'Free' TTC Metropass will make condos more costly
December 12, 2009
Stephen Dupuis
http://yourhome.ca/homes/columnsblo...ee-ttc-metropass-will-make-condos-more-costly
Whether they want it or not, whether they need it or not, new condo buyers in the City of Toronto are going to get a "free" TTC Metropass for a year from their condo builder thanks to a recent decision by city council.
Under the new policy, developers of condominium buildings with 20 or more units located in specified areas of the city (basically anywhere a developer would want to build) will be required to provide every purchaser in that building with a Metropass "at no cost."
This the city's way of encouraging people to take transit but everybody except city staff and council knows that people aren't going to use the TTC just because their benevolent developer was forced to give them a pass.
I couldn't tell you what percentage of buyers the "free" Metropasses will be wasted on but I do know that in any given building, there's going to be a segment of people that can walk to work and therefore don't require unlimited transit access. There will be another segment of residents who need their car to get from A to B during the workday so a Metropass is useless to them. And there will be a further segment of buyers that live in the core but commute to jobs in the regions. What are they supposed to do with their Metropasses?
Don't get me wrong, the Building Industry and Land Development Association (BILD) is pro-transit and the industry as a whole is delighted with all the transportation infrastructure investment that is taking place.
But let's not forget that condo buyers are already paying for transit through development charges not to mention the connection fees that the TTC is extracting from the developers. And now they want us to pay the riders as well?
Let's get one thing straight. There is nothing free about this. If you do the math on a 300-unit building times the price of a monthly Metropass times 12 months, the developer is looking at a cost of more than $400,000. Sure, the policy says the builder has to provide the Metropasses "at no cost," but we all know that the cost will get buried in the purchase price. All the city has really succeeded in doing with this policy is to make condos more expensive for buyers.
Senseless regulation can be incredibly frustrating and this Metropass issue is just the tip of the iceberg. This year alone, the city has approved a near doubling of development charges, albeit deferred, while imposing additional regulatory costs through its green building standards and green roofs by-laws.
The city is currently looking at mandating condo developers to build 10 per cent of their units for families even though there is no demand for such units in the city at the price developers would need to charge.
And all of this is on top of the infamous local land transfer tax.
What's particularly galling about this latest regulatory assault by the city is the fact that it has been imposed retroactively with no fair transition or grandparenting provisions, just a money grab at the end of the approvals process when the city has the developers at its mercy.
If the city isn't going to rethink the whole policy, it behooves council to review the retroactive application of it.
If you will pardon the pun, there has to be "a better way" to treat the one industry that is investing in the city, creating tens of thousands of jobs in the process.
Stephen Dupuis is president and CEO of the Building Industry and Land Development Association. The views expressed are those of the president. Email:
president@bildgta.ca.
Dupuis: Free Metropass policy needs review
December 19, 2009
Stephen Dupuis
http://www.yourhome.ca/homes/columnsblogs/article/739793--dupuis-free-metropass-policy-needs-review
I can never predict which columns will generate the most reaction, but it seems last weekend's column on "free" Metropasses struck nerves all around.
Checking my email early last Saturday morning, I found my inbox was lit up like a slot machine with messages from condo owners and condo builders, as well as Toronto Councillor Adam Vaughan.
To quickly refresh your memory, the City of Toronto recently approved a new policy, which requires condo developers of buildings with 20 or more units to provide every purchaser in that building with a Metropass for a full year "at no cost" to the buyer.
I pointed out that far from being free, the Metropass policy would cost approximately $400,000 on a typical 300-unit building. But as one condo builder rightly noted, the cost on a city-wide basis rises exponentially. Some more quick math reveals that even in a year of relatively weak condo sales, such as this one, this new policy represents a massive burden on condo buyers.
This year, builders will sell approximately 10,000 condo units in the City of Toronto. Multiply that by roughly $1,000 for each "free" Metropass and all of a sudden we are talking about a $10 million extraction from condo buyers, year in, year out. And if I'm right that one-third to one-half of condo buyers will have no use for the "free" Metropasses, we're looking at a $3 million to $5 million grant to the TTC at best or at worst, the equivalent amount of pure waste.
Vaughan says that the problem with BILD positions is that we often omit "the total profile of an argument," by which he means that I failed to mention the savings that would accrue to developers from reduced parking requirements.
The truth is, apart from one very innovative project in Vaughan's Ward 20, the industry has certainly not seen any relaxation in parking standards from the city. In fact, in the course of one radio interview two weeks ago, Councillor Howard Moscoe stated at the outset that the free Metropass policy would be good for developers as it would allow for reduced parking requirements, but later in the interview stressed that he's not advocating condos with no parking,
adding that the city hasn't reduced parking standards at this time.
Vaughan points out that parking spots can cost up to $35,000 to build, and he's not wrong.
The only problem with his argument is that unless the city can wipe out a whole floor of parking, there is no savings to offset the cost of the Metropasses. And for the most part, the city is not prepared to relax its parking standards that much.
The exception to all of this is the 42-storey, 318-unit Residences at RCMI project by Tribute Communities being marketed in Vaughan's ward. The project has but nine parking spots for AutoShare cars. I give Vaughan huge kudos for shepherding this project through, particularly in light of a staff recommendation against the project based on, you guessed it, the lack of parking.
I said last week that the industry needs to have a conversation with the city about the retroactive application of the policy. On second thought, the whole policy deserves some sober second thought, particularly in light of the reaction from all quarters. As Moscoe admitted on air, the policy was "adopted without debate, it's the law, and it's not appealable," to which I say, there has to be "a better way."
Stephen Dupuis is president and CEO of the Building Industry and Land Development Association. The views expressed are those of the president. Email:
president@bildgta.ca.