Globe & Mail: Burnaby, B.C. is eager to build, but stymied by funding gap

Posted March 28, 2022

Burnaby, B.C., would like the other levels of government to show them the money.

The city has five city-owned properties “shovel ready” for affordable housing development, but a shortfall of senior government funding means the properties are still sitting vacant.

Now, the city and its non-profit partners are attempting to find creative new ways to get the properties developed without the funding that they’d been hoping for. In the meantime, however, they have heard David Eby, B.C. attorney general and minister responsible for housing, publicly say that municipal approvals are tying up the delivery of housing amid an affordability crisis.

Burnaby came up with a comprehensive strategy to address its rental housing shortage after years of failing to deliver. The housing on city-owned land would provide affordable rental suitable for young residents early in their careers, and seniors whose incomes are low. Many seniors, for example, have had to return to the workforce, said Ed Kozak, general manager for planning and development.

“I’m extremely frustrated,” he said. “This has been going on for, I want to say the better part of three years. The city has pivoted from taking a position of being an advocate, maybe a facilitator for affordable housing, to being much more closely associated with being a direct provider. Although we don’t provide the units themselves, we are certainly throwing more city-owned land into it. Council has been very open to subsidizing it with cash contributions, and yet still – with all that movement on the city’s side – there is an inability to access federal or provincial programs that help make it real.”

Housing advocates say the city needs senior levels of government to step up and provide proper funding for housing, the way they used to up until the mid-1990s.Jimmy Jeong/The Globe and Mail

As for Mr. Eby’s criticisms, he said: “I can’t comment on the comments made publicly, other than to say it’s disheartening because we have certainly done everything we could. … It’s not for a lack of effort.”

Burnaby has come up with a definition of affordable that is 20-per-cent below the Canada Mortgage and Housing Corporation median average for the area, which works out to be about 50 to 60 per cent of market rents. But even that rate is beyond reach for many renters, Mayor Mike Hurley says.

Housing advocates says the city needs senior levels of government to step up and provide proper funding for housing, the way they used to up until the mid-1990s. Mr. Hurley took issue with the housing minister calling out municipal governments for failing to efficiently deliver affordable housing.

“Maybe they should focus on what they need to do because we aren’t the problem here,” he said.

Mr. Hurley says the city has had many discussions with the other levels of government, and that it has agreed to service the sites and enter into partnerships with non-profit housing providers. The city’s non-profit housing partners applied for provincial funding through BC Housing’s Community Housing Fund (CHF), but only one of six sites was approved for funding.

“We put our [six] properties through public hearings. We had the permits all ready to go and it all fell down at the senior levels of government,” Mr. Hurley said. “So it wasn’t our city that slowed it down – it was the lack of funding. And they are still sitting there. They could build tomorrow. They’ve already been through all the city processes. I don’t know which city they are talking about. It’s certainly not ours.”

The City of Burnaby partnered with Catalyst non-profit housing provider to develop 134 units on a city-owned site. It’s been rezoned and is shovel ready, but BC Housing rejected it for funding.Jimmy Jeong/The Globe and Mail

As for federal funding, the process to acquire the little funding there is has been a quagmire of bureaucracy.

“They keep announcing all these billions but I haven’t seen people that have been able to access any of those billions. We could have had those really important buildings built by now.

“If the city is giving land, the other two levels of government should just step up and say, ‘let’s make this work,’ and get rid of all the bureaucracy around it all,” Mr. Hurley said. “It’s too much, and certainly way too much for non-profits to keep on top of all the time.”

BC Housing responded in an e-mail that it has supported the development of 2,427 units of affordable housing in Burnaby since 2017, including 552 homes in four Community Housing Fund projects. The agency received “an overwhelming number of proposals” from all over the province in its most recent request for proposals.

“While many were well put together and worthwhile submissions, the CHF was oversubscribed and not all projects could be approved.”

Funding was given to 2,400 units in the province, of which 579 were in the Lower Mainland and 129 were in Burnaby. It said BC Housing is allocating $300-million for a second round of CHF funding, part of a $1.9-billion provincial investment over 10 years through the CHF.

“As part of future calls for CHF funding proposals, we will reach out to organizations whose proposals were not approved to invite them to resubmit,” BC Housing said.

Burnaby-based Murray Martin is a spokesman for housing advocacy group BC Acorn, and member of the mayor’s housing task force. His group had campaigned against the demolition of affordable old rental buildings in Metrotown in 2018. Today, they are fighting for vacancy control to protect the affordable units that remain and those that get built.

“We can understand Burnaby’s frustration, and not just Burnaby, but other cities too. Before 2018, there was a big problem in Burnaby with the city government, but now after the election, the focus is, from our point of view, on the federal and especially the provincial government.”

Mr. Martin said the problem is government continues to look to the private sector to solve the affordability crisis. As a result, deeply affordable housing isn’t getting built and rents continue to rise.

“They are still pursuing the same policies, thinking it’s going to work when it’s obvious that this market-oriented approach – depending on developers to build these buildings for profit – isn’t going to get you out of it.”

Luke Harrison, president of Catalyst Community Developments Society, has partnered with Burnaby on two of the city-owned sites. Once funding is obtained, his organization would enter into a lease agreement with the city and build the housing.

Mr. Harrison said they were large projects, both requiring north of $50-million in funding. They are now trying to obtain federal CMHC funds in order to begin construction on the Burnaby projects by the end of the year. If they can’t get federal funding, they would probably have to look at market lending, which would erode the affordability.

The organization has seven projects in development, and two of them obtained CHF funding. Mr. Harrison, who previously worked in banking and for private development, said that CHF funds are limited, so Catalyst doesn’t put all its eggs in one basket.

“My concern is there will likely never going to be enough public dollars to invest in housing at the supply levels that we need. What I believe is an opportunity that needs to be considered more is these public-private partnerships. How do we use public dollars to unlock more private dollars, whether those are institutional funds, union funds and pension funds that are investing into affordable housing in other parts of the world? How do we get them into the Canadian market?”

Mr. Kozak says there is a lot more that can be done to generate affordable housing outside private market-rate development. The constant narrative, that a glut of market-rate supply will eventually create trickle-down housing that is affordable, isn’t what he is seeing play out.

“We know those units don’t always go to the people that need them, and that ‘trickle down’ doesn’t always work as intended. I’ve been doing this for close to 25 years, and I haven’t seen a moment in time that the housing market took a dip, save for example, there being other external factors that caused it like a recession or credit crunch.

“It’s never been because there is an over supply of housing.”

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Article by Kerry Gold for the Globe and Mail

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