COUNTY OF LAMBTON OFFICIAL PLAN UPDATE

BACKGROUND REPORT NO. 12

POPULATION, HOUSING, AND EMPLOYMENT

Image Source: (Word Clip Art Stock Photos, 2011)

Date: May, 2015

Page 2 of 22

PLANNING AND DEVELOPMENT SERVICES DEPARTMENT

789 Broadway Street, Box 3000 Wyoming, ON N0N 1T0 Telephone: 519-845-0801 Toll-free: 1-866-324-6912 Fax: 519-845-3817 www.lambtononline.ca

BACKGROUND

In compliance with the Planning Act (RSO 1990 as amended), the County of Lambton Planning and Development Services Department is undertaking a review of the 1998 County Official Plan. This review is required at 5 year intervals to ensure Official Plans remain relevant to area demographics, land use changes and emerging topics in planning. Under the review, the County will also ensure the Official Plan is in accordance with provincial legislation including the Provincial Policy Statement (2014) and other documentation.

Population projections are an initial step in many aspects of planning including predicting land, infrastructure, and servicing needs and establishing economic development needs and goals. The County Plan currently contains growth projections from 1991 to 2016. The predicted growth has failed to materialize. Instead population is approximately the same.

A report titled "Population Projections, Census Years 2011 to 2031" (the 2011 County Population Projections Update) was prepared internally and adopted by County Council on November 7, 2012. It is an update to the report "Population: Summary Trends & Projections Census Years 2006 to 2031" that was adopted in 2010. These projections look at population distribution and growth in individual age groups. Like other rural areas, Lambton loses many young adults to net migration. Nationally, birth rates are significantly lower than past decades. For the County as a whole, this combination of factors presents the likelihood of population decline in the County as the "baby boomers" age. Although perhaps being unique in having taken what is considered an honest approach to its projections, it is important to point out that Lambton is not unique in its situation. Most rural Counties have a similar age distribution and similar growth trends in key age groups, and can therefore be expected to face similar declines, despite possibly having adopted more optimistic growth projections.

Work force size in 2006 was slightly greater than in 1991, but not nearly in the order projected in the current Plan. Work force size is expected to decline in the future - a function of a decline in the size of the working age population.

Building permit data however shows new dwelling construction projections in the County Plan have been met and exceeded despite trends in population growth. The major factor has been a decline in average household size (AHS).

Page 3 of 22

RELATION TO PROVINCIAL POLICY STATEMENT (2014)

The Provincial Policy Statement considers the accommodation of "an appropriate range and mix of residential (including second units, affordable housing and housing for older persons), employment (including industrial and commercial), institutional…, recreation, park and open space, and other uses to meet long-term needs" an important part of sustaining "healthy, liveable and safe communities" (section 1.1.1 b). Further it requires municipalities "provide for an appropriate range and mix of housing types and densities required to meet projected requirements of current and future residents of the regional market area" (section 1.4.1 Housing).

To this end, it requires that "sufficient land shall be made available to accommodate an appropriate range and mix of land uses to meet projected needs for a time horizon of up to 20 years..." (section 1.1.2). At a minimum, municipalities must "maintain at all times the ability to accommodate residential growth for a minimum of 10 years" (section 1.4.1 a) and "maintain at all times where new development is to occur, land with servicing capacity sufficient to provide at least a three-year supply of residential units available through lands suitably zoned to facilitate residential intensification and redevelopment, and land in draft approved and registered plans" (section 1.4.1 b).

Population, housing and/or employment projections are the initial step in meeting these Provincial Policy Statement requirements. Projections are also important components of determining targets and phasing policies for intensification and redevelopment (sections 1.1.3.5, 1.1.3.7, and 1.2.4 c) as dealt with in Background Report No. 11. Projections also form the first step in justifying the expansion of a settlement area boundary (section 1.1.3.8), a process described as a "comprehensive review" in the Provincial Policy Statement.

The 2014 Provincial Policy Statement places a focus on coordination within and between municipalities:

1.2.1 A coordinated, integrated and comprehensive approach should be used when dealing with planning matters within municipalities, across lower, single and/or upper-tier municipal boundaries, and with other orders of government, agencies and boards including:

a. managing and/or promoting growth and development… g. population, housing and employment projections, based on regional

market areas.

Further it requires that the County take the lead in producing projections and allocating growth among the lower tier municipalities.

1.2.4 Where planning is conducted by an upper-tier municipality, the upper-tier municipality in consultation with lower-tier municipalities shall:

a. identify, coordinate and allocate population, housing and employment projections for lower-tier municipalities…

Page 4 of 22

b. identify areas where growth or development will be directed, including the identification of nodes and the corridors linking these nodes;

c. identify targets for intensification and redevelopment within all or any of the lower-tier municipalities…

CURRENT COUNTY OF LAMBTON OFFICIAL PLAN

Projections' Uses: Population projections form the basis for a number of generic planning exercises that the County Plan requires local municipalities to complete. These include calculating sewer and water capacity needs, developing infrastructure and public service facilities, planning other services and programs, designating adequate land, designating settlement boundaries, identifying the type, mixture, location and densities of future land uses, and more generically accommodating anticipated growth (sections 3.1 & 3.3 (2)). Projections are also required to justify further expanding a settlement area boundary prior to the end of the original planning horizon; this can be done by completing new projections and extending the planning period out another 20 years from the time of the updated projections (section 3.6 (2) a) & e).

