TOWN OF CANMO ORE POLIC CY EFFECTIVEE DATE: ADOPTED BY RESOLUTION: POLICY TITLE: AMENDED BY RESOLUTIONS: April 19, 2011 145-2011, Aprill 19, 2011 Council Meeting Perpetually Affordable Housing (PAH) Policy TABLE OF CONTENTS: 1. VISION ALIGNMENT 2. PURPOSE 3. DEFINITIONS 4. GUIDING PRINCIPLES 5. PAH CONTRIBUTIONS 6. PAH ELIGIBILITY CRITERIA 7. PAH PARTNERSHIP AGREEMENT 8. PAH BUILD GUIDELINES 9. PRIOR PAH POLICY 1 1 2 3 4 5 7 8 8 APPENDIX A APPENDIX B PAH Build Guideliness Hector PAH Eligibilityy Requirements 9 10 1. VISION ALIGNMENT The Town of Canmore has made affordable housing a strategic priority in its Business Plan and Community Sustainability Plan. The Mining the Future visionn identifies that a well stratified demographic profile and the provision of affordable housing are important elements off maintaining the community s social fabric. 2. PURPOSE The decreasing supply of affordable housing in Canmore is a community wide issue. The Town of Canmore recognizes that a permanent, year-round populationn plays an important role in the social and economic health of the community. The availability and affordability of housing plays a critical role in creating opportunities for members of the workforce to establish themselves in the community on a permanent basis. Perpetually affordable housing (PAH) is a way of introducingg a type of rental or owned housing that, while not part of the open market, meets the demand for affordable housing by providing resident workers with an additional housing option that is price and resale restricted to ensure affordability over the long term. PAH is not social housing and is intended to meet the housing demands of median income households.
The basic principle of this policy is that the Town, CCHC, the residents of Canmore, the development industry and the business community all have a vested interest in finding solutions that will address the affordable housing issue and keep Canmore socially sustainable into the future. The development of PAH equity and rental units are intended to address the affordable housing demand of those Canmore residents unable to purchase or rent accommodation on the open market. 3. DEFINITIONS Perpetually Affordable Housing is a range of housing types that shall be maintained as a Canmore resident s permanent primary residence, available to eligible persons at below market purchase prices and rental rates. PAH shall be restricted by occupancy, resale price, and buyer or tenant eligibility criteria. PAH rental rates shall be established at a minimum of 10% less than the local market rate. PAH units for ownership or for rent shall be no smaller than the following size criteria: Minimum Unit Size by Type Bachelor Suite 400 sq. ft. 37 m 2 One-Bedroom Apartment 550 sq. ft. 51 m 2 Two-Bedroom Apartment 700 sq. ft. 65 m 2 Two-Bedroom Townhouse 750 sq. ft. 70 m 2 Three-Bedroom Apartment 900 sq. ft. 84 m 2 Three-Bedroom Townhouse 950 sq. ft. 88 m 2 PAH households should spend no more than 35% of their gross household income on their housing costs. a) Housing costs for home owners shall include mortgage payments, property taxes, heating costs and a share of condo fees; b) Housing costs for renters shall include rent and heating costs. The purchase price of ownership PAH shall be affordable to households earning up to a maximum of 120 percent of Area Median Income (AMI), based on recommended Gross Debt Servicing (GDS) ratios. The rental rate for rental PAH shall be affordable for households earning up to a maximum of 100 percent of Area Median Income (AMI), based on recommended Gross Debt Servicing ratios. Area Median Income (AMI) refers to the median income of Canmore determined annually by CCHC using Statistics Canada data. Building permits are approvals required for any new construction, additions, alterations or changes of use of existing buildings. The Province of Alberta Safety Codes Act and the Town of Canmore Building Permit Bylaw govern the Canmore building permit process. Business community refers to any person or company that receives a tax assessment under the nonresidential assessment code. CCHC refers to the Canmore Community Housing Corporation.
