Community Improvement Plan Service Review Planning & Environment Committee Monday, April 24, 2017
Service Review Objective Council Resolution, February 16, 2016: Staff directed to undertake Comprehensive Service review of the City’s existing Community Improvement Plans and associated incentives: The review sought to: Evaluate the potential for adding more Community Improvement Plans and associated incentives, Consider the cost and value of existing incentives, and Consider the potential for re-allocating funding associated with one or more of these programs to best meet Council’s strategic priorities.
Request for New Incentives Part of this Service review also included consideration of the demand for new incentive programs that have been requested of Council, these include: Requested Incentive Programs • For NEW Hamilton Road CIP • For NEW Lambeth CIP • From expansion of the Downtown CIP (new boundaries of BIA) • Granting DC rebate for publicly accessible sports and recreation • Granting DC rebate for private/not-for-profit educational facilities (music schools) • For environmentally sustainable buildings or communities • Granting DC rebate to accommodate small businesses • Funding existing Brownfield Contamination Assessment Study Grants incentive program • Fund the existing Industrial Corridor Enhancement Program • Funding existing Tax Increment Grant program in SOHO • Funding existing Heritage Building Assessment/Condition Grant Program in Downtown & Old East Village
Request for New Incentives Part of this Service review also included consideration of the demand for new incentive programs that have been requested of Council, these include: Requested Incentive Programs • For NEW Hamilton Road CIP • For NEW Lambeth CIP • From expansion of the Downtown CIP (new boundaries of BIA) • Granting DC rebate for publicly accessible sports and recreation • Granting DC rebate for private/not-for-profit educational facilities (music schools) • For environmentally sustainable buildings or communities • Granting DC rebate to accommodate small businesses • Funding existing Brownfield Contamination Assessment Study Grants incentive program • Fund the existing Industrial Corridor Enhancement Program • Funding existing Tax Increment Grant program in SOHO • Funding existing Heritage Building Assessment/Condition Grant Program in Downtown & Old East Village
Incentives Through CIPS The City of London has 7 CIPS though which Financial Incentive Programs are offered CIPs Financial Incentive Programs Offered Last Façade Upgrade to Tax Grant Mile Downtown DC Grant Improvement Building Code Program Grant Old East Upgrade to Tax Grant Façade Improvement DC Grant Village Building Code Program SoHo Façade Improvement Upgrade to Building Code Development Charge Equivalent Heritage Tax Increment Grant Grant Airport Tax Increment Grant Area Contamination Property Tax Tax Increment Development Brownfield Assessment Study Assistance Equivalent Grant Charge Rebate Grant Program Program Industrial Development Charge Grant Lands
Incentives With No Recommended Change There are NO proposed changes to the CIPs and Programs below as at this time CIP Programs Tax Increment Grant : provides a tax grant for eligible aerospace industries Airport for up to 10 years that locate in the identified airport area Tax Increment Grant : provides a tax grant for a portion of the tax increase associated with a new development, where a heritage building resource is conserved through rehabilitation Heritage DC Equivalent Grant : provides a grant equivalent to the DCs that would have been due if the heritage building had been built at the time of the redevelopment. Contamination Assessment Study Grant : provides grant for 50% of the cost of the study, up to $10,000 Property Tax Assistance Program : provides for the cancellation of 25% of current property taxes for up to 3 years Brownfield Development Charge Rebate : provides grant back to property owner for up to 50% of normal DCs to cover eligible remediation costs Tax Increment Equivalent Grant : provides a grant for the amount of the municipal property tax increase resulting from rehabilitation for up to 3 years
Recommended Approach Savings Funded by Savings Façade Loans Residential Development Charges 1. Increase max value of loan to $50k 2. Expand program to Richmond Row Require that applicants pay for their full 3. Expand program to Hamilton Road (*) development charge and then grant back 4. Expand Program to Lambeth (*) the development charge over a schedules 5. Re-establish forgivable loan portion for 3 years period (10 years in most cases) for some areas Savings Building Code Loans $620,000 per year (annual) 1. Increase max value of loan to $200k $6 million one-time 2. Expand program to Richmond Row 3. Expand program to Hamilton Road (*) 5. Re-establish forgivable loan portion for 3 years in Downtown & OEV CIP areas Industrial Development Charges Tax Grant Program 1. Apply Program to SoHo program area Reduce the development charge grant 2. Increase tax grant schedule for heritage offered to non-targeted industrial uses to designated properties (creating greater incentive 50% of the development charge on first for retention) $500k in DCs (i.e. $250,000 maximum cap) Fund Industrial Corridor Enhancement Grant Savings TBD $200k savings to 4-year budgeted savings target Revised Programs start January 1, 2018 to December 31, 2023
Industrial DC Program Changes To align with corporate economic development strategies, including the Industrial Lands Development Strategy, the recommended change to the program is to differentiate two categories of industrial uses: targeted and non-targeted Building Applicable DCs Applicable Grant DC Grant DCs (Category) ($) (%) Amount Payable Agri-Food Manufacturer $ 600,000 100 % $ 600,000 $ 0 (Targeted) Shipping/Warehousing 50% $ 600,000 $ 250,000 $ 350,000 (Non-Targeted) ($250,000 cap) The categories “targeted” and “non - targeted” will be based upon existing definitions within the Industrial Lands Community Improvement Plan. This approach strategically links incentives to targeted uses – those that will generate more employment and multiplier employment (spin-offs) and also will have the largest impact on developing London’s economy for the future.
