Evaluation of Community Improvement Plan Incentives Public Engagement Open House Thursday October 20, 2016
What Are We Here to Talk About? Review of the Financial Incentives through Community Improvement Plans: Loans & Grants • - Upgrade to Building Code & Façade Improvement Loans - Forgivable Grant Programs - Non-street Façade Loan Program - Awning, Signage and Decorative Lighting Grant Program Industrial Development Charges • Residential Development Charges • Tax Back Grants • - Residential; - Brownfield; - Heritage; - Airport
Why Review ?
Objectives of Review • Determining the overall best value for money – “bang for buck”/ROI • Ensure we are not incenting something that would occur even without the incentives in place • Ensure that the incentive programs implement the goals of the CIPs • Focus on key policy objectives of the CIPs • Establish clear measures of success for programs • Ensure consistent with CIP Legislation • Find savings wherever possible
Interim Report & Direction
August 22, 2016 – Report to Planning and Environment Committee DIRECTION GIVEN FROM COUNCIL THAT: No CIP or program for Sports and Recreation Programs • No CIP or program for Private/Not-for-Profit Education Facilities • Retain Upgrade to Building Code Loan Programs (Downtown, Old East, SoHo) • Retain Façade Improvement Loan Programs (Downtown, Old east, SoHo) • Retain Tax Increment Grant Programs (Downtown, Old East) • Retain Brownfield Tax Increment Grant Program and Property Tax Assistance Program • Retain Brownfield Assessment Study Grant Program • Noting that changes to the programs to align with the objectives above will be • recommended.
Existing Programs
Existing Types of Financial Incentives through CIPs Loans Tax Grant Other Grants DC Grants
Existing Types of Financial Incentives through CIPs Programs Examples Description No interest, 10 year pay back to the - Upgrade to Building Code City, Capped (percentage of cost of Loans - Facade Improvement improvements set to a max.), - Non-street Façade Improvement Loan Low cost Tied to increase Tax (related to - Brownfield Tax Increment Equivalent Grant improvement), New taxes paid, grant - Rehabilitation & Redevelopment Grant Tax Grant provided for a set proportion of the - Heritage Tax Increment Grant tax increase, city received no less - Airport Tax Increment Grant than prior to improvement, Low cost - Forgivable Upgrade to Building Code - Forgivable Facade Improvement Typically tied to Small Scale property Other - Awning, Signage & Decorative Lighting Grant improvement Projects or studies, Grants - Tax Holiday Grant Capped, Moderate cost - Industrial Corridor Enhancement Grant Widely used for a variety Projects, - Industrial Not capped for IND/RES/AIR, Capped - Residential for HER/BRO based on costs of site DC Grants - Brownfield improvement/remediation – value - Heritage Development Charge Equivalent Grant of grants determined at Building Permit Stage, High cost
Loan Programs
Loan Programs Programs Examples Current Program Description Loans Upgrade to Building No interest, 10 year pay back to the • • Code City, Capped (percentage of cost of improvements set to a max.), Facade Improvement • Non-street Façade • Improvement Loan
1. Loan Programs - Upgrade to Building Code Upgrade to Building Code Current Model Proposed Changes Up to $50,000 loan to property owner or Up to $ 250,000 loan to property owner or half the value of the eligible works half the value of eligible works Review criteria for ‘eligible works’ Areas of Eligibility proposed: – Downtown CIP; – Old East Village CIP; and – SoHo CIP.
2. Loan Programs – Façade Improvement Façade Improvement Current Model Proposed Changes Up to $ 25,000 loan to property owner Up to $ 100,000 loan to property owner or half the value of eligible works Review criteria for ‘eligible works’ Only one (1) application per property Permit one (1) application per property every eleven (11) years or one (1) year after the previous loan is repaid. Open eligibility to include non-street façades Areas of Eligibility proposed for Façade Improvement: – Downtown CIP; – Old East Village CIP; and – SoHo CIP. Areas of Eligibility proposed for Non-Street Façade program: – Downtown CIP; and – Old East Village CIP.
Grant Programs (including Forgivable) Program Example Description Grant Programs Forgivable Upgrade to Building Typically tied to small • • Code Grant; scale property (not including Tax Forgivable Façade Improvement improvement projects or • Increment Grant Grant; studies. Programs) Awning, Signage & Decorative Moderate cost to City with • • Lighting Grant; costs capped. Tax Holiday Grant; • Industrial Corridor Enhancement • Grant.
