New Westminster’s business community wants more affordable housing

At the January 16, 2017 New Westminster Council Meeting, Mustel Group (a market research consulting company) presented the results of a survey that they had done of New West’s business community during September and October 2016. You can read the full survey results in the agenda package I linked to above, but I would like to highlight some important pieces of data.

First, in the quantitative section (this is where they just look at survey question responses and not free-form answers), the factor influencing a local business’s location that had the worst satisfaction rating was local affordable housing. In other words, current businesses are not satisfied with the availability of affordable housing here.

Second, affordable housing was the fourth-highest priority that local businesses wanted to see improved in New West, after being more business friendly, transportation, and taxes.

In the qualitative section, where an interviewer sat down with business owners and representatives to get more detailed and personal responses, the lack of affordable housing was seen as one of the challenges of doing business in the city. Related to this was the concern of the lack of mixed-use developments, which the business community feels contribute to a thriving city.

One of the suggestions that came out of the qualitative section was to “develop the business community — but keep green space and affordable housing in mind to make New Westminster a more livable city.”

And one of the questions that was asked was “what would you do if you could make one change?” One of the responses was “creating more affordable housing and student housing which will contribute to the overall growth and development of the city; and help to create a balanced city in which it would be comfortable to work and live.”

It’s pretty clear that the New Westminster business community wants more affordable housing in New Westminster. It only makes sense.

People shop more and use more services close to where they live. If people can’t afford to live in New West, they’re usually not going to make special trips to go grocery shopping in New West. They’ll come for specialty items like wedding dresses (which has a good knock-on affect for local businesses like restaurants) but most businesses rely on a relatively steady stream of local customers. They can’t all rely on tourists to our city.

If people can’t afford to live in New Westminster, then they’ll have to commute in to their jobs in New Westminster. This either increases the amount of traffic on the roads (which was the business community’s biggest challenge of doing business here) or if they rely on transit, they’ll miss shifts because of transit delays or be unable to make early morning shifts on weekends because of cutbacks to TransLink schedules. In either case commuters need to spend more money and time to get to their jobs, money and time that could be spent shopping locally.

And not only that, if a family is mortgaged up to their eyeballs, they don’t have any extra money to spend on a night out for dinner, or shop locally for gifts for loved ones, or buy a new bike from the local bike store, or meet up with friends at the local brewery. All of these businesses (and more!) take hits from housing being too expensive.

Not every job is going to pay a living wage, unfortunately. As a recap from a Kelowna Chamber of Commerce discussion on ending homelessness and supporting affordable housing put it:

The reality of the labour market is that some people make lower wages than others, yet are critical to our labour pool. These workers and community residents need affordable housing, and need it in order to work, to continue to contribute to the economy, and to avoid the risk of becoming homeless.

Without local affordable housing we run the risk of requiring people to pay more for transportation to get to their jobs, which means they have to cut from other parts of their budget. Without local affordable housing we run the risk of people holding too much debt, which doesn’t allow them to support local businesses. And without affordable housing we run the risk of losing these local businesses entirely.

The New Westminster business community sees this, and they rightly want more affordable housing in New Westminster.

How property taxes work (in New Westminster)

There’s been a lot of talk recently about property taxes, now that the property value assessments are out. Property taxes are based, kind of, on property value, so when people see their property assessment go up by 40%, they flip out because they think that their property taxes are going up 40%. They won’t, but people are confused because they don’t fully understand the link between property values and property taxes. Hopefully this blog post will help make things simple to understand.

Keep in mind that this is only for New Westminster. I’m pretty sure other jurisdictions around work the same way (especially those in BC) but I’m not 100% certain, so keep that in mind. And it only looks at residential property taxes; commercial and industrial taxes might work differently, but given people are confused about their residential property taxes, that’s what I’m focusing on.

Suppose you have a city. In one year, that city requires $1,000,000 to keep running — potholes need filling, roads need to be cleared of snow, police officers need to be paid, that sort of thing. Now suppose there is only one person living in that city and the entire city is made up of one plot of land. That landowner needs to give the city $1,000,000 in taxes. Easy.

