May 15, 2017

Richmond, Let's Make Farmland Important, Not a Land Grab for Mansion Builders

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As reported in the Richmond News there’s been some surprising setbacks in the City of Richmond’s approach to stop the creation of massive monster houses eating up farmland in the Agricultural Land Reserve within the municipality. In a previous Price Tags we addressed the fact that the City of Richmond was thinking of  “restricting the size of houses built on the ALR (the Agricultural Land Reserve) in that municipality. A couple of things-if you purchase farm land you do not have to pay the 15 per cent foreign owner tax. And if you can crop blueberries or have a calf born on the property you can claim you are a farmer and have the land taxed as agricultural instead of as a large house executive estate.”

Price Tags also noted “A Globe and Mail investigation found wealthy investors bought farmland in Richmond without any intention of farming and took advantage of tax incentives to pay meagre property taxes while, in some cases, operating illegal hotels. The investigation found local and foreign buyers enjoy large tax breaks meant to encourage farming.”

Well things have not gone too well for the Agricultural Land Reserve and some of the most arable lands in Canada within the jurisdiction of the municipality of Richmond. While city staff wanted housing on the ALR to be limited to  5,382 square foot houses, Council has caved into pressure to double that to 10,674 square feet.  That is a very, very very big house.

On Monday May 15 there is a public hearing in Richmond to discuss floor space restrictions. Of course farmland owners are also upset as their properties are worth more with the potential to be big mansion holders. While there was a moratorium put in place until this matter was resolved,  sadly the majority of council has caved into a compromise to double the staff recommended size limit to 10,764 square feet if the land is at least one half an acre in size. Less land-you are at 5,382 square feet.
It’s one for the buyers and builders of this massive housing form, and zero for the entrusted status of  arable farmland. And of course there is that weird counter argument that  “farmers and landowners continued their message that they “shouldn’t be punished” because of rogue developers seeking to build mega mansions on farmland.” It’s all part of the gravy.
Councillor Harold Steves, who was one of the original backers of the Agricultural Land Reserve sensibly called for farmhouses to increase vertically, not horizontally noting that increasing farmland prices for mansions prices land out of reach for farmers. What increasing mansion size on farm land is doing is “jumping the gun above the (neighbouring cities) and this will put pressure on them to increase their sizes” of land in the Agricultural Land Reserve. Every decision is connected.

Allowing large agricultural mansions puts farmers into renters of space, not owners, and not in control of the lands. Applications for farmland mansions have increased, with the average mansion being at 13,000 square feet, with one at 32,660 square feet.
Is this the end of the region as we know it? Do we so devalue our farmland and the chance for sustainable agricultural practice in our region that we will sell out for this not needed housing form that has no benefit to agricultural lands? Monday’s City of Richmond hearing will tell.

 

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Leave a Reply to Ihor ZalubniakCancel Reply

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  2. I wouldn’t say it’s the end of the region, but certainly the region’s planning objectives are being nibbled increasingly away with each passing year. I’d venture to say that an elected Metro government would override the local government and clamp down pretty quickly on these edifices to poor planning and terrible land management practices. We do, after all, have an agreed upon regional growth strategy and these houses are clearly in violation of it.
    Has the mayor and council been called on their weak leadership?

    1. Not so easy. Taxation policies are federal and provincial. If we continue to allow tax free personal residences, of any size or any gain, than that is a federal issue. One could argue that perhaps a lifetime cap of $1M per person or $2M per couple is sufficient here, then anything above that is taxed as income.
      On the provincial side we allow ALRs and farmland designations with certain tax breaks. Again, we can modify those, provincially
      Clever immigrants or locals just wade through the taxation minefield and act rationally.

    2. Then it’s time to develop a rational strategy to close the loopholes.
      I see the ALR as a legacy bank account where only withdrawals are possible, the latest one in excess of 3,000 hectares for the Site C dam. The account has been eroded over the decades, and now even the highest value “currency” of irreplaceable Class 1-3 soils is targeted. The land is gone and it’s not coming back. This is stupidity when you account for the fact that only 4% of the land in the province is arable — a gift of nature, really — in the context of a growing society.
      If the conversion of agricultural parcels to residential are permitted by a municipality, then a higher authority needs to step in and either cancel the conversion, or charge residential tax rates on the portion that is not farmed. I think the former is the best way to preserve the land bank because the latter is affordable to a lot of wealthy purchasers when local councils are demonstrably weak on the leadership front.
      This is a regional and provincial land use matter. Municipalities need to toe the line.

      1. I agree with this here ” .. charge residential tax rates on the portion that is not farmed. ..” Certainly a massive tax loophole today.
        Keep in mind that for capital gains purposes already only the land that is not farmland is tax free if used as a permanent residence.The definition of “principal residence” in the Tax Act deems it to include ONLY the land upon which the housing unit stands and any portion of the adjoining land that can reasonably be regarded as contributing to the use and enjoyment of the housing unit as a residence. Where the total area of the land upon which a housing unit is situated exceeds one half hectare, the excess land is deemed not to have contributed to the use and enjoyment of the housing unit as a residence and thus will not qualify as part of a principal residence, except to the extent that the taxpayer establishes that it was “necessary for such use and enjoyment”. The excess land must clearly be necessary for the housing unit to properly fulfill its function as a residence and not simply be desirable.
        Likely much tax abuse here when “farmland” with a mega house on it is sold. More on this here http://www.cra-arc.gc.ca/tx/tchncl/ncmtx/fls/s1/f3/s1-f3-c2-eng.html

        1. The land and structures deemed for personal use are already taxed municipally at virtually the same rate as a home in a subdivision.

      2. Land bank? If you want to responsibly grow veggies etc in January in this province you need heat and light generated by hydro-electric. This whole issue is Leo much more complex than “save the dirt”.

  3. In some places in Europe, farmers don’t live on their land. They live in the village close to it. Since places to live are so close to the ALR, maybe no one would be allowed to live on a farm. That would keep it for agriculture and not just a cover for big houses.
    At some point gas will be $15/litre so trucking in produce from Mexico will cost more than growing it here and we would regret removing this bit of arable land we have.

    1. When you can economically grow table produce in January, let me know. Not only that are you prepared to give up many of the fruits , vegetables and grains that could never be grown here.
      Editor’s note: Vegetables,fruits and grains were grown intensively in greenhouses and fields by Japanese gardeners in the Gulf Islands throughout the winter right up to the time of the detention of the Japanese during World War Two. All crops were marketed. There are many local histories describing this.

  4. Well, it was only a matter of time before the whole issue of large houses on farmland got picked on again. A home with a foot print of 8,000 square feet occupies about 1/5 of an acre, (approx 43,000 sqft). 20% which is substantially less than the area permitted in most urban areas for a single home. Now, given that 20 acres (approx 860,000 sqft ) is an average/low size for many of the ALR properties in the Fraser valley that same home occupies less than 1% of the area in that farm. So your point is really not that important. This is a favourite hobby horse of so many ” save the farmland and save our agricultural future” individuals who have not really explored the issue. Ask the average ” farm land advocate” questions about food production in the Fraser valley and they won’t be able to separate the % of land used for berries grown for export, the % of land in dairy, the % of land growing table produce in the open, the % of land for table produce grown under glass, the % of land deemed agricultural used for recreational equine purposes and finally the % of the land used for growing ornamental horticulture.

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