Moncton test will see taller building in exchange for units deemed affordable

Moncton is testing a new policy known as density bonusing that allows construction of buildings larger than normally allowed if they include units deemed affordable or having energy efficiency measures.

The option was introduced through a 2017 change to the province's Community Planning Act, but has not previously been implemented in Moncton. Fredericton has already implemented it.

The planning tool still leaves it to developers to opt to include affordable units in a city where low vacancy rates have led to a boom in apartment building construction, most of which has been advertised as higher-end or luxury.

Councillors voted unanimously in favour of approving an agreement between the city and Sackville-based J. N. Lafford Realty Inc. on Tuesday evening.

"This involves, I think, the city's first bonus zoning agreement," Bill Budd, the city's director of planning and development, said. 

The agreement allows the company to build a four storey, 76-unit building on Highlandview Road in the east end of the city where only three floors are normally allowed. In exchange, 10 per cent of the units are required to charge rent linked to income in the region. 

It uses a program called MLI Select through the Canada Mortgage and Housing Corporation. It sets the maximum rent for the affordable units at 30 per cent of the median income for greater Moncton. 

That amount was $45,700 in 2019, so rent will be cap out at $1,142.50 per month in the units deemed affordable.

"Still not affordable for many," Coun. Daniel Bourgeois said of the monthly cost.

According to the CMHC, the maximum can be adjusted during the 10 years based on changes to the consumer price index, a Statistics Canada measure of changes in the cost of goods and services.

Bourgeois asked city staff how compliance with the agreement would be tracked since it's the first test of density bonusing. 

Josh Adams, a planner with the city, said the CMHC would be responsible for that. 

The proposed building is the second phase of Lafford's Birch Meadows project. 

Last year, then-federal Social Development Minister Ahmed Hussen announced the government would give the company a $16-million loan with highly favourable terms for the first phase. 

Half the units would offer "deeply affordable" rent, Hussen said.

CBC reported last fall  that the "average affordable rent" of the Birch Meadows project would be $1,500 a month.

A request for comment from J. N. Lafford Realty Inc. was not returned Wednesday.

Density bonusing was one of several measures city staff have examined to try to boost affordable housing in the city. 

Moncton has committed to spend $6 million on Rising Tide, a non-profit that is expected to open 160 units by 2023 to reduce homelessness in the city.

The New Brunswick government announced that as part of local governance reforms municipalities would be able to enact a measure called inclusionary zoning. 

The tool would allow municipalities to require builders include some affordable units in certain conditions. 

City staff expect that power to be in place sometime next year.