Analysis of Canmore’s Housing Accelerator Fund application results
Federal funds for Banff, but not for Canmore:
BVCA analysis of Housing Accelerator Fund application results.
On February 19, 2024, federal Housing Minister Sean Fraser joined Banff Mayor Corrie DiManno to announce $4.6 million in federal funding for Banff’s Housing Action Plan. At the announcement, the Minister also announced another $9.2 million in federal funding for five other small Alberta communities. Canmore was not among them.
This briefing note will attempt to answer why Banff was funded but Canmore wasn’t.
Summary
The federal government has offered $4 billion to fund municipal Housing Action Plans. This is the Housing Accelerator Fund (HAF). Municipalities must apply for HAF funding. HAF funding is not guaranteed. The federal government has been extremely clear about their funding priorities. Key among these are commitments to zoning reform, densification, and transit-oriented development. Minister Fraser repeatedly uses the phrase “end exclusionary zoning”.
Banff developed a Housing Action Plan which is responsive to the HAF program requirements. Canmore’s Action Plan does not meet the federal asks. In fact, Canmore appears to explicitly reject those federal expectations.
Minister Fraser has clearly indicated that Canmore can revise its commitments to align with the HAF asks. When other cities have done so, federal funding has soon followed. But the Minister has also clearly warned that the fund is quickly being depleted. Canmore must act quickly if it hopes to access several million dollars in federal funding for housing action.
BVCA Position
We respectfully suggest that, with the greatest urgency, Canmore should contact Minister Fraser for guidance on federal priorities in HAF allocation. Canmore should then revise its Housing Action Plan to align with those federal priorities
Analysis
The Housing Accelerator Fund (HAF)
The HAF is $4 billion of federal government money, which is being offered to fund systemic changes in municipal housing regulation. To apply for HAF money, municipalities were required to create and adopt a Housing Action Plan. Applying to HAF was essentially a request for Ottawa to fund a municipality’s Action Plan. But a federal payday was not guaranteed. Ottawa is choosing which Municipal Housing Action Plans to fund. And it’s choosing based on whether the Plans meet federal expectations.
The HAF program is clear about what it wants in those Action Plans. Ottawa wants municipalities to commit to new and ambitious housing reforms. The pre-application reference material includes a list of example initiatives that plans can incorporate (page 5 as marked). (The guide effectively says “commit to reforms like this if you want money”.) Here are the top 5:
“Promoting high-density development without the need for rezoning (as-of-right zoning), e.g., for housing developments up to 10 stories that are in proximity (within 1.5km) of rapid transit stations and reducing car dependency”
“Allowing increased housing density (increased number of units and number of storeys) on a single lot including promoting “missing middle” housing forms typically buildings less than 4 stories”
“Encouraging Accessory Dwelling Units – a second smaller unit on the same property as a primary unit”
“Enable mixed-use redevelopment of city-owned properties…”
“Promoting infill developments (adding new units to existing communities) with increased housing density and a variety of unit types (e.g. duplexes or secondary suites)”
To be even more clear, the Housing Minister wrote to many major municipalities to tell them that their HAF applications would not be funded, unless they committed to specific reforms related to densification/upzoning. For example: Calgary, Winnipeg, Toronto, London – all of those cities then committed to the federal asks and got funding. During this process, CMHC published a list of 10 HAF best practices from successful HAF applicants. At the #1 position on the list was:
End exclusionary zoning
Stop low-density zoning and regulation that excludes housing types such as affordable and social housing in residential areas.
Encourage high density by allowing mixed-use development and high-density residential as-of-right within proximity to urban cores and transit corridors.
This includes adopting by-laws to adopt more as-of-right zoning measures, from the number of units to storeys.
And the Housing Minister publicly warned that municipalities must commit to zoning reform in order to get HAF money:
“There are cities who won’t receive funding because they don’t want to end exclusionary zoning in Canada. I know who some of them are and maybe they’ll change their ways.”
“The reality is there’s not a city who signed a deal with us who hasn’t more or less ended exclusionary zoning in Canada”
In summary, the federal government has been abundantly clear: municipalities can win HAF funds by making new and ambitious commitments to housing action. And a commitment to end exclusionary zoning appears to be a firm expectation for successful funding applications.
Banff’s plan is responsive to federal expectations.
In Banff’s Housing Action Plan, their first two initiatives (agenda p36; RFD attachment 1) are:
“Land use bylaw amendments to incent housing”, specifically:
Reduced parking requirements
Zoning/land-use changes – density ratios, mixed use
Increased Floor area ratio
Reduced Setback requirements
Increased Height allowances
Increased Site coverage
Maximum dwelling size
“Develop an Accessory Dwelling Unit Incentive Program”, including zoning changes, financial incentives, and streamlined permitting
Canmore’s plan is not responsive to federal expectations.