Now suppose there are two properties in the city. Each property is the same size, and each is worth the same amount of money. Each landowner owes half of the city income, or $500,000 each. (This is an expensive city to live in, but what do you expect when you own half a city?)

Now suppose that there are still two properties in the city, but one is mostly swamp and the other isn’t. Both properties are the same size, but the swamp property is worth 10% of the other one (let’s say the swamp is worth $100,000 and the other one is worth $1,000,000). There are two ways we can split up the amount owed to the city: by property size or by property value. In this case one could argue either way, but maybe the swamp property receives fewer city services (maybe swamps don’t need much policing or sidewalks, for example), so if we split the amount owed by property value, one property owes $90,909.09 and the other owes $909,090.91. The total property value across the city is $1,100,000, so the swamp property owes $100,000/$1,100,000 = 9.1% and the “good” property owes the rest.

Now suppose there are still two properties in the city. One swamp, one not swamp. It’s been discovered that swamps actually contain gold, so the property value of the swamp property has skyrocketed from $100,000 up to $2,000,000. That’s an increase of 1,900%! The other property’s value goes up as well, but not that much — only by 100% to $2,000,000. The total property value across the city is now $4,000,000, and the city still needs $1,000,000 to operate, and because each property is worth the same amount of money, each property owner owes $500,000.

This is where the disconnect between property value and property tax comes in. The swamp property’s value went up 1,900%, but their tax bill “only” went up 450%. The “good” property’s value went up 100%, but their property tax actually went down by 45%!

There’s obviously a wrinkle in this in that the city doesn’t need a fixed amount of money each year. The amount they need typically goes up, because of inflation, rising salaries, and extra projects that the city wants (or needs) to take on. That’s why every year you see a news story stating that “property taxes are going up by 2.73%“. Well, they’re not. Well, they are. On average property taxes are going up, but not everybody’s taxes go up. What the 2.73% refers to is the amount of money the city needs to take in from property taxes is going up.

Let’s take our example again. The city needs $1,000,000 one year and $1,100,000 the next. 10% property tax increase for everybody, right? Wrong. The swamp property paid $90,909.10 in year one, and will pay $550,000 the next, for an increase of 505%. The “good” property paid $909,090.90 the first year and will pay $550,000 the next, for a decrease of 39.5%.

What matters is the difference between a specific property’s value and the total value of all of the property in the city. And that’s why you can’t look at a news report about property taxes going up and think “oh great my property taxes are going up”, and it’s also why you can’t look at a news report about property values going up and think “oh great my property taxes are going up”, because the “property taxes” (the amount of money the city needs to take in via taxation) can go up AND your property value can go up BUT the actual taxes you pay can go down.

In New Westminster, “property taxes” are going up 2.73% (or maybe 2.98%, I don’t know exactly). The average change in property value for 2016 is 28.5%, so if your property’s value has gone up by 28.5% then your property tax bill will go up by about 2.73% (or 2.98%). If your property value “only” went up 20%, the amount you pay in property taxes will go down.

And that’s how residential property taxes work.

My response to Susan Dextras

Today the New West Record printed a response to the Yes In New West story that ran a couple of weeks ago. It was written by Susan Dextras, a New Westminster resident, who has been outspoken about the proposal in the draft Official Community Plan to change the land use designation (note: not zoning) of the block that she lives on from single family houses to rowhouses and townhouses.

Her letter was fairly NIMBY and since she addressed my family directly, I’m responding to her points.

My husband and I are long time residents of New Westminster since 1984. When we first arrived in the Lower Mainland, there was no affordable housing in Metro Vancouver, so we looked in New Westminster and found the property where we have resided and raised our family for the last 32 years. We plan to continue living in our home for many years to come and we have no intention of selling to a developer or anyone else in the next 25 years.

