OMB Confirms Section 37 Contributions Must Be Specific, Fair, Transparent And Predictable

As municipalities desperately look for new sources of revenue, section 37 of the Planning Act has received more attention. That section provides that in exchange for facilities or services (such as public art or community benefits), municipalities may allow developments to exceed the maximum height and density standards permitted by the applicable zoning bylaw. To exercise this authority, the municipality's official plan must include provisions which permit height and density increases.

In the recent decision of 1477677 Ontario Ltd. (Baywood Homes) v. Toronto (City), the Ontario Municipal Board (the "Board") refused to impose a section 37 contribution in the amount of $260,000 in exchange for a development of approximately 3,858 square meters over and above the as-of-right zoning permissions. In doing so, the Board confirmed that section 37 benefits must be grounded in fair, clear, transparent, predictable and specific requirements that are set out in