Committee Transcript 2000-Nov-20 | Legislative Assembly of Ontario

Chair / Présidente
Ms Marilyn Mushinski (Scarborough Centre / -Centre PC)

Vice-Chair / Vice-Président
Mr Carl DeFaria (Mississauga East / -Est PC)

Mr Marcel Beaubien (Lambton-Kent-Middlesex PC)
Mr Michael Bryant (St Paul's L)
Mr Carl DeFaria (Mississauga East / -Est PC)
Mrs Brenda Elliott (Guelph-Wellington PC)
Mr Garry J. Guzzo (Ottawa West-Nepean / Ottawa-Ouest-Nepean PC)
Mr Peter Kormos (Niagara Centre / -Centre ND)
Mrs Lyn McLeod (Thunder Bay-Atikokan L)
Ms Marilyn Mushinski (Scarborough Centre / -Centre PC)

Substitutions / Membres remplaçants
Mr David Caplan (Don Valley East / -Est L)
Mr Brian Coburn (Ottawa-Orléans)
Mr John Gerretsen (Kingston and the Islands / Kingston et les îles L)
Mr Rosario Marchese (Trinity-Spadina ND)

Also taking part / Autres participants et participantes
Mr George Smitherman (Toronto Centre-Rosedale / Toronto-Centre-Rosedale L)

Clerk / Greffier
Mr Tom Prins

Staff / Personnel
Mr Jerry Richmond, research officer, Legislative Research Service

The committee met at 1548 in room 151.

SOCIAL HOUSING REFORM ACT, 2000 / LOI DE 2000 SUR LA RÉFORME DU LOGEMENT SOCIAL

Consideration of Bill 128, An Act respecting social housing / Projet de loi 128, Loi concernant le logement social.

PUTTING HOUSING BACK ON THE PUBLIC AGENDA

The Chair (Ms Marilyn Mushinski): I call the meeting to order.

Good afternoon, ladies and gentlemen. Please accept my apologies for the delay in getting started. Unfortunately, the orders of the House rule that we cannot start until petitions have been read.

This is a meeting of the standing committee on justice and social policy to consider Bill 128, the Social Housing Reform Act. Each group has up to 20 minutes in which you will be permitted to make your submission and for questions to be asked, if there is time.

The first group we have this afternoon is Mr Alan Redway, co-chair of Putting Housing Back on the Public Agenda. Good afternoon, Mr Redway.

Mr Alan Redway: Thank you very much, Madam Chair and members of the committee. I am one of three co-chairs of a non-partisan organization known as Putting Housing Back on the Public Agenda. We are a broad coalition of people interested in affordable housing and we come before you today in that regard. John Sweeney is the former housing minister for the province of Ontario, and the third co-chair of our organization is Marion Dewar, a former mayor of Ottawa and a former member of Parliament. I, of course, am a former member of Parliament and Minister of State (Housing) federally.

The purpose of Bill 128 is stated in section 1: "to provide for the efficient and effective administration of housing programs." However, everyone knows that the overarching purpose of the bill itself is to require local bodies to be responsible for financing and administration of social housing, known, I guess, in the media as the downsizing of the provincial role in housing.

There are very serious questions to ask about the wisdom of downsizing or downloading the financing of social housing to the local level. We, our organization, Putting Housing Back on the Public Agenda, feel this will weaken rather than strengthen the supply of existing affordable housing, and the loss of affordable housing is not in the best interests of any sector of our society. We do not support the downloading of these costs.

It's useful to set this bill in its historic context with regard to the provision of affordable housing in Ontario. The first affordable housing initiatives were undertaken by municipalities, specifically the city of Toronto with the Toronto Housing Co way back in 1912. That company constructed several projects. The city's interest in housing was renewed in the 1930s and subsequently the city initiated, financed and developed the Regent Park project in 1949. Social housing was also built in other municipalities in Ontario.

It was not until 1964 that the Ontario Housing Corp was created. OHC assumed the construction and management of existing and new social housing and the assets of local housing companies were transferred to OHC as those local companies were disbanded.

But it proved very difficult to manage housing from the provincial level, and the provincial government looked for ways of not being blamed for the problems in the management area that emerged. So in the early 1970s the then Minister of Housing in Ontario, Claude Bennett, who later served, while I was minister of housing federally, as the chair of Canada Mortgage and Housing Corp in Ottawa, made the decision that the best way to deal with that from a provincial point of view was to establish local housing authorities which would be responsible for the day-to-day management of public housing according to OHC rules. The local housing authorities would remain firmly within provincial control.

The trade-off there was that their costs were being paid for by the province and they were being operated according to provincial policies, OHC policies and rules. That of course created some distance between the minister and the management of the housing, since the latter reported to a board which included local representatives. This device split the responsibility for day-to-day management from the authority for setting policies and guidelines concerning this management.

A great number of people have noted that this separation of responsibility and authority has been at the root of management problems in public housing. Those responsible found they didn't have control of the levers of authority. It made effective management very difficult, if not impossible, and public housing has had its problems as a result ever since.

The co-op and non-profit housing that was built in the last 25 years has not suffered from the same problem since it has been directly managed, and by all accounts managed efficiently and effectively. From time to time we hear the province's concerns that this kind of housing has been a boondoggle but as yet, I, for one, have never seen the evidence of this boondoggle, and if there was some boondoggle, I don't think it applied universally; it clearly must have been some individual cases. I wish the province, if it feels there were cases where there were problems here, would present us with some actual public evidence of that, rather than making statements that it has been a boondoggle and not providing any evidence to that effect.

Every good manager in the public and private sectors knows that he or she must have the authority to manage in a manner that's responsible. If authority is hived off from responsibility, good management becomes really impossible. The breach of this simple rule of good business has bedevilled public housing in Ontario now for almost 30 years. It was a mark of difference between public housing and other forms of social housing. The only good thing to say about the arrangement was that the provincial and federal governments paid a goodly share of the cost of the subsidies needed. These costs were in the manner of income transfers, which made sense given the situation.

Unfortunately Bill 128 builds on this confused management tradition. It confirms the provincial government's refusal to provide funds to cover the costs of social housing, and it takes this separation of responsibility for day-to-day management from management authority to the extreme and applies it not only to public housing but to all other kinds of social housing as well.

The legislation gives the provincial government control over every possible level of detail in the way social housing will be managed. It creates an extreme regime of rule-setting for local authorities to follow, with the province bearing no responsibility of any kind. It also cancels existing contracts, which specify these matters for co-ops, and replaces them with a great many rules that the minister will proclaim.