Official Plan Section 3.6 (2) Settlement boundary expansion

… Prior to the extension of boundaries, local municipalities will have regard to the following:

a) the need for additional urban designations based on updated population, household and employment projections, in the context of a maximum 20 year planning time frame…

e) the supply of vacant land within each municipality and the achievement of housing targets, in the context of a horizon of up to a 20 year planning time frame…

As per Provincial Policy Statement, the County Plan requires municipalities to maintain a minimum 10 year supply of designated residential lands and a 3 year supply of draft approved or registered lots for residential units (section 2.3 (1)).

1991 to 2016 Projections in Current Plan: The current Plan contains projections to 2016 with 1991 census data as the base year. This is a 25 year period but represented a 20 year planning horizon when the background reports to the Plan for population and housing were adopted in 1996. It seems that the high population projections in the background reports were adopted for planning purposes. Projected population and dwelling unit growth were allocated as ranges and by sector and are summarized in Table 1 on the following page. As discussed in the following section, population and work force projections have not been realized. Dwelling unit projections however have been met and exceeded.

Page 5 of 22

Area Dwelling

Units Population

West Lambton1 4,000 to 5,000 7,200 to 8,800

North Lambton2 1,500 to 1,900 2,600 to 3,300

Central Lambton3 1,000 to 1,400 1,900 to 2,300

East Lambton4 400 to 600 750 to 950

TOTALS 6,900 to 8,900 12,450 to

15,350

Table 1: Growth Allocations in Current County Plan (Source: Lambton County Official Plan, 1997, pg. 3-1)

Official Plan Chapter 3

Projections

The Official Plan anticipates that the County will reach a population of 142,000 persons and a work force of 73,000 persons by the year 2016. The Plan also anticipates the need for the production of an average of 400 dwelling units annually over the planning period to the year 2016.

Allocation

Expected population and housing growth has been allocated among these four growth areas. To provide for a degree of flexibility, a range has been provided within these allocations. These allocations are as follows [see Table 1 above].

Official Plan 2.3 (2)

Housing Projections

The County encourages the construction of an adequate supply of dwelling units to meet the needs of the local housing market. This is expected to average 400 dwelling units per year over the planning period.

Establishing Growth Areas: Provincial Policy Statement requires upper tier municipalities to establish nodes of growth. Map 1 to the County Plan (Figure 1 next page) identifies a hierarchy of settlement areas, which are to be the focus of projected growth (section 3.2 (1)). The County Plan requires that local plans' designations and development policies reflect

1 West Lambton includes City of Sarnia, Village of Pt. Edward, and the now-amalgamated St Clair

Township. 2 North Lambton is the now-amalgamated Municipality of Lambton Shores.

3 Central Lambton includes Town of Petrolia, Township of Enniskillen, Village of Oil Springs, the now-

amalgamated Town of Plympton-Wyoming, and the pre-amalgamation Township of Dawn. 4 East Lambton includes the now-amalgamated Townships of Warwick and Brooke-Alvinston and the

pre-amalgamation Township of Euphemia.

Page 6 of 22

these designations (section 3.2 (7)). However, the Plan delegates local municipalities the responsibility of defining detailed boundaries for these settlement areas (section 1.4, 3.1 (2), 3.3 (2) a), 3.6 (2), 10.7). This is especially the case for the Plympton-Wyoming and southern Lambton Shores' "Lakeshore Policy Area", where the County Plan designates much more land than is needed to meet land needs and requires the local Plans to determine where it wishes to establish "identifiable communities" (section 3.5 (1) a) and b).

Figure 1: Lambton County Growth Strategy - Map 1 to the County Plan (Source: Lambton

County Official Plan, 1997)

Page 7 of 22

Interpreting, Monitoring, And Updating: A number of policies within the Plan note the need to use caution in interpreting and applying the projections and allocations because of the uncertainty inherent in them. The non-performance of the projections in the current Plan punctuates this.

The Plan discusses the need to monitor growth and allows for growth allocations to be adjusted based on actual growth without amendment to the County Plan. Further, the Plan does not require amendment to update projections done as part of justifying a settlement area expansion.

Nothing in the Plan as currently drafted prohibits local municipalities from carrying out monitoring and updates for just their municipality. In fact the general tone of the Plan with respect to settlement areas seems to be to give freedom to local municipalities for determining their needs and boundaries. The general tone of the Provincial Policy Statement is to have direction and coordination by the upper-tier level. The County Plan needs to be clear on what involvement the County will have in municipal updates of local projections and settlement expansions and what conditions must be met for such updates and expansions.

Official Plan Chapter 3

Caution

Given that projections are influenced by many factors, caution should be exercised in applying this information [the projections]. Official Plan Chapter 3.1(1)

Monitoring Population, housing and employment growth will be monitored by the County in consultation with the local municipalities.

