POLICY REPORT
                                URBAN STRUCTURE

                                           Date: March 27, 1996
                                           Dept. File No.:  PF


   TO:       Vancouver City Council

   FROM:     Directors of Central Area Planning, Community Planning, City
             Plans and Land Use & Development, in consultation with Manager
             of Housing Centre, Director of Permits & Licences, Director of
             Environmental Health and Assistant Chief Fire Protection
             Officer

   SUBJECT:  Live/Work and Work/Live: Vancouver Overview

   RECOMMENDATION

        A.   THAT Strategic Directions 8.1, 8.2, 8.3, and 8.4 in Appendix A
             be endorsed, to guide consideration of Live/Work and Work/Live
             in  future planning  work programs, as  and when  these occur.
             Briefly these include:

             8.1: general  directions  for   all  types  of   Live/Work  or
                  Work/Live  including eligibility  for City  affordability
                  initiatives,   owner/tenant   awareness  of   nature   of
                  development; the need for consultation;
             8.2: directions to  enhance Commercial Live/Work,  including a
                  possible future review of "homecraft" regulations;
             8.3: directions  to guide  Commercial  Work/Live  (as part  of
                  current work underway on "general live/work"); and
             8.4: directions  to enhance  Industrial  Live/Work (i.e.,  low
                  impact  activities, as part  of current work  underway on
                  "general live/work").

        B.   THAT Strategic  Directions 8.5.1  to 8.5.10  in Appendix A  be
             endorsed, regarding Industrial Work/Live.

             8.5.1  to 8.5.10 include  directions regarding: taking  a CD-1
             project approach;  limiting the number of units to be approved
             city-wide to  300 over  5 years;  approaching Building  By-law
             issues;  an occupancy  limit;  the  design features  required;
             parking,  loading,  security   solutions  needed;  monitoring;
             entertaining projects in three mixed-use/industrial districts;
             entertaining  projects in  M  and  I  districts,  in  existing
             building, rental only, up to 1.0 FSR; considering experimental
             projects in M and I sites subject to various conditions.

        C.   THAT Strategic  Direction 8.5.11 in Appendix A be endorsed, to
             entertain an experimental Industrial Work/Live project, in new
             construction, of up to 150 units on the Trillium site, subject
             to conditions.

        D.   THAT  Strategic Directions 8.5.12  in Appendix A  be endorsed,
             regarding   responding   to  other   experimental   Industrial
             Work/Live proposals in new construction, on M and I sites.

   GENERAL MANAGER'S COMMENTS

        The General Manager of Community Services RECOMMENDS approval of A,
        B, C, and D.

   COUNCIL POLICY

   Council  policy  regarding  Live/Work  and  Work/Live  accommodation  is
   currently embodied in  the regulations of  the Zoning By-law  concerning
   "homecraft",  and the regulations and policies concerning "dwelling unit
   in  conjunction with artist  studio" (a.k.a. artist  live/work studios).
   These are described in the accompanying Overview.

   SUMMARY

   At  Council's  request,  in  conjunction  with  the  False  Creek  Flats
   planning, a study  entitled Live/Work and Work/Live:  Vancouver Overview
   has  been  completed  and  is  on  file  with  the  City Clerk  (limited
   distribution to Council).   The study is  a broad policy review  of what
   the City is doing now, and could  do in future, to respond to the growth
   of home-based business.

   This report summarizes the study findings and recommendations.  Appendix
   A  to this  report contains  Strategic  Directions to  be used  to guide
   further City work, as and when it occurs.

   A key finding is that the City  is not standing in the way of home-based
   work's  role in  the "new  information economy,"  but rather  is already
   accommodating the predominant  types of home-based business  through its
   homecraft and artist live/work studio provisions.   The study identifies
   further advances  that  could  be  made:   reviewing  current  homecraft
   regulations and  processes to ensure  work as  well as possible  for the
   users  and  neighbours; and  moving  to permit  Commercial  Work/Live, a
   combination  of  living with  office  or  service businesses  that  have
   employees, or on-site sales.  The first item is not on any work program.
   Work on the  latter has already  been directed by  Council in its  March
   1995 resolution to investigate "general live/work," and will be reported
   back later this year.