Residential DC Program Changes Combined DC rebate and a Tax-back Increment rebate simultaneously, further changed include: • At the time of building permit issuance applicants pay DCs & apply to Grant program • Grants commence in the same year (after a re-assessment) • The scheduled grant-back will be equivalent to 100% of the municipal portion of the tax increment each year until all the DCs have been repaid
Residential DC Program Changes Development Charges: $ 4,000,000 Tax Increment: $ 650,000 Assessed Value: $ 55,000,000 Year Tax Rebate (TIG) DC Rebate Annual Grant Amount Rate (%) $ Rate (%) $ (= 100 % of Increment) 1 60 $ 390,000 40 $ 260,000 $ 650,000 2 60 $ 390,000 40 $ 260,000 $ 650,000 3 50 $ 325,000 50 $ 325,000 $ 650,000 4 40 $ 260,000 60 $ 390,000 $ 650,000 5 30 $ 195,000 70 $ 455,000 $ 650,000 6 20 $ 130,000 80 $ 520,000 $ 650,000 7 10 $ 65,000 90 $ 585,000 $ 650,000 8 10 $ 65,000 90 $ 585,000 $ 650,000 9 10 $ 65,000 90 $ 585,000 $ 650,000 10 10 $ 65,000 90 $ 35,000 $ 100,000 Totals $ 1,950,000 $ 4,000,000 $ 5,950,000
Tax Increment Grant Program Changes Increase the value of the grant for Level 1 properties to encourage the adaptive re-use of properties designated under the Ontario Heritage Act Level 1 Level 2 Level 3 Proposed Year Current No Change No Change New * Program to 1 80% 100% 70% 60% be activated in 2 80% 100% 70% 60% SOHO CIP Area 3 70% 100% 60% 50% 4 60% 90% 50% 40% 5 50% 80% 40% 30% 6 40% 70% 30% 20% 7 30% 60% 20% 10% 8 20% 50% 10% 10% 9 10% 40% 10% 10% 10 10% 30% 10% 10%
Façade Loan Program Changes REVISED PROGRAM DETAILS: REVISED Façade Improvement Loan Programs To be offered Loans increased from $25,000 to up to $50,000 or half of the value through: of work (whichever is less). Old East Village CIP Loans are paid back at 0% interest over a 10 year period. SoHo CIP ** Forgivable loans to be offered to 3 years (2018 to 2020) with Expanded ongoing Evaluation (for future budget considerations). Downtown CIP Hamilton Road CIP & One application per property every eleven years or one year after Lambeth CIP the previous loan is repaid to the City, whichever is less. **Forgivable Loans only in Downtown & Old East Village CIPs EXISTING PROGRAM DETAILS EXISTING Façade Improvement Loan Programs Loans up to $25,000 or half of the value of work (whichever is less). Offered through: Heritage building facades are eligible for loans up to $30,000. One Downtown CIP, lifetime loan per property. Old East Village CIP & SoHo CIP Loans are paid back at 0% interest over a 10 year period.
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