In reviewing the bill, we've been unable to count the number of times the legislation includes the phrase "as may be prescribed" or the number of times reference is made to the minister's power to make regulations. We would estimate that references to one or both of these mechanisms is found, on average, about four times on every page of the legislation. This means there are more than 400 references to rules that will underpin this legislation. As a former minister, I know you need rules and regulations but there is a limit to how much-how little lack of detail there should be in legislation of this sort.

Look, for instance, at section 88, "Duties of Housing Providers." This section literally wraps the housing provider in a welter of regulations made by the minister and takes away any independent decision-making of any kind. What self-respecting manager in the private sector would wish to work in such an oppressive environment? The legislation even sets out in section 94 that it's the minister who will establish a mandate for the housing provider, not the provider itself.

We believe management is best done at the local level, with funding for income transfers required coming from the provincial and federal governments. This legislation reflects neither of these principles.

Some of the proposals in the legislation are extraordinarily complex. We have found it very difficult to make sense of the rules that will follow from section 52, for instance, about the transfer of motor vehicles. We are unable to determine what kind of corporation is set up in section 135, since this section makes the corporation being established subject to some laws but not subject to others. It says that the Corporations Act doesn't apply, but some sections of the Business Corporations Act do apply with necessary modifications. It's a pick and match arrangement that leads in circles.

The legislation purports to transfer from the province the control and ownership of this kind of housing. We believe this transfer is unclear since section 49 says local authorities can do nothing with the properties without the approval of the minister. We think a court may very well conclude that the ownership remains, at least to some extent, with the provincial government.

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The Chair: Ladies and gentlemen, I realize the room is full. There is an overflow room, committee room 2, to your right and right again; actually it's to the west. Carry on, Mr Redway.

Mr Redway: Section 49, as I was indicating, says the local authorities can do nothing with the properties without the approval of the minister. We believe a court may very well find that the province has at least some ownership in this housing. It should be noted that the provincial government is requiring the local authorities to take over buildings that are widely known to be in need of significant repair-some estimates run to over $1 billion-but not one cent is provided to cover these costs that are being downloaded. When tenants sue for non-repair, a court, in our view, would be hard pressed not to agree that the provincial government be joined as the party primarily responsible for these costs.

Management policy and responsibility for money should be in the same hands. If the province thinks it needs to exert as much control as this bill gives it over the management of social housing, then in our view it should manage this housing and cover the costs itself. It's unworkable to require local structures to pay for social housing while being forced to wear a straitjacket of provincial management rules.

Bill 128 is a step backward and is in no one's interest. It will not achieve the purpose referred to in section 1, namely, effective and efficient administration. It is flawed and in our view it should be abandoned.

The Chair: There's time probably for three one-minute questions starting with Mr Caplan.

Mr David Caplan (Don Valley East): Mr Redway, I understand from some of the history of housing that there had been a long-standing provincial demand in some quarters for housing to be transferred to the provincial level. This legislation goes one step further: it transfers it to the municipal level. I've never heard, and perhaps you can correct me, of any municipality ever requesting this kind of ability to fund and administer housing at the local level. Have you ever heard of that?

Mr Redway: Certainly in my time as federal housing minister, I absolutely never heard of that and I haven't heard of it since. While you're quite right that there are some provinces that feel housing is a provincial responsibility, they never, ever made representations to me that housing should be a municipal responsibility. Quite clearly, across Canada there are probably three or four provinces at the most that can afford to take on the responsibility of social housing. The rest of them just can't do it. In my time as a federal minister, many provinces opted out of federal programs because they couldn't afford the provincial share themselves.

Mr Caplan: Fair enough.

Mr Rosario Marchese (Trinity-Spadina): I first want to congratulate all three of you, the co-chairs, for the work you've been doing voluntarily, each coming from separate parts of the province.

My question has more to do with the funding. My biggest preoccupation is that we're going to be funding for housing from the property tax base, from homeowners, tenants, and yes, to some extent business as well. That's my biggest worry. It should be coming out of provincial income as opposed to property tax. Do you want to comment on that?

Mr John Sweeney: It's interesting to note that the province made the decision a little while ago to take the cost of education out of the municipal tax base and put it at the provincial level. We would certainly say that the same thing ought to be true with respect to social housing. It makes even less sense that the cost of this particular service be at the local property tax base, particularly, and again I would ask someone to look at the rationale, when the municipality has only, for all practical purposes, the property tax base. It has no access to sales tax or gasoline tax or income tax, and on and on the list goes. So it really is quite inappropriate to be put at that base. There's a big difference between saying that the management, even the administration, of social housing could be at the municipal level but the costing, the financial responsibility for it, simply can't be, and as my colleague has already pointed out, it will not be efficient; it will not be effective. Our concern is that if this goes through, things are going to get worse. They're not going to get better.

Mr Marcel Beaubien (Lambton-Kent-Middlesex): As a former municipal politician I appreciate some of your comments. I must admit I agree with some, but others I certainly don't agree with. First of all, I think there are other ways of providing housing. I think Habitat for Humanity has been working on all the continents of this world and I think they give title ownership and it does work. There are programs that work.

I think Mr Redway mentioned that you fail to see where the boondoggle is. My question to you would be, I think the market value of the public housing stock is about $4.5 billion and I think the debt load on that is about $8.5 billion. Could you explain that to me if that's not a boondoggle, sir?

Mr Redway: I'm not sure that makes it a boondoggle. Obviously the cost of land has varied over some period of time. As you know, it was much higher in the late 1980s and the mortgaging provisions that were put in place at that time certainly reflected the fact that the fair market value of that land was there at that time. It may have changed. I can tell you right now I just closed a real estate deal in the private sector on Friday where commercial and residential buildings were bought for about $650,000 in the early 1990s and were sold now for something in the neighbourhood of $390,000. That's the private sector and that's what happened to the cost of land and the mortgaging that was put in place at that time.

The Chair: Thank you very much, Mr Redway and Mr Sweeney, for your presentation.

Mr Sweeney: Can I just make one observation?

The Chair: As long as it's no more than 10 seconds.

Mr Sweeney: With respect to Habitat for Humanity, as the former chair of their national board I can tell you they do wonderful work, but the potential impact is considerably below what the need is. In our area we produced about 40 houses. The need is for 4,000.

