Purpose

 This report has been prepared in response to the Toronto Community Council's request for information regarding the use of Section 37 of the Planning Act as an effective planning tool in securing public benefits. The report outlines the intent of Section 37 as well as the relevant former City of Toronto Part I Official Plan provisions which relate to the use of Section 37.

 Funding Sources, Financial Implications and Impact Statement

 There are no financial implications associated with the subject matter.

 Recommendation

 That this report be received for information.

 Background

 At its meeting of June 24, 1998, the Toronto Community Council requested the Commissioner of Urban Planning and Development Services and the City Solicitor, to report to its meeting of July 22, 1998 respecting Section 37 of the Planning Act and the flexibility the City has to use such section, in particular, the definition of "local". The report has been reviewed by the City Solicitor.

 Planning Act Provision

 Section 37 of the Planning Act provides for local municipalities to pass by-laws under Section 34 (zoning by-law) which authorize increases in density and/or height in exchange for the provision of public benefits (ie. facilities, services and matters). The reference to a "local municipality" in Section 37 (as well as in Section 34) makes it clear that, where there is two-tier municipal government, it is the local municipal council, and not the county or regional council, that is empowered to pass by-laws under Section 37. In the new City of Toronto, the word "local" in Section 37 has no special significance. These benefits may be secured by a municipality entering into one or more agreements with a developer dealing with the particular benefits. This agreement may be registered against the title of the land to which it applies and the municipality is entitled to enforce those provisions contained in the agreement(s). In order to give effect to the by-laws, a municipality must have an Official Plan in place which contains provisions relating to the authorization of increases in height and/or density.

 Section 37 is a flexible planning tool which enables a municipality to secure the provision of both City-wide and local public benefits. The former City of Toronto successfully secured a range of facilities and/or amenities in the City's Central Area and Financial District by participating in Section 37 agreements. The public benefits secured through these agreements provided both local services and facilities such as community services and parks as well as City-wide benefits such as social housing.

 Overview of the Former City of Toronto Official Plan Policies

 The former City of Toronto's Official Plan contains policies which allow for the use of Section 37 to secure specific public benefits in exchange for increased height and/or density. These provisions include a policy framework for securing the benefits, in particular affordable housing. Appendix A summarizes the relevant policies which provide the framework for the application of Section 37.

 Section 16.21 (Implementation) of the former City's Part I Plan outlines the policy framework regarding the use of Section 37. Subsection 16.21(a) provides the general policy provisions and identifies priority objectives to be secured through agreements with developers including: social housing; non-profit community, cultural and institutional facilities; heritage preservation of designated properties and public parks. Subsection 16.21(b) outlines an implementation framework which contains specific guidelines respecting density incentive provisions including ensuring that good planning principles are achieved; the benefits secured must focus on "capital" items such as land, buildings and structures; and the estimated value of the public benefits should equal a minimum of half the value of the increase in height and/or density.

 Advantages of the Use of Section 37

 The use of the Section 37 provisions has been a valuable tool for achieving City objectives. This tool has been effectively applied to a significant number of development projects across the former City and has successfully assisted in achieving a broad range of public objectives outlined in the Official Plan. There are numerous advantages of applying this tool, including:

• flexibility of funds to be earmarked for a local area in the City;
• securing public benefits as well as the positive features of site-specific developments through agreements;
• providing an incentive for developers through increases in height and/or density; and
• providing an ability to achieve a wide range of planning objectives (local and City-wide) contained in the Official Plan.

 Accomplishments

 The former City of Toronto has historically secured a large array of public benefits through Section 37 incentive provisions in the Official Plan. These benefits include a large number of social housing units, workplace day cares, heritage preservation projects, public art projects, community service space along with a significant amount of improvements to the public realm (ie. streetscape and infrastructure). In addition, a significant amount of capital funds have been secured towards the construction of new community facilities, including schools, recreation centres and libraries. Many of these contributions were secured through site-specific Official Plan Amendments which authorized permitted residential density in the Central Area and Financial District.

 In the early 1980's, the private sector contributed land for approximately 6000 social housing units along with over $19 million cash-in-lieu of land. The former City of Toronto currently has 6 workplace daycare facilities operating (329 spaces) and 4 others secured (182 spaces) through the use of Section 37.

 A City-wide Policy Approach

 As part of the review being undertaken for the new Official Plan, staff are currently working on developing a consistent City-wide approach respecting the use of Section 37. As part of the background work in developing such an approach, a review of the Official Plan provisions for the former local municipalities was undertaken. The former municipalities of Toronto, North York, East York and Etobicoke have policies in their Official Plans that provide a framework for the use of Section 37. The former municipalities of Scarborough and York have applied Section 37 on a site-specific basis and do not currently have an Official Plan policy.

 Priorities

 The use of Section 37 is one option available to the City for achieving planning objectives in the form of the provision of services, facilities and matters, without direct public expenditures. Other options include direct expenditure of tax dollars and development charges. In recognition of the use of Section 37 as a flexible planning tool which has the ability to achieve a broad range of public benefits and/or objectives, it is important that the following priorities be considered as part of the development of a new City-wide policy approach noted above:

• the need to assist local communities in addressing needs;
• the need to meet good planning principles and not compromise the overall urban built form and/or structure; and
• the need to consider securing City-wide benefits which include affordable housing and improvements to the public realm (ie. pedestrian and/or parks connections).

 Conclusion

 The use of Section 37 as a planning tool in the former City of Toronto has been very successful in achieving a wide range of public benefits, particularly in the Central Area and Financial District. The lessons learned through the application of this tool will assist in the development of a new and consistent City-wide policy approach. This will enable City planners to continue to apply the Section 37 tool within a consistent policy framework. Ultimately, agreements between the municipality and the developer will be undertaken, using this framework as a basis for good planning. It is anticipated that the new policy framework will be flexible enough to benefit both the municipality and the development industry. This will result in development which will be innovative and address the positive features of the development, while also addressing the potential impacts on the local community along with securing contributions for local and City-wide public benefits.

 In the meantime, the old City's existing policies as expressed in the Official Plan will continue to be applied.

 Contact Name: