On-farm Diversified Uses (OFDUs) are identified in the Provincial Policy Statement (PPS) as one of three categories of uses permitted in Ontario’s prime agricultural areas. They may be related to agriculture, supportive of agriculture, or able to co-exist with agriculture as the primary use in agricultural areas.
Examples of OFDUs include (but are not limited to) value-added uses such as a winery, bakery, agri-tourism and recreational uses, home occupations such as a bookkeeper or daycare, home industries such as a vehicle repair shop, retail services like a farm market, and a small café or restaurant. While OFDUs cover a broad range of business types, they must meet all five policy criteria specified in the PPS. The OMAFRA Guidelines on Permitted Uses in Ontario’s Prime Agricultural Areas (‘Guidelines’) elaborate on the criteria a proposal must meet to qualify as an OFDU to balance farmland preservation with economic development opportunities. Under the Guidelines, almost any proposal may qualify as an OFDU, provided that the use is:
- Located on a farm
- Secondary to the principal agricultural use of the property
- Limited in area (e.g., 2% of farmland to a maximum of 1 ha)
- Includes (but is not limited to) home occupations, home industries, agri-tourism and value-added uses
- Is compatible with, and does not hinder, surrounding agricultural operations
Demand is increasing for OFDUs in the agricultural community. On-farm diversification contributes to the economic viability of farms and helps with farm succession planning while supporting rural economic development.
Municipalities implement OFDU policies through Official Plans, Zoning By-laws, and other municipal planning procedures. Municipalities are usually the authority that approves or denies applications for OFDUs. While the Guidelines clarify how to interpret PPS policies, municipalities may develop their own criteria for OFDUs as long as they achieve the same objectives as the Guidelines and do not conflict with provincial policy. This can result in inconsistencies in how municipalities interpret and implement the Guidelines, sometimes creating barriers to establishing legal OFDUs in prime agricultural areas and on rural lands. For example, proponents may encounter obstacles depending on local approaches and policy context, including having to secure costly and time-consuming Official Plan or Zoning By-law Amendments, meet Site Plan Control, and pay development charges. In addition, the complexity of the planning process for OFDUs may make it difficult for farm businesses to thoroughly investigate the proper steps for establishing an OFDU, and its potential impacts on their operations. This may lead to future conflict with municipal enforcement authorities or neighbours.
The OFA believes that in prime agricultural areas, the only permitted uses should be agricultural uses, agriculture-related uses, and on-farm diversified uses. Agricultural uses are promoted and protected, and agriculture-related and OFDUs are permitted if they are compatible with surrounding agricultural operations.
OFA believes that on-farm diversification opportunities are critical to farm economic viability and succession planning while supporting rural economic development.
OFA believes that OFDUs must meet all five criteria for an OFDU to be permitted, according to the Guidelines, to ensure OFDUs balance opportunities for additional income generation while preserving farmland and compatibility with farm operations.
OFA encourages municipalities to adopt policies and provisions guiding the development of OFDUs on active farm operations and parcels that are active in agricultural use (not just properties zoned for agricultural uses) to ensure farmers may benefit from the intent of OFDU policies in the PPS.
Consistent with the PPS, OFA wants municipalities to recognize OFDUs as a permitted use in prime agricultural areas and on rural lands to support long-term agricultural viability.
OFA urges municipalities to adopt OFDUs ‘as-of-right’ within their municipal Official Plans and Zoning By-laws, with precise size and scale development criteria, based on the consistent scale standard proposed in the Guidelines. As-of-right policies will assist farmers in the planning approval and recognize what is considered an appropriate size and scale.
OFA suggests that municipalities scale back application fees, simplify requirements, and streamline the process for farmers looking to establish OFDUs, where appropriate and feasible (e.g., using Site Plan Control over amendments to Official Plans and Zoning By-laws). Ensuring a timely and affordable planning approval process is critical to enabling farmers to enhance their agricultural viability by diversifying their operations.
For OFDUs, Site Plan Control should be appropriate to the agricultural area; the procedure and conditions must be designed with a rural and agricultural lens suited for the property. OFA encourages the Province to guide municipalities to design and implement a streamlined Site Plan process appropriate for the development in question at the municipal level.