   The study addresses issues that  are often debated about the livability,
   safety,  and "genuineness" of  Live/Work and Work/Live.   Directions are
   suggested to address these issues, as we move into new areas.

   The  question of whether  "Industrial Live/Work" should  be permitted on
   industrial  lands is  also  considered.   The  conclusion  is that  only
   Industrial  Work/Live  (i.e.,  higher  impact  activities,  and/or  with
   employees or sales), has any claim to be considered.

   With   respect  to  Industrial   Work/Live,  the  study   estimates  the
   theoretical maximum for Industrial Work/Live  at 900 units over the next
   15 years.  It suggests considering up to 300 units over the next 5 years
   (city-wide)  on a  CD-1  project rezoning  basis,  subject to  stringent
   conditions, and monitoring these before expanding the number of units.

   On the question of areas where Industrial Work/Live could be considered,
   the study supports considering projects in areas where land use policies
   already include the use mix (Burrard Slopes IC-1 and IC-2, Cedar Cottage
   MC-1, Brewery Creek IC-3); and on M and  I districts subject to the same
   limits as current  for Class B artist live/work  studios (i.e., existing
   buildings,  rental only, up to  1.0 FSR).  The  issue of whether to also
   consider new,  strata-titled Industrial  Work/Live projects  in M  and I
   districts, is discussed.  It is recommended that an experimental project
   of up  to 150  units could be  considered on the  Trillium site.   Other
   experimental  projects  on the  order  of  75  to  150  units  might  be
   considered on  M  and I  lands,  subject to  a  number of  criteria  and
   conditions.

   PURPOSE

   The purpose  of this report  is to convey  to Council the  Live/Work and
   Work/Live:  Vancouver Overview,  to briefly  describe  its contents  and
   implications,  and to  request  Council  endorsation  of  the  Strategic
   Directions it contains.  (Attached as Appendix A.)

   BACKGROUND

   1.   Origins

   In March 1995,  Council approved changes to the  artist live/work studio
   policies directing  staff  to make  some regulatory  changes; to  extend
   artist live/work studio opportunities into more of the mixed-use  zones;
   and to put additional limits on them in industrial lands.  At that time,
   Council directed staff to report  back on possible zoning and guidelines
   for "general live/work" in mixed-use, Downtown and heritage zones.  This
   report back is anticipated
   later this  year.  Shortly  after, proposals came forward  from Trillium
   and the McLean  Group to consider "industrial live/work"  on False Creek
   Flats and the Grandview/Boundary sites, respectively.

   Council decided  that a broad  policy overview of live/work  was needed,
   and that  no decision on rezoning  for "industrial live/  work" would be
   made until then.   Therefore,  staff undertook  this study, concurrently
   with the first stage of False Creek Flats planning.

   2.   Study Contents and Process

   The  Study outlines  the nature  of home-based  work and  future trends;
   develops common  labels for categories  of live/work to cut  through the
   wide variety  of terminology;  and  reviews how  Vancouver is  currently
   responding through provisions of the Zoning and Development and Building
   By-laws.   Some unmet  needs (quantitative and  qualitative) in  the six
   categories of Live/Work  and Work/Live  are described.   Approaches  are
   suggested to  deal with  a number of  issues that  must be  faced if  we
   address these  unmet needs.   The  conclusions of  the study  related to
   Industrial Work/Live are described. Lastly, Strategic Directions are set
   out which should  guide any future work  by City staff on  Live/Work and
   Work/Live.   These strategic Directions  are attached to this  report as
   Appendix A.

