Hamilton councillors had very few questions for the roughly one dozen members of the public who appeared before the General Issues Committee pleading with councillors to not give a tax increment grant to the developer Malleum. The Toronto developer has been purchasing older apartment buildings in the central and eastern core, and renovating them–or as tenants who were displaced in the process called it–reno-victing. Malleum was applying for a tax increment grant—a grant program the city developed 20 years ago to encourage downtown development. Under the plan, the developer receives a rebate on a portion of the additional taxes that arise as a result of their development. In the case of Malleum it took over an apartment complex at 540 King Street East, displaced all of the existing tenants who had been paying rents in the $800 per month range, renovated the units and put them back on the market for $1495 a month, for a one-bedroom unit. As a result, Malleum had more than doubled the taxable value of the property and under the plan would qualify for $170,000 in tax rebates over five years. Some of those who appeared were tenants who had been forced out of the 540 King complex, other were members of the tenant advocacy group ACORN. Their message was a simple one-why is the city handing out money to organizations that are evicting poor people from their homes and adding to Hamilton’s housing crisis?
Moments before the Malleum debate, council had voted to give a similar grant to Vrancor for an apartment complex being built on Main Street East. Staff pointed out that the Vrancor complex is a new built project and does not involve reno-victions. In the end, with several councillors indicating they were prepared to deny the grant to Malleum, it was decided to have legal staff prepare a report on whether council could turn down the Malleum grant without incurring legal liability. To-date Hamilton has never refused a tax-increment grant, which have mostly gone to new construction. The city has changed the tax-increment grant policy to discourage reno-victions but the Malleum request was filed before the changes took place.
Malleum is one of several developers who started buying up properties in the lower city after the Hamilton LRT had passed a major hurdle in 2017. It is expected that the construction of the LRT will raise property speculation along its route, beyond that which has already taken place and with that will only come further home affordability issues. Nonetheless the councillors representing wards 1 through 4 all supported the LRT project. Hamilton has a backlog of 5,000 applications for social housing. Meanwhile, whether Council grants the Malleum tax rebate or not, some 36 formerly affordable rental units have gone off the market for good.