Zoning reform, 'renovation revolution' & a property tax hike: Gil Penalosa makes his mayoral pitch

There's less than one week before Toronto goes to the polls and CBC Radio's Metro Morning is hosting several mayoral candidates this week to hear about their vision for the city.

Tuesday's interview was with Gil Penalosa, the urbanist who has emerged as one of John Tory's most vocal challengers during the campaign. 

He spoke with host Ismaila Alfa at 7:13 a.m. ET.

LISTEN | Gil Penalosa's full Metro Morning interview:

Below is a partial transcript of the interview. It has been edited for clarity and length.

Zoning reform

Alfa: You have laid out a lot of plans for getting more homes built in the city, part of that would allow different kinds of housing in areas where only single family homes are zoned are allowed. City staff are also working on this. John Tory has also made a promise about this as well. What makes your plan different?

Penalosa: Well, what I'm proposing is totally different. By the way, I ask listeners not to only hear what [incumbent mayor] John Tory is saying he will do in the next four years. He's been mayor for eight years. So evaluate what he has done or not. It's been a huge failure in affordable housing. Huge.

So what I'm proposing is this — 80 per cent of the city is for single family homes and we have a huge housing crisis — I'm going to allow people, as of right, to subdivide their homes.

My friend Jamal has a house. His kids are away. He's an empty nester. He is going to have to leave because the house is big and he cannot afford it. Well, as of right, he'll be able to subdivide it in four units. He can live in one of the four and rent out the other three. It's good for him as owner. It's good for contractors, because we're going to have thousands and thousands of homes being done. And it's good for renters because now citywide we're going to end exclusionary zoning and people will be able to rent.

The second [part] is on all of the streets that we have public transit, we are going to allow to densify, as of right, the height of the width of the road. What does this mean? That developers will save three to four years. So that's less cost, not money going into lawyers, not negotiations. It is very transparent, very clear. So we're going to have a lot more housing. 

Transforming city-owned land

And finally the land that is owned by the public sector, including areas with low-hanging fruits such as two-storey libraries or two-storey LCBOs or Canada Post, we could put some storeys on top of that. When it's on public land, it's going to be 100 per cent affordable — one third deeply affordable, two thirds affordable.

Alfa: When it comes to building affordable and deeply affordable housing on public land, who is going to build that? 

Penalosa: We're going to have a public builder that is going to outsource contracts with private builders. We're going to just cut the middle person. So today the city goes to a private contractor that hires the private builder. Now we're going to hire the private builder directly. 

The important thing is that a large cost of any building is the land. We own the land, the citizens own the land. So there is no better opportunity to do affordable and deep affordable than when we own the land because we can come and say, "Okay, if the land is one third of the cost, we can put it at one third or at zero." And if we put it at zero, then we are going to be able to sell it or rent it. Two thirds of that is going to be affordable, one third deeply affordable. We should not be wasting the land that belongs to all of us on market rate.

Alfa: How would the city afford to operate and maintain these buildings if it is going to be paying 30 to 80 per cent of market rent there?

Penalosa: We can create a fund with the money that we have from the cost of the land we create so that indefinitely this will be affordable because we need those buildings to be very well maintained. 

For that fund, we will be working with the federal government. The federal government has a lot of money on this and they have failed. This is really a failure of both Tory and [Prime Minister Justin Trudeau] that they have not been able to get off the ground. So that is how we are going to get this off the ground. We put in that priority. So this has to be included on the cost of the project, the fund, so that indefinitely that 20 per cent missing will be for the administration of the building and it will be coming out of that fund.

Paying for the vision

Alfa: Your housing plan here is a big plan, it's big ideas. I just wonder how you're going to pay for all of that because that's a very expensive plan, right? 

Penalosa: It's not very expensive. For example, 80 per cent of the area of Toronto is single family homes. If we allow people to [subdivide their homes as of right] they are the ones doing it and so it's not really going to cost the city. We're just going to allow it, we're going to facilitate it.

We're going to encourage a one stop shop office in the city where people can come and solve all the issues that they have about finance and legal and design and this is going to be great for the house owner.

Alfa: How do you convince the house owner then to put their house, part of it, up for rent if they're required to have one third of available suites be deeply affordable or be affordable for people?

Penalosa: So one of the things is that we are going to have part of the funding that the federal government is giving the city for affordable housing. We're going to say this can be that much faster, immediately in the first year, we can start doing so. Let's use this federal money not only for buildings but also to allow for what I call renovation revolution. 

So let's say you are an empty nester and you have this house — 91 per cent of the empty nesters want to age in place. But they have a big house, they cannot afford it. Okay, if they want money from the city to subdivide their home, then they subdivide into four. So they will rent out one for $1,000 [per month], another for $1,000, and another one for $500. Imagine now they got $2,500 per month and $30,000 per year. This year and next and next, for the rest of their lives they're going to get this $30,000.

Toronto's budget shortfall

Alfa: Toronto is facing a $857-million budget gap. How specifically are you going to find money to make that up? 

Penalosa: Well the province just announced that they have a $2.5-billion surplus. The federal government has a $10-billion surplus. The reality is that much of that is from Torontonians. The money that the government of Ontario uses, about 40 per cent comes from Torontonians. So a lot of that money is ours. So as Torontonians, we're going across the province, we're going to go to the federal government and we're going take care of that.

Alfa: Will you also raise property taxes?

Penalosa: Well, you know Toronto has the lowest property tax and the city is falling apart. The streets are dirty, the garbage is not picked up. You go to the parks and the washrooms are closed eight months of the year. You go to take the subway and the escalators don't work. I'm going to get the public service working. 

Alfa: So will you raise taxes then?

Penalosa: What I'm committing is that we're not going to  be the lowest and we're not going to be the highest. We might end up in the middle. 

End of transcript.

If you missed the mayoral debates, you can catch up on what happened in the following links:

On Monday, Metro Morning spoke with Sarah Climenhaga about her campaign. On Wednesday, the show is set to speak with John Tory. 

In total, there are 31 people running for mayor — comprising by far the longest list on your ballot. They are:

• Blake Acton
• Avraham Arrobas
• Darren Atkinson
• Chloe Brown
• Drew Buckingham
• Elvira Caputolan
• Kevin Clarke
• Sarah Climenhaga
• Phillip D'Cruze
• Cory Deville
• Alexey Efimovskikh
• Isabella Gamk
• Arjun Gupta
• Peter Handjis
• Robert Hatton
• Monowar Hossain
• Soaad Hossain
• Khadijah Jamal
• Kris Langenfeld
• John Letonja
• Tony Luk
• Ferin Malek
• Gil Penalosa
• Stephen Punwasi
• D!ONNE Renée
• Kyle Schwartz
• Knia Singh
• Sandeep Srivastava
• John Tory
• Reginald Tull
• Jack Yan