Canmore’s Housing Action Plan included four initiatives (agenda p499, 500 as marked):
Develop a plan to phase out the Tourist Home Designation
Investigate a tax structure to incentivize purpose-built rental accommodation
Investigate tax structures to incentivize full-time/long-term occupancy of residential units
Land Use Bylaw changes
While #4 seems like it might meet Ottawa’s requirements, the description of the initiative is far, far less ambitious than the HAF asks:
“The above new projects are recommended by Administration as they are likely to have the most impact on improving the availability of housing for the local population. It is also recognized, however, that there are additional initiatives that could potentially support the provision of more housing units, which may impact availability of housing for town residents. This could include Land Use Bylaw changes, most notably related to residential building heights and parking requirements. Administration intends to consider such changes, and potentially pilot them in the land use districts in the Palliser and downtown local area plans.” (agenda p500 as marked)
This is a very weak commitment to “consider… and potentially pilot” the sort of actions that the federal government has explicitly demanded in exchange for HAF funding. Unfortunately, Canmore appears to have done worse than simply not meeting the HAF expectations: town documents seem to actively argue with those expectations. In the Canmore Housing Action Plan Request for Decision report, there’s this:
“… while LUB changes may impact supply, they are not necessarily impactful regarding addressing issues of community equity, affordability, or availability of housing for the local population. This is supported by emerging research into ‘missing middle’ housing initiatives focused on land use bylaw changes, which suggests that while changing bylaws may increase supply and bring down rental prices, the increase in land values associated with these changes do not typically translate to more affordable housing stock.…
Given the recognized need for affordable housing units geared to a local population, and the limitations presented by our provincial regulatory framework, the new initiatives being proposed focus on levers other than the land use bylaw.” (agenda p499 as marked)
Overall, Canmore argued that provincial regulation makes zoning reform too difficult. Somewhat strangely, Canmore recognized that zoning reform could increase housing supply and reduce rents – yet it rejected zoning reform because it might not impact other aspects of the housing crisis. We also find it notable that Canmore’s analysis relied, in part, on “emerging research” but did not provide citations. Therefore, we were unable to properly assess those assertions.
Clearly, the federal government does not agree with Canmore’s conclusions. Nor did Banff in adopting their Housing Action Plan. Nor did Calgary. Nor did Edmonton. Nor did Sylvan Lake, Bow Island, Westlock, Smoky Lake or the Village of Duchess.
Ultimately, we conclude that Canmore’s application for HAF funds was not funded because it was not responsive to federal expectations.
Canmore’s HAF prospects
Minister Fraser has been clear about expectations for HAF funding. He has also been clear that municipalities are encouraged to increase their housing action commitments in order to meet those expectations – and unlock federal funding. Speaking at the Banff announcement, he said:
“If anyone else is listening in neighbouring municipalities, consider doing more to match the ambition of your neighbours and we’re happy to have conversations about what that means for specific applicants.”
The Minister was also clear that there is an urgency to any such revisions:
“There will come a point the fund will be exhausted. We’ve been very clear from the get-go, this particular fund is only for the most ambitious communities in Canada,”
BVCA Position
It is the position of Bow Valley Climate Action, that the Town of Canmore should, with greatest urgency:
Seek guidance from Minister Fraser and Canada Mortgage and Housing Corporation regarding federal expectations. Notably, what specific reform initiatives should Canmore commit to in order to maximize chances of HAF funding.
Amend Canmore’s Housing Action Plan to adopt those initiatives as soon as possible.
The federal government has been very willing to be explicitly clear about what they expect from municipalities. At the same time, they have been appreciative of and flexible to local solutions to local conditions. (For example, in their agreement with Halifax.) Ottawa has not been demanding one-size-fits-all, but they have been demanding ambition. Canmore should step up.
BVCA Interest
Most of the key HAF initiatives have significant climate implications:
Higher density built forms will reduce GHGs through greater efficiency. Built to the same standards, multiunit buildings are more energy efficient than low-density forms because of reduced surface-area-to-volume ratios: for any given interior space, there is less exterior surface to lose heat. Multiunit buildings also make it easier and less expensive to adopt higher efficiency assemblies and mechanical systems.
Higher density development makes transit more effective and appealing. With more people living in an area, it makes more sense to directly serve them with transit. And if transit is directly serving the area, using transit becomes more convenient for riders (transit stops are nearby) and more cost-effective for payers (more riders for the same length of route).
Mixed use development and infill will better connect people to daily services. This reduces total commuting and makes trips easier to do on foot or on bike. This reduces vehicular use and associated emissions.
Less car dependent development directly contributes to lower transportation emissions by enabling mode shifts. It also has lasting effects as the community’s norms and expectations shift alongside those changes in infrastructure, geography, and options. That is, we are comfortable what we are accustomed to, and we are accustomed to those particular things because those are the options our built environment has given us. Changing the built environment can change our options and empower us to make new choices.
We are also members of the community. We live in the Bow Valley. We know the crushing effects of the housing crisis all too well. We are also aware that Canmore has been grappling with major budgetary challenges. It would be a shame to allow this major opportunity to pass by.