CMHC refers to the Canada Mortgage and Housing Corporation. CPI refers to the national all-item Consumer Price Index, including housing. Council refers to Council of the Town of Canmore. Development Industry refers to any person, builder or other producer of lots or buildings for residential and non-residential use. Dwelling unit refers to the definition contained in the Canmore Land Use Bylaw 09-99. Fund refers to the PAH Reserve Fund Gross Debt Service Ratio refers to an affordability measure where monthly housing costs are calculated as a percentage of gross household monthly income. Non-residential property refers to the commercial, industrial and institutional uses defined in the Canmore Land Use Bylaw 09-99 by either definition or by purpose and intent of sections of each land use district. PAH Eligibility Criteria refers to the qualifications which prospective PAH owners must meet in order to qualify to purchase a PAH unit, which may change from time to time. PAH Partnership Agreement refers to the terms which govern both partners (CCHC and the PAH unit owner) once a PAH unit has been purchased, which may change from time to time. PAH Reserve Fund is an account established by the Town of Canmore through the PAH Contribution Policy (Resolution #179-2005) that currently receives all monies to be used for the specific and sole purpose of developing equity or rental PAH projects or facilitating any aspect of constructing, producing or delivering PAH units. Town refers to the Town of Canmore. PAH Waiting List refers to the list of people who have met the PAH Eligibility Criteria, but who cannot purchase a PAH unit because there are none available that they qualify to buy. The Waiting List is also used by CCHC as a method to prove the general demand for PAH, and to provide local statistics to help determine the PAH housing prices most in demand. 4. GUIDING PRINCIPLES PAH will provide housing with price and resale or rental rate restrictions. PAH will be restricted to people who are qualified, based on employment, residency, income, asset, and other qualifications as determined from time to time. PAH will be provided to meet the demand based on a variety of income levels above the level of social housing and below the level of market housing.
PAH shall be needs based, provided for those who are unable to afford to purchase or rent housing on the open Canmore real estate market. PAH shall be provided in a diversity of locations across the community. PAH shall be in various housing forms including secondary suites, apartments, townhouses, duplexes and fourplexes. All monies received as part of this PAH Policy will be used to further the development of PAH within the Town of Canmore. 5. PAH CONTRIBUTIONS This section of the Policy outlines the manner in which financial contributions are to be made by various segments of the community. 5.1 The PAH Reserve Fund (a) The PAH Reserve Fund is established and administered by Council. The Fund will be used solely for the creation of PAH equity and rental units. The Fund will be reported in the Town s annual financial statements. A detailed reporting of revenue into and expenditures from the fund will be made available to the public on an annual basis. The Fund is an interest bearing reserve and all interest is to accrue to the Fund. (b) The PAH Reserve Fund shall be accessed only to: i) use as working capital to build or contract the building of PAH projects, ii) purchase land and service land that PAH will be constructed on, iii) use as equity on rental units, iv) used to reduce the sales price of equity units, or v) facilitate any aspect of delivering PAH units within the Town of Canmore. 5.2 Accountability to the PAH Reserve Fund The use of the PAH Reserve Fund will be by decision of Council. Prior to the use of any funds from the PAH Reserve Fund, Council will obtain a recommendation from the CCHC Board. 5.3 Contributions to the Reserve Fund (a) The contribution amount from each sector for the development of PAH will be determined annually during the Town of Canmore s budget process. (b) All contributions net of the annual operating costs associated with CCHC will be transferred to the Fund. (c) Annual contributions to the Reserve Fund may be as follows: (i) (ii) Residential Property Owners The Residential Property Owners contribution is expected to be collected via a fixed residential mill rate established each year by Council. Business Community (Non-Residential Property Owners) The Business community contribution is expected to be collected via a fixed nonresidential mill rate established each year by Council.
(iii) Other The Town of Canmore may target a contribution of up to $350,000 annually from the Planning and Development Department to the PAH Reserve Fund. The actual annual contribution amount will be established each year by Council. In addition, any year-end surplus above the budgeted operating surplus within the Planning and Development Department may be contributed to the PAH Reserve Fund as directed by Council. 6. PAH ELIGIBILITY CRITERIA This section of the Policy outlines the qualifications that PAH applicants must meet before being approved to own or rent a PAH unit. 6.1 Applicants are required to meet all PAH qualifications. There are no preferences given within qualifications and no preferences given based on family size, or who constitutes a family unit. 6.2 Spouses of a deceased employee/retiree who between them would have met all PAH qualifications will also be considered as qualified applicants. 6.3 Age and Citizenship 6.3.1 All ownership applicants proposing to be on title must be of Alberta legal age and be a Canadian Citizen or Permanent Resident, except a spouse. 6.3.2 All rental applicants of Alberta legal age must be listed as tenants on the rental lease and must be a Canadian Citizen, or be a Permanent Resident, or possess a valid Canadian work visa. 6.4 Residency and Employment At least one ownership applicant proposing to be on title and all tenants on a rental lease must meet one of three categories of Residency and Employment Criteria outlined below in sections 6.4.1, 6.4.2 and 6.4.3: 6.4.1 Canmore Residency and Employment (a) Currently live in Canmore and shall have lived in Canmore for at least twelve (12) months prior to taking possession of a PAH home. The twelve (12) month residency requirement may be fulfilled through cumulative or consecutive months; AND (b) Must be one of the following: i. an employee working in Canmore a minimum average of twenty (20) hours per week for a licensed Canmore business; or ii. a self-employed person with a Canmore business license or recognized equivalent performing the services as a self-employed person for a minimum of an average of twenty (20) hours a week; or iii. a retiree with at least five years of prior work experience in Canmore. For ownership applicants, criteria (a) and (b) can be met by different applicants within the applicant household proposing to be on title. For rental applicants, employment includes, but is not restricted to, being on maternity leave or sick/disability leave, or being a homemaker, or having accepted a bona fide job offer.
