Planning for employment under the new Growth Plan

August 15, 2017

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By Tim Smith and Mirej Vasic

With the release of the 2017 Growth Plan, the Province of Ontario has put forward a policy framework that continues to protect and support employment uses and designated employment areas. There are more policies (15 vs. 10 in the 2006 Growth Plan) and new terms that recognize the diverse settings for employment uses. Significantly, the new Growth Plan pushes municipalities to think strategically about their employment lands and how they can be successful, well-functioning places with an important city-building role.

 

Employment Strategy

During their next municipal comprehensive review, upper and single-tier municipalities are required to develop an employment strategy that (a) establishes a minimum density target for all employment areas and (b) identifies opportunities for intensification of employment areas on sites that support active transportation and are serviced by existing or planned transit. The new policy (2.2.5.5) is consistent with the Growth Plan’s focus on transit-oriented growth but, interpreted in the light of other new policies discussed below, appears to recognize that employment densities will vary widely across a region. Presumably, despite the wording of the policy, the Province will allow multiple minimum density targets to be established based on the existing nature and realistic growth prospects of different employment areas. Since most employment areas need flexibility to respond to the ever-evolving requirements of employers, density targets should not be so aggressive that they restrict desirable uses, except perhaps where higher order transit is at the doorstep and higher-density office development is achievable.

 

Prime Employment Areas

Another notable change is the addition of the new “prime employment areas” designation. Prime employment areas are lands within settlement areas that are protected over the long term for uses that are land extensive or have low employment densities and require locations that are adjacent to or near major goods movement facilities and corridors, including warehousing, manufacturing and logistics. According to policy 2.2.5.8, municipalities may identify prime employment areas and plan for their protection by (a) prohibiting residential, institutional and other sensitive land uses, (b) prohibiting retail and office uses that are not ancillary to the primary use, and (c) planning for freight supportive land use patterns. The new term and associated policy go a step further than the 2006 Growth Plan, which encouraged the preservation of employment lands for such purposes. They recognize that traditional industrial lands with good highway access will continue to play an essential role in Ontario’s economy as places for warehousing and distribution facilities (and, as hoped for, more manufacturing, too). Since municipalities are not required to identify prime employment areas, however, will some opt out, hoping to attract stand-alone office buildings on lands more suitable for low-density employment uses? Certainly, it will be a challenge to apply the designation to existing employment areas where it would result in restricting land use permissions.

 

Retail Permissions and Innovation Hubs

The employment policies of the 2006 Growth Plan were silent with respect to stand-alone retail uses in employment areas apart from stipulating that major retail uses were considered non-employment uses for the purpose of the employment area conversion policies. This stipulation has been dropped in the 2017 Plan, which provides more clarity and flexibility regarding retail uses in employment areas, perhaps in response to Ontario Municipal Board decisions stating that “a job is a job.” (Of note, the Province has not changed the conversion criteria significantly in the new Growth Plan.)

Under policy 2.2.5.7, municipalities may prohibit major retail uses, defined as large-scale or large-format and stand-alone, or establish a size or scale threshold for them, which would be permitted and cannot be exceeded. Municipalities and retail developers will be pleased that the Province did not set a threshold itself, allowing the municipal comprehensive review process to address this new opportunity (an MCR will be required to permit new or expanded opportunities for major retail in employment areas). With this loosening of previous restrictions, is the Province acknowledging that mixed-use employment areas that include big-box retail (but not residential, which remains prohibited) may be more desirable and appropriate than trying to fit big boxes into other, pedestrian-oriented mixed-use areas?

The third part of policy 2.2.5.7 goes one step further, calling for the integration of employment areas with adjacent non-employment areas and developing vibrant, mixed-use areas and “innovation hubs,” where appropriate. The latter term is defined as “locations that support collaboration and interaction between the private, public and academic sectors across many different economic sectors to promote innovation.” How the integration happens presents an urban design challenge for municipalities. Alternatively, municipalities can focus on developing innovation hubs where they are most appropriate, in urban growth centres.

 

Major Office and Office Parks

Regarding urban growth centres, Policy 2.2.5.2 does state that major office development “will be directed to” UGCs, or to major transit station areas or other strategic growth areas; the revised wording replaces “should be located in,” in the 2006 Growth Plan. Significantly, the Province has lowered the threshold for what constitutes a major office use, from 100,000m2 or 500 jobs to 4,000 m2 or 200 jobs. Will the stronger language and lower threshold be enough to reverse the trend in most municipalities outside Toronto of office development gravitating to lower-cost office parks and employment areas generally? Probably not, particularly since the new Growth Plan acknowledges office parks and states they will be supported by planning for intensification and improving connectivity with transit and active transportation networks (2.2.5.13). How municipalities are expected to respond to the new office-related employment policies and balance the competing objectives for UGCs and office parks is not yet clear. The car-oriented design of office parks makes them resistant to urbanization. What is apparent is that developers and employers will continue to have many options for locating new office buildings.

The 2017 Growth Plan has expanded and refined its employment policies to recognize different types of employment areas and the potential benefits of integrating employment uses with other complementary uses in some locations. The next big challenge for upper- and single-tier municipalities, as they approach their next municipal comprehensive review, is to go beyond an assessment of employment land needs and develop a comprehensive employment strategy. Planning for job growth more strategically will help ensure municipalities optimize investments in infrastructure, direct development incentives effectively, and create the type of urban environments employers are seeking.


There is no doubt this is a complex and complicated suite of policies and legislation.  At Urban Strategies, we are here to help you.  If you need to know more about these Plans and what they mean for you, your land, or community, please contact us:

Melanie Hare, Partner, mhare@urbanstrategies.com, 416-340-9004 x 215

Pino Di Mascio, Partner, pdimascio@urbanstrategies.com, 416-340-9004 x 210