The Chair: Thank you, Mr Sweeney. Ladies and gentlemen, we are under a very tight time schedule, so I would ask you to please try and refrain from too many expressions of applause.

Mr Beaubien: Do I get a 30-second rebuttal?

The Chair: No, you don't, Mr Beaubien.

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PUBLIC HOUSING FIGHTBACK CAMPAIGN

The Chair: The next presenter is Ann Fitzpatrick, of the Public Housing Fightback Campaign.

Ms Ann Fitzpatrick: My name is Ann Fitzpatrick. I'm a member of the Public Housing Fightback Campaign on behalf of the Children's Aid Society of Toronto. I'm joined by tenants Yasmin Maharaj, Arlene Goneau, Cliff Martin and Carolyn Fenn. Regrettably, more tenants and organizations do not have a chance to speak to you today. On a bill of this magnitude, two afternoons is simply insufficient and undermines the democratic voice of those affected.

We began in 1995 to oppose the government's plan to sell off 84,000 units of public housing, an action that would impact over 200,000 children, parents, seniors and disabled people. More recently, through letters to the minister, we opposed the plan to sell off 5,400 units of public housing for families. To date, thankfully, social housing stock has not been sold off but Bill 128 opens this door to sell-offs.

This downloading bill will undermine social housing in many ways, which the tenants will speak to. Public housing is one of the most cost-effective forms of providing housing to people in need, and we cannot risk losing this housing. The option of shelter allowances to private landlords will cost two to four times that amount. The Ontario government committed to provide 10,000 households in need with rent supplements in private housing in 1999, but in Toronto they're having difficulty in finding landlords to meet these targets.

Our overarching alarm is that this legislation leaves so much open to the discretion of the government of the day to set regulations without public hearings and debate in the Legislative Assembly. Tenants deserve input into the future of their homes. At the Children's Aid Society of Toronto housing and homelessness is a factor in almost one in five admissions to care. This costs $1,700 a month for each child in care. Contrast that with the previous cost to the province of about $200 per month for a public housing unit. A strong social housing safety net is a cost-effective investment.

We urge you to withdraw this bill or, at the very least, ensure that regulations developed on this bill go to public hearings across the province and go before members of the Legislative Assembly. I'll turn it over to Yasmin.

Ms Yasmin Maharaj: Good day. My name is Yasmin Maharaj and I'm a parent and tenant living in the Jane-Finch community.

Supply of rent-geared-to-income housing: There are concerns that the supply of affordable housing will be reduced. The bill is too vague, and tenants will have to wait for regulations on many matters to see the real impact on their lives and on their housing. For example, how many rent-geared-to-income units will be targeted in plans for Toronto? In future years, will cities act on their powers to reduce RGI housing further? The bill states that cities could increase subsidized units in Toronto by up to 10% of the target in plans for RGI housing. In public housing in Toronto alone, this would be a loss of about 2,900 units. This is shameful at a time when we have over 50,000 households on waiting lists for social housing in Toronto.

Affordability. This bill does not say whether rent-geared-to-income rents will be set at 30% of family income or whether it will be higher. As a tenant on a fixed income, I can tell you we cannot afford higher rents without a cost to our health and welfare. Tenants who live in public housing have seen the housing get less and less affordable over the years. At the same time, their incomes have dropped. Many of us pay new user fees imposed by MTHA for parking and utilities. These fees can be hiked up dramatically with little notice to tenants. With the city burdened to pay for social housing, we are worried about more and newer user fees and higher rents. Without affordable housing and social housing, we will have more hunger, more use of food banks, more economic evictions, more homelessness.

Eligibility for social housing and future integration social services: It seems that this bill gives the city the power to centralize a process where tenants are assessed for eligibility and rents are set. Disabled people, seniors and others may not want to go to a local welfare office to deal with their social housing eligibility. This is not as accessible for tenants who prefer to deal with their housing providers locally. Who is eligible for housing under the new bill? Again this is left up to regulations. Will the government in the future make regulations that will integrate benefits and make tenants ineligible to receive benefits for more than one program, for example? If you live in public housing, will you be eligible for OSAP or child care subsidy or even welfare?

I will now turn it over to Arlene Goneau.

Mrs Arlene Goneau: My name is Arlene Goneau. I live in public housing with my family and children and am co-chair of Jane/Milo Residents' Council. For tenants like myself there are no private rental housing options. You just have to look in the newspapers. Those rents are not affordable since rent controls came off vacant apartments. We need to keep our social housing. I am concerned about this law for two main reasons: this law opens up the city's right to sell off some social housing units and contract out and privatize more public housing management.

Tenants have opposed provincial plans to sell off units of social housing for the past five years. Now this bill gives the cities the right to sell off units if the minister approves it. Where would those tenants live? What options does this give when they're kept on a huge waiting list for social housing? What does that do to the housing supply that tenants and governments have paid for as an investment in a social safety net? If all social housing units are sold, where does the money go? There are criteria to sell off units. For example, could the city sell off where they have a long social waiting list?

Low vacancy rates: Public housing is not just a service provided by the government; it's our home, our community. People like me try to make a healthy place for our children to grow up. Families paying 80% of their incomes on rent or living in shelters do not have a fair chance. We want to live in housing that is publicly accountable. I know first-hand that privatization is a real threat, because MTHA were planning behind closed doors to privatize my building and others in my community. Our residents' council fought it with other residents' councils in the area, and thank God we were able to stop it. Privatization might save money because there are cuts in staffing, cuts to staff salaries, cuts to budgets, and all these savings are at the expense of tenants' well-being and quality of life.

Private companies that want to make a profit: We would rather see public rent dollars go to bettering communities and making necessary repairs instead of draining funds from the community. We also want qualified staff who are trained and sensitive in dealing with tenants. As a tenant I want to be able to deal with a housing provider who is accountable to tenants, who know best the conditions in their communities and their needs.

Mr Cliff Martin: My name is Cliff Martin. I'm the co-chair of the St James Town Tenants' Council. I want to talk to you about a few concerns I have about this bill.

Say for pay and tenant participation in housing and planning: The Ontario government talked about the downloading legislation setting the ground for more say for pay for cities because they will fund and manage social housing. Tenants demand the same too. We pay 59% toward operating costs of MTHA, giving us the majority stake in our future homes. In fact, we pay a higher percentage than the other two senior levels of government in operating costs.