6.4.2 Canmore Long-Term Resident Currently live in Canmore and shall have lived in Canmore for at least sixty (60) months, since the age of fifteen (15) years old, prior to taking possession of a PAH home. The sixty (60) month residency requirement may be fulfilled through cumulative or consecutive months. 6.4.3 Canmore Permanent Employment Currently work in Canmore and shall have worked in Canmore for at least six (6) months prior to taking possession of a PAH home, and be an employee working a minimum of thirty (30) hours per week on a contract of at least one year with a licensed Canmore business. 6.5 Gross Household Income 6.5.1 To qualify to own a PAH unit, annual Gross Household Income shall not exceed 120 percent (%) of the AMI for couple families. 6.5.2 To qualify to rent a PAH unit, annual Gross Household Income shall not exceed 100 percent (%) of the AMI for couple families. 6.6 Net Household Assets Shall not exceed $100,000, this amount being subject to change from time to time, excluding RRSP, RESP, RRIF, and Pension Plans. For the purposes of determining Net Household Assets, real estate will be valued based on the most recent Property Tax Assessments from the jurisdiction in which the property is located. 6.7 CCHC has the discretion to approve applications with variations to either the Net Household Asset or Gross Household Income cap, provided the new combination of income and assets results in the household being able to afford no more than the most expensive PAH unit in inventory. 6.8 Applicants applying to purchase a PAH unit must provide a mortgage pre-approval. 6.9 CCHC shall require a non-refundable $100 application fee before any PAH application for ownership will be processed. Upon approval, applicants will receive an approval letter and shall be placed on the CCHC PAH Waiting List. 6.10 If there are no PAH units available to own or rent that meet the applicant household s requirements, PAH applicants will remain on the CCHC PAH Waiting List. The approval letter is valid for a period of six (6) months from the date of approval. Applicants will remain on the PAH Waiting List after the six month period provided that they maintain their eligibility for PAH. 6.11 As long as the PAH Eligibility Criteria are met, no one (including any elected official; municipal, provincial, or federal government employee; CCHC Board member or employee) is ineligible by virtue of their job/volunteer position. 6.12 Once a PAH applicant has purchased or rented a PAH unit, CCHC will only monitor the PAH Residency Requirement. The Residency Requirement states that the PAH unit must be the applicant s permanent, primary residence, with no rentals or sub-letting allowed without prior written consent from the CCHC Board. Housemates and boarders are allowed in PAH ownership units as long as a titled owner remains in permanent residence. 6.13 Once a PAH applicant has purchased or rented a PAH unit, they will be removed from the PAH Waiting List. If the PAH applicant is interested in moving or upgrading within PAH, they must submit
another application, and once approved, they must maintain their eligibility while on the PAH Waiting List. 6.14 CCHC will ensure regular reviews of the PAH Eligibility Criteria and PAH Partnership Agreement, at a minimum annually. CCHC will identify Eligibility Criteria and Partnership Terms which do not appear to be synchronized with the local demand for PAH, consult with external groups, and recommend to Council appropriate changes to the PAH Eligibility Criteria and/or the PAH Partnership Agreement. 6.15 The Eligibility Criteria contained in this Policy may be altered either generally, or specifically with respect to a particular PAH project or development, only with the approval of Council. 6.16 The specific Eligibility Criteria for the Hector Project at the Palliser Village development are attached as Appendix B to this Policy. 7. PAH PARTNERSHIP AGREEMENT This section of the Policy governs the terms which both partners (CCHC and the PAH unit holder) agree in advance to follow after the purchase of a PAH unit, and establishes the requirement upon all future builders of PAH who are working with the Town of Canmore and CCHC, to standardize their PAH Partnership Agreement terms to those established in this Town of Canmore policy, which may be changed from time to time. The specific terms of the PAH Partnership Agreement will be contained in the appropriate agreements at the time of purchase, which may take the form of a Memorandum of Lease, or an Option Agreement and Restrictive Covenant. 