Official Plan Chapter 3.1(5)

Updating …The growth projections are not intended to be incorporated as a formal component of this Plan. Any changes to these projections resulting from ongoing monitoring will not require a formal amendment to this Plan

Appropriate Surpluses: The County Plan includes an important concept regarding "appropriate surpluses of land". Section 3.2 (8) requires local Plans to designate an appropriate surplus of land to ensure "land market competition". While not permitting municipalities to plan beyond a 20 year horizon, this provision does potentially require municipalities, especially smaller ones, to designate more than a 20 year land supply. This policy only applies to the top tiers of settlement areas in the County plan however - urban centres and urban settlements.

Page 8 of 22

A close reading of policy 1.1.2 of the Provincial Policy Statement allows this. It prohibits the use of a planning horizon beyond 20 years, but it does not specifically limit the land designated to a 20 year supply. It requires that sufficient land be made available to accommodate projected needs. In low-growth rural areas and small communities an appropriate surplus is appropriate (and may be necessary) to ensure an adequate land supply to meet projected needs. This is an important concept in rural areas with less lucrative land values to attract land developers. Placing all your "eggs in one basket" or having your future land supply tied up in too few properties may effectively result in land not being available to meet projected needs.

Official Plan Chapter 3.2(8)

Over-designation Sufficient land will be designated for settlement and employment purposes to meet expected growth during the planning period, including an appropriate surplus to ensure land market competition within the Urban Centres and Urban Settlements.

PROPOSED POLICY CHANGES TO THE OFFICIAL PLAN

The population and work force growth predicted in the Official Plan have not been realized and recently adopted projections predict population decline in the future. Notwithstanding, building permit activity has been in line with Official Plan projections. Despite population trends, there has been a continued supply and demand for new dwelling units. Continuing increases in the number of households and a declining average household size have primarily been responsible for explaining this trend.

Recent Population Growth: Table 2 below shows the County is not on pace to reach the population of 142,000 predicted in the County Official Plan for 2016. If more current census data had been available at the time, it would have been apparent the projections were already off track when adopted.

There is a clear difference in trends prior to and since 1991. The slowing of growth since 1991 is anticipated to turn to population decline in coming census periods as the baby boomers age and historic rates of growth in other age groups will be insufficient to offset mortality in older age groups.

Period

Period's

End

Population5 Change %

Change

1976 to 1981 117,970 2760 2.3%

1981 to 1986 120,730 2060 1.7%

1986 to 1991 122,790 4305 3.5%

5For comparability between Census periods, these populations exclude Indian Reserves.

Page 9 of 22

Period

Period's

End

Population5 Change %

Change

1976 to 1991 (15 years) - 5 year average

3042 2.6%

1991 to 1996 126,850 -245 -0.2%

1996 to 2001 123,595 -3255 -2.6%

2001 to 2006 124,605 1010 0.8%

2006 to 2011 124,615 10 0.0%

1991 to 2011 (20 years) - 5 year average

-559 -0.4%

Table 2: County Population Growth Pre and Post 1991 (Source: derived from Statistics Canada, Profiles of Census Divisions and Sub-divisions, Census Years 2011, 2006, 2001, 1996, 1991, 1986, 1981 and 1976).

New Population Projections: Staff recommends that the population projections and allocations in Chapter 3 of the Plan be updated in accordance with Table 3 on the following page. Table 3 reflects the 2011 Population Projection Updates adopted by County Council. These projections were based on age-specific growth rates estimated from historic trends. With the one exception noted in the footnotes, the range provided in Table 3 below is based on the populations projected using the "Reference" and "High" growth scenarios.

Area

Population Change (5 year average)

1991 to 2016

Projections

1991 to

2011 Actual 2011 to 2031 Projections6

Sarnia -504 -1587 to +423

Point Edward -71 -125 to +7

St Clair -90 -495 to -160

West Lambton 1440 to 1760 -665

Lambton Shores (North

Lambton) 104 to 132 +125 -335 to +238

Petrolia +233 +218 to +4587

6 This projected growth range is based on the "reference" and the "high" growth scenarios in the 2011

Population Projection Update.

Page 10 of 22

Area

Population Change (5 year average)

1991 to 2016

Projections

1991 to

2011 Actual 2011 to 2031 Projections6

Enniskillen -60 -209 to -55

Oil Springs +9 -42 to +23

Plympton-Wyoming +61 -180 to +66

Central Lambton

(less Dawn) 380 to 460 +243

Warwick -89 -191 to -33

Brooke-Alvinston -68 -133 to +5

East Lambton (less Euphemia)

150 to 190 -157

Dawn-Euphemia -166 -135 to -20

TOTALS 2490 to 3070 -620 -3310 to -613

Table 3: Actual & Projected Population Change: 1991 to 2031 (Source: 1991 to 2016 projections derived from: County Official Plan, 1997, pg. 3-1; Actual 1991 to 2011 growth derived from: Statistics Canada, Profiles of Census Divisions and Subdivisions, Census Years 2011 and 1991; 2016 to 2031 projections derived from 2011 Population Projection Update statistics).