In 1984 the average price for a single family home in Greater Vancouver was $116,444, and the average total family income was $30,070, which is a ratio of just under 4. In 2014 the average price for a single family home in Metro Vancouver was about $1,400,000 and the median family income was $76,040, which is a ratio of over 18. Since 2014 the housing prices have grown even more, yet incomes have not kept up.

There was affordable housing available in Metro Vancouver. House prices were not huge multipliers of income like they are today.

I would note that Mrs. Dextras’ husband holds a BEng in Civil Engineering, which he obtained in 1976. Civil Engineering is a fairly advanced field of work and pays well, so the odds are quite good that the Dextras family had an above average income in 1984. For Mrs. Dextras to say that “there was no affordable housing” is a stretch.

I would also note that the Dextrases (is that how you pluralize it?) managed to have enough money to tear down the 1903 house they purchased and build a new one in 1990. People who complain about housing not being affordable don’t generally build their own house six years into a mortgage.

Oh, and she says that she has no intention of selling to a developer. Great! Then don’t! Nobody’s forcing you to. Just like how you shouldn’t be forcing your views on your neighbours, over half of which didn’t sign your petition, by the way.

So my advice to Mr. and Mrs. Cavanagh and young couples like them would be to search for affordable housing in the outlying municipalities of the Lower Mainland where land is cheaper and more available, much like we did when we first arrived here. And yes, there will be a commute to and from work but it is what most people have to deal with to be able to afford housing of any kind in our expensive city. Such is life.

Basically what Mrs. Dextras is saying here is “we don’t want anybody young or poor to move into our city”. It reeks of classism. She also seems to be in favour of people not spending time with their families. Mrs. Dextras, I like my family. I like spending time with them. For you to say “just suck it up an commute” is offensive. You might not like spending time with your family, but I like mine and I would rather spend my time with them instead of commuting.

Mrs. Dextras also seems to be proposing that our traffic get worse. Instead of being able to live close to where you work, you should have to live out Langley, Abbotsford, Mission, or Chilliwack and drive through New Westminster to get to your job, right? One of the best solutions for traffic is reducing the need to drive to and from work, and Mrs. Dextras seems to think that maybe more traffic on our streets is a good thing. More pollution is a good thing. Greater dependence on oil is a good thing. Right, Mrs. Dextras?

When we became aware in September of this year of the City’s Draft Future Land Use Map which was sent by Canada Post to the households in our neighborhood, we were astounded to see that the City Planners had arbitrarily colored our 5th – 6th Street Corridor (from 10th Av. To 6th Ave.) “orange” to designate that our streets had been changed from RS1- Single Family Detached zoning to Residential Townhouse zoning – without our consent.

I’ve been told that you’ve been told numerous times that you’re wrong about this. Well, here’s one more time:

YOU ARE WRONG.

The zoning isn’t changing. After the OCP is implemented your property will still be zoned RS-1. The land use designation may change to townhouses, but that is not rezoning! What that means is that if someone wants to rezone their property, the densest it could go is to townhouses. They wouldn’t be able to rezone it to a condo tower (at least, not without a huge fight).

Let me give you an example of the difference between land use and zoning. Queen’s Park is a lovely park in the middle of the city. It has an arena, a baseball diamond, some tennis courts, a nice rose garden, a really good playground, a petting zoo, and wonderful trails. It’s a park. It’s also zoned RS-1. Now do you see the difference between land use and zoning?

If Mayor Cote and the City Councillors take the time to walk down 5th Street, they will see a lovely eclectic collection of old and new homes, all well maintained, some with manicured gardens where neighbors meet for special events and family gatherings.

If Mayor Cote and the City Councillors take the time to walk down my street, they will see a lovely eclectic collection of old and new homes, townhouses and low-rise apartment buildings, all well maintained, some with manicured gardens. We had a street party right in front of my house this year, and another one right around the corner. There are Christmas lights everywhere, and people are always out walking on the sidewalks. Kids play in their front yards, whether they be in front of single family homes or apartment buildings. It’s a vibrant and diverse community, and it should be held up as a model community for the rest of New Westminster.