7.1 The PAH unit must be the applicant s permanent, primary residence, with no rentals allowed. However, housemates and boarders are allowed as long as a titled owner remains in permanent residence. 7.2 All future sales of PAH units shall be handled through the CCHC (as allowed by the Real Estate Act) and its PAH Waiting List as permitted in the purchase agreements. The PAH Waiting List shall be managed on a first-come, first-serve basis for the sale of new PAH developments and the sale of CCHC PAH leasehold units. CCHC will facilitate re-sales by using the PAH Waiting List as a list of eligible applicants approved to purchase PAH units from a PAH seller. 7.3 An administrative fee of 2.5% of the original purchase price, as agreed in writing by the applicant, shall be paid by the applicant to CCHC upon each PAH resale. 7.4 CCHC will calculate the restricted PAH resale price based on the original purchase price, as agreed in writing by the applicant for the PAH unit, multiplied by 110% of annual percentage change in CPI, prorated for the number of days owned in a year, and compounded annually. Resale price shall always be a maximum price, never a guaranteed price. 7.5 If applicants wish to appeal a CCHC staff decision, appeals shall be made to the CCHC Board. The decision of the CCHC Board is final. A report on all appeal decisions will be made available to Council on a quarterly basis. 8. PAH BUILD GUIDLINES The PAH Build Guidelines are intended to provide guidance on a year to year basis on the cost of construction in relation to household types and Area Median Income. The PAH Build Guidelines shall be
used by CCHC and any developers or partners that are constructing or providing PAH units, to ensure that they are appropriate and affordable. The PAH Build Guidelines are intended to provide the operational and practical clarity regarding the provision of PAH units so that they are both appropriate to households and are affordable to the suitable household type. 8.1 The PAH Build Guidelines shall: a) Be reviewed annually by the CCHC Board and submitted to Council for approval; and b) Define required amenities by unit type; and d) Identify the affordable construction cost of PAH based on Area Median Income as derived from StatsCan by unit type and household type. 8.2 CCHC will annually identify a priority of unit types that are required, based on a demand assessment. 8.3 The PAH Build Guidelines will be attached annually to this Policy as Appendix A following approval by Council. 9 PRIOR PAH POLICY 9.1 This Policy replaces all other prior Perpetually Affordable Housing policies and all amendments thereto. TOWN OF CANMORE WHERE THERE IS ANY CONFLICT BETWEEN THE POLICIES ADOPTED BY THE TOWN OF CANMORE AND THE POLICIES SET FORTH IN A COLLECTIVE AGREEMENT ADOPTED BY CUPE LOCAL #37, OR POLICIES SET FORTH IN A STATUTE OF THE PROVINCIAL OR FEDERALGOVERNMENT, THE COLLECTIVE AGREEMENT OR THE PROVINCIAL OR FEDERAL STATUTE SHALL SUPERCEDE SUCH OTHER POLICIES. T.M. Registered Trade Mark
2010-11 PAH Build Guidelines PAH BUILD GUIDELINES YEAR: 2010-11 Note: changes from the previous year are italicised PAH Maximum Qualifying Income PAH Rental (non CNIT) $ 94,282 100% Median Income: Couple Families PAH Ownership $ 113,139 120% Median Income: Couple Families * Washer/Dryer means either 1) provision for washer/dryer such as hook-ups within the unit, or 2) access to common washer/dryer Amenities by Unit Type Minimum Unit Type ft 2 m 2 Amenities Bachelor Apartment 400 37 Window Coverings, Range, Fridge, Washer/Dryer *, Storage One-Bedroom Apartment 550 51 Window Coverings, Range, Fridge, Washer/Dryer *, Storage Two-Bedroom Apartment 700 65 Window Coverings, Range, Fridge, Dishwasher, Washer/Dryer *, Storage Two-Bedroom Townhouse 750 70 Window Coverings, Range, Fridge, Dishwasher, Washer/Dryer, Storage Three-Bedroom Apartment 900 84 Window Coverings, Range, Fridge, Dishwasher, Washer/Dryer *, Storage Three-Bedroom Townhouse 950 88 Window Coverings, Range, Fridge, Dishwasher, Washer/Dryer, Storage within the development Sales price/square foot Unit Price Unit Type Price/sf at Min Size Bachelor Apartment $ 200 80,000 One-Bedroom Apartment $ 200 110,000 Two-Bedroom Apartment $ 225 157,500 Two-Bedroom Townhouse $ 225 168,750 Three-Bedroom Apartment $ 250 225,000 Three-Bedroom Townhouse $ 250 237,500 Corresponding Household Category Single Single Lone Parent/Couple NC Lone Parent/Couple NC Couple Families Couple Families Priority by Unit Type 1 One-Bedroom Apartments 2 Three-Bedroom Townhomes 3 Two-Bedroom Townhomes Approved by CCHC (Motion 2010.27) for recommendation to Town Council
