will:

1. Increase the supply of affordable rental units city-wide
2. Increase the supply of rental units downtown
3. Revitalize the downtown building stock, and,
4. Remediate and redevelop brownfield sites.

December 14, 2020 – Belleville approves Community Improvement Plan

The 2021 CIP has 17 programs, split between:

• 3 for affordable rental units
• 5 for new rental units
• 4 for downtown businesses to improve their storefronts
• 5 for the rehabilitation of industrial lands

CIP programs

April 20, 2020 – Analysis finds CIP could incentivize the creation of 544 new affordable rental units with $13 million over 20 years

Dillon Consulting estimates the CIP programs could result in the creation of 544 new affordable rental units which would cost $13 million over a 20 years period – an average of $708,962 per year – for an average cost per new housing unit created of $24,568.53.

• The Year 1 cost to the City would be $1,341,303;
• The peak cost to the City would be $1,731,376 in Year 9;
• The average cost to the City over the 19-year period would be $708,962;
• The grand total cost to the City would be $13,470,282; and
• The average cost per new housing unit created (an assumed total of 544 new units) would be $24,568.53 (excluding the costs associated with non-residential unit based incentives).

Based on this, it will be important to set a yearly budget that the City is comfortable with for all three of the CIP programs. If a fixed budget is determined, Dillon can then reverse engineer the numbers to meet the budget and then determine how many units the City will be able to incentivize. If the number of units as a result of this is determined to be too low, then there will need to be a middle ground identified where the costs and the number of units created is considered to be acceptable.

Belleville Finance Department staff asks consultant to update analysis to smooth out the budget allocations

Based on input from senior Finance Department staff, and a review of budget allocations previously granted to programs in the former CIP, including the City’s successful façade improvement and brownfield programs, staff requested that the financial analysis be updated to include more consistent budgetary allocations.

March 25, 2021 – Based on direction from City staff, consultant recommends $13 million over 10 years and not starting programs 1, 2 and 7 in the first year

• An overall budget of approximately $13 million for the affordable rental housing and downtown C.I.P. programs³, which is intended to provide funds to cover the extent of the programs over a duration of ten years⁴;
• The budgetary input will begin with $850K in Year 1 and will increase annually;
• An existing annual program-specific budgeting of $85K is retained for the façade programs;
• An existing annual budget of $50K for the brownfields programs is retained, which is held in a separate account that does not draw from the $13 million budget;
• All programs except the building permit and development charge (D.C.) rebate programs (1, 2, and 7) will be initiated in Year 1; and,
• Unused funds in any given year will carry forward in reserve for use in future years.

For programs 1, 2 and 7:

Payout varies. Program to be activated at the City’s discretion when sufficient reserve funds have been accumulated.

• 1 – Affordable rental units in new mid- or high-rise apartment buildings receive 100% rebate of development charges up to $9,000 per unit.
• 2 – Affordable rental units in new apartment buildings or new second units receive 100% rebate of building permit fees up to $2,000 per unit.
• 7 – New rental units above commercial ground floors Downtown receive 100% rebate of building permit fees.

May 3, 2021 – Application deadline for first intake of CIP programs

June 14, 2021 – Belleville Council approves consultant’s recommendations in principle of $13 million over 10 years

The availability of CIP funding is determined by Council on an annual basis in the operating budget. Any unused money would go into the Community Improvement Plan Reserve Fund and be carried over for use in the future. The City has absolute control over administering the CIP funds to eligible projects and council can decide not to fund CIP programs at any time.

Mayor Panciuk says Belleville will be contributing $13 million

The City of Belleville will be contributing more than $13 million in financial incentives to build additional rental accommodation in our city. This will result in at least 544 additional specific units on top of what we’ve approved to this point. We will do more if the intake on this is so good that we are moving forward our council or our future council will actually put more resources available to allow this to go forward, because we know it is so important.

You know there were a lot of reasons not to do anything, and there are a lot of communities in Ontario that are suffering the same type of stress in their housing market as we are in Belleville and they are not taking these steps. We have been leaders on this – yes – we shouldn’t be doing this – this is 13.1 million dollars that really we should be spending in other areas of our operations – fixing our roads, fixing our sidewalks providing more recreation for people. This is a area of provincial and federal jurisdiction, but they’re not doing it and so we have to.

Mayor Mitch Panciuk

Mayor Panciuk says other programs will start once Development Charge Bylaw is finalized

I think as soon as we finalize our Development Charge Bylaw as you – just for people that are watching we had a significant proposed increase based on the cost the city is seeing and we’ve been having discussions with the Quinte Home Builders in terms of how we will see that increase. And we also had to get a report that was going to be completed dealing with some of those estimated future costs. When that information is all compiled and we’ve had consultations with the Quinte Home Builders the final bylaw will come back and it’ll be a five-year by-law and as soon as that information is approved by Council then we can implement that in our intended development charge relief for rental accommodations at that point.

Mayor Mitch Panciuk

December 13, 2021 – Belleville passes 2022-2027 Development Charges Bylaw

July 12, 2022 – Manager of Policy Planning Desta McAdam says rebates for development and building-permit fees were planned but pending sufficient funds in the reserve fund

April 2023 – Primary affordable housing CIP programs 1 & 2 still not offered

The following programs had not been opened/offered almost 2 and a half years after the CIP was approved according to the Acting Manager of Policy Planning:

• 1 – Affordable Rental Housing Development Charge Rebate (up to $9,000 per unit)
• 2 – Affordable Rental Housing Building Permit Fee Rebate (up to $2,000 per unit)
• 7 – Downtown Residential Above Commercial Building Permit Fee Rebate
• Brownfield programs 15, 16, 17

All other programs were made available for Spring 2021 with an intake deadline of May 3.

December 3, 2024 – Desta McAdam starts as Director of Development Services for Port Hope