#2 - Ontario's Transit-Oriented Communities (TOC) Program
Unlocking Progress at Subway, GO & LRT Nodes
Contents:
Key Challenges: Population Surge + Congestion + Housing Crises
Historic Opportunity: Transit & Housing Alignment
Transit-Oriented Communities Program
1. Key Challenges: Population Surge + Congestion + Housing Crisis
Population Surge
Ontario has seen a rapid acceleration of population growth in recent years (e.g. nearly half a million people in 22’-23’ alone) due to the increase in immigration and non-permanent residents. Notwithstanding the recent announcement the Government of Canada is reviewing its immigration levels, this rapid growth is expected to remain for some time and then return to more normal increases.
Pressure has been concentrated in the Greater Golden Horseshoe - making it the fastest growing region in North America1.
Congestion
More people = more commuters.
Ipsos polled the GTHA and 86% of respondents consider congestion to be worsening2. This was validated by TomTom, a GPS manufacturer, who released its annual Traffic Index using GPS data. It ranked Toronto as the slowest city in North America (3rd-slowest globally). This painful time in traffic costs us dearly on a personal level, plus $11B annually in lost productivity and opportunity on a macro level3.
Housing Crisis
More people = more demand for homes.
Canada’s chronic undersupply of homes means we have the lowest number of homes per capita of any G7 country4. Two-thirds of this shortage has come from Ontario5, where the historical underbuilding of homes has resulted in home prices tripling in a decade and rising much faster than incomes6.
This prompted the Government of Ontario to convene a Housing Affordability Task Force, which recommended building 1.5 million homes in 10 years and actions to get there. These included adding more density especially where there is transit, expediting approvals and investing in municipal infrastructure to enable development. The province has made significant progress on many of these including recent announcements to invest in municipal water infrastructure and road infrastructure to enable more homes.
2. Historic Opportunity - Transit & Housing Alignment
Fortunately, after decades of chronic underbuilding of transit and homes, the Government of Ontario is taking tangible action to address both gaps.
Transit Expansion
Ontario is embarking on the largest transit expansion in Canadian history and building roads to get people moving.
Ontario’s subways program is a $28B+ program to deliver four new subway lines - adding 40km and 29 stations to the network and connecting Toronto, York and Peel. Additionally, the Sheppard Extension is being “studied”.
The GO expansion program already has $11B+ in early works and off corridor work underway across the network (which includes 7 lines, 67 stations) to enable all-day, two-way service with trains every 15 minutes across core segments. Some additional net new stations are advancing through the process and development can help make these a reality (e.g. Innisfil, Durham, Niagara).
Four new LRTS are also being built - adding 61km and 79 stops covering Toronto, Mississauga/Brampton and Hamilton.
Transit-Oriented Development
Unlike in the past, density at transit nodes is expected - barring technical or business case constraints. This is now consensus between all three levels of government.
However, according to the Canadian Homebuilders Association, several factors are locking well-qualified buyers out of the market and thus constraining sales launches (pre-requisite for construction financing) even for high quality zoned sites: restrictive mortgage rules, red tape, development taxes, high interest rates, etc. Builders are sharpening their pencils and must be increasingly strict in managing timelines, costs and risks or they could join the growing number of projects forced into receivership.
3. Transit-Oriented Communities Program
Ontario is leveraging transit investment to achieve Transit Oriented-Development (TOD) to deliver homes, jobs and amenities while increasing ridership and saving taxpayers’ money. It can put a big dent in both congestion and housing issues at once.
Ontario launched the “Transit-Oriented Communities” program in 2019 under the leadership of Minister Surma. It has passed legislation, such as the Transit-Oriented Communities Act, 2020, to streamline land acquisitions and allow for the designation of land which further enables TOCs to get built (e.g. parkland caps and acceptance of encumbered parkland).
Definition
TOCs are defined by the province as:
“Vibrant, mixed use communities that will bring more housing (including affordable housing options), jobs, retail, public amenities and entertainment within a short distance of transit stations. These transit-oriented communities, and other transit development opportunities, will be located along the province’s four priority subway projects, GO Transit and Light Rail (LRT) projects”7.
Roles and Responsibilities
Infrastructure Ontario (IO) is a crown corporation responsible for the development and delivery of the program and leading negotiations with private sector partners and supporting the province’s engagement with municipalities, the public and Indigenous communities. Where there is interface between development and transit elements there is coordination with Metrolinx and the transit constructor.
The program will leverage partnerships with “private sector partners” who will build TOCs. These can take one of two transaction forms8:
“Partnership Opportunities” with existing and viable development partners
“Collect and Compete” whereby the province acquires/owns the lands and sells the opportunity to a private sector partner
The program has and will continue to engage with municipalities, the public and Indigenous communities on proposed TOC projects.
Entitlements Process
To date, 11 sites have been through the Infrastructure Ontario TOC process and resulted in the entitling of ~48,000 housing units and ~44M sf. of density. A list of projects that have been through the zoning process and additional proposed sites can be found here: Transit-Oriented Communities | ontario.ca. These sites were located within the City of Toronto, Markham and Richmond Hill along the Ontario Line and Yonge North Subway Extension.
Metrolinx had previously administered a TOC program on GO/LRT corridors too. But moving forward, engagements and transactions at GO/LRT stations will be led by Infrastructure Ontario where there is an opportunity to create more housing supply9.
The process for IO advancing these sites through to securing entitlements included10:
The Province/IO submitting a TOC proposal to the municipality for review. These are all publicly available too
Municipal engagement and collaboration
Public engagement via public meeting(s) and stakeholder engagement meetings
Indigenous engagement
Section 47 of the Planning Act, authorizes the Minister of Municipal Affairs and Housing to make zoning orders that regulate the use of land in Ontario, subject to the Minister’s approval and discretion. These orders are similar to local zoning by-laws and can permit the use of land (e.g. for housing), prohibit the use of land (e.g. to protect and an environmentally sensitive feature) and regulate location, use, height and spacing of buildings and structures. More on zoning orders and enhanced authorities here: Zoning order framework | ontario.ca.
This tool has been used in partnership with local municipalities to enable TOCs.
Key Considerations:
There are some key considerations for project leaders to keep in mind – to state a few.
Technical interface requirements between development and transit vary dramatically whether it’s an overbuild project, an adjacency or a site in walking distance unencumbered from transit;
Approvals processes beyond zoning (e.g. Metrolinx permitting and coordination requirements within the Zone of Influence – 300m for GO and 60m for Subways/LRTs) are needed around transit stations/corridors
Phasing and synchronization, especially if interdependency with transit procurement and delivery can impact project timing
And many more…
These projects can be complicated. But, this program is a key delivery mechanism to address Ontario’s rising population, gridlock and housing crises. There is a huge opportunity for municipalities and landowners alike to work collaboratively with the province to leverage a toolbox and help manage timelines, costs and risks to ensure both transit and housing are built for the greater good.
Building Edge Strategies is a strategic consulting firm on a mission to unlock progress on projects that deliver housing, infrastructure and jobs. It provides strategic advisory, government relations and public affairs services to private and public sector clients.
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