APPENDIX B HECTOR PAH ELIGIBILITY REQUIREMENTS 1. INTRODUCTION The Eligibility Criteria contained in this policy are specifically for The Hector at Palliser Village Perpetually Affordable Housing (PAH) rental property. The Perpetually Affordable Housing (PAH) Policy includes specific Eligibility Criteria. Section 6.15 allows the Eligibility Criteria contained in that Policy to be altered either generally, or specifically with respect to a particular PAH project or development, such as in the case of The Hector at Palliser Village. The Hector at Palliser Village was funded in part by the Province of Alberta under the Rural Affordable Housing Partnership Initiative (RAHPI), and accordingly, is subject to the terms and conditions of that grant, including maximum income criteria. Canmore Community Housing Corporation (CCHC) acts as the Town s agent to implement the eligibility criteria through an application process. Should applicants wish to appeal a CCHC staff decision, appeals shall be made to the CCHC Board. The CCHC Board has the discretion to consider how Staff applied and interpreted the Eligibility Criteria, but does not have the discretion to allow exceptions to the Eligibility Criteria itself. The decision of the CCHC Board is final. A report on all appeal decisions will be made available to Town Council on a quarterly basis. 2. DEFINITIONS "CNIT" is the Core Need Income Threshold published annually by the Province of Alberta, which limits the gross annual income by unit type allowed in developments funded by specific provincial grants. Disability refers to a prolonged and/or permanent condition that substantially limits an individual s ability to earn a living. This includes, but is not limited to, recipients of the Assured Income for the Severely Handicapped (AISH) in Alberta and of the Canadian Pension Plan (CPP) Disability Benefit. "Employed" includes, but is not restricted to, being on maternity leave or sick/disability leave, or being a homemaker, or having accepted a bona fide job offer. "Tenants" are all adult persons living in rental accommodation. All such persons shall be on the lease. 3. ELIGIBILITY CRITERIA Applicants are required to meet all qualifications. Age and Canadian Legal Status: All applicants of Alberta legal age must be listed as Tenants on the rental lease and must be a Canadian Citizen, or be a Permanent Resident, or possess a valid Canadian work permit. Employment: All Tenants must be one of the following: i. an employee working in Canmore a minimum average of twenty (20) hours per week for a licensed Canmore business; or
ii. iii. iv. a self-employed person with a Canmore business license or recognized equivalent performing the services as a self-employed person for a minimum of an average of twenty (20) hours a week; or a retiree, and the spouse or caregiver of the retiree, who meets one of the following conditions: a. has worked in Canmore a minimum average of twenty (20) hours per week for at least three (3) years; or b. has lived in Canmore for at least five (5) years since the age of fifteen years old. or; is an individual, and the spouse or caregiver of the individual, who has a disability and who meets one of the following conditions: a. has worked in Canmore a minimum average of twenty (20) hours per week for at least three (3) years; or b. has lived in Canmore for at least five (5) years since the age of fifteen years old. Residency: Preference shall be given to Tenants who currently live in Canmore and shall have lived in Canmore for at least the twelve (12) months prior to the effective date of the lease. Occupancy: The rental home must be the permanent primary residence, on a continuous basis, of all Tenants. Net Household Assets: No asset cap. Gross Annual Income: All tenants must meet the Core Needs Income Threshold (CNIT) as approved by the Province of Alberta or as otherwise agreed to by the Province of Alberta.