I know, right? I started reading this at 5 a.m.

So the definition of “affordability”—this is the definition that they’re looking at proposing: A unit is affordable—which means it would get a reduction in development charges—if it is 80% of market rent or 80% of the purchase price of the average area, and those definitions of affordability will be set by the Ministry of Municipal Affairs and Housing.

There are a few concerns that we’re already hearing about. One is that having developers get a development charge exemption—which is what you’re proposing—by only having an affordable unit for 25 years seems very generous to developers. And to give you an example, in the city of Toronto we just passed an inclusionary zoning law—which the Ontario government is sabotaging—which would require developers to get a development charge discount if the affordable housing units were for 99 years.

There is a move here that I’m seeing with this change to affordable housing where they’re affordable for less period of time and the definition of affordability is linked to market rents, as opposed to what a renter can afford—so based on income—and the discount of fees that developers get has gone from a little bit to completely.

There is a benefit in having lower development fees for affordable housing units, but we have a lot of concerns around this decision to change the definition of affordability. We’re exploring that a little bit more and we’ve got a lot of concerns.

The other piece that we have concerns with when we’re talking about development charges is, how does this impact municipalities? The reason why I say this is because municipalities across Ontario rely on development fees to fund the services that current and future residents use. We’re talking garbage pickup, parks, child care, schools, constructing affordable housing, transit and sewage. When there is a reduction on development fees—some of them are good if it’s for non-market housing, non-profit housing, deeply affordable housing—it means that municipalities are in the hole. And it’s a significant hole.

In the case of Toronto, Toronto has an $800-million funding shortfall. That’s the shortfall that they’re facing right now. We just got a report here. This is the budget that the new city council is going to be debating. They have a deficit of $857 million. What is challenging is that they’re already having to make cuts. The city of Toronto is going to make cuts of $300 million to planned maintenance and repair projects because they don’t have enough money. The provincial and the federal governments have said that they don’t want to pay.

Then we also have the case where interest rates are going up. That means that the ability to access money and pay back money is going to become tougher and tougher and tougher. Matt Elliott, this reporter here, explains it. He says, “As inflation hammers the global economy, interest rates on new city debt have been going up fast. City hall was getting 30-year interest rates as low as 2.4% in 2020. Toronto’s latest 30-year debt issue carried an interest rate of 4.4%.”

So we’ve got this challenge now with this bill where the government has said, “We need affordable housing, we need to reduce development charges to incentivize more affordable housing, but we’re not going to cover the shortfall. We’re going to make municipalities just deal with it”—at a time when we have an inflationary crisis, we have budget shortfalls and we have interest rate hikes, which make these fees, or the ability to borrow, higher and higher and higher.

That is very concerning, that there is not a commitment from the provincial government to help out with this development fee shortfall so that we get the affordable housing but we also have the transit and the services and the child care and the parks and the sewage infrastructure and the electricity infrastructure that is necessary to house current and future residents. That is a big concern.

It’s a concern that AMO shares. They issued a press release—wow, they were quick. They introduced it at 5:51 last night, so maybe they got a heads-up this bill was coming. Who knows? They say, “Municipalities will welcome some of the proposed changes”—like I said, it’s a mixed bag—but are “very concerned about others, such as changes to the Development Charges Act. We will work with the government on the ideas that have the potential to make housing more affordable, and we will oppose changes that undermine good economic and environmental policy.” So they’ve got some concerns about how they’re going to balance their budgets and provide services to residents given that this bill guts their ability to access development fee charges. That’s the concern, and I’m not seeing this government come up with economically wise solutions to that. That’s a concern.

The next piece—like I said, this is a big bill—is schedule 5. Schedule 5 is called the New Home Construction Licensing Act. We heard a lot about this issue in the media because, across Ontario, people are buying homes that, in some cases, are shoddily built. The developer does not build the home to the standard that the homeowner expects: There’s mold, there are leaks, and then the homeowner has to pay the bill because the regulatory authorities are not strong enough at holding developers to account.

We’re also seeing this disturbing trend where homeowners will buy a home pre-construction. They’ll put down the deposit in the hope of getting access to this home, of buying their home and moving into it within two or three years once the home is built. Their dreams, their hopes are all tied up in this; as well their money is all tied up in this future prospect of living in a home. What we have seen as housing prices have risen, changed, and risen again and changed is that developers have turned around, often for no good reason, and said, “Actually, I know we said that we would let you buy this home for $600,000, but we took another look and we think that you’re going to have to pay $800,000 for that home, and if you don’t like it, too bad, so sad. We’ll give you your deposit back and we’ll just cancel the contract.” Then they turn around and sell it to someone else at a higher bid. That is really unethical. If developers sign a contract with a potential home buyer, that contract should be upheld by the Ontario government in a court of law, and the developer has a responsibility to honour that contract.

We have seen the Premier talk a good talk about how he’s going to slap developers on the wrist and fine them and ensure they have consequences if they do the wrong thing, but we have seen very little action—close to none—to ensure that developers build the homes that they say they’re going to build at the price that they committed to in the contract. It’s a huge concern.

In this schedule, the New Home Construction Licensing Act, there has been a decision to increase the maximum fines for developers that break contracts with first-time home buyers, with home buyers who are looking at moving into these homes. That is a good thing. There is also a broader range of actions the developer can be fined on, which is good. They’ve expanded the powers and the number of things that can be fined—good. It gives the minister the power to decide how much of a fine goes to the home owner. This is a bit confusing to me, because Minister Clark says one thing—that he’ll give it to the home owner—but when I actually read the schedule it says something else. I’m trying to get some more information there. It could be good, could be—I don’t know.

The big thing that we’re not seeing and what we’re hearing from stakeholders, such as Canadians for Properly Built Homes, is that there’s no commitment to actually enforce the laws on the books and ensure that developers are actually held to account. Doubling the fines, good, but it’s not worth anything unless you’re actually going to fine developers that aren’t doing the right thing. That’s what people are calling for and that’s what this government needs to do.

As Karen from Canadians For Properly Built Homes tweeted, “Please show us evidence, any evidence, that you’re ‘cracking down on unethical developers.’ There’s no disciplinary action on the website of your regulator, @hcraontario.” That’s what they’re looking for: They’re looking for enforcement. Let’s see if the government moves through on that.

There are other measures in this bill that we are talking to stakeholders about that could have a significant impact. One is changes to the Ontario Heritage Act, schedule 6. Schedule 25.2 gives the minister the power to override any heritage designation on any provincial property or any public property. That’s a lot of power. I welcome feedback from residents and municipalities on these proposed changes because they seem pretty significant.

Interjection.

Thank you very much, Speaker. I appreciate the opportunity. Like the opposition critic for housing, I did take some time to read the bill last night. It was very long—123 pages—and it intersects and amends 13 acts. It’s not easy to digest, certainly. But I do recognize, as I was reading the bill, that a few things were coming to mind. One of them was the fact that the government is reframing this whole affordable housing crisis as a supply crisis. Certainly this bill is trying to get to that, but I don’t think it gets to the affordability piece.

What the bill does do, interestingly enough, is gut certain things. You’re gutting the conservation authority, you’re undermining food security by not protecting farmland, and you’re taking away critical revenues for cash-strapped cities.

The bill also ignores the fact that there’s a rising cost of construction, a labour shortage, land values and other building regulations that are stopping the construction of affordable housing. How will your bill address those concerns that I’ve just raised?