The potential for so many changes with no tenant input is devastating. Both the federal government through CMHC and the provincial government through OHC at various stages in history have valued tenant participation in planning and decision-making in social housing communities, and it's been cost effective. This bill is silent on the responsibility that service managers or housing providers have to involve tenants. We need some provincial standards to set out the expectation that cities cannot ignore the voices of tenants in the future management of social housing.

Regulations need to be approved by the Legislature. It is troubling to tenants that Bill 128 leaves the most important decisions up to regulations. This leaves tenants in legal limbo. What are you really supposing? Why not be clear and put them on the table so they can be debated?

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For example, you have not guaranteed that the 84,000 public housing units across Ontario will be preserved, of which 29,000 are in Toronto. It seems that the cities will have the door open to sell off units, to make more of them market-rent units or to move from providing homes to rent-supplement agreements with private landlords instead.

I do not support legislation that gives zero protection to tenants. It's not social housing reform; it's just dumping the responsibility.

Furthermore, the bill has no overarching preamble that spells out high principles other than the downloading of the housing. There's nothing to ensure efficiency or effectiveness. Tenants would like to see a statement of purpose that spells out our government's commitment to live up to the international UN agreements on the right to housing and the government's role to preserve and expand social housing programs to meet the needs of citizens, and that spells out the value of involving tenants in the planning and administration of their communities.

I'd like to turn to Carolyn Fenn for conclusion.

Mrs Carolyn Fenn: Good afternoon. My name is Carolyn Fenn, president of the Greenbrae Resident Group. I will be making the concluding statements.

I am a disabled senior and a veteran's wife and have lived in a Metropolitan Toronto Housing Authority apartment for several years. As a senior on a fixed income, I rely on a rent-geared-to-income subsidy. I have been a president with residents' groups and associations in MTHA communities over the past 24 years and have played a key role in my community.

For many like myself, social housing is an essential part of our safety net. This housing was originally built for veterans and their wives. Now I'm finding in my golden years that I have to worry about the stability of my home.

Downloading will lead to disrepair and poor quality of housing. I am concerned that this bill will result in more disrepair and neglect of our homes. With the budget cuts over the last number of years and the move to private management, our buildings are falling into more and more disrepair.

Your government has not carried out an independent and thorough audit of the physical condition of each and every building. I understand this government did an assessment of about 10% of the units across Ontario. Peel region estimated it will cost $2 billion to make necessary capital repairs across the province. In Toronto, many of our public housing buildings are 30 or more years old. They are in need of serious repairs.

Your bill states you will not be liable for any repair needs after the properties are transferred. This is not a responsible action. Your government reminds me of the Grinch who stole Christmas. You should do a proper audit and should be liable for the capital dollars needed to fix the buildings up to standard. It is unfair to put this burden on the property taxpayers of Toronto and other cities in Ontario. I want to live in dignity. I don't want to live my golden years in slum housing.

Let me give you an example. In my community, we have units with mould that is just painted over and over again. This is a toxic substance and can lead to health problems. We have extensive flooding of apartments caused by holes and damage in the bricks on the exterior of the building. MTHA, now through a private management company, does Band-Aid work, making the building look nicer but not dealing with the root of building problems.

Others have presented the risk of selling off units or a reduction in rent-geared-to-income assistance. I echo their concerns. What kind of province allows people to live on the streets and puts our homes and security at threat? I don't want any changes where I am uprooted at my age from my home. As a member of the Royal Canadian Legion, we always say, "Lest we forget." I am a voter and I shall remember.

Thank you on behalf of Public Housing Fightback. We hope you heard our concerns.

The Chair: Thank you very much for your presentation this afternoon. Unfortunately, we are running so late that there won't be time for questions today.

PRIORY SQUARE CO-OPERATIVE HOMES

The Chair: The next presenters are Scott Piatkowski and Keith Brown of priority square co-op homes. Good afternoon, gentlemen.

Mr Scott Piatkowski: Madam Chair, members of the committee, thank you for the opportunity to address the standing committee on the important subject of Bill 128, the Social Housing Reform Act. My name is Scott Piatkowski and I am the coordinator of Priory Square Co-operative Homes. It is Priory Square, although we do consider housing to be a priority.

This is Keith Brown, the president of the co-op. We are speaking to you today on behalf of the 120 members and more than 140 children living at Priory Square co-op.

Mr Keith Brown: Priory Square is an 82-unit townhouse co-operative located at the south end of Guelph. Like all housing co-ops, we are proud and fiercely protective of our independence and autonomy. We feel we have earned the right to manage our housing by doing so effectively over the past nine years through our elected board of directors and our eight standing committees.

Co-op members are expected to be involved in the community, and the vast majority of them are. On October 1, for example, more than 85% of our members attended our 10th annual general meeting. This three-hour meeting included approval of our audited financial statements, election of board members, passage of three new co-op bylaws and a question-and-answer session with candidates in the municipal election. We could talk about our co-op all day, but due to time restrictions we would instead invite members of the committee to visit our Web site at www.priorysquareco-op.on.ca.

The board, members and staff of Priory Square Co-operative Homes are very concerned that Bill 128, the Social Housing Reform Act, would undermine the very qualities that make the co-op such a great place to live. While we continue to question the rationale for downloading housing to the municipal level, in the interests of time we will focus our remarks on trying to improve the proposed legislation. We recognize that the government has more than enough legislative votes to pass this bill, but we are hopeful that members of all parties will be open to making improvements to it.

Mr Piatkowski: Currently, Priory Square has an operating agreement with the province of Ontario which sets out the roles and responsibilities of both parties. This legislation would unilaterally cancel that agreement and place the co-op's operating rules under legislation and regulations that can be amended or clarified without any consultation with housing providers.

The bill also creates additional levels of bureaucracy. Instead of dealing solely with the Ministry of Municipal Affairs and Housing, our co-op will now be dealing with the ministry in areas relating to mortgage renewals and program framework, with the county of Wellington on matters of program administration, and with a new province-wide Social Housing Services Corp on reserves, insurance and purchasing. Each of these layers of accountability may in fact impose new rules and new reporting requirements.

Mr Brown: Our members are most concerned about the proposal to have municipalities take over the administration of rent-geared-to-income assistance, also known as RGI. Municipalities would be in the position to make all decisions relating to eligibility, including setting the local rules, income verification, housing charge or rent calculations and payment deferrals.

