Thursday, February 29, 2024
February 29, 2024

Housing agreement stripped from Brackett Springs land

A Rainbow Road property’s disposition has become an object lesson in dotting I’s and crossing t’s — and, possibly, in the value of a good reputation — as the saga of one affordable housing project comes to an end and another hopefully waits in the wings. 

Salt Spring Island’s Local Trust Committee (LTC) discharged a housing agreement from the 7.8-acre parcel once known as Brackett Springs Thursday, Nov. 16, essentially removing permission it granted in 2009 to build 10 units of affordable housing at the former Salt Spring Land Bank Society property.  

The LTC has left open the possibility of granting it again — indeed, that body’s interest in lower-cost housing has only grown in the last 14 years. But Islands Trust staff discovered problems with the extant agreement; one section gave no specific definition of “affordable,” and as the property is currently under forced sale foreclosure, a new owner could potentially define it for themselves. 

Moreover, according to senior Trust planner Anthony Fotino, some wording in the current agreement doesn’t even include “affordable,” referring simply to a requirement to build 10 units. 

“This could potentially lead to some confusion,” said Fotino, “since the cancellation of the housing agreement through foreclosure could leave a possibility that a court-ordered purchaser could acquire the property and benefit from the covenant requiring 10 dwelling units — but not be bound by those units being affordable, because the covenant does not specify that the units must be affordable.” 

Fortunately, the housing agreement anticipated the possibility of foreclosure, and in the event of a court-ordered sale the former LTC agreed to officially abandon the agreement; that has happened, and according to representatives of lender Vancouver City Savings Credit Union (Vancity), multiple housing societies that have considered purchasing the property to build low-cost housing have been unable to effectively plan a way forward. 

“We share Salt Spring Island’s goal of having this be affordable housing in the future,” said Vancity special accounts department team manager Chris Freeman. “But with this housing agreement that’s in place, every offer we’ve tried to entertain — including with foundations and other groups that are on the island — can’t work, with the terms that were set out back in 2010.” 

Freeman told trustees the credit union had fielded several offers in different forms — including one that contemplated housing for medical professionals who wanted to work on the island.  

“If this is discharged, then [new owners] can negotiate a new agreement,” said Freeman, “and let everybody move forward and get the housing on that land.” 

Trustee Laura Patrick expressed concern that the property could potentially now just be purchased for a single dwelling, which staff agreed was a possibility; but Freeman said Vancity was actively marketing the property in terms of its potential for affordable housing. 

“We’re not looking for people that just want to go back to the one [dwelling zoning] and have the land for themselves,” said Freeman. “And we can control that bit when we take it to court — we can only take in offers where people are totally like-minded. It’s Vancity’s goal to see affordable housing [here], that’s one of the pillars of our reputation in the community — and we’re not looking to just do a fire sale and get out of it.” 

Patrick said since she believed Vancity had been proceeding in good faith, it was worth the well-mitigated risk. 

“You could have disposed of this a long time ago, and quicker,” said Patrick. “We were very fortunate that it’s Vancity we’re working with, and not ‘big bank X’.” 

In a letter to the LTC, Vancity’s legal counsel said that the sale is hoped to satisfy the Land Bank Society’s outstanding indebtedness related to both the Rainbow Road property and another one at 384 Fulford-Ganges Rd. — possibly leaving the society with the ability to continue to operate at the latter. 

The Land Bank Society originally envisioned as many as 15 affordable housing units when it began its efforts at Rainbow Road with a rezoning submission in 2008; delays and concerns over management led to the withdrawal of $182,000 in grant funding from the Capital Regional District (CRD) in 2015. A CRD staff report at that time noted the project had also acquired $500,000 in grant funding from BC Housing and a $440,000 loan from the Canada Mortgage and Housing Corporation (CMHC). 

Some of the delays reportedly came from the project’s plans to use recycled homes from on and off-island, which were to be renovated largely by using volunteer labour and recycled materials. In 2013, concern arose around construction delays and issues with documentation, which led to BC Housing and CMHC pulling out of the deal. The CRD report noted the BC Housing grant was largely repaid, but CMHC had written off the loan. 

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