Staff also recommends a switch to allocation by municipality rather than by sector. We also recommend allocation primarily by where growth is occurring as opposed to artificially trying to limit growth in one area in hopes of benefiting another area. It is generally thought this would only result in the restricted area using up its designated land supply more quickly and needing to designate more land.

Recent Dwelling Construction A surprising trend is that the number of dwelling units constructed has met and even exceeded projections despite population projections not being met (see Table 4 below). This illustrates that there is much more to housing demand than simple population growth and also that a stable or declining population does not automatically or immediately equate with declining development or economic activity.

7 Where a municipality has anomalies in key age groups' growth rates in one or more census periods,

some of the growth scenario assumptions of the 2011 to 2031 projections have the potential to produce unrealistically high projections. This is believed to be the case for Petrolia, and therefore the lower number for Petrolia in Table 3 is still the reference scenario from the projections, but the higher number is based on aggregate growth each Census of 7.4% (the maximum aggregate growth experienced by Petrolia in any recent Census period).

Page 11 of 22

Area

Average New Dwelling Units Per Year

1996 to

2016

Allocations

1997 to 2010

Permits

Issued

2006 to 2010 Permits Issued

2011 to 2031

Allocations

Sarnia 189.4 220.4 230

Point Edward 5.4 2.0 5

St Clair 52.0 54.6 55

West Lambton 200 to

250 246.8

Lambton Shores 75 to 95 71.5 48.6 50

Petrolia 35.6 36.2 36

Enniskillen 7.7 6.2 7

Oil Springs 1.2 2.0 5

Plympton-Wyoming 41.1 42.4 42

Central Lambton

(less Dawn) 50 to 70 85.6

Warwick 12.0 7.6 10

Brooke-Alvinston 3.1 3.2 5

East Lambton

(less Euphemia) 20 to 30 15.1

Dawn-Euphemia 4.4 6.8 5

TOTALS 345 to

445 423.4 430 449

Table 4: Actual & Allocated New Dwelling Units (Source: 1996 allocations derived from Lambton County Official Plan, 1997, pg. 3-1; permits issued derived from yearly statistics provided by County of Lambton Building Services Department, City of Sarnia, and Municipality of Lambton Shores).

8

8City of Sarnia issued 241 and 253 permits for new dwellings in 2010 and 2009, respectively. Village

of Point Edward 1997-2010 average includes 46 units in 2005 and would average 2.3 without that year. Municipality of Lambton Shores 1997-2010 average is based on 2000 to 2010 (11 years) as data for former Bosanquet Township for 1997 to 1999 is unavailable. Warwick Township 1997-2010 average includes 66 units in 2001 and 27 in 2005 and would be 6.3 without these years. Township of Brooke-Alvinston 1997-2010 average is based on 1999 to 2010 (12 years) as data for 1997 and 1998 is unavailable for former Brooke Township. Township of Dawn-Euphemia averages include 22 units in 2009 and would be 3.1 for 1997-2010 and 3.0 for 2006 to 2010 without that year. Total assumes number of permits issued for Brooke-Alvinston and Lambton Shores in the unknown years equalled the average of the known years.

Page 12 of 22

Households - Number and Size A significant portion of demand for new housing units can be attributed to the fact that the number of households has increased despite no significant change in population. The number of households increased by an average of 273 per year from the 1996 to the 2011 Census.9 There was an estimated average of 423 permits per year issued for new dwellings from 1997 to 2010 (Table 4 on previous page). This suggests the net increase in total households explains about 66% of new dwelling unit permits issued in the County from 1997 to 2010. Table 5 below however suggests that the rate of increase in number of households has declined in this last census period both numerically and as an explanation of dwelling unit demand.

Calendar

Years10

Average New

Dwelling Permits

per Year11

Census

Period

Average Increase in Households

Dwelling Permits Explained by

New Households

1997-2000 353 1996-2001 299 85%

2001-2005 473 2001-2006 358 76%

2006-2010 430 2006-2011 162 38%

2001-2010 452 2001-2011 260 58%

1997-2010 412 1996-2011 273 66%

Table 5: New Dwelling Units Explained by Increase in Number of Households (Source: permit information derived from yearly statistics provided by County of Lambton Building Services Department, City of Sarnia, and Municipality of Lambton Shores; household date derived from Statistics Canada, Profiles of Census Divisions and Sub-divisions, Census Years 2011, 2006, 2001, and 1996).

An increase in number of households with no population growth equates to a decline in average household size (AHS) and average census family size (see Figure 2 next page). Attributable factors may include greater numbers of widow and widowers (presumably a factor of an aging baby-boomer population) and increased numbers of divorced individuals and single-parent families. Low interest rates have probably encouraged more young adults to become first-time homeowners meaning more one-person households. Table 6 on page 13 shows demographic trends related to average household and family size in Lambton.