While the legislation allows municipalities to contract with another party to administer this program, there is no requirement that housing providers be consulted in this decision. Furthermore, while co-ops and other non-profit housing providers would obviously want RGI administration delegated to them, essentially preserving the current situation, the legislation does not specifically mention them as a potential administrator, only as another person.

Mr Piatkowski: There are a number of reasons that municipal administration of RGI programs would be considerably less efficient and less desirable than the current system of administration by individual housing providers.

When a member of Priory Square co-op experiences an increase or decrease in income, they are able to come to the co-op office, present their new income information, and actually wait while their new housing charge is calculated. This often occurs in the last several days of the month. It allows members to present a cheque to the office immediately. Both arrears and retroactive adjustments in amounts owing are avoided under this situation. With all due respect to Wellington county social services, this kind of responsiveness and sensitivity would simply not be possible under municipal administration. The larger the system, the more difficult it is for people in the system to get answers.

Furthermore, co-op members appreciate the ability to sit down with co-op staff people for an explanation of their calculation. It simply doesn't make sense to force them to visit the social services office more than four kilometres away in order to defer payment or submit new income information. Members vastly prefer dealing with the one person they know in the co-op office, who is just steps away from their unit.

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Because less then 10% of members receiving rent-geared-to-income assistance are currently involved with the welfare system, municipal administration would drag people into a system with which they have no other reason to interact. Many co-op members justifiably take pride in having "escaped" from this system and they really don't want to be re-stigmatized by the changes proposed in this legislation.

Lastly, we believe there may be a perception that co-ops are not sufficiently vigilant in monitoring potential incidents of fraud. In fact, co-op boards and staff are far more effective at detecting fraud than municipal bureaucrats could ever be, simply because we are on the ground. Priory Square has a good record of uncovering income which has not been reported and has in fact evicted several households which have been guilty of this practice. We take our responsibility to administer public funds very seriously and we're very much aware that any incidents of fraud that are not dealt with undermine the integrity of the system as a whole.

Mr Brown: We do not believe that RGI administration should be transferred to municipal service managers until the service manager has consulted with housing providers and presented a business case for this change. Specifically, we are asking that a new subsection be added to section 71 of the bill, requiring such consultation and requiring that a business case be presented. If this change is made, we are confident that most municipal service managers, including the county of Wellington, will conclude that RGI administration is best left to housing providers.

We appreciate the opportunity to appear before this committee and we hope that the members of the committee will agree to the changes which we have proposed, as well as those proposed by other housing co-ops and co-op housing organizations that will be appearing before you. We have provided you with a written copy of our remarks, but rather than a separate attachment of amendments, we will refer you to ones being provided by the Co-op Housing Federation of Canada (Ontario Region). We ask the clerk of the committee to include these documents in the records of these hearings. Thank you very much.

The Chair: Thank you, Mr Piatkowski and Mr Brown. There's time for about one question each. Mr Caplan.

Mr Caplan: Section 88 of the act outlines the duties of housing providers and I'd like to get your opinion on some of these. "Every housing provider is required to meet such provincial requirements as may be prescribed." It goes on to say, "The housing provider's corporate structure, including its constating documents and bylaws; ... the housing provider's operation, management and maintenance of ... projects and it's selection of property managers; ... " In fact, I think it even goes on to say the province will have the power to appoint who is going to be on your board of directors.

You've described the nature of co-ops. How are some of these duties and changes going to affect the nature of Priory Square Co-op in Guelph?

Mr Piatkowski: We're actually very concerned, as we indicated, that the provisions undermine the very nature of housing co-ops. The reason that housing co-ops work so well is that their boards of directors are selected by election from among their members. There are provisions within our co-op bylaws to remove directors who are behaving improperly and elect new ones from among the membership. The aspect of the legislation to which you referred allows the province, or the municipal service manager, to appoint directors from outside the community who may in fact have no ties to the community and no knowledge of the needs of the community. Yes, we are very concerned about that and the ability to pass regulations without consultation. "As might be prescribed" is a term that comes up far too often in this legislation for our liking.

Mr Marchese: I may have missed the first part of your presentation, but did you comment on some of the things that were covered by the Co-operative Housing Federation?

Mr Piatkowski: We did.

Mr Marchese: More bureaucracy and less autonomy, the continued financial uncertainty in terms of surplus dollars, and no new housing. Did you-

Mr Piatkowski: We touched on the autonomy issue. We're leaving it to our good friends to bring up the other issues. As Mr Brown indicated, we fully support the amendments that are proposed in this rather thick document.

Mr Marchese: Thank you.

Mr Beaubien: Mr Brown, Mr Piatkowski, thank you for your presentation. You seem to have some concern with the RGI administration and you suggest that, under section 71 of the bill, changes should be made, but when you talk about making a business case for this change, what are you trying to tell me?

Mr Piatkowski: We're not convinced that such a case exists. We don't think it would be a good idea. We think that if the municipal service managers were required to make such a case, they would come to that realization as well. We don't think they have the capacity or the same expertise that we have, or the ability to administer them as effectively as individual housing providers.

Mr Beaubien: So you have concerns they may not be able to respond to the needs of the tenants quickly enough?

Mr Piatkowski: Exactly.

The Chair: Thank you, gentlemen.

PEGGY AND ANDREW BREWIN HOUSING CO-OP

The Chair: The next speaker is Mr Du Maresq of the Peggy and Andrew Brewin Housing Co-op, Toronto. Good afternoon.

Mr Michael Du Maresq: Good afternoon, Madam Chair. My name is Michael Du Maresq and I have been a member of Peggy and Andrew Brewin Housing Co-op in downtown Toronto since it first opened in 1995. We are about to celebrate our sixth anniversary of existence.

Brewin is a virtual microcosm of the city of Toronto. We have members of different races, religions, sexual orientations, socio-economic backgrounds, individuals dealing with long-term illnesses and people with physical or developmental challenges. We are one of the few co-ops in the city that has units designed for visually or hearing impaired.

When I joined my first committee at Brewin, I met a woman who was terrified at the thought of getting up to speak in front of a room of people. Since then, in the course of five years, she has joined our board of directors and regularly addresses our members meetings with complete confidence.

Last spring I went to a funeral for one of our members, surrounded by other people of our co-op. A member of our community had died and we were there to mourn his passing.

At the last provincial election, I helped a developmentally challenged young woman vote for the first time because the process previously intimidated her. She left that polling station with a confident smile on her face.

