City of Vancouver’s “Zero Means Zero” tax freeze in the newly passed 2026 budget will slow approvals, stall the very housing reforms the city says it wants, and undercut good paying jobs in Vancouver’s green-building industry, says Passive House builders and industry stakeholders trying to deliver multiplexes, Passive House projects and new low-carbon housing types.
Mayor Ken Sim’s 2026 budget freezes property taxes while cutting the Planning, Urban Design and Sustainability portfolio by 14 per cent. The impact of these dramatic cuts could lead to the dismantling of the sustainability and climate team and move staff to other departments, reported the National Observer. The overall budget could cut some 400 jobs across city departments, according to a leaked internal memo.
“I am really concerned about the elimination or reduction in staff on the climate and sustainability departments,” said Susan MacDougall, Founder of Focal Engineering and Passive House Canada Board Chair. “We know their team really well, which is wonderful. You can actually call someone up and ask them a question – and not a lot of municipalities can do that.”
Planning, Urban Design and Sustainability accounts for one per cent of the city’s $2.39-billion operating budget. Yet it receives a 14 per cent cut next year, dropping from $40.4 million to $34.9 million. Meanwhile, police services consume 22 per cent of total spending and rise by more than $46 million in one year.
“It’s possible to find cost savings and efficiencies in a $2.3 billion budget without impacting service levels,” said Mayor Ken Sims in a press release after the budget was passed. “We have a responsibility to do everything we can to make life affordable for those who live and work in Vancouver.”
Where the Mayor sees efficiencies others in the building industry see political machinations designed to shore up support for the mayor in advance of the next election as public support for climate mitigation has plummeted in public opinion surveys. Climate change now ranks far behind cost of living, housing, and health care, with only 13 percent of Canadians naming it among the country’s top three issues, according to Abacus Data.
“This is a naked political move to pit affordability against sustainability,” Dave Ramslie, Vice President Climate & Sustainability at Introba posted on Linkedin. “It’s a short term stunt that will have real and lasting consequences and I believe make Vancouver a worse place to live and work.”
That tension between cost and performance is exactly what recent evidence has begun to dismantle. A BC Housing study found no consistent link between higher performance targets and higher construction costs: some Passive House projects carried modest premiums, while many BC Building Code Step 4 buildings were actually cheaper to build than code-minimum counterparts. Similar findings in New York City and Pennsylvania show that as teams gain experience, cost premiums shrink and often disappear entirely. High-performance buildings become more efficient to deliver, not less.
Which is why professionals say the cuts are so counterproductive.
“When it comes to buildings, energy is actually one of the areas that can save money if it’s done right,” said MacDougall. “Perhaps there’s a slight increase in capital cost, but affordability isn’t just the initial cost of a building, it’s the cost to operate it, maintain it, and that’s what keeps rents and other home expenses lower for people who live in these buildings.”
Despite what the Mayor says, that services won’t be impacted, the cuts are an alarming story for anyone working on Passive House and high-performance buildings, say green-building professionals.
“It’s gonna slow everything down,” said Bryn Davidson, co-founder and co-owner of Lanefab, a design and construction company specialising in high-performance and laneway houses. “We have multi-plex projects in the works right now that are going through permitting where we are piloting a new type of program that combines Passive House certification with embodied carbon modeling – and if we don’t have support, it’s all going to grind to a halt.”
On top of the multiplex rezoning that ties Passive House certification to embodied-carbon modelling, there are a wave of housing and building reforms in motion, including single-stair small-lot apartment buildings, stratified laneway houses, new apartment zones, and small multiplexes in residential zones.
“There’s all sorts of new options potentially coming down the pipeline,” said Davidson. “[The housing reforms] could potentially either open up options or speed up the process, but they require staff time to make that happen.”
In advance of the budget deliberations, Davidson, MacDougall and Ramslie along with over a hundred green businesses in the Vancouver area signed a letter opposing the cuts.
The letter urged council to reject the cuts, noting that Vancouver’s green jobs have more than doubled over the past decade, HVAC and electrification manufacturing have grown by double digits, a $1.25-billion contech sector has emerged from the city’s performance standards, and mass-timber and low-carbon concrete companies are scaling for major export growth. The signatories argued that this ecosystem exists because Vancouver invested early in clear, consistent sustainability policy. Dismantling the staff who built it will put the city’s clean-competitiveness advantage at risk.
“There’s been a lot of widespread news on these cuts, and it’s unfortunate that people are changing their view of Vancouver as a city that was leading the way in sustainability,” said MacDougall.
By gutting the team that designs, coordinates and updates the green agenda, will this introduce a new kind of risk premium after 20 some years of consistent policy? Will investors hesitate? Will manufacturers look elsewhere? Will skilled staff leave for jurisdictions that are moving forward, not backwards?
“We can’t underestimate the extent to which the green building and sustainability approach that the city has embraced is really a driver of jobs and business – people moving here, people wanting to stay here – and to undercut that is just the most bizarre,” said Davidson.
Vancouver now has to decide whether these cuts are a temporary detour or the start of a slow surrender of the leadership it spent over two decades building.