This is NOT a neighborhood which should be rezoned by the City and then offered to a developer who would then systematically over the next 20 years, demolish each house and begin construction on 450 townhouse units in our 15 acre Corridor.

That’s not how rezoning works, and that’s not how this process works. Again, just to make this clear, the OCP process is not rezoning. Nobody is offering developers anything. There are no bulldozers coming for you. Stop with the paranoia.

What the OCP process means that should one of your neighbours decide to sell their house, someone can buy it. And then maybe their neighbour sells their house, and that same someone buys that one too. Now they own two neighbouring properties. At that point, the landowner can apply for a rezoning. Only after that gets approved would there be any hint of demolition.

In fact, this is exactly the case of the block of houses up for sale along Eighth Avenue at Cumberland Street. One man bought one of those houses decades ago. Then the neighbouring house came up for sale, and he bought that. Let one of his kids live in it. He did that for four or five of the houses there, and members of his family were living in each house. And now the families have grown up, started moving away, and the gentleman has decided to try to sell all of the properties at once so that the adjoining lots can be rezoned to townhouses, making more affordable housing for young families to move into. His view is that young families should be able to enjoy New Westminster and afford to live here, and he’s trying to help that by trying to increase the number of family-friendly townhouses in New Westminster.

It’s a shame that you can’t see that, Mrs. Dextras. It’s a shame that you got lucky on the land lottery and are now so selfish that you can’t bear to see a few younger families move into your neighbourhood.

And all of this done to meet the City of New Westminster’s OCP agenda, which ultimately was initiated by Mayor Cote and council … to satisfy Metro Vancouver’s regional growth strategy and its need for more densification. However, Metro Vancouver’s strategy is “only guidelines and not the rule of law,” as Chief Justice Sharma of the Supreme Court of B.C. has outlined in her decision of the (Metro Vancouver vs. the City of Langley) court case in 2014.

Here’s a tip for readers at home: if someone who isn’t a lawyer starts talking about court decisions, they’ve usually misinterpreted that decision. In this case, she not only gets the defendant wrong (it was actually the Township of Langley, not the City of Langley) but the entire jist of the case. Metro Vancouver was trying to get the Township of Langley to not develop a “University District” because it didn’t fit into Metro Vancouver’s regional growth strategy. The Township of Langley argued that they were operating under the old plan. And yes, the judge did say that the regional growth strategy is “guidelines expressing policy” and that Metro Vancouver “does not have superiority over land use management within the boundaries of a municipality.” But Metro Vancouver isn’t telling New Westminster how to manage its land use within New Westminster. The whole point of the OCP is that New Westminster is telling New Westminster how to manage its land use within New Westminster. Is New Westminster supposed to take New Westminster to court to try to get New Westminster to not manage its land use?

(Astute readers will note that I’m someone who isn’t a lawyer and I’m talking about a court decision, but my information comes from this news story and you can go read it and determine for yourself if my synopsis makes sense instead of Mrs. Dextras’ throwaway line with no backstory.)

Therefore, the city is not legally bound to follow Metro’s strategy and should not be using it as an excuse to rezone, devalue and eventually dismantle our existing private property neighbourhoods in the name of creating more affordable housing in the future for someone else’s benefit.

New Westminster is not rezoning your property. Pay attention.

But I guess we just have different views about the future of our city. I see a city that embraces newcomers of all kinds. I see a city that’s welcoming to young people, to immigrants, to people who aren’t as well off as others. I see a dynamic and evolving city. And I think Mrs. Dextras wants to wrap the city in Saran Wrap and keep it the way it is forever, to the detriment of future generations.

And that’s a shame.

Chuck Puchmayr and science

A couple of times now I’ve heard Chuck Puchmayr say that public surveys done by the City of New Westminster aren’t scientific, and by “scientific” I assume he means a survey that samples a representative sample of the population to provide a statistically significant result that can be applied to the overlying population.