   The study was  done by  a Planning  Department staff  team, assisted  by
   advice from  other departments.   Information  sources included  current
   zoning and building by-laws; analysis of census data; a consultant study
   on  live/work trends; telephone, written and field research in Vancouver
   and a number  of other  cities; meetings with  members of the  live/work
   development community  and potential  users.   In addition  the previous
   research  and analysis  regarding  artist  live/work  studios  has  been
   helpful.

   DISCUSSION

   1.   Common Labels

   To facilitate discussion,  the study uses six categories  based the type
   of  work  activity  (Commercial,  Industrial,  or  Artist)--and  whether
   residential expectations take precedence over work needs,  or vice versa
   (Live/Work, and Work/Live, respectively).  Figure 1 describes the  types
   of business that fit in each category, as well as how the City's current
   regulations treat them.

   2.   Vancouver's Response to Home-Based Work

   On  a number of occasions,  Council has been urged to  meet the needs of
   the "new information  economy," and in particular the  growing trend for
   home-based  work.   People  have  raised the  question  of whether  City
   regulations are  standing in the way of  entrepreneurial activities such
   as   software   development,  research,   consulting,  film   and  media
   businesses,  designers,  artisans  and craftspersons  by  not permitting
   these to be combined with residential.

   The study confirms  that home-based businesses are indeed  growing, with
   occupations   mainly   in   the    area   of   professional,   business,
   health/social/recreation,   administrative,   finance/   insurance,  and
   personal services--as  well as  a limited amount  of manufacturing.   In
   1991, about  6.7% of Vancouver  workers worked mainly  at home,  up from
   3.5% in 1981.

   A  key finding is that Vancouver zoning  regulations are already open to
   much  of this  activity.   The  existing "homecraft"  provisions of  the
   zoning allow  any  occupation to  be  carried on  in any  dwelling  unit
   throughout the city,  provided there are no "objectionable" impacts, and
   no  employees or on-site sales.   A development  permit is not required.
   In  addition  to  homecraft,  artist live/work  studios  have  also been
   permitted in many areas.   It may  be worthwhile at  some point for  the
   regulations and administration processes to be reviewed.

   While  recognizing that  the  City  currently meets  the  needs of  much
   home-based work, the study also indicates there are some unmet needs the
   City could address. Among them:

   -    the user (and neighbour)  satisfaction with "homecraft" regulations
        and administration processes should be  reviewed as and when  staff
        is available;
   Figure 1.  Categories of Home-Based Work

                                                                      PERMITTED?
                                                                      (ZDB = Zoning and Development By-law)
       CATEGORY        TYPES OF BUSINESS                              (BB = Building By-law)

       Commercial       office or service work with few or no        ZDB: "homecraft" permits any occupation
       Live/Work         impacts, no employees, no sales (examples:   without development permit in any dwelling
                         self-employed consultants, researchers,      provided no employees, sales or
                         software developers, analysts, writers,      "objectionable impacts"
                         accountants, secretarial services;
                         personal services such as hair stylists,     BB: most office, retail and many service
                         music teachers, tutors, doctors,             uses permitted in combination with
                         therapists, child daycare; contract          residential (note: health regulations
                         workers, teleworkers; office bases for       prohibit some, e.g., hair stylist, food
                         off-site services such as building and       preparation, pet grooming)
                         landscape contractors, sales reps)
       Commercial       above activities, but where employees are    ZDB: not currently permitted; Council
       Work/Live         involved, plus                               resolution to investigate "general
                        retail sales and repair or other services    live/work" regulations for mixed-use,
                         with frequent customer trade                 downtown, heritage zones

                                                                      BB: as above
       Industrial       goods production or servicing involving      ZDB: permitted as "homecraft" in dwellings
       Live/Work         lower impacts and no employees (examples:    throughout the city, without development
                         some jewellers, garment making, small        permit provided no employees, sales or
                         leather goods, some printing, computer or    "objectionable impacts"
                         small good repair, some production and
                         recording studios)                           BB: if carried out under "homecraft", many
                                                                      are not likely seeking business licenses or
                                                                      renovation permits; if they did, some of the
                                                                      work activities would be permitted but many
                                                                      would not

