SUPPORTS ITEM NO. 2
CS&B COMMITTEE AGENDA
MARCH 28, 1996
POLICY REPORT
FINANCE
Date: March 12, 1996
TO: Standing Committee on City Services and Budgets
FROM: Director of the Office of Cultural Affairs and the
Manager of the Housing Centre, in consultation with
the Director of Legal Services, the Comptroller of
Budgets & Research and the Manager of Real Estate
SUBJECT: Management and Allocation Plan - Bonused Artist
Live/Work Studio at 272 East 4th Avenue
RECOMMENDATION
A. THAT Council approve an allocation and management
plan as detailed in this report for the bonused
artist live/work studio #303, 272 East 4th Avenue.
B. THAT Council approve a three-year lease of the
bonused artist live/work studio to the Contemporary
Art Gallery for occupancy by a low-income artist,
at a nominal rent ($1) and no taxes, subject to the
terms and conditions being to the satisfaction of
the Director of Legal Services, in consultation
with the Director of the Office of Cultural
Affairs, the Manager of Housing Centre and the
Manager of Real Estate Services.
- OR -
CONSIDERATION
C. THAT Council approve a three-year lease of the
bonused artist live/work studio to the Contemporary
Art Gallery for occupancy by a low-income artist,
at a monthly rent equal to the shelter portion of
welfare ($325) and no taxes, subject to the terms
and conditions being to the satisfaction of the
Director of Legal Services, in consultation with
the Director of the Office of Cultural Affairs and
the Manager of Housing Centre; and
FURTHER THAT any rental revenue remaining after the
operating costs are paid be held in the Affordable
Housing Fund.
GENERAL MANAGER'S COMMENTS
The General Manager of Community Services RECOMMENDS A
and B and puts forward alternative C for CONSIDERATION,
noting that both B and C constitute grants and as such
require eight affirmative votes.
COUNCIL POLICY
On November 17, 1993, City Council approved Vancouver Arts
Initiative (VAI) recommendations, including a recommendation
that the City:
- seek non-market solutions through zoning and
building code provisions to address the need for
affordable artists live/work spaces;
- establish awards to honour Vancouver artists; and
- establish the Vancouver Arts Endowment, an arms-
length organization committed to the City's cultural
objectives.
On February 10, 1994, City Council approved a report,
"Amendments to Vancouver Charter - Bill 57", which recommended
that staff review opportunities to obtain affordable and
special needs housing through density bonusing.
On March 28, 1995, City Council approved Artist Live/Work
policies including the ability to bonus FSR in exchange for
the provision of low-income rental studios in IC-3 district.
Council also reconfirmed its goal to "encourage the provision
of artists live/work studios that are legal, safe, functional,
and where possible, affordable".
On April 27, 1995, Council approved a rezoning application for
272 East 4th Avenue which permitted additional density in
exchange for conveying, at no cost to the City, one artists
live/work unit. As a condition of approval, Council directed
staff to report back with a detailed management plan for the
unit.
PURPOSE
This report outlines a plan for the eligibility, selection,
management, term and funding of the occupancy of the bonused
artist live/work studio at 272 East 4th Avenue and seeks
Council's direction either:
- to lease the bonused unit to the Contemporary Art
Gallery at a nominal rent ($1) who will award
occupancy of the unit at no cost to an artist
through a juried selection process based on
financial need and artistic merit; or
- to lease the unit directly to a low-income artist on
the same basis as above but charging a monthly rent
of $325.
BACKGROUND
With the approval of a rezoning proposal at 272 East 4th
Avenue, Council secured a housing bonus, and the first bonused
artist live/work studio. Staff believe that this bonus
provides a significant opportunity to combine the City's
objectives of affordable artists housing with the objective
identified by the Vancouver Arts Initiative of enhanced
recognition of local artists. Staff are therefore proposing
to award occupancy of this bonused unit to a Vancouver artist
whose work shows exceptional talent and who can demonstrate
financial need.
This recommendation to grant occupancy as an award is a one-
time only initiative which responds to the opportunity
established as part of the rezoning of 272 East 4th Avenue.
Should additional artist live/work units be secured in the
future through housing bonuses, staff propose that they be
treated as other social or rental housing where tenants are
expected to pay rent.
Staff are recommending that the award be jointly made with the
Contemporary Art Gallery (CAG). The CAG was established in
1971 by the City to collect and exhibit the work of
contemporary Vancouver artists. Today the CAG is a separate,
non-profit society which operates as a public gallery and
which maintains and cares for the City's contemporary art
collection. Staff believe that the proposed collaboration
with the CAG will provide the best balance between the
interest of the arts community and the City.
DISCUSSION
Eligibility
Professional artists currently working in the City of
Vancouver would be eligible to apply for the occupancy award.