And you know what? He’s right. They’re not. They usually only engage the people who are very interested in a given subject, so they artificially bias towards people who have strong opinions on either side. If you don’t care about, say, heritage houses in Queens Park, you’re probably not going to go to the effort to fill out a survey about heritage houses in Queens Park. There are ways to try to unbias the results (weigh them against the demographics of the general population, for example) but even those have biases. It’s tough to make a public opt-in survey scientific, but that doesn’t necessarily mean they’re bad.

But then Mr. Puchmayr seemingly goes on to reject them and instead replace them with either his walks around neighbourhoods or with the opinions of people showing up to public hearings.

The mind wobbles!

Walking around a neighbourhood and talking with people that you may or may not know is only scientific if you talk to every single person there, or if you choose people in an unbiased way (and the odds are stacked against you from choosing people in an unbiased way — everybody has biases, either implicit or explicit). And then you’re only targetting one specific neighbourhood. You’re a councillor for the entire City of New Westminster, you’re not a councillor for Fifth Street.

And public hearings are even more biased than public surveys! There’s less effort to fill out a survey, so people don’t necessarily have as strong an opinion about a given subject. But to show up to a public hearing and speak in public? That’s a tremendous barrier and only the very opinionated are going to show up and talk. Using the people who come out to a public hearing as a basis for an opinion that’ll affect the entire city is horribly unscientific!

Mr. Puchmayer, please educate yourself on survey methodology. A public survey of 500 people is more representative of walking around a neighbourhood and talking to a dozen people, and it’s way more representative of listening to five people talk at a public hearing.

Besides, you were elected based on the results of a public survey. Or was that unscientific too?

Trudeau announces new Kinder Morgan route, Broadway SkyTrain

Earlier today, Prime Minister Justin Trudeau announced that Kinder Morgan is applying for a re-route of their TransMountain pipeline that currently runs from Edmonton to Burnaby, B.C. He also announced conditional federal funding for an expanded SkyTrain line to be run in a tunnel under Broadway in Vancouver.

“We have heard criticisms over the past few days since announcing the approval of the Kinder Morgan TransMountain pipeline, specificially concerning the increase in oil tanker traffic in Burrard Inlet and tunnelling through Burnaby Mountain. We remain committed to acting in the best interests of Canada, and remain committed to rigorous environmental protections for our lands and waters.

“We have also received applications for federal funding to expand Vancouver’s SkyTrain system to service the Broadway corridor. This region of Vancouver is an important one, not just for the City of Vancouver, but for all of Metro Vancouver. It is an important commercial district, it is an important healthcare district, and students and employees of the largest university in Western Canada travel it every day. Congestion along this corridor causes pollution and reduces the quality of life of everybody who travels it. Easing this congestion with proven SkyTrain technology will help everybody.

“These reasons are why I’m announcing conditional federal funding of a bored tunnel under Broadway that will contain both SkyTrain and the re-routed Kinder Morgan TransMountain pipeline.”

The SkyTrain will run from Commercial-Broadway SkyTrain Station to Alma Street, where it will terminate at a bus loop. The TransMountain pipeline will be tunnelled under Highway One to Broadway, under Broadway to Alma, then curve north to a new marine delivery terminal at Jericho Beach.

“By building a new marine delivery terminal at Jericho,” Trudeau said, “tankers will avoid the busy Burrard Inlet and Lions Gate Bridge crossing. This terminal will also be located closer to the Kitsilano Coast Guard Station — which I re-opened, you’re welcome — for quicker response to any emergencies.”

“Mayor Corrigan should also be pleased that the pipeline will no longer be going under Burnaby Mountain and that tankers will no longer be sailing via the environmentally significant Burrard Inlet.”

“We have listened to the concerns of Mayors Robertson and Corrigan. We have listened to the concerns of the First Nations. We have listened to the concerns of all citizens of Canada, and we have acted accordingly.”

“We hope they’re happy now,” said Trudeau.