Youlayla – Worries of ‘preferential treatment’ in Ontario zoning orders, AG report says

At the beginning of 2019, the floodgates opened as the Ford government began approving a deluge of controversial zoning orders, something it said was primarily done to add new homes and address the housing crisis.

The process it engaged in, however, lacked structure and an ability to measure if it was working, according to the auditor general, who found examples that “give the appearance of preferential treatment.”

In a scathing report released Tuesday, the provincial watchdog also found that in many cases, zoning orders were approved in areas without municipal serving so construction could not begin, and many orders issued to “support housing may not meaningfully speed up development.”

On average, agricultural land rezoned using the controversial orders increased in value by 46 per cent, the report found.

The findings were revealed in the auditor general’s annual report looking into the Ford government’s liberal use of Minister’s Zoning Orders — or MZOs.

The tool allows the province to permit developers to sidestep the planning process and significantly speeds up development.

“We also found there was no protocol and no apparent rationale for prioritizing some MZO requests over others,” the report found. “The Minister’s Office often selected which of the MO requests to work on, setting ad hoc (and often short) timelines for the Ministry to review the request.”

The auditor general revealed a slew of examples of unusual zoning orders, including orders justified through potentially inflated economic benefits and plans built around transit infrastructure the government had no intention of building.

Before the Ford government took office, MZOs were a relatively rarely used tool, generally considered necessary only in urgent situations or where the municipal planning process had ground to a halt.

When Ontario Premier Doug Ford took office, with an eye on massively increasing the supply of privately built housing, the zoning tool was relied upon heavily. Between 2019 and 2023, according to the auditor general, an average of 23 MZOs were issued every year a 17-fold increase.

A total of 114 of the 169 zoning orders requested in that time were approved by the government through a process the auditor general said was “ad hoc” and lacked both structure and accountability.

The report found that political staff with the Ford government imposed “tight deadlines” on civil servants with “no rationale” given for them to urgently prepare assessments of various zoning order requests.

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As a result of the surge in zoning order requests, civil servants told the auditor general they stopped making recommendations on the merits of an MZO request, instead focusing only on providing basic facts and summaries.

“We found that on several occasions when the Ministry did make recommendations, such as to assess risks or perform risk mitigation, the Minister’s Office did not accept them,” the report said.

That “ad hoc” process led to zoning orders being approved that in some cases didn’t lead to construction for years, according to the auditor general. In some cases, zoning orders were approved to speed up the development on sites that wouldn’t have access to key services like wastewater for “years and sometimes decades” after the zoning order was approved.

The uncoordinated process, with advice slipping out of reports as more zoning orders were requested, was subject to the auditor general’s scathing criticism.

“These delays beg the question why an MZO was used instead of the municipal planning process,” she wrote.

In cases where zoning orders were subject to analysis and advice sought either from municipalities or other government ministries, it often appeared to go unheeded.

When towns or cities requested MZOs, something that has become commonplace in the past five years, they often made specific requests. Councils would send requests for zoning orders to the ministry on condition the developer provided a certain amount of affordable housing or mitigated potential environmental concerns.

Those requests, the auditor general confirmed, were ignored — and often not even possible under the current framework.

“Ministry did not accommodate conditions asked for by municipalities,” the report stated, adding that the Ford government has failed to track whether or not its zoning orders have created affordable housing.

Internally, the ministry would also reportedly also ignore advice from experts and other government departments.

“In cases where the Ministry engaged with these experts, it often did not act on their recommendations to assess risks, nor did it recommend actions to mitigate risks before or after rezoning,” the report said.

In a series of examples listed by the auditor general, advice appears to have been disregarded.

An MZO request to create mixed-use housing around the site of a proposed new GO station in York Region was approved, for example. The approval came despite the planned train station having no funding and both the Ministry of Transportation and Metrolinx recommending against its construction.

In Caledon, a rezoning request was approved around the site of a proposed Bolton GO Station. The Ministry of Transportation and Metrolinx expressed concern about the plan to the minister, the auditor general said, because a GO train line doesn’t even currently run to the site.

In other cases, the government confirmed to the auditor general it “did not generally challenge” the claims made by developers or municipalities that an MZO was actually needed.

The rapid and changing process to rush through more than 100 zoning orders also left the government open to the perception it was giving special treatment to some people, the auditor general warned.

The auditor general said that in at least four cases her office found documentation showing that a senior political staffer directed civil servants to prioritize projects which they had been “directly lobbied” on.

In one case, the justification given for speeding up the request was that “the Minister and Premier were asking for that MZO, specifically, to be finalized,” the auditor general wrote.

In that case, there was no documented reason, beyond political interest, given for speeding up those zoning order requests. “Actions such as this give the appearance of preferential treatment for some proponents of MZOs over others,” the report said.

The auditor general suggested in the report that the senior staff member was significantly involved in a number of requests, and lobbied on them too.

In the case of an MZO request for a tourist and residential development in the Township of Cavan Monaghan. Three months after the town submitted the zoning request, the mayor of the town “emailed a request for an amendment to the MZO directly to the political party email” as well as the senior staffer.

The auditor general said civil servants reviewed the changes request for three months before a consultant working on the request arranged lunch with the senior staffer. The next day, the amendment was approved.

In its response to the auditor general’s report, the government said many of the concerns raised in the report had been addressed with a new MZO framework introduced in December 2023.

The auditor general, however, suggested many of the new measures in that process were “ineffective.”