A decline in birth rates is another factor of declining average household size. Lambton's general fertility rate declined from 57.2 live births per 1000 women aged 15-49 in 1989 to a low of 34.6 in 2000 (a decline of 40% over just 11 years). From 1999 to 2004

9 Source: Statistics Canada, Profiles of Census Divisions and Subdivisions, Census Years 2011 and

1996. 10

Because of the delay between building permit issuance and occupancy, calendar year of permits issued and census periods are off-set. Average permits issued for 1997-2000 is based on four years of data. 11

Permits per year include estimated data. Building permit data for former Brooke (1997 and 1998) and former Bosanquet (1997-1999) is not available, so permits issued for these two municipalities in these unknown years was estimated from known years.

Page 13 of 22

however, the birth rate has stayed between 34.6 and 37.7.12 The ratio of population aged 0- 4 to population aged 15-49 suggests birth rates during the 2011 Census period have increased relative to 2006 and 2001 Census periods, but are still well-below earlier rates.13 The 2011 Population Projection Update assumes birth rates have generally leveled out.

The apparent disconnect between population growth and housing starts and household formation could also be the result of a delay between population growth in certain age groups and the time they require housing - e.g. past growth in age groups that are only now reaching the age of forming households.

Policies need to be added to the Plan regarding the connection between AHS and age distribution and dwelling unit needs - and also regarding the need to monitor AHS and the things that seem to influence it. This concept has obviously been a driver in recent housing needs and is largely missing from the current County Plan.

Other Factors in New Dwelling Starts As noted in the previous section, the increase in number of households only explains about two thirds of the dwelling permits issued from 1997 to 2010, and may be becoming less of a determinant in the number of new dwelling units constructed. Other factors such as replacement dwellings, demolition of less desirable or obsolete housing stock, increased vacancies and abandonment, and conversion to seasonal and secondary homes may be becoming more important factors in determining housing supply and demand.

12

Source of live birth information: Provincial Health Planning Database data as reported in County of Lambton Community Health Services Department, Lambton County 2007 Health Status Report: Reproductive Health, Released September 19, 2007, page 3. 13

See Figure 11 in the 2011 Population Projection Update and related discussion of birth rates.

Figure 2: Declines in Average Household and Census Family Sizes (Source: Derived from Statistics

Canada, Profiles of Census Divisions and Subdivisions, Census Years 2011 and 1991)

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

Ave

rage

Nu

mb

er

of

Pe

rso

ns

Household and Family Size Declines in Lambton County 1991 to 2011

1991 Avg Family Size

2011 Avg Family Size

1991 AHS

2011 AHS

1991 Avg No. Children<18/Family

2011 Avg No. Children<18/Family

Page 14 of 22

What demolition permit data is available suggests that the retirement of existing housing stock is the next greatest factor (after household size trends) in explaining the number of new dwelling units constructed. The number of houses demolished from 2007 to 2010 in Lambton County (excluding Lambton Shores, for which no demolition permit data was available) was 14% of the number of permits issued for new dwellings over that same period. It should be noted this ranged from 10% to 17% in any given year

2011

Proportion

1991

Proportion Absolute Change

Change in Proportion

Persons aged 15 and over who are:

Married (not separated)

52.2% 60.9% -5440 -14.3%

Single (never married) or Common-law

31.7% 24.3% 9450 30.6%

Separated 3.1% 2.8% 510 11.4%

Divorced 5.6% 5.0% 910 11.1%

Widowed 7.3% 7.0% 820 5.2%

Types of Households

1 person 28.1% 21.9% 4465 28.3%

2 persons 38.2% 32.7% 4710 16.9%

3 persons 14.1% 16.1% -185 -12.6%

4 or 5 persons 17.6% 26.1% -3050 -32.5%

6 or more persons 2.0% 3.2% -465 -37.8%

Types of Families:

Married 73.7% 83.6% -2505 -11.9%

Common-law 11.3% 6.1% 1990 83.6%

Lone-Parent 15.0% 10.3% 1920 46.6%

Married or Common-law Couples with:

No children at home 54.3% 41.7% 3762 30.2%

1 child at home 17.5% 18.9% -535 -7.3%

2 children at home 18.9% 25.1% -2085 -24.7%

3 or more children at

home 9.2% 14.2% -1650 -35.1%

Table 6: Demographic Changes Related to AHS in Lambton, (Source: derived from Statistics Canada, Profiles of Census Divisions and Subdivisions, Census Years 2011 and 1991)

Page 15 of 22

with a possible upward trend. It should also be noted that there is a wide variation between municipalities. Petrolia issued only 2% as many demolition permits as building permits and Sarnia only 9%. Some municipalities however have issued as much as 60% as many demolition as building permits or even seen a net loss in housing stock.14

Some new dwellings are constructed specifically to replace a demolished house on the same lot. We speculate this is more prevalent in proximity to shoreline areas as discussed more below. Other demolitions will reflect the migration of housing to different areas altogether. Agricultural areas for example are expected to have a greater ratio of demolition to new construction than other areas.

Another expected correlation with new dwelling construction is increased vacancy rates and abandonment and also withdrawal of some dwelling units such as apartments from the housing market. The units vacated by the occupants of new dwellings will become available to others wishing to upgrade to a higher quality home or one that better suits their needs. Via this "trickle-down" effect, lower-quality, obsolete, or less desirable dwelling units will be vacated and/or removed from the market.