While the award is intended to recognize artistic excellence,
it will only be available to artists who can demonstrate
financial need, as described below, to the satisfaction of the
Manager of the Housing Centre.
As this unit is located in IC-3 district, only professional
artists involved in the production of art as defined in the
City's Zoning and Development By-Law would be considered
eligible. Priority would be given to artists requiring Artist
Live/Work Studio - Class B, which means the use of the
premises for the production of art involving toxic or
hazardous materials or processes, or the creation of art using
electronically amplified sound.
Selection Process
Interested artists would be required to submit documentation,
including demonstration of financial need, examples of past
artistic works, professional references, and a statement of
intent indicating how the work produced during the residency
would benefit the artist and the community.
The City's Housing Centre staff will pre-qualify candidates
with respect to financial need using the core-need housing
criteria ($26,000 - 1995). Many Vancouver artists would
qualify using this criteria alone. The National Cultural
Labour Force Survey (1993) estimated an average income of
$8,800 per year for visual artists and $12,800 per year for
musicians and dancers. Staff are therefore proposing that
once candidates meet the financial means test, a jury of peers
would judge applications on the basis of artistic merit.
Staff from the Office of Cultural Affairs and the Contemporary
Art Gallery would administer the jury process.
Management
As the City cannot make an award to an individual, staff are
recommending that the unit be leased to the Contemporary Art
Gallery (CAG) for a term of three years and that the CAG
administer and manage the award in consultation with the City
through the Office of Cultural Affairs and the Housing Centre.
Terms
Occupancy of the unit to the selected artist would be for a
non-renewable three year maximum period. The selected artist
would be required to enter into an agreement with the CAG in
the case of an award, or directly with the City which would
address issues of term, repairs, insurance, and liability and
rent if applicable.
The tenant will be required to pay for hydro, cable, telephone
and any other user-related costs.
Staff believe that a three-year term is long enough to be of
practical value to an artist and at the same time renews the
benefit throughout the arts community every three years.
At the end of the three-year term, the City may wish to renew
the lease with the CAG, or if the Vancouver Arts Endowment
(VAE), recommended by the Vancouver Arts Initiative has been
established, staff would then report to Council with a
proposal to lease the unit to the VAE.
FINANCIAL IMPLICATIONS
The unit at 272 East 4th Avenue was secured at no cost to the
City as a condition of a rezoning. The unit has been finished
and fitted-up to the satisfaction of the Manager of the
Housing Centre. Staff do not anticipate any additional
capital costs associated with the unit.
Staff have reviewed potential annual operating expenses which
are estimated as follows:
Strata fees - residual funds of approximately $2,861 were
secured from the developer as part of the bonus
calculation. These funds are currently being held by the
City and are to be used to pay the Unit's strata fees which
at the estimated rate of $59 per month should cover
approximately 4 years. Once the developer's allowance for
the strata fees is exhausted, the City, or its designate,
would be responsible for strata fees.
Repairs - anticipated expenses for minor ongoing repairs,
as well as extraordinary strata assessments.
Taxes - have not been included as the City owns the unit.
Management Costs - management costs of the unit are
expected to be minimal and are therefore proposed to be
absorbed within the current budgets of the Office of
Cultural Affairs, the Housing Centre and Real Estate
Services.
CONSIDERATION OPTION
Staff recommend that the City treat this first bonused unit as
an award and lease the unit to the Contemporary Art Gallery
for occupancy by a low-income artist, at a nominal rent ($1
per year).
Alternatively, the unit could be leased to the CAG and rented
to a low-income artist, using a similar selection process as
the full award option, but charging the recipient a monthly
rent. In this case, staff recommend the rent be set at the
shelter portion of welfare ($325 per month) to ensure
affordability for low-income artists. This approach is more
consistent with the City's practice of charging rent in City-
owned housing.
Real Estate, Housing Centre and Cultural Affairs staff support
the no rent option, recognizing that this is an award noting
that this is a one time opportunity involving a single live/
work unit.
Housing Centre staff estimate that, based on comparable units
in neighbouring developments, the market rental potential of
the unit over three years to be approximately $22,000. The
value of the award (Recommendation B) would be $22,000. The
value of Recommendation C would be $10,000 over three years.
Should Council select the option with rent, staff recommend
that the rental funds received by the City remaining after the
occupancy costs are paid be held in the Affordable Housing
Fund.
CONCLUSION
The development at 272 East 4th Avenue is now complete and
staff are proposing, with Council's approval of this report,
to put into place a process which will award the unit as soon
as possible.
The awarding of occupancy of the City's first bonused artist
live/work studio contributes to the City's objectives to
address affordable artists accommodation through non-market
solutions and also enables the City to recognize, through the
award, the contribution of Vancouver artists to the City.
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