Fraser Institute: Oshawa stifles development
By Joel Wittnebel/The Oshawa Express
The latest report from the Fraser Institute has a few people shaking their heads at Oshawa City Hall.
The report, New Homes and Red Tape: Residential Land-Use Regulation in Ontario’s Greater Golden Horseshoe, surveyed homebuilders across the Greater Golden Horseshoe (GGH) – a region which includes Durham Region, Toronto, Hamilton, Waterloo and Guelph – and based on their feedback on different criteria, identified those municipalities with significant amounts of regulatory red tape that could be stifling development.
Oshawa was ranked 21st out of 23 municipalities, labeling the city as one of the most regulated municipalities in the GGH.
According to Ken Green with the Fraser Institute and one of the authors of the report, surveys asked developers to grade municipalities based on how long it took to get a building permit, the costs associated with the permit, how often rezoning was required for a project and how long that added to the development process.
“The important thing we try to stress in this report is that virtually all municipalities across Canada have expressed concerns about housing affordability,” Green tells The Oshawa Express. “And the best way to get housing affordability is to have the optimum amount of housing stock that the buyers are willing to pay for.
“Many of the major municipalities are below that because they’re suppressing the supply with regulatory delays,” Green says.
However, development statistics in Oshawa suggest that despite the survey results of large quantities of red tape, it’s doing nothing to stifle development. The city surpassed development permit records last year and is on par to blast past those numbers once again.
Paul Ralph, the city’s commissioner of development services, says he was “blown away” when he first read the report, suggesting some of the survey respondents dealing with Oshawa may have only done development in the city years ago. The city has received nothing in the form of negative comments from developers in recent years, Ralph adds.
“We constantly have dialogue with the building and development industry. We’re always talking about continuous improvement because continuous improvement around here is part of our corporate culture,” he says. “No system and no process is perfect and we’re always trying to find ways to make it more effective and more efficient.”
Councillor John Aker, the chair of the development services committee, had much more colourful words to describe the report.
“It’s just insane,” he says. “The Fraser Institute loses any credibility they have when they put out garbage like this.”
While the reports lists Oshawa as the third most regulated municipality in the GGH, Green admits this doesn’t necessarily mean a development boom isn’t underway.
“We fully recognize that government red tape is only one factor in housing availability, housing prices and housing construction and it’s not necessarily the dominant one,” he says.
In fact, Green suggests that in some areas, the survey responses and the amount of development could actually be correlated. With an area experiencing heavy development, the regulatory system could become backlogged with requests and rezoning proposals, causing delays.
“The building boom could actually be a causal factor in the regulatory lock up,” he says.
Green says the goal of the report is to show readers that these regulatory delays are actually costing homebuyers money, money that is going into the government’s pocket.
The further a development is delayed, the higher costs are for the builder, which is then built into the price of a new home.
“When you realize then that perhaps $40,000 or $50,000 of that price was the cost of compliance with the regulations, that’s the down payment…you’re talking about another additional down payment, 10 per cent of the price, that goes to the government,” he says.
The Fraser report is the third in a series which also looked at the areas of Vancouver and Calgary prior to the GGH.