An interesting question to consider is whether the trickle-down or a "trickle-up" effect has the greatest influence at any given time in the supply and demand of new housing units. The trickle-down effect makes housing available for people to upgrade or enter into the housing market as first-time home owners. However, if there is a lack of people at the bottom of the market to whom existing home-owners can sell to; does this condition ultimately prevent new construction?

A small percentage of residences are intentionally maintained as second or seasonal dwellings. In particular, Lambton County has a greater concentration of seasonal cottages within its shoreline areas. Some of the permits issued for new dwelling units will be explained by an increase in secondary and seasonal dwellings.

New Housing Allocations: Recommended housing allocations are included as part of Table 4 on page 10. They take into account average yearly new dwelling permits issued over the 5 and 14 years prior to 2010. The County has shown a 7% increase in yearly housing starts in the last five years (2006-2010) compared to the previous nine (1997-2005). This is as a result of increases of 28% in Sarnia, 8% in St Clair, 5% in Plympton-Wyoming and 3% in Petrolia. These increases in building permit activity in these municipalities reflect the 2011 Census population results, in particular for Sarnia. Conversely, new dwelling permits issued in Lambton Shores' from 2006 to 2010 were 46% less than from 1997 to 2005, which may be a factor in the population decreases reported by the Census.

A decline in average household size has obviously been closely connected to continuing housing demand. There are practical limits on how far AHS can be expected to decline. It may level out or even rise as the baby boomer generation passes on. The

14

Derived from demolition and building permit data provided by County of Lambton Building Services Department and City of Sarnia Planning Department.

Page 16 of 22

implications of an increasing AHS combined with a relatively fixed housing supply and built urban infrastructure could be serious.

Given the uncertain relationship between population, age distribution, AHS and housing needs, the recommended housing allocations are largely based on historic permit activity. The population projections suggest the real change in population trends would come more towards the end of the planning horizon. It is therefore possible we are on the brink of a change in trends in housing starts. It is therefore appropriate to base projected housing starts on historic permit activity, monitor permit activity and relevant demographics, and adjust projections at five year intervals.

At present, municipalities may focus on determining what types of dwelling units should be promoted now should the latter portion of the planning horizon result in a decline in housing needs or even a surplus in housing stock.

Residential Land Needs Considerations: Number of permits issued or expected to be issued does not translate directly into projected designated residential land needs.

Municipalities need to designate enough land and/or have the flexibility to designate additional lands in order to accommodate unexpected land needs. Growth in Lambton County, especially some of the smaller municipal populations, is of a nature that is susceptible to sudden changes in trends and individual events. The construction of a multi-unit development or an abnormally high number of units constructed in a given year in a local municipality illustrates this. Some examples are noted in Table 4's footnotes on page 10. The allocations in Table 4 therefore include a minimum.

Land designation considerations must also take into consideration second dwelling unit (on a lot) policies and other infilling goals.

The County Plan should encourage local municipalities to look at where growth is occurring within their municipalities. Net population change may mask areas of growth and/or decline internal to a municipality. Where multiple growth areas exist within a municipality, municipalities should "sub-allocate" expected growth within those areas in consultation with the County.

Other considerations that municipalities should take in assessing designated land needs include:

Proportions of new construction that replace an existing house without requiring a new lot or using up an existing vacant lot.

Apparent trends of re-investment (house replacement) on lots in shoreline areas.

Net changes in the quantity of housing stock in agricultural areas. (Houses constructed in agricultural areas do not contribute to residential land needs in urban areas, however net declines in agricultural housing stock could).

Changes in vacancy and abandonment rates and other forms of retirement or disuse of housing stock.

Page 17 of 22

Shifts in demand and surplus stock of certain dwelling types.

The proportion of seasonal and secondary dwellings, especially in shoreline areas.

Data related to the above-noted trends is spotty and lacks sufficient detail to quantify. The following are several samples of the types of statistics that should be considered, but these should not be taken as representative or conclusive as quantifying any particular trends.

From 2007 to 2011, 42% of residential demolition permits issued in the County (excluding Lambton Shores and Sarnia) were in agricultural areas. 15

Approximately 46% of all demolition permits in St Clair and 37% in Plympton-Wyoming from 2007 to 2011 were on lots in the immediate vicinity of the shoreline, the majority of which have been or we assume will be replaced.16

From 2001 to 2010, only 31 (1.7%) of new dwellings constructed in Sarnia were in agricultural areas.17

For Plympton-Wyoming's agricultural area, from September 2008 to November 2011, 10 existing houses were demolished and 14 new dwellings constructed (4 were replacement houses).18

Approximately 16 (15%) of the 108 permits issued in Plympton-Wyoming from September 2008 to November 2011, replaced a demolished house on the same lot.19

Upper Tier Coordination: The 2014 Provincial Policy Statement places an emphasis on upper-tier coordination of projections and allocations. The County Plan generally tries to provide flexibility for local Plans to establish their own settlement boundaries and to determine when additional lands are required. The Provincial Policy Statement definition of a comprehensive review does not exclude one from being conducted by a lower tier municipality. There is potential that over the course of the new proposed planning horizon, the local municipal Plans could end up with a variety of updated projections and planning horizons.

