City council trades favours with developers to increase affordable housing
The City of Nelson’s Affordable Housing Reserve Fund has $59,753 in it.
That money has come from developers, such as those that built Amber Bay, Silver Bay and Lake View Village. When developers ask the city for a re-zoning or some other regulatory change that will increase density and therefore the value of the development, the city may ask them to do something in return.
They might ask the developer to either build some affordable housing as part of the development, or contribute to the city’s affordable housing reserve fund.
No developer in Nelson has yet taken on the first option.
The city can’t require developers to do these things, but, “they are asking for something we don’t have to give them,” says city manager Kevin Cormack.
He says that most developers recognize that if they want the city to help them in a way that will increase the value of their development, they might have to provide something in return. It’s something like an incentive system.
“It’s a negotiation,” says Councillor Donna Macdonald. “It’s all voluntary.”
The city’s Affordable Housing Fund Policy (attached at the end of this article) specifically sets out what constitutes affordable housing and how to calculate a donation to the fund.
In some situations the city might ask for something other than affordable housing, such as their encouragement of Nelson Landing to extend the waterfront pathway and doing improvements to a public Red Sands Beach.
The affordable housing fund has been around for a couple of years and has never been drawn from. The policy says it could be used to pay for consultants, administration, legal costs, land purchase, or utility connections, all in relation to a specific housing project. It can only be used by the city or by a non-profit involved in housing such as the Nelson Cares Society.
Macdonald says Amber Bay and Silver Bay paid the fund $250 per unit. The Kootenay Co-op, in its proposed Nelson Commons development in the old Extra Foods site, is going to raise the bar— it has volunteered to pay $1000 per unit as a contribution to affordable housing in Nelson if the housing part of the Nelson Commons development goes ahead. That would approximately double the current balance in the fund.
The fund is overseen by the Nelson Housing Committee, whose mandate and activities are summarized in the last few paragraphs of a July 15, 2013, story on housing in The Nelson Daily.