These are just random examples of what grows from a community of co-op members. The Brewin community has a direct impact on our lives whether its providing a safe place for a woman coming from an abusive environment or instilling a sense of accomplishment to a young woman voting for the first time. Its benefits are incalculable in enriching our members' lives and those of the greater community at large.

It has been the express purpose of our board and staff to be inclusive and provide safe affordable housing for vulnerable people. We have agreements with social agencies to provide housing for abused women, people living with HIV/AIDS, and the developmentally challenged. Any new members are made aware of our community and educated about how it works. It is a community that has obvious demands that are met by a committed and sensitive board and staff.

We have several committees that range from the pragmatic duties of gardening and night-time security to community builders like the social committee. Members take care of each other, and take pride in their home, helping in its maintenance both physically and spiritually.

What struck me about first moving into Brewin almost six years ago was that it was like no other building I had lived in in the past. We are self-governed. I know a request for something to be changed or fixed in the building is taken seriously and done. I see members participating by coming to meetings, volunteering in the office, planting flowers or helping neighbors with groceries. With the investment of time and energy came a genuine concern for our home, and further still, a sense of pride in our home, not to mention the fiscal responsibility of members doing work as opposed to hiring outside contractors.

The vision statement of Brewin Co-op states, "Our goal is to provide ongoing education and training for our members-our human resources-so they can play an active part in the management of the co-op, take advantage of their rights as citizens and realize their own potential. We recognize the building we live in requires care and attention as well-a community resource which must be wisely tended to serve our needs and those of future residents."

A copy of our vision statement has been attached.

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Bill 128 puts all our community's hard work in jeopardy, in particular, taking away the administration of RGI, rent geared to income, and handing it over to one large body. The sensitivity of the issue of personal income, coupled with the unique circumstances of individuals in our community, would be seriously undermined by a cookie-cutter, anonymous municipal office's decisions. Why replace a system that already works quite well as it is? Only a knowledgeable and interested manager such as ours can best serve the needs of the individuals at Brewin in this regard.

We at Brewin are also opposed to legislation that will take away our self-government, including administration and budget planning. The co-operative housing movement has a long history in this province, with a solid base of support mechanisms to ensure a viable housing option for lower-income people. Handing over the administration to an already overburdened municipality can only result in a great loss of service and financial instability. Leave the administration in the already capable hands of the members, boards, staffs and the co-op housing support sector. It's only common sense, a phrase many of us in this room are familiar with.

Brewin, and indeed all city of Toronto co-ops, fully endorses all the recommendations made by CHF Ontario to Bill 128, a copy of which has been submitted to the committee. We ask that you give them serious consideration when you deliberate over this bill. We are witnessing an erosion of many social services in our province, placing vulnerable people at even more risk. Housing is a human right. The members at Brewin co-op believe that co-operative housing is an effective, reliable and vital part of our society. We hope the committee will see the wisdom in its existence and seriously consider the amendments to Bill 128 proposed by the co-op housing sector. Thank you.

The Chair: Thank you very much, Mr Du Maresq. There's time for about one question each.

Mr Marchese: Thank you for you submission. I'm not as optimistic about your last sentence, "We hope the committee will see the wisdom in its existence." I wish I could say that was the case. One of the exciting things and one of the most efficient things that you do as co-ops is that you manage your own affairs. My fear is that these folks just don't understand what you people do. Do you get that sense too?

Mr Du Maresq: I would extend an open invitation to any members of the committee to come and visit our co-op. It's only about a 10-minute walk from here. You could come on your lunch hour. Seriously, we've had other politicians. We welcome it. I'm chair of the political action committee and I invite anyone who would like to come and pay us a visit and speak with some of our members if you would like more exposure or just more knowledge about a co-op in the city. I can give the number to the clerk.

Mr George Smitherman (Toronto Centre-Rosedale): Michael, welcome to the committee. I had the opportunity to attend the official opening five years ago with Barbara Hall. I wanted to ask you a question about community, but you've covered off in a rather compelling way the extent to which members go to take care of one another.

The riding we both call home is home to a variety of thousands of units of public and social housing. I had the opportunity recently to canvass in Regent Park, which is owned and managed by MTHA, and I found countless empty units. I'm wondering if you can comment, because I think that might be the only thing that appeals to these guys, in terms of the management practices there. What has been the policy around vacancy rates? How have you managed those?

Mr Du Maresq: We take that very seriously. We have a very diligent manager and board who are very conscious of that. I can say that as a former board member of Brewin housing co-op. There was an example of that and we do try to stay on top of that, and we thankfully have a very good manager who is good at seeking that out and making sure it's taken care of.

The Chair: Thank you very much, Mr Du Maresq.

CO-OPERATIVE HOUSING FEDERATION OF CANADA

The Chair: The next presenters are Joyce Morris and Dale Reagan from the Co-operative Housing Federation of Canada.

Ms Joyce Morris: Thank you for the opportunity to speak today about our concerns regarding Bill 128, the Social Housing Reform Act. My name is Joyce Morris and I am the president of the Ontario council of the Co-operative Housing Federation of Canada. With me is Dale Reagan, managing director of our Ontario region office. A number of our members are here, as you've noticed, to witness these proceedings. We have a written report for the committee, that's the rather large book in front of you, which includes my presentation, a more complete brief, a set of our recommendations around the bill and of course an interesting stack of letters from our members.

About 21,000 co-op households across Ontario are directly affected by this bill. These co-ops provide a good home to more than 55,000 men, women and children. Our members have three grave concerns about Bill 128.

First, more bureaucracy and less autonomy for housing co-ops: Bill 128 cancels hundreds of long-term contracts between housing co-ops and the provincial government. It shifts housing programs from one provincial administration to 47 municipal service managers. It adds more layers of administration. It takes away services that co-ops have provided well and sensitively to our members and hands them to government to deliver through centralized bureaucracies. And far from giving co-ops the business independence promised, it gives governments more power.

Second, continued financial uncertainties for co-ops: The funding model has flaws that need to be fixed. It taxes away operating surpluses of co-ops that budget and spend wisely. The formula for payment to municipalities is too aggressive, and the bill contains no measures to deal with underfunded capital reserves.

Third, no new housing: At a time when the province-wide housing crisis has reached desperate levels, this bill does nothing to create much-needed new affordable housing. It simply leaves the job to municipalities, which can't afford it. Co-op members do not support the policy behind this bill. We don't think social housing should be downloaded to municipalities. We're not alone. Non-profit housing providers are opposed. The Association of Municipalities of Ontario and most municipal leaders are also against it. So is the business sector, such as the Toronto Board of Trade. Even experts appointed by the Ontario government, such as David Crombie, say that housing is a provincial responsibility. It's hard for us to find anyone who supports downloading.