With the exception of the City of Sarnia, planning services in Lambton County are provided via a single upper tier planning department. The County's planning services arrangement allows the County as the upper tier to oversee updates and provide the coordination required by Provincial Policy Statement even if a variety of planning horizons develop in local Plans over the course of the County Plan's planning horizon.

15

Derived from detailed demolition permit data provided by Lambton County Building Services Department from January 1, 2007 through December 31, 2011. 16

Same source as previous footnote. 17

Derived from building permit data for 2001 through 2010 provided by City of Sarnia Planning Department. 18

Derived from detailed demolition permit data from January 1, 2007 through December 31, 2011 and detailed new dwelling unit data from September 1, 2008 to November 27, 2011 provided by Lambton County Building Services Department. The detailed and overlapping permit data required to determine such statistics were available for these few years and Plympton-Wyoming only. 19

Same source and comment as previous footnote.

Page 18 of 22

A policy should be added requiring municipal sub-allocations and updates of projections to be coordinated by or (in the case of the City of Sarnia) in discussion with County planning services.

Monitoring: The predicted age-specific growth rates used in the projections are based on assumptions that future growth rates will reflect trends in historic growth rates. Unexpected changes in key age groups' growth rates, if significant enough, could greatly affect population projections.

The projections predict declines for most municipalities if past growth rates continue. There is an established housing supply however and a likelihood that such declines would begin to create housing price discrepancies between municipalities. It is expected that in some situations these factors would begin to have a geographical influence on place of residence choices and lead to lesser growth rate discrepancies between some municipalities. Recent increased building permit activity and population growth in the City of Sarnia suggest this may already be happening between Sarnia and communities within commuting distance.

The County Plan already includes policies regarding the need to monitor growth projections' performance, but more detailed policies are needed about the importance of reviewing the projections' performance from census to census especially in key age groups.

Appropriate Surplus: In order to ensure Section 3.2 (8) of the County Plan is consistent with the Provincial Policy Statement, a statement to the following effect should be added: "An appropriate surplus of land should be provided in any community identified as Urban Centre or Urban Settlement on Map 1 if the projected growth for that community is such that land supply would otherwise be confined to too few properties to ensure the actual provision of the number of units needed during the planning horizon".

Establishing Growth Centres The intent of the County Plan with respect to future development in the Lakeshore Policy Area is that local Plans define which portions are to be focuses of development and which are to be protected for long-term agricultural use. This is not clear without a detailed knowledge and reading of the text of the Plan. The designation of this area as Urban Settlement and Rural Settlement on Map 1 has caused confusion. Local Official Plans have now implemented this policy and established centres of growth. Consideration should be given for retracting the settlement boundaries on Map 1 to reflect local Plans, drawing more attention to the Lakeshore Policy Area on Map 1, and/or providing clearer policies in the text regarding the role of the local Plans and the long-term preservation of agricultural lands outside of the areas designated as centres of growth in the local Plans.

Page 19 of 22

Workforce Like total population, the work force size of 73,000 projected for 2016 in the current County Plan (section 2.3(2) and chapter 3 introduction) is also not being realized. In fact it declined significantly from 1991 to 2001 and the 2006 population was only slightly greater than the 1991 population.

For projecting future workforce size, we naturally found correlation between workforce size and the population aged 15 to 64. The workforce size averaged 78% of that age group's population from 1991 to 2006. Under each of the growth scenarios in the adopted population projections report, the number of people aged 15 to 64 is expected to decline going forward to 2031. Likewise, the size of the workforce is expected to decline (see Table 7 below). We suggest 55,000 as a projected workforce size, but it should be noted that this assumes the "High" growth scenario, whereas the "Reference" scenario was adopted for population projections.

Ages 15-64 Work Force Work Force / Ages 15-64

Actual 1991 82,715 66,090 79.9%

1996 81,465 62,540 76.8%

2001 80,465 60,390 75.1%

2006 82,440 67,450 81.8%

1991-2006 Average 81,771 64,118 78.4%

2031 Projections "Reference"

Scenario 61,233 50,211 82%

"High" Scenario 67,631 55,457 82% Table 7: Historic and Projected Working Age Population (Source: 1991, 1996 and 2001 Statistics Canada workforce figures as reported in Harry Cummings & Associates' report, "The Economic Impacts of Agriculture on the Economy of Lambton County", December 23, 1999; 2006 workforce and all age 15-64 populations derived from Statistics Canada, Profiles of Census Divisions and Subdivisions, Census Years 2006, 2001, 1996, and 1991; projected populations as per 2011 Population Projection Update; Age 15 to 64 populations exclude and work force number include Indian Reserves; 2011 Census work force data not available at time of writing).

It is possible average retirement age and participation rates may increase. The 2031 workforce projections in Table 7 assume future participation rates will be greater than in the past. Still, the implications of a declining workforce size are significant firstly to the size of the local economy and secondly in light of the strain that will be added to that workforce in order to provide services and care to a larger population of dependants.