       Industrial       goods production or servicing involving      ZDB: not permitted currently
       Work/Live         higher impacts, employees, and/or sales
                         (examples: metal work, wood work, some       BB: most would not be permitted currently
                         printing, some production studios)
       Artist           artists and craftspersons working in         ZDB: permitted as "homecraft" in dwellings
       Live/Work         low-impact media or processes (examples:     throughout the city, without development
                         many painters, graphics, photography and     permit; provided no employees, sales or
                         print artists; some potters, carvers; some   "objectionable" impacts; also permitted as
                         musicians)                                   "dwelling unit accessory to Artist Studio
                                                                      Class A"

                                                                      BB: in the case of "homecraft" no business
                                                                      license or renovation permit likely being
                                                                      sought; however, residential is permitted
                                                                      with "Artist Studio Class A"1

       Artist           artists and craftspersons working in         ZDB: permitted as "dwelling unit accessory
       Work/Live         higher-impact media or processes             to Artist Studio Class B"1
                         (examples: using amplified music, on-site
                         film processing, welding, woodworking,       BB: residential permitted with "Artist
                         spray painting, fired ceramics, generally    Studio Class B"1
                         using toxic or hazardous products)


     1  Reflects recent changes in artist live/work policies  that have not yet  implemented
      as regulations.
    - investigations into  allowing  Commercial  Work/Live  should  proceed,
     pursuant to Council's 1995  instructions.  This focuses on  office and
     personal service businesses that  want to expand to have  employees or
     on-site sales.   Several  areas already  have land  use policies  that
     would support permitting  this (e.g., Downtown South,  Brewery Creek),
     and  ongoing planning  in Victory Square,  Gastown and  other heritage
     areas may also provide opportunities.  In future, other neighbourhoods
     will also likely identify  places where this might occur  during their
     Neighbourhood Visioning processes;

   - the  Building  By-law  classification  of   some  of  the  home-based,
     low-impact "industrial" activities,  should be reviewed as part of the
     above work.  Some of them  may be having difficulty obtaining business
     licences   or   renovation   permits  because   of   their   occupancy
     classification under the Building By-law; and

   - opportunities  to  meet the  small  demand for  "Industrial Work/Live"
     could be provided.  These are  somewhat higher impact manufacturing or
     non-personal service activities,  and/or those that have  employees or
     sales.  They are not currently permitted under  the Zoning or Building
     By-laws.  The  study estimates  a maximum theoretical  demand for  900
     units over the next 15 years, city-wide.

   The first item is not on any work program, at this time.  The second and
   third  will  be  pursued   by  staff  following  Council's  March   1995
   instructions  to investigate  zoning and  guidelines for  what was  then
   called "general  live/work."   The fourth  is discussed  in more  detail
   below.

   2.   Issues Related to Live/Work and Work/Live

   Throughout the public discussions on artist studio  policies, and during
   the process  of this  study, misgivings  have been  expressed about  the
   livability and safety  of combining work and live activities, as well as
   about  the "genuineness"  of  live/work. In  addition,  the question  of
   whether to allow industrial lands to be used has been debated.

   (a)  Impacts

   First and  foremost, the study  reveals that most  of the demand  is for
   commercial or low-impact  "industrial" live/work activities that  do not   pose a problem.   However, if we  extend into permitting new  types, the
   study suggests several directions.

   First, we should recognize the  need to consult with neighbouring owners
   and residents before introducing uses that may have impacts on them.  We
   also suggest ensuring  future owners and tenants are aware of what is to
   be expected in a work/live environment, through covenants and markers on
   the buildings.

   Another  important concern is  the appropriate protection  of the safety
   and health of  residents.  Our  current relaxations to permit  living in
   artist  studios  partly rely  on  restricting  units to  two  residents.
   Enforcing  this may  be difficult,  as time  goes on.   Therefore, staff
   recommend caution  when extending  into Industrial  Work/Live, with  its
   higher  impact  activities.  Specifically, there  should  be  a physical
   firewall-type, separation between the live and work areas.

