Community
and Protective Services Committee
Comité des services communautaires et de protection
and Council / et au Conseil
10 August 2009/ le 10 août 2009
Submitted by/Soumis par:
Steve Kanellakos, Deputy
City Manager/Directeur municipal adjoint,
City Operations/Opérations municipales
Contact Person/Personne
ressource:
Colleen Hendrick, Manager, Policy,
Evaluation and Community Partnerships Branch, Community and Social Services
Department/ Gestionnaire, Direction des politiques, de l’évaluation et des
partenariats communautaires, Services sociaux et communautaires
(613)
580-2424 x/poste 24366, colleen.hendrick@ottawa.ca
SUBJECT:
|
|
|
|
OBJET :
|
That the Community and Protective Services Committee
recommends that Council:
1.
Authorize the Manager of the City’s Policy,
Evaluation and Community Partnerships Branch to receive rent bank program
funding from the Minister of Municipal Affairs and Housing, to administer a
rent bank program in accordance with the 2009 Rent Bank Agreement and the rules
thereof, and to negotiate and execute a service agreement with a local
not-for-profit corporation to operate a rent bank program in accordance with
the requirements of the 2009 Rent Bank Agreement.
2.
Authorize all payments of rent
bank program funding on a grant basis and in accordance with Provincial Rules
set out in the agreement.
Que le Comité des
services communautaires et de protection
recommande au Conseil :
1.
D’autoriser le directeur
des Politiques sociales, de l’Évaluation et des Partenariats communautaires à
recevoir des crédits du ministre des Affaires municipales et du Logement dans
le cadre du Programme des banques d’aide au loyer, afin d’assurer
l’administration d’un programme de banque d’aide au loyer conformément à
l’Entente de 2009 sur les banques d’aide au loyer et aux règles qui s’y
rattachent; ainsi qu’à négocier et à signer une entente de services avec une
société sans but lucratif locale en vue de la réalisation d’un programme de
banque d’aide au loyer conforme aux exigences de l’entente de 2009 sur les
banques d’aide au loyer.
2.
D’autoriser
le versement des crédits du programme de banque d’aide au loyer sous la forme
de subventions, en conformité avec les règles provinciales énoncées dans
l’entente.
The City
of Ottawa has, since September 2004, received and administered “Rent Bank” funding
from the Ministry of Municipal Affairs and Housing (MMAH) which provided
financial assistance of up to two months of rent to tenants who are at the
point of losing their housing because of rental arrears. The goal is to prevent homelessness, which
is costly for both the province and municipality, and disruptive to individuals
and families including the affected children.
From
2004 to 2008, the City received Rent Bank funding from MMAH totalling $2.3 million. The City’s former Employment and Financial
Assistance Branch and the Salvation Army distributed the Rent Bank funding. The City’s Homelessness Initiatives Team, of the
Policy, Evaluation and Community Partnerships Branch, oversees and administers
the funding contract. Since January 2009, the City has contracted with the
Salvation Army to distribute all the Rent Bank funding.
Ottawa’s share of the $5 million annual provincial funding ($368,402) is determined on an equal weighting of the area’s population, level of core housing need, and percentage of renter population. CMHC defines core housing need as “households who are unable to afford shelter that meets adequacy, suitability, and affordability norms. The norms have been adjusted over time to reflect the housing expectations of Canadians. Affordability, one of the elements used to determine core housing need, is recognized as a maximum of 30 per cent of the household income spent on shelter”.
Ottawa’s Rent Bank Program
Ottawa’s
Rent Bank is mainly used by employed people with low incomes. During 2007 and 2008, an average of 318
Ottawa households per year received an average of $1,323 grant per
household ($421,000 was distributed
each year, on average).
Applicants requesting Rent Bank assistance typically have
high rent in comparison to their low incomes.
Additionally, many have recently encountered a major situation such as a
birth or death in the family, loss of employment or other change in household
income, family breakdown, etc. Many are
dealing with temporary employment, the shortage of appropriate affordable
housing, etc.
The process to assess applicants’ eligibility for Rent Bank assistance includes a review to ensure that the client will be able to afford the housing after the arrears have been paid; and an assessment to determine if the housing is appropriate for the client’s household.
Other
Arrears Programs
Where tenants are not eligible under
the Rent Bank Program, other programs exist that can assist applicants with
arrears payments to avoid eviction.
Ontario Works or Ontario Disability Support Program clients with rental
arrears are often eligible for mandatory and/or discretionary benefits that are
cost-shared with the province.