However, we recognize that the government is committed to this legislation, but we have a warning: let's get it right at the onset or get ready for serious consequences down the line. In our brief we have listed a series of amendments to correct what we believe are the major flaws in the bill.

Bill 128 is no simple administrative transfer. There has never been legislation like this in the history of Canada. For the past three decades, every federal and provincial housing program has been based on the premise that the government and the community-based housing providers are partners in the delivery of affordable housing. The details of this partnership, including the rights and responsibilities of each party, are spelled out in legally binding contracts called operating agreements. Co-ops signed these agreements with the province in good faith. In turn, we expected that the government would honour its legal obligations.

Bill 128 tears up these operating agreements. Instead of a contract that we can rely on, housing co-ops have legislation, regulation and several additional layers of administration. The bill badly erodes the community-based model of social housing and hands service delivery in key areas over to the government.

Co-ops are proud of our record of success. For three decades we have been developing and managing affordable housing. We have created wonderful communities based on a common identity, mutual support and shared values. People want to live in our co-ops because they are great places to live. We are determined to protect our homes. We want to make sure that our co-ops remain strong, healthy and financially secure for years to come. Let me tell you, gentlemen, my grandchildren live in a co-op and I want their grandchildren to live in a co-op.

Our pride in our homes, and our determination to protect them, comes through clearly in the hundreds of letters that co-op members have written to this committee, to their MPPs and to the Honourable Tony Clement, Minister of Municipal Affairs and Housing in recent months.

Co-ops are remarkably successful but we're not content with the status quo. Since the early 1990s, co-ops have been urging the Ontario government to reform provincial housing programs.

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We want a more business-like relationship with government. We are prepared to make trade-offs to achieve our goals, including paying back more of the operating funding that we receive. But in exchange for taking on more responsibility, co-ops need reasonable assurance of economic viability in the long-term and significant operating independence.

Bill 128 doesn't create a more business-like relationship. It adds more administration. And it fails to deliver the funding stability that co-ops are looking for as the bottom line of reform. The bill also falls far short of the commitments made by Minister Tony Clement. The minister has promised to "reduce government duplication and bureaucracy" and to create an "improved and more cost-effective social housing system" with "simplified administration." In a background paper, ministry officials have said that "providers would gain more autonomy." Bill 128 fails to deliver on these promises.

I would like to point out several areas of concern about Bill 128 and identify changes that are needed. Our brief has much more detail on these issues.

Our first broad area of concern is that the bill creates more bureaucracy and reduces co-op autonomy. Lots of concerns fall under this issue. Most fundamentally, the bill fails to recognize the role of co-ops and other housing providers as partners in the delivery of social housing with rights and responsibilities. We are asking for a clear recognition of the critical role of housing providers in the very first clause of 128.

Second, by cancelling co-op's operating agreements, the bill replaces a contract-based model with a system that relies on legislation, regulations and municipal rules, all of which can be changed whenever the government chooses. Co-ops have less operating certainty, faced always with the likelihood that more rules will follow and that the rules will be changed.

Co-ops want as many of the contractual commitments contained in our current operating agreements as possible to be enshrined in the legislation and not left to regulations. We're also asking you to delete section 89, which permits local standards to be set, along with provisions that allow local rules. If the bill does allow service managers to set any local rules, it must be amended to require them to consult fully with housing providers before setting or changing local rules. Our brief sets out the minimum amendments we consider necessary.

Co-ops are very concerned about plans for the Social Housing Services Corp. There is no need for this new body and layer of administration.

The province has decided to retain responsibility for two key functions: mortgage renewals and risk management. Several of the functions assigned to the corporation, such as group insurance and bulk purchasing, are already being done effectively by sector organizations.

The co-op and the non-profit sector groups have developed a credible plan to allow for the pooling of capital reserves of housing co-ops and non-profits and educate providers about capital reserve planning.

The benchmarking and best practices functions proposed for this corporation can be done by sector organizations. The province can take responsibility for the rental cost indices used in the funding formula.

Co-ops want you to delete the sections on the Social Housing Services Corp. Let sector organizations get on with the job of serving their members, something we do very well. If you're not prepared to do this, we ask you to make the detailed changes we propose in our brief to limit the scope of this corporation.

We are also concerned that the bill allows excessive oversight and intrusion into co-op operations. The government and housing providers share the goal of streamlined administration. The bill, however, moves us in entirely the opposite direction. It creates excessive reporting requirements and open-ended power for service managers to interfere in the operations of providers. Our brief contains detailed recommendations on amendments to the bill. Note in particular, please, the amendments to sections 110 through 116.

We are concerned about planned changes to rent-geared-to-income programs. We believe the powers given to municipalities to set local rules will result in a patchwork of service levels. This bill needs to set out strong provincial standards that apply right across the province.

Our members and non-profit housing providers are alarmed by plans to move from cost-effective, on-site administration of RGI programs to delivery by government through municipal agencies. They believe it will add cost, reduce service to applicants and fundamentally change the face of our co-op and non-profit housing communities.

We are asking the committee to stop the shift of RGI administration from the community to municipal government. Municipalities should be required to prove that a government delivery model is more cost-effective and leads to better client service than on-site administration by housing providers. And the service manager should be required to consult with housing providers before making any changes to service delivery.

If municipalities do end up taking on delivery of RGI programs, business protection for co-ops must be built into this legislation. Decisions by municipalities about RGI assistance can have significant financial impact on co-ops. The rules must provide that co-ops will not be financially penalized as a result of decisions made by municipalities.

We appreciate the promises from the minister to protect the number of households being assisted and the current mandate of co-ops. The legislation, however, falls short of his goals. We are asking the committee to amend sections 93 and 94 to make it clear that existing levels of RGI and provider mandates are fully protected.

Section 65 requires the municipal service manager to set up waiting lists for RGI applicants. Our experience with the current, more limited coordinated access systems across this province runs from well run to badly flawed. We believe the legislation should be amended to say that the current rules about coordinated access will continue to apply.

Municipalities should be required to consult with providers about how to set up better local systems to improve access to affordable housing.