   Lastly, because of the time involved in changing complex regulations, we
   propose that Industrial Work/Live be approached on a CD-1 project basis,
   rather than through broad Bylaw changes.

   (b)  Continuation of Work and Live Activities

   As  changes occur  in  business  fortunes  and  personal  objectives,  a
   Live/Work person may stop working in their unit.  Similarly, if and when
   we allow Work/Live, a business owner may  decide at some point that they
   want to stop living  on premises, and turn the  whole unit over to  work
   activities.

   Enforcing  occupancy requirements is more difficult where the activities
   share the same physical space, as with artist live/work studios.   As we
   move into Commercial Work/Live, we may have the same challenge.  When we
   can't guarantee  that space will not become all-work or all-residential,
   we should  plan  with that  in  mind, and  ensure  that other  land  use
   policies are not inadvertently compromised.   For example, we should not
   locate  space that  might  convert to  all-residential where  we require
   continuous retail or service along  the street, or above the residential
   density limits set for various reasons.

   In  the case  of Industrial  Work/Live, staff  feel the  requirement for
   physical separation of the  live and work space  noted above, will  make
   enforcement of the  permitted work use easier,  forestalling conversion.
   As   well,  requirements  described  below  for  appropriate  scale  and
   functional features of the work  space will tend to encourage legitimate
   use.

   (c)  Using Industrial Lands

   Recently-adopted  Industrial   Lands  Policies  call  for  retention  of
   industrial land  for city-related  or city-serving  industry.   However,
   several development  proponents have argued that  "industrial live/work"
   should be permitted.

   One argument is  that because modern industry is  clean, residents won't
   be  impacted.   This  neglects  two  factors:   that  much  city-serving
   industry is still  a nuisance to residents, as  complaints and pressures
   on businesses to curtail activities  indicate; and that incorporation of
   residential, even  in the  form of market  "live/work" units,  drives up
   land  values, and  thus taxes, and  further jeopardizes  the businesses.
   These are the  fundamental reasons the remaining 5% of City land that is
   industrially zoned needs to be protected from residential incursion.  

   The second argument suggests that industrial land should be used because
   its  cheaper  prices can  subsidize  more  affordable  units.   However,
   experience shows that  market live/work studio prices reflect the normal
   condominium  market, and  land prices  rise in  response.   In addition,
   there  is no argument for  using cheaper land  prices to subsidize units
   for  only  a small  segment  of  the population.    Council has  already
   determined that  providing affordable housing  sites is not  a criterion
   for rezoning retained industrial lands.

   The only rationale for using retained industrial lands is to provide for
   work  activities that are  suitable (i.e., compatible)  in an industrial
   area  and cannot  be comfortably  accommodated  elsewhere.   Of the  six
   categories, only Industrial Work/Live qualifies.

   4.   Industrial Work/Live: Conclusions

   The theoretical maximum demand for  Industrial Work/Live is 900 units in
   2011,  or about 60 units  per year.  (This  may be an over-estimate with
   respect to  actual market.   For comparison,  estimated absorption  in a
   market study for San Francisco was about 20 units per year.)  

   Staff recommend considering proposals for Industrial Work/Live on a CD-1
   rezoning basis.  In  order to gain experience, we should limit approvals
   to 300 units over the  next 5 years, and  monitor the projects.   Strict
   criteria are proposed:  among them physical separation of  live and work
   spaces (with fire wall); a ratio of  2/3 work space to 1/3 living space;
   and provision of necessary functional features  such as loading, freight
   elevators, adequate door sizes, etc.

   In terms of  locations, we should entertain Industrial  Work/Live in the
   areas  where land  use policies  already  support industrial  mixed-use:
   Burrard Slopes IC-1 and IC-2 Districts, Cedar Cottage MC-1 District, and
   Brewery Creek  IC-3 District.   As well,  we should  consider Industrial
   Work/Live in  other M  and I  districts subject  to the  same limits  as
   recently  endorsed by  Council for  Artist  Live/Work Studios--i.e.,  in
   existing buildings, for  rental only (not strata-titled), and  up to 1.0
   FSR.

