Have You Ever Heard of Section 37?

Planning law and regulation in Toronto and the province is complicated, cumbersome, and difficult to understand. It is overwhelmingly written by Queen’s Park, given the Constitutional arrangements in Canada which afford provinces so much legislative punch and power, especially in comparison to regional and municipal governments. Planning law reviews do occur on a routine basis and everyone has their own opinions and views on the state of the overall system and on what should be reformed. One interesting component of planning in the region is Section 37 – which refers to a section of the Ontario Planning Act. 

Section 37 is a clause which gives municipalities, through local Councillors (elected politicians), the power to negotiate changes to planning and zoning in exchange for monetary commitments to certain arbitrary projects. For example, let’s say you’re a developer with a fair bit of cash and you want to build a 30 storey condo in an area where zoning says 20 is the max. You’ve got access to a deal to buy a plot of land for a decent price, now want to make some profit, but calculate that a 20 storey building won’t net you the kind of proceeds you want. So, what do you do? Well, you activate S. 37 and ring up your local City Councillor.

Negotiations start. The Councillor hears you out and thinks what you want is not too unreasonable – it’s only a few extra storeys. What’s wrong with making money? Now in exchange for the immediate zoning change for your extra 10 storeys, the Councillor wants you to scratch his back. You see, he wants to get re-elected, and there’s a neighbourhood where he didn’t get as many votes in the last election that he could use in the next. He wants you to promise $250,000 to upgrade a park in his tricky neighbourhood. You say sure, why not, and the deal is done. Under Section 37, the commitments to projects in exchange for zoning changes are designed to be used to help the community add resources in needs in exchange for the heavy duty development changes. If a developer builds a 60 storey condo instead of a 20 storey condo, the impact on roads, sewers and local schools will be massive.

Councillors have huge power to negotiate these deals for their own political ends and the Section 37 system has come under serious scrutiny in recent years, especially under now deceased former Mayor Rob Ford. With the planning system undergoing massive reforms by now Premier Doug Ford, expect Section 37 to be changed thoroughly.  

Ontario’s Housing Revamp Bill 108

The Ford PC government has unveiled a major piece of omnibus legislation designed to promote the construction of new housing and to reform planning in Ontario.

The bill is being passed swiftly by the government, as is the case with most legislation the PCs have introduced. The bill has received a fair bit of media attention and both praise and criticism. One of the key elements of the bill is that it eliminates the two stage appeal process of broad planning reform legislation brought in by the previous Liberal government – returning to a single hearing system. Marking a return with the bill is some of the old powers of the Ontario Municipal Board; namely the return to a single hearing. 

108 also reforms the section 37 system. Section 37 received a considerable amount of attention under former Toronto Mayor Rob Ford. The system allows municipalities to arrange special contributions and payments from developers in exchange for variances and changes to zoning and planning rules. The late Mayor Ford believed the system allowed City Councillors to amass pork barrel spending accounts to spend on parks and other amenities while accommodating powerful and wealthy developers and saw it as a corrupt and inefficient system. Most Section 37 money is accrued in the development heavy downtown core and benefits largely left-wing Councillors and politicians. 108 replaces certain provisions of Section 37 with a new community benefits charge and allows the province to exempt certain types of development from the charge. This reform will intensify provincial activity and interest in municipal and local development matters.

Bill 108 also cuts down on timelines for municipal processing of applications from 180 days to 120 days. It also limits witness activity in an appeal and restricts third party appeals to sub division planning and proposals. All of these changes will speed up development, benefit developers, and restrict the capacity of individuals to challenge construction. These are but a few of the changes Bill 108 makes to the system. The province has also expressed its desire to work with a wide variety of stakeholders and partners to get more housing to market.