Table 8 on the following page shows past and projected ratios of the working-age population (ages 15 to 64) to seniors and children under age fifteen. Projections predict that by 2031 there will be more than one senior for every two persons in the working-age population, and that combined populations of seniors and children will be close to half of the total population.

Page 20 of 22

Employment Land Needs: With an expected decline in working aged population and workforce size, we do not foresee the need to add significant amounts of employment lands for the purpose of accommodating expected growth. This is not however to deter the designation of lands to provide for changes in the nature of employment lands needed or as part of strategies to create employment opportunities.

A policy should be added setting criteria whereby local municipalities may designate land without amendment to the County Plan to accommodate unforeseen demand for employment lands and setting guidelines for where that land should be located.

Some Comments on Addressing Potential Population Decline The County, like many other rural areas and even Western Culture as a whole, faces an uncertain and potentially instable future on account of an aging and shrinking population. While declining average household size currently allows housing activity to continue, it cannot decline forever.

The County needs to continue with strategies for job creation, youth retention and attracting immigrants (domestic and foreign). It is recognized that most, if not all, jurisdictions in similar situations are engaged in similar activities. As noted in a number of other background reports prepared in conjunction with this Official Plan review, the County needs to continue to enhance its already attractive environment in order to create and maintain a community that appeals to all age groups, family structures and personal economic circumstances, and that fosters opportunities to make a living and support future generations. These efforts can include things like creating healthy and active communities, enhancing the role of culture, preserving our natural heritage features and creating a welcoming environment for economic development and entrepreneurism. The County should continue to work with its municipal and community partners in this regard.

20

Population aged 15 to 64 is used for "working age" population. Population aged 65 and over is used for "senior" population. Populations aged 0 to 14 and 65 and over, together, are used for "dependant" population.

Actual Projected

1991 1996 2001 2006 2011 2016 2021 2026 2031

Working Age: Senior Population

84:16 81:19 80:20 79:21 78:22 74:26 70:30 66:34 64:36

Working Age: "Dependent" Age Population

65:35 64:36 65:35 66:34 66:34 63:37 60:40 57:43 55:45

Table 8: Ratio of Working Age Population to Dependant Population, Historic and Projected (Source: Actual ratios derived from Statistics Canada, Profiles of Census Divisions and Subdivisions, Census Years 2011, 2006, 2001, 1996, and 1991; projected ratios derived from "Reference" growth scenario of the 2011 Population Projection Update; ratios exclude Indian Reserves).

20

Page 21 of 22

Summary Policy Proposals: Update population, housing, and workforce projections. Allocate growth by municipality rather than sector, and allocate by where growth is

occurring. Add policies requiring municipalities to consider where growth is occurring within

their municipality and "sub-allocate" in consultation with the County. Add policies allowing for designating residential land to accommodate unforeseen

demand and requiring municipalities with low growth to maintain sufficient land supply to accommodate a minimum level of unforeseen population growth.

Add policies allowing designation of land to create employment opportunities, accommodate changes in the nature of employment land needs, or accommodate unforeseen needs for employment lands when the need arises.

Add clarification to policy 3.2 (8) to define when it would be appropriate for a municipality to intentionally designate a surplus of land.

Clarify the intent of the County Official Plan with respect to the "Lakeshore Policy Area" and the role of the local Official Plan in determining future growth patterns.

Add policies requiring municipalities who update their own population projections to do so in coordination with the County.

Add policies requiring the monitoring of population projection performance, especially in key age groups.

Add policies requiring the monitoring of average household sizes, age distribution, other related demographics, and their impact on housing demand.

Add policies requiring monitoring of Census population data and building permit statistics on a five year basis and adjustment of housing needs and allocations accordingly.

Add policies that require consideration be given to what housing types should be encouraged in light of possible future surpluses.

Add policies to encourage collaborative efforts to enhance quality of life and opportunities in order to attract and retain residents of all ages.

SUMMARY

Population and work force growth since 1991 have not met projections and do not reflect the type of growth that was experienced prior to 1991. Future projections predict decline due to an aging baby boomer population, loss of young adults, and inadequate birth and immigration rates to compensate in the long-term. These effects will become more apparent not immediately, but towards the end of the planning horizon.

Surprisingly, housing starts have kept up with projections. Decline in average household size, increases in the number of households, and the retirement of existing housing stock are the primary explanations. Average household size and the social trends and demographics that affect it have to be closely monitored and acknowledged as a major factor in housing demand.

Growth rates in key age groups need to be monitored from census to census to test the performance of the growth projections and to look for shifts in trends. Monitoring is

Page 22 of 22

needed to see how expected population decline will interact with an established housing supply.

The County work force is not anticipated to increase and the designation of additional employment lands is not considered necessary. For more information on this report, or the County of Lambton Official Plan Update, please contact the Planning and Development Services Department:

789 Broadway Street, Box 3000 Wyoming Ontario, N0N 1T0 Telephone: 519-845-0801 Toll Free: 1-866-324-6912 Fax: 519-845-3817 email: planning@county-lambton.on.ca or visit the Official Plan Update Website at:

www.lambtononline.ca/home/residents/planninganddevelopment/Pages/OfficialPlan.aspx