   This  leaves  the issue  of  whether  to  entertain  new,  strata-titled
   Industrial Work/Live projects in M and I districts.  The three districts
   noted  above provide  significant  capacity  (3,800  units).    However,
   Industrial Work/Live  is an experimental  concept, and may want  to take
   forms that are  not possible under the  regulations in these areas.   In
   particular, the larger industrial-type work spaces that are required may
   result in less  intensive development than those now  occurring in these
   areas.  Industrial Work/Live may not be able to compete.

   On the risk side,  allowing some projects on M and I lands may result in
   pressure to approve more.   On the other hand, provided we adhere to the
   number  limits,   the   amount  of   industrial  land   used  would   be
   small--perhaps 3 to 6  acres for 300 units.  Monitoring will  tell us if
   the experiment is  worthwhile before there is any  extension beyond 300.
   A requirement  for projects  to contribute  to public  benefits, perhaps
   including an affordable housing contribution, could limit the land value
   increases  that might  set  off speculation  elsewhere.   Lastly,  while
   conversion  to all residential  is an issue,  the stringent requirements
   noted above mitigate against this.

   Staff feel that an  experimental project on  M and I  land would be  the
   best way  to test  real market  interest  in Industrial  Work/Live.   To
   assess whether proposed  locations are appropriate for the  needs of the
   development, we suggest some locational criteria that balance the future
   users'  work-related needs  with their  living  needs.   (See 8.5.10  in
   Appendix A.)  In terms of appropriate scope of project, we propose it be
   big  enough for users  to share some  facilities and feel  some sense of
   community.  Based  on research in other  cities, we propose 75  units as
   the minimum.   However, in order to  allow some of the  300-unit, 5-year
   demand to be tried elsewhere, we suggest a maximum 150 units for any one
   project.

   Staff feel  that the  Trillium site,  which  has been  examined in  some
   detail  as part  of the  False Creek  Flats planning process,  meets the
   locational criteria.  We recommend that  a proposal for up to 150  units
   of Industrial  Work/Live could be  entertained on this site,  should the
   owner wish.

   If owners of other M and I sites wish to propose  experimental projects,
   they  could  apply  provided  the  Industrial Work/Live  is  part  of  a
   comprehensively planned project, with a minimum of 75 unit proposed; and
   provided there are less than 300 units already  in process for rezoning.
   When the CD-1 application is made, staff would assess the location based
   on the locational criteria,  and report to Council early  for a decision
   on  whether  to continue  to  process  the  work/live component  of  the
   application.

   CONCLUSION

   The study has shown that the City is well along the way in providing for
   the  types of  living  and  working combinations  that  many people  are
   seeking.     Strategic  Directions  are  recommended  to  guide  further
   initiatives for Commercial Work/Live and Industrial Live/Work which will
   be  the subject  of  staff  efforts, pursuant  to  Council's March  1995
   directive to  investigate "general  live/work."   Specific proposals  on
   locations, regulations, and guidelines will come forward in due course.

   Staff  also   recommend  consideration  of  Industrial   Work/Live  CD-1
   proposals  subject  to  a limit  of  300  units over  the  next  5 years
   (city-wide), stringent conditions on spatial configuration and features;
   and monitoring.   These projects  should be considered in  several areas
   where land use policies already support them; and in M and I zones under
   similar limits now applied to Artist Live/Work Studios there.

   Finally,  staff  recommend  consideration  of  up to  150  units  in  an
   experimental  Industrial Work/Live project,  in new construction  on the
   Trillium  site,  should the  owner  be interested.    Other experimental
   projects on M  and I lands may  be considered in future, subject  to the
   300 unit 5-year  limit, if they form  part of a comprehensively  planned
   project and locational criteria.

                           * * *