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Affordable housing

Affordable housing development

Affordable Housing Unit

The Affordable Housing Unit works with both the private and not-for-profit sectors on the development of affordable housing in an effort to advance the objectives of the City’s 10 Year Housing and Homelessness Plan. The Affordable Housing Unit has four areas of business:

  1. Delivering the Investment in Affordable Housing (IAH) for Ontario Program, which may include the following components:
    1. New Affordable Rental Housing
    2. Ontario Renovates Program
    3. Homeownership Down Payment Assistance
  2. Facilitating the development of affordable housing by identifying and negotiating ways to improve housing affordability for low income households, including negotiating and advocating with other levels of government, community agencies, developers and other City departments.
  3. Developing and managing funding and incentive programs to support the development of affordable housing by leveraging other resources, including federal and provincial funding, private funding, land and other equity.
  4. Developing community capacity by brokering partnerships in the community to transfer and share knowledge, skills and expertise, as well as to leverage additional resources to increase the supply of affordable housing.

For more information, email affordablehousingunit@ottawa.ca or contact the Housing Services branch at 613-580-2424 ext. 12300.

Action Ottawa

Program objectives

Action Ottawa is the City’s primary program for increasing the supply of low-income affordable housing in Ottawa. The program is designed to facilitate the development of mixed income communities, including supportive housing, that are well designed and well managed, and built on a scale that ensures integration within the existing neighbourhood.

Action Ottawa combines City incentives with funding from all three levels of government to assist private and non-profit developers in building new affordable rental housing for moderate and low-income households. Action Ottawa bundles fee relief and capital grants and in some cases City-owned land. The overall objective of Action Ottawa is to support the creation of needed affordable housing by making available significant municipal resources and facilitating access to programs provided by other levels of government.

Investment in Affordable Housing for Ontario Program

The Investment in Affordable Housing (IAH) for Ontario Program provides federal and provincial funding for the creation of affordable housing in Ontario. The IAH program is divided into two funding streams with 5 optional components, three of which are capital programs (Rental Housing, Homeownership Assistance, and Ontario Renovates) and two are operating components (Rent Supplements and Housing Allowances).

In April 2015, City Council approved the capital spending plan for the IAH 2014 Extension Program totalling $48,298,000 over six years (2014 – 2020). In September 2016, City Council approved and updated its IAH capital spending plan resulting from $19,174,000 in additional funding over two years (2016-2018) received from the provincial and federal governments’ Social Infrastructure Fund (SIF) for a total of $67,474,000.

These programs are a continuation of the original IAH program that ran from 2011 to 2015, which provided the City with $25.8 million over four years, in addition to approximately $17 million of City capital. Highlights from the investments made during the 2011 to 2014 term of Council include:

  • A total of 743 new units were approved, completed or funded with priority given to supportive housing for long stay shelter clients, units for larger families, and for households with accessibility requirements.
  • Of these units, 179 were earmarked for seniors, 186 for supportive housing, and 378 for individual households, including families.

For more information on the IAH Program Guidelines, IAH 2014 Extension Program and the SIF IAH, including the capital spending plans, please review the following reports:

Affordable Housing - Request for Proposals

The Affordable Housing Unit posts notices of Requests for Proposals (RFP) on MERX.

Please review this site regularly and visit MERX for information regarding upcoming RFPs.

For more information about the RFP process, please contact the Affordable Housing Unit's program administration at affordablehousingunit@ottawa.ca or 613-580-2424 ext. 12300.

Incentives for affordable housing development

Having adequate, affordable and suitable housing is key to building thriving communities. Our ability to reach our full potential through health and well-being, educational achievements, social connections, attachment to the labour market and community identity can all be impacted by the stability or the instability of our housing. The need for affordable housing is therefore, one of the key issues facing our city.

As part of municipal efforts to meet housing needs in our city, Ottawa City Council approved an Affordable Housing Strategy in February 2002. The Strategy covered a wide range of initiatives including:

  • Reducing tax and regulatory barriers including effectively reducing the higher property tax rate for new multi-residential developments,
  • Reducing the costs of development through initiatives such as providing land and grants, and reducing fees and charges,
  • Requesting the Province to increase the duration and number of Rent Supplement units available,
  • Establishing a Housing First policy for surplus City lands and leasing lands for affordable housing projects,
  • Establishing a municipal By-law designating housing as a municipal capital facility, and
  • Establishing a capital development program.

To date, the implementation of the Affordable Housing Strategy has resulted in the creation of the following tools for affordable housing development:

As-of-Right Incentives

Some affordable housing incentives are available to developers "as-of-right". These are incentives that were created through By-laws of Council and include:

  • Reduced property taxes: the New Multi-Residential Tax Class is for all new residential developments of multiple forms with seven units or more and provides a tax rate comparable to the residential class rate for a period of 35 years.
  • Relief from development charges and building permit fees is available for all residential development in the downtown core area of the city.

Non-profit or Charitable Developers have additional as-of-right incentives which provide relief from development charges, planning application fees, building permit fees and parkland levies for the development of affordable housing. Verification of non-profit or charitable status must be presented to the City in order to receive relief.

Discretionary Incentives

The City's Municipal Housing Facilities By-law is a tool that gives Council the ability to grant specific development charge relief and other incentives to developers in exchange for affordable rental housing.

Specific returns are expected:

  • Housing must be guaranteed to be affordable for a minimum of 20 years
  • Rents can be no higher than the CMHC Average Market Rent and a minimum of 60% of the units must be at rents affordable to lower income families
  • Units for lower income households must be rented to tenants drawn from The Social Housing Registry's centralized waiting list

Developers may seek discretionary incentives at any time. Proposals are assessed on merit, achievement of City objectives, and in consideration of available resources. Council must approve proposals of this kind.

Program Application and Approval Incentives

Action Ottawa is the housing program initiated by the City of Ottawa to help private and not-for-profit developers build new affordable rental housing for moderate and low-income households. Action Ottawa bundles as-of-right and discretionary incentives with additional resources of capital grants and, in some cases, City-owned land. These incentives are offered to developers through a competitive bid process.

In addition to the as-of-right and discretionary incentives, the Action Ottawa package includes:

  1. Capital Grants of up to an average of $60,000 per unit (Federal and/or Municipal)
  2. Long-term lease opportunities on City-owned land at nominal rates

In exchange for incentives, the City requires successful applicants to provide affordable rental units for a minimum of 20 years. The rents can be no higher than the CMHC Average Market Rent, as well as 60% of the units must be at rents affordable to lower income families, and these units must be rented to tenants drawn from The Social Housing Registry's centralized waiting list.

Action Ottawa applications are accepted on a proposal call basis only.

How Action Ottawa incentives fit together to make rents affordable:

How Action Ottawa incentives fit together to make rents affordable

As illustrated above, the combination of capital funding, tax relief and relief from municipal fees should enable proponents to reach Average Market Rent levels.

Additional assistance from the City such as land and additional capital funds should allow proponents to offer below market rents.

Financial incentives can also work in "mixed" or "blended" housing projects which contain both full market housing (which benefit from lowered property tax rates for new multi-residential construction), average market rent units and rental housing affordable to lower-income households.

Housing Facilitation

The City of Ottawa's Housing Services branch ("Housing Services") serves as a facilitator for affordable housing development, providing information and advice to private and non-profit housing developers, other City departments and the community at large.

Housing Services will continue to work with affordable housing partners through implementing other aspects of the City's Affordable Housing Strategy, as well as continue to work together to advocate for increased support from other levels of government, which will create much needed affordable housing.

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