Grant Programs (Non-DC)
Grant Programs (including Forgivable) Propose re-activation of pilot program for Forgivable Loans as part of Grant programs. Eligible Areas Proposed Changes Downtown CIP 25% of Upgrade to Building Code and Façade Improvement • Loans to be paid back to property owner through a grant, up to Old East Village CIP a cap of: SoHo CIP $ 12,500 forgivable portion for Façade Improvement; • and $ 25,000 forgivable portion for Upgrade to Building • Code; Forgivable portion only applicable for defined ‘eligible uses’. Note: List of ‘eligible uses’ requires review and confirmation. Note: Awning, Signage and Decorative Lighting Program subject to a future budget ask; possibly incorporated into Façade Improvement Program.
Tax Grant Programs Program Example Description Tax Grants Brownfield Tax Increment Tied to increased tax (related to • • Equivalent Grant improvements) through new taxes Rehabilitation & paid; • Redevelopment Grant Grant provides for a set portion of • Heritage Tax Increment Grant the tax increase; • Airport Tax Increment Grant City receives no less than prior to • • improvement. Identified as lower cost to the City. • No changes proposed to Tax Grant programs
Development Charges Programs
Development Charge Programs Program Example Description Development Industrial; Widely used for a variety of projects; • • Charges Grants Residential; Cost not capped for Industrial or • • Brownfield; Residential; • Heritage DC Equivalent Costs capped for Heritage and • • Grant Brownfield, based on costs of site improvement/remediation. Value of grants determined at Building • Permit Stage. High cost program to the City. •
Brownfield and Heritage DC
DC Grant Programs – Brownfield & Heritage DC Equivalent Development Charges Program Current Model Proposed Program Changes Brownfield Grant for eligible remediation costs No changes proposed. • on up to 50% of the Development Charges that have been paid Heritage Grant in the amount of the DCs that No changes proposed. • would have applied to the heritage- designated building, had it been built today, when that structure is rehabilitated or incorporated into a development project. Grants may not exceed cost of • rehabilitating the heritage- designated building
Residential DC
DC Grant Programs - Residential Four (4) options for the Residential DC Grant Program: Residential DC Grant program Option 1 Option 2 Option 3A Option 3B Option 4 “Existing” “Stepped” “Straight Cap” “Cap with “Heritage” Minimum Quality Threshold Criteria” Note: funding for the Council-approved but un-funded SoHo Residential DC Grant Program under consideration.
DC Grant Programs – Residential (Option 1) Option 1: “Existing Program” • 100% grant back of Development Charges • Eligible in the Downtown CIP and Old East Village CIP areas
DC Grant Programs – Residential (Option 2) Option 2: “Stepped” Stepped DC Rebate (% by # of units) 120 • Units 0 to 100 at a 100% DC rebate; 100 • Units 101-200 at a 75% DC rebate; 80 • Units 201+ at a 50% DC rebate. 60 40 20 0 DC Grant % 100 units 101-200 units 201 units +
DC Grant Programs – Residential (Option 3A) Option 3A: “Straight Cap” – 100% Development Charges Grant; – Grant is up to a maximum of $ 2 million cap; – $ 2 million cap is a cap per building.
DC Grant Programs – Residential (Option 3B) Option 3B: “Cap with Minimum Quality Threshold Criteria” Grant (%) Cap ($) Minimum Quality Threshold Note Criteria 100% DC Grant Up to a maximum Grant only provided if meets No grant back if of $ 2 Million per the criteria as follows: development does building If Heritage building on not meet the • the site, the building is minimum quality appropriately conserved threshold criteria. (Heritage Designated); Meets applicable Design • Guidelines; and Provides green roof or an • alternative that is acceptable to Council.
DC Grant Programs – Residential (Option 4) Option 4: “Heritage” • If no Heritage-designated building on the site: • 75% DC grant for site; • Grant is up to a maximum of $2 million (per building). • If a heritage building is on site and is conserved with Heritage Designation: • 100% DC grant for site; • Grant is up to a maximum of $2.5 million (per building).
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