Low-income applicants may be eligible for Emergency Assistance, as well
as other benefits, to cover the costs of arrears. These are also cost-shared.
The Essential Health and Social Supports Program can also provide assistance to
low income residents. This program is 100% city funded. It is in the City’s interest to prevent
residents from becoming homeless and therefore staff will continue to work with
the Rent Bank Program to ensure that as many eligible applicants as possible
are supported to retain their housing, including households residing in rent
geared to income units.
DISCUSSION
Under the
terms of the Rent
Bank Agreement, the City is required, by October 31st 2009, to demonstrate that
City Council has:
The
new Rent Bank program’s rules, (similar to previous rules) will be effective
October 1, 2009, and are summarized as follows:
(1) To be eligible for Rent Bank assistance,
the applicant must
(2) The funding must be paid directly to the
applicant’s landlord and not to the applicant, and the amount of the assistance
may not exceed two times the average market rent for the City of Ottawa, as set
by the Ministry.
(3) Payments of Program Funding for
applicants shall be in the form of a loan and/or grant, to be used only for
rental arrears, and at a maximum frequency of once every two years. Council has
discretion to decide whether the payments are issued as a grant or as a loan.
(4) Up to 10% of the Program
Funding may be used for administrative costs.
As mentioned, CMHC recognizes housing affordability as a maximum of 30% household income contribution towards shelter. Many of Rent Bank clients are paying from 50 to 60 %, with some extreme cases paying between 60 and 70 % of their income on rent due to unforeseen circumstances. As a result, there may be insufficient income to cover food, transportation, clothing and other costs of daily living for a period of time.
This reality coupled with the fact that eligibility for Rent Bank assistance includes a review to ensure that the client will be able to afford the housing after the arrears have been paid and an assessment to determine if the housing is appropriate, provides some reassurance that issuances will stabilize the household with a one time intervention.
However,
the program’s goal of preventing homelessness would not be served if that
issuance was a loan, increasing these low-income clients’ debt loads and stress
levels as a result of the need for repayment.
Also, this program is already administratively overburdened,
notwithstanding adding loan collection to the workload.
Ten Percent Administration Costs
An
issue to many municipalities, including Ottawa, is the Ministry’s continued 10%
maximum limit on the amount of Rent Bank funding that may be used for administrative
costs, The City currently contracts with the Salvation Army to operate this
program, but given the funding reduction to $368,402, the available $36,840 in
administration funding would only allow that agency to provide less than one
full-time staff position. With the
reduced funding, the Rent Bank’s office should handle a reduced caseload of
approximately 250 annual cases as well as the related reporting, recording and
auditing requirements set out in the contract.
(The past level of service, when some of the funding was distributed by
the City, provided 318 grants per year averaging $1,323 each.) City staff has
advised MMAH that the 10% maximum administrative funding is inadequate, but
there is no indication that the Ministry is considering changes. Staff will
continue to advocate for an increase in administrative funding limits.
If the City is
unable to contract with a local non-profit organization to administer this
program after March 31, 2010, the City’s Social Services Centres may administer
the program. The City will use the 10%
administration funding, and leverage Social Services’ Centre
staff to administer the program.
Therefore,
staff recommends that Council accept the new program as written by the
province, in order to secure this program funding, without which the City’s
funding agreement will end on October 31, 2009, including the staff
recommendation that assistance be provided as grants (not loans) to avoid
placing additional hardship on City of Ottawa low-income tenants.
The Salvation Army has agreed to continue to administer the Rent Bank funding until at least March 31, 2010 provided that the funding continues to be given as grants rather than loans. Before that period expires, the City will issue an Expression of Interest to determine if an appropriate non-profit community agency, including the Salvation Army, is able to administer this program within the available funding.
The City’s Business Support & Integration Branch of the Community and Social Services Department has confirmed that if possible, all the funding should continue to be distributed through a non-profit community agency but that it will distribute the funding if that is not possible.
FINANCIAL
IMPLICATIONS
The Rent Bank program is 100% funded by the Province. If the City is unsuccessful in contracting with a local non-profit agency to administer this program, the Community and Social Services Department will deliver the program within the existing 10% administration allocation with no additional cost to the City.
There are no legal/risk management impediments to
implementing the recommendation in this report.
SUPPORTING DOCUMENTATION
Document 1- Rent Bank
Agreement with Ministry of Municipal Affairs and Housing (On file with
the City Clerk’s office.)
DISPOSITION
Community and Social Services Department will implement the decision of Council.