Municipalities can’t tax their way to affordability

The campaigning is over, the lawn signs have come down, and the victory parties have been cleaned up. My sincere congratulations to all those who ran for elected office and to those who have earned the public trust for the next four years.

Now the hard work begins. Rarely does a single theme dominate municipal elections, but that was certainly the case this year in communities across B.C. From Nanaimo to Metro Vancouver to Prince George and beyond, the issues which dominated municipal campaigns were housing, homelessness and affordability.

It is no surprise. Rental units are increasingly hard to find, home prices have increased, and yet the number of newly-built homes hasn’t kept pace with growth. Meanwhile, tens of thousands of newcomers are moving to B.C. every year.

Over the next 15 years, a million people are expected to move to Metro Vancouver and yet the region is building only 20,000 new homes a year. It is an imbalance that will only get worse unless it is addressed.

Provincial politicians think the solution is to levy more taxes — from the school tax to the speculation tax — but I don’t believe we can tax our way to affordability. When you increase the costs to build a home, those costs get passed along to the eventual buyer or renter.

We need new solutions, and a surprising number of them are in the hands of communities and the councillors and mayors they have just elected. Municipalities control zoning, or land use, and are able to set priorities that lead to meaningful change.

I believe one of the biggest things we can do for our children, our parents and young workers is to develop more home choices. Often, when we talk about homes, we think of single-family homes or highrise condominiums. They remain crucial, but in many communities, there is a huge gap in the middle that goes largely unfilled. Options such as duplexes, triplexes, lane homes, row homes, micro suites, mid-rise buildings, and many more. These are the kind of homes that appeal to families, seniors and young professionals. If we want our communities to remain vibrant for our citizens, we must improve the diversity of housing we offer them.

But the homes must also be more affordable, and municipalities have an important role to play. Too often, new construction is seen as a taxation cash cow where municipalities can levy fees and special development contributions. An independent analysis this spring found that 26 per cent of the cost of a new condominium in Vancouver can be attributed to government taxes and fees. In real terms, a new Vancouver condo priced at $840,000 would have $220,000 in taxes, fees and levies embedded in the price. Once again, those costs get passed along to the final user.

If our political leaders are truly committed to affordability, they must reduce their addiction to taxes and fees.

Municipal leaders can also help address affordability by encouraging speedier processing times. A new housing project can take years to earn the necessary approvals, with some communities much quicker than others. In Vancouver, a new project can be tied up in municipal red tape for seven years before shovels hit the ground, while in the Township of Langley, a project can be approved in eight months.

Long delays for approvals mean increased costs for buyers and renters. Improving efficiency will bring new homes to the market sooner, without diminishing standards or building safeguards.

This is just a start to the ideas that municipalities can adopt to address the housing crisis — and there are many more, including special landuse planning for low-income accommodation, targeted tax measures to encourage the construction of purpose-built rental homes or zoning modernizations to allow lane homes, micro units and basement suites.

Elections represent a time of renewal, where new energy and creative ideas can bring transformative change to our communities. If we are serious about addressing the housing crisis and making this province more inclusive, the time for action is now.