Ontario bill giving cities power to expand boundaries for housing passes

The Ontario government has passed a bill giving cities the power to expand their borders “at any time” in order to build more homes.

The legislation, known as Bill 97 or the Helping Homebuyers, Protecting Tenants Act, passed its third reading on Monday at Queen’s Park. It will go into effect once it receives Royal Assent.

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The Ministry of Municipal Affairs and Housing first introduced the bill in early April. At the time, they said it would create a regulatory framework for a wide variety of changes that will help the provincial government reach its goal of building 1.5 million homes.

Part of the legislation will see two land use planning documents—the Provincial Planning Statement and A Plan to Grow: Growth Plan for the Greater Golden Horseshoe—merge to “support growth” near transit stations and allow more homes to be built in rural areas.

Municipalities would also have “more flexibility” to decide when and where to expand their settlement area boundaries.

In November 2022, the provincial government modified Hamilton’s Urban Official Plan and its Rural Official Plan to expand the city’s boundaries by 2,200 hectares, something that was criticized by environmental law charity Ecojustice as being “unlawful.” The legislation that passed today will allow municipalities to take this action themselves.

“The proposed changes would ensure land is available for industry and manufacturing, encourage office and institutional uses in areas closer to transit, and provide flexibility to convert lands for mixed uses – supporting the kinds of development and jobs that communities need,” officials said in a presentation in April.

Officials stressed that existing Greenbelt Plan protections will remain in place; although they stopped short of promising not to develop on the land in the future.

In an effort to encourage more development, the government is freezing 74 provincial fees to reduce the cost of applications and red tape associated with home building.

A review on a cooling-off period for freehold homebuyers would also take place.

TENANT PROTECTIONS

In addition to giving municipalities the ability to build in more rural areas, the bill also includes a number of changes officials say will protect renters from so-called renovictions.

Under Bill 97, landlords will be required to give tenants a 60-day grace period to move back in once renovations are complete at the same rent they were paying before.

If a landlord doesn’t allow the tenant to move back in at the same rate, the tenant would have two years after moving out or six months after the renovations are completed to file a complaint with the Landlord and Tenant Board.

Fines for offences under the Residential Tenancies Act will double to $100,000 for individuals and $500,000 for corporations.

While officials are touting these changes as the next step in addressing the housing crisis, others have expressed concern that the legislation gives the Minister of Housing more powers that could diminish protections for some tenants.

Amendments to the City of Toronto Act and the Municipal Act, made under Bill 97, gives the minister power to impose “restrictions, limits and conditions” when it comes to the demolition or conversion of residential rental properties.

A Toronto report, submitted to the province about a month after the legislation was tabled, found the city’s policies have helped secure about 5,000 replacement rental units and ensured tenants are provided with compensation. The policy requires developers who intend to demolish rental buildings of more than six units replace existing apartments for those tenants.

These units must be of similar size and offered for the same rent for a period of 10 years.

"Without this critical policy framework, it is likely that significantly more rental units would have been demolished and not replaced due to new developments. This would have negatively impacted both the supply of rental units and availability of affordable rental units,” staff wrote in the report, adding that few details have been provided about how the minister intends to use these regulatory powers.

“As currently drafted, these changes could purport to enable the Minister to fundamentally change the City's current rental replacement practices,” the report says.

Toronto city staff say the new regulations could allow for replacement rental units to be significantly smaller than the units they are replacing, limit the city’s ability to restrict rents, reduce tenant compensation and allow owners to provide “cash-in-lieu of replacement units.”

They also expressed concern that the province could create new definitions of affordable rental housing that don’t reflect the city’s plan.

Toronto staff requested the province not move forward with any changes to rental replacement by-laws until “meaningful consultation” can take place. As of early May, staff said they had not been invited to participate “in any form of consultation on the development of a regulation.”

The Association of Municipalities Ontario (AMO) also said it would be “watching closely” to ensure replacement by-law frameworks “balances the need to provide additional protections to tenants while at the same time increasing housing supply.”

For the most part, the AMO was supportive of the province’s efforts; however, it expressed concern that requirements for rental replacements not be set too low. An example they provided would be preventing municipalities from imposing minimum square footage requirements for replacement units.

“Local governments are a mature order of government and should be allowed some flexibility to meet local needs and circumstances.”