Rental Apartment Buildings: Results of Public Consultation and Proposed Regulatory Regime
|
Licensing and Standards Committee consideration on November 30, 2016
| LS15.3 |
ACTION
|
Ward:All
|
| Rental Apartment Buildings: Results of Public Consultation and Proposed Regulatory Regime |
| Origin |
| (November 16, 2016) Report from the Executive Director, Municipal Licensing and Standards |
| Recommendations |
The Executive Director, Municipal Licensing and Standards recommends that:
1. City Council approve a new regulatory by-law for rental apartment buildings that requires property owners to:
a. register the building with the City of Toronto and submit required information;
b. have a process for receiving, tracking and responding to tenant repair requests;
c. notify tenants of service disruptions, property standards appeals, work orders and cleaning plan,
d. install notification board in central location;
e. use licensed pest management professionals;
f. have a waste management plan;
g. have a cleaning plan;
h. use contractors with certification from Ontario College of Trades to conduct maintenance of HVAC and plumbing systems
i. have a state of good repair capital plan; and
j. pay all applicable fees.
and direct the Executive Director, Municipal Licensing and Standards to report to the March 6, 2017 meeting of Licensing and Standards Committee with the new regulatory by-law.
2. City Council direct that the program be funded as follows:
Option A: Program budget of $4,442,904, funded:
- 80% from a $13.00 registration fee per unit per year ($3,580,317);
-20% from the tax-base ($888,580)
OR
Option B: Program budget of $4,442,904, funded:
- 65% from a $11.00 registration fee per unit per year ($2,917,123),
- 15% from revenues from enforcement action ($637,200)
- 20% from the tax-base ($888,580)
OR
Option C: Program budget of $4,442,904, funded:
- 60% from a $10.00 registration fee per unit per year ($2,665,742),
-40% from the tax-base ($1,777,161)
OR
Option D: Program budget of $4,442,904, funded:
-45% recovered from a $8.00 registration fee per unit per year ($2,028,542)
-15% recovered through revenues from enforcement action ($637,200)
-40% recovered from the tax-base ($1,777,161)
and direct the Executive Director, Municipal Licensing and Standards to report to Budget Committee during the 2017 Operating Budget process on the program budget and the six additional FTEs required to implement the program proposed.
|
| Summary |
The report responds to City Council directives to consult on a proposed licensing framework for rental apartment buildings and recover the costs of an enhanced MRAB program. The report details the findings of staff research and public consultations that took place from August to October 2016.
Staff evaluated the regulatory option of licensing rental apartment buildings based on stakeholder expectations and the goal of improving the City's enforcement capacity. Findings confirm that a regulatory approach through licensing does not present any advantages over other regulatory tools authorized by the City of Toronto Act, 2006 and may actually create additional complexities that would not contribute to the programs goals of bringing rental apartment buildings into compliance.
The evaluation confirmed that the enactment of a regulatory bylaw, instead of a licensing bylaw, would provide the City with the necessary authorities to accomplish the City's mandate of consumer protection, safety and wellbeing of its citizens, and fulfill public expectations, while avoiding potential hindrances to obtaining compliance.
The report proposes improvements to existing enforcement activities and regulations that will help:
The improvements include the creation of a regulatory by-law, which would impose legal requirements for rental building owners, improved access to information about the quality of rental apartment buildings and new opportunities for higher fines.
The report also identifies additional inspection activities to help benchmark the quality of the housing stock in rental apartment buildings and enhance the proactive enforcement of property standards. Lastly, the report outlines a process for recovering the costs of existing and proposed inspection and enforcement activities based on a combination of tax revenues, rental apartment building registration fee and user fees for non-compliant building owners.
The proposed changes build on the successes of the existing MRAB program and represent the next building block in an evolving municipal approach to improving living conditions for tenants in Toronto.
Legal Services, Shelter Support and Housing Administration (SSHA), Toronto Fire Services, Solid Waste Management Services, Toronto Public Health, and Tower Renewal Steps Program were consulted in preparation for this report.
|
| Financial Impact | ||||||||||||||||||||||||||||
The current 2016 annual operating budget for the MRAB program is $3.18 million and includes salaries and benefits for 24 FTE, material and equipment, and indirect and overhead costs. This report outlines a proposed annual budget of $4.4 million, which includes the current costs of the MRAB program plus the proposal to add six (6) new FTEs. It also includes an amount of $100,000 for stakeholder engagement and $227,575 in one-time costs to cover implementation and the development of an online information portal. The total proposed new annual program budget is $4.4 million.
The current 2016 annual operating budget for the MRAB program is 100% tax supported. For cost recovery option D, the preferred option, described in the report, 60% ($2.66 million) of the program will be funded through new and increased user fees, and 40% ($1.77 million) will be tax supported (see Table I) on an annual basis.
Table I: Cost Recovery Option D
Table II: Annual Financial Impact Based on Cost Recovery Option D
Table II highlights the difference between the current MRAB program and the proposed program (Option D) on an annual basis for gross expenditures, revenues and net expenditures. 6 new positions are recommended to be added to the existing staff of 24. These positions are required to ensure the program is operating with the appropriate levels of management oversight and analytical support. The recommended revenue represents 60% cost recovery from user fees and the remaining 40% funded by property taxes. As a result, the annual net cost of this program has been reduced by $1.406 million or 44.2%. These changes are consistent with the 2017 Operating Budget currently being recommended to Budget Committee. Subject to the approval of City Council on this cost recovery model, the Executive Director, Municipal Licensing and Standards will report to Budget Committee during the 2017 Operating Budget process on the proposed program budget and applicable fees.
The Deputy City Manager and Chief Financial Officer has reviewed this report and agrees with the financial impact information. | ||||||||||||||||||||||||||||
| Background Information |
| (November 16, 2016) Report from the Executive Director, Municipal Licensing and Standards on Rental Apartment Buildings: Results of Public Consultation and Proposed Regulatory Regime (http://www.toronto.ca/legdocs/mmis/2016/ls/bgrd/backgroundfile-98654.pdf) Attachment 1 - Jurisdictional Scan (http://www.toronto.ca/legdocs/mmis/2016/ls/bgrd/backgroundfile-98655.pdf) Attachment 2 - Results from 2015 Ipsos Reid Survey on Apartments and Condominiums (http://www.toronto.ca/legdocs/mmis/2016/ls/bgrd/backgroundfile-98656.pdf) Attachment 3 - Consultation Findings from Online Survey, 2016 (http://www.toronto.ca/legdocs/mmis/2016/ls/bgrd/backgroundfile-98657.pdf) Attachment 4 - Proposed Building Information Requirements at Registration (http://www.toronto.ca/legdocs/mmis/2016/ls/bgrd/backgroundfile-98658.pdf) Attachment 5 - Impact of Proposed Program Fees on Rent (http://www.toronto.ca/legdocs/mmis/2016/ls/bgrd/backgroundfile-98659.pdf) Attachment 6 - MRAB Activities and Service Standards (http://www.toronto.ca/legdocs/mmis/2016/ls/bgrd/backgroundfile-98660.pdf) |
Comments