Why You Should Care Expiry of Operating Agreements, Even Though it’s Not Sexy

If you missed the excellent commentary by Sue Calhoun explaining the expiry of operating agreements, the affordable housing crisis, and what these mean for New Brunswick, you can read it here. The infographic below highlights what the expiry means for the Saint John-Rothesay riding.

Now is the time to make sure all politicians know that Canadians want them to do something about the affordable housing crisis in our country & community!  Please share & discuss!

NB lurches toSue's T&T Commentaryward crisis in affordable housing, Yet election candidates remain silent

By Sue Calhoun
I had a call from a journalist the other day, wondering why housing and homelessness didn’t seem to be on any political party’s agenda during this election campaign.

Good question – and one I couldn’t answer – especially since we have a looming affordable housing crisis in this country that few politicians or candidates seem to understand, let alone want to talk about.

The expiry of operating agreements for social housing is not sexy, it’s not easy to understand, and it doesn’t make for good eight-second sound bites in the news.

But it’s crucial to the future of affordable housing in this country at a time when an estimated 235,000 Canadians experienced homelessness during 2014; when an estimated 35,000 people are homeless in Canada on any given night; and when 4.8 million people in Canada are living in poverty.
Brief background. After World War II, the federal government began investing in social housing. It did this by signing operating agreements with housing providers such as non-profit organizations, Aboriginal housing providers, cooperatives and public housing operators. These provide social housing for low-income seniors, people on income assistance and the working poor.

At the peak of Canada’s social housing program in 1993, the federal government was investing $2 billion each year, and there were 600,000 social housing units through various operating agreements. Many of the operating agreements were for a small number of units, for example, a church that put up a 10-apartment affordable housing building for seniors.
The government stopped signing new agreements after 1993, and now those agreements are starting to expire. From a $2 billion investment per year in 1993 to $1.6 billion this year, the investment will be at zero by 2040, once all the agreements have expired.

The original thinking was that by the time an agreement expired, the mortgage on the building would be paid. Good theory, but errors were made in setting up the agreements. For example, housing providers were not allowed to set aside capital reserves for maintenance and repair, and many of these buildings are now in serious need of repair.
Another example, for about two-thirds of social housing units, the tenant would pay 30% of their income in rent (the definition of affordable housing in Canada), and the federal government would cover the rest. Social housing providers, in New Brunswick and across the country, are now scrambling to figure out how they will cover this major rent gap, once their agreement expires.

Some will raise rents, and some tenants will move out or be evicted because they can no longer afford their rent. Homelessness may be the end result for many of these tenants (and remember, we’re talking about seniors and single moms). An estimated 66% of people in current social housing units (334,000 families in Canada) risk losing their homes.

In New Brunswick, the expiry of operating agreements will impact about 10,000 units of housing or 76% of the provincial portfolio of social housing, according to the NB Non-profit Housing Association (NBNPHS). National research suggests that two-thirds of the portfolio will face serious viability challenges.

In Greater Moncton, an estimated 1,890 units will be impacted.
The federal government claims that it still supports social housing, and points to the Investment in Affordable Housing agreement signed with the province in April 2014. This agreement will bring $78 million into the province over five years. We’ve been told that it will bring us 300 new rent supplements (subsided housing units where the tenant pays 30% of the rent, and NB Housing pays the rest).

But, again, this is at a time when there are more than 6,000 people on the NB Housing waiting list, 2,000 of them in Moncton. And for every dollar coming into the province through the Investment in Affordable Housing agreement, an estimated $2.20 worth of federal investment will stop coming into the province because of the expiry of operating agreements (according to the NBNPHA).

I don’t think it’s an exaggeration to say that this is a crisis waiting to happen. For those of us who care about issues such as poverty, housing and homelessness, we need to put the candidates on-the-spot, to get them to do their homework, to get them to stand up and let us know what THEY and their party will do on this various serious issue.

I met with a politician lately who scrutinized the graph of the federal investment as it starts to dwindle in 1993, and continues downward to zero in 2040. After several seconds, he pointed to the downward line, and said, “Well, all you need to do to stop the line from going down is to re-invest some money. Then it will start to go back up.”

Sue Calhoun is the chair of the Greater Moncton Homelessness Steering Committee. You can find more from the Greater Moncton Steering Committee here. http://monctonhomelessness.org/

Candidate-Leavebehind-Saint John-RothesayCandidate-Leavebehind-Saint John-Rothesay2

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