City council’s housing committee has rejected three controversial aspects of Nelson Commons’ affordable housing plan. But city management doesn’t agree with the committee, and will be recommending to council at its May 4 meeting that the developer’s requests be granted.
At the April 7 council meeting, Nelson Commons asked for a number of variances, some of which were approved. But three of them caused some problems for council, which consequently referred them back to the housing committee for an opinion.
“Restricted resale units”
The first issue was Nelson Commons’ request that instead of contributing $54,000 ($1000 per door, about four times higher than any other residential developers have paid to the city) to the city’s affordable housing fund as previously agreed, Nelson Commons’ contribution to affordable housing would be three “restricted resale” units discounted in selling price by 25 per cent in perpetuity.
Several council members at the April 7 meeting were not receptive to this because a buyer would have to have an income of $55,000 to qualify for a mortgage for the discounted units, which would sell for about $200,000.
Second, Nelson Commons asked that the city take over the administration of any future resale of those discounted units. Some council members rejected this because they said such administration was the developer’s job and the amount of work involved is unknown.
Third, Nelson Commons asked that the city waive $9,837 in connection fees for the three units.
It was those three issues that, at its April 7 meeting, council decided to refer back to its housing committee for an opinion.
Housing committee says no
The housing committee, chaired by Councillor Michael Dailly, who was one of the most persistent objectors to the proposed variances at the council table but who told the Star he tried his best to be neutral at the committee meeting, considered these three issues at its meeting on April 21.
The committee rejected the idea of offering restricted resale units instead of a payment of $54,000 because the selling price of the units after discounts would still require a relatively high income.
The committee meeting minutes state that, “While the generosity of the contributions is recognized and applauded, a disconnect seems to exist in the language being used for the restricted resale units compared with what is considered truly affordable housing. The lack of developed criteria creates further ambivalence.”
The second issue—the city taking over administration of future sales of the restricted resale units—was also voted down by the committee, as was the proposed waiving of the connection fees.
All three votes were nine opposed and three in favour. Members of the housing committee present at the meeting were Michael Dailly (Chair), Laureen Barker, Jenny Robinson, Kathy Fair, Rona Park, John Alton, Brad Howard, Ann Harvey, Joan Reichardt, Trevor Jenkinson, Jim Reimer, Qadesh Markowski, and Sharmaine Gray.
Management staff says yes
The committee then communicated those recommendations to city management staff, who have now drafted a recommendation to council that is against the committee’s wishes and in favour of Nelson Commons’ desired variances. These recommendations will be considered at council’s regular meeting tonight.
Management staff’s reasons for sticking with recommending the three restricted resale units are based on the concept that there is a continuum of housing forms and types, ranging across a spectrum described in the City of Nelson’s housing needs update report from the fall of 2014.
That spectrum ranges from emergency shelter at one end, through various social housing options, to assisted rental, to market rental, to home ownership at the opposite end.
Even though the units in question might not be affordable to the lowest income people, the argument goes, it could work for someone who is a little higher on the continuum but still in need.
City staff argues that a couple with a combined income of $55,000 could in fact afford one of these units, and that such a purchase would free up housing for other low income people. Their math is outlined in the documents attached below.
Their argument is also based on the idea, put forward by Nelson Commons in previous meetings, that the total reduction in the cost of the three suites amounts to a contribution of about $240,000 by the developer to affordable housing—a contribution much more significant than the proposed $54,000 donation.
The material prepared for council by management staff for tonight’s meeting is attached below.
Referral to the housing committee is questioned
There are some, including Nelson Commons’ Russell Precious, who say that there was no need to send the restricted resale issue back to the housing committee because the committee had already tacitly agreed to it. The committee’s minutes from November 2013 record a carried motion “that Nelson Housing Committee provide recommendations to Nelson Commons to establish criteria for the three restricted resale units within the Nelson Commons development.”
The membership in the housing committee in 2013 was significantly different from today.