Ontario’s new housing plan: The More Homes Built Faster Act, 2022

The Ontario Ministry of Municipal Affairs introduced the More Homes Built Faster Act, 2022 (“Bill 23”) on October 25, 2022. Bill 23 is part of Ontario’s Housing Supply Action Plan, a long-term strategy to increase housing supply and provide attainable housing options.

Bill 23 proposes significant changes to the current regime and aims to support the province’s goal to add 1.5 million new homes in Ontario by 2031. The highlights of Bill 23 are discussed below:

As-of-right zoning

Bill 23 proposes to allow the creation of up to three residential units “as-of-right” on most residential lots that are zoned for a single home without a municipal by-law amendment. The three units can be within ‎an existing residential structure or take the form of a residence with an in-law, basement ‎suite, laneway, or garden home. If passed, there will be a new threshold for what can be built in Ontario’s residential unit framework. Depending on the type of property, the three residential units would be exempt from development charges and parkland dedication fees so long as they comply with the building code and municipal by-laws for standards regarding matters such as height.

The Ontario government is also hoping to move towards “as-of-right” zoning to meet planned minimum density targets near major transit stations. If passed, more homes may be built near public transit corridors. Local municipalities would be required to establish and implement official plan policies for protected major transit station areas (“PMTSAs”) with amended by-laws within one year of the zoning by-laws coming into effect.

Streamlined approval processes

Bill 23 proposes to streamline approvals for certain residential projects by eliminating time-consuming bureaucratic and municipal processes. For instance, Bill 23 suggests removing site plan control requirements for most projects with fewer than ten residential units and reduce the number of required approvals for small housing projects.

Reforms to the Ontario Land Tribunal

Bill 23 proposes to amend the Ontario Land Tribunal Act to allow the Ontario Land Tribunal to prioritize cases that would create the most housing. Under Bill 23, the Tribunal would have the power to dismiss appeals without a full hearing and restrict “third party” appeals on official plan amendments, zoning by-law amendments, consents, and other minor variances. The timeframe for an applicant to appeal a non-decision to the Tribunal would be shortened from 120 days to 90 days after the application for a permit is made. In this way, the government aims to enable the Tribunal to resolve cases more efficiently.

Reduced government charges and fees

Bill 23 proposes to freeze, reduce, or exempt government charges and fees to reduce the overall cost of building a home and spur the supply of new home construction. If passed, select attainable housing units and non-profit housing developments would be exempt from municipal development charges, parkland dedication levies, and community benefits charges.

Under Bill 23, the government would also reduce development charges for rental construction, freeze conservation authority fees for development permits and proposals, and review all other fees levied by provincial ministries, boards, agencies, and commissions with the intent of further reducing the fees. The Ontario government further plans to consult with the federal government to potentially introduce HST/GST incentives or other forms of tax reform that could incentivize housing construction.

Inclusionary zoning

Bill 23 proposes regulatory changes to inclusionary zoning rules by prescribing a maximum 25-year affordability period and a five percent cap on the number of inclusionary zoning units. Bill 23 introduces a standardized approach to determine the lowest price or rent of a unit under an inclusionary zoning program: 80 percent of the average resale purchase price, and 80 percent of the average market rent for rental units.

Other proposals

Bill 23 proposes to launch consultations with industry partners and various stakeholders to renew and update Ontario’s heritage policies, discuss the impact of land use speculation on the government’s housing supply goals, and enable greater standardization of municipal by-laws on regulating the demolition or conversion of multi-unit residential rental properties.

Bill 23 passed its first reading on October 25, 2022. Its second reading has been referred to the Standing Committee on Heritage, Infrastructure, and Cultural Policy as of November 2, 2022.