I also want to comment on concerns with the new funding model. The proposed funding formula transfers the full risk of cost increases to housing providers, but leaves them ill-equipped to manage that risk. Four elements of the funding model need to be reconsidered. The model requires that co-ops share operating surpluses with municipalities, even after making a mandatory payment.

Surpluses arise when a co-op manages its finances effectively. A model that forces co-ops to pay half of any surplus to municipalities encourages a use-it-or-lose-it approach to spending. We are asking the committee to delete provisions in subsection 98(10) and elsewhere on the sharing of surpluses. If you won't recommend this change, then allow co-ops to prudently use that surplus first to deal with accumulated deficits, liabilities carried over from the existing program, operating reserves or capital reserves before paying out a share to the municipality.

The formula for mandatory payments by co-ops to service managers is too tight. It assumes that the rate of increase in market rents is always greater than the rate of increase in operating costs. This is certainly not true today with rapidly escalating utility costs. We are asking the committee to amend the bill to build a small contingency into the way that formula works.

The new financial base for housing providers will be set using new benchmarks for operating costs and revenues established by the minister. Co-ops have faced a number of funding cuts over the past five years and there's nothing left to cut. The benchmarking process must not be a backdoor route to more cuts. Subsection 99(1) should be amended to make sure that housing providers are part of the process of establishing benchmarks and have the right of review and appeal.

The proposed funding model will only work in the long term if projects start out with adequate capital funding. When setting the new financial base, the province must make sure that providers have adequate capital reserves to meet their long-term replacement needs. The bill should require the province, in consultation with service managers and housing providers, to make sure that reserves are adequately funded before responsibility is transferred to municipalities.

And, finally, a few words about the critical need for new housing: Two years ago, the study Where's Home documented the province-wide housing crisis. Problems have grown much worse since then. We urge the provincial government to provide the housing funding and programs that Ontarians so desperately need and not download this responsibility to already cash-strapped local municipalities

I thank you for the opportunity to present the views of our co-op members. We would be pleased to answer questions that you have.

The Chair: Thank you very much, Ms Morris. Unfortunately, we don't have time for questions because we are running so far behind. Thank you for your comprehensive presentation too.

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ONTARIO PUBLIC SERVICE EMPLOYEES UNION

The Chair: Our next presenters are: Leah Casselman, Suzanne Kelly, Tim Hadwen and Jim Elliott of the Ontario Public Service Employees Union. Good afternoon.

Ms Leah Casselman: Good afternoon. My name is Leah Casselman. I'm president of the Ontario Public Service Employees Union. I want to thank you for this opportunity to present our views on Bill 128.

Suzanne Kelly is a housing worker and the president of OPSEU Local 592. Jim Elliott is a security officer and unit steward of the Housing Authority Officers Association, OPSEU Local 292. Both work for the Metro Toronto Housing Authority and are directly affected by Bill 128.

OPSEU represents more than 1,000 members who work in social housing. Each day they labour to ensure low-income tenants in this province have decent and safe social housing.

OPSEU members provide professional, technical and administrative support at the Ministry of Municipal Affairs and Housing and assistance to the Ontario Housing Corp. OPSEU represents the professional, administrative, clerical and security staff at the Metro Toronto Housing Authority. OPSEU members work in many non-profit housing providers in municipalities across the province.

The Minister of Municipal Affairs and Housing suggests that Bill 128, the Social Housing Reform Act, is a simple administrative transfer. This is not an administrative transfer. Bill 128 is an attack on the quality of life of low-income tenants. Bill 128 creates the conditions to ensure the privatization of one of our province's most important assets, our public housing.

If that's not enough, Bill 128 is a vicious attack on our members and their rights. Bill 128 rips up our collective agreements. Bill 128 takes away union representation and it wipes out more than 20 years of decent labour relations. Bill 128 is bad housing policy and is bad for the workers. Bill 128 should be withdrawn and the down-loading reversed. Instead, the government should upload the province's public social housing stock back from the municipalities. The government should make a real commitment to ending the housing crisis in Ontario.

OPSEU is not alone in saying Bill 128 doesn't make sense. Tenants, co-ops, non-profit housing providers and many others are calling for the province to reverse the download. Take a hard look at the depth of the housing crisis.

Here is but one example from the hundreds of stories available. An OPSEU member called her local union office a couple of months ago. She recently had to leave an abusive relationship and was forced to leave her apartment. She was living in a shelter when she called our office. She works in a full-time job and has two children. She needed affordable housing. She found long waiting lists and nothing affordable in her neighbourhood. Her kids could not continue to go to their school. She spent six long months staying with friends trying to find a decent and affordable unit to live in.

We hooked her up with the housing organizations. We represented her when her boss tried to discipline her because her concentration had been affected by the ordeal. Her life was in turmoil, thanks to the way this government deals with housing. The government has abdicated its role in providing decent and affordable housing. It stopped building social housing in 1995. Then it turned rent controls into the cash grab of the decade for landlords.

Next the download started with Bill 152. We said it in 1997, and we say it again today: downloading housing doesn't make sense, not even common sense. Social and public housing should not depend on the local property tax base. The shift puts a huge financial strain on municipalities. This strain led to direct threats of the privatization of 5,400 units of public housing in Toronto in 1998. Other housing programs and services are being tested for privatization as we speak. You called Bill 152 the act to improve services; we called it yet another gift to the private sector and a cutback on public housing.

OPSEU offices across Ontario are getting more calls from members every day who are searching for affordable housing. It's a growing phenomenon, thanks to this government's approach to housing. More and more working people are homeless or living on the edge, searching for affordable housing. Why repeat your mistakes with a policy headed in the wrong direction? And Bill 128 does just that. Why do you create and exacerbate a housing crisis?

Bill 128 will mean less public housing in the province because cash-strapped municipalities cannot afford the liability for capital repairs and upgrades in the older housing stock. You have forced municipalities to look for ways to cut corners and save costs. You have provided no new money for social housing in this bill. Municipalities simply cannot afford to carry social housing.

Bill 128 will force municipalities to further privatize public housing, and section 5 of the act gives them the power to do so. It will force municipalities to limit who gets into public housing. Municipalities will be able to set new rules on rent geared to income and the size of the units for low-income households. Bill 128 lets the minister set targeting plans. Where's the protection that the new plans must be based on current levels?

Bill 128 also has a direct impact on our members who work for the local housing authority. They were promised a smooth and seamless transfer. The government suggested that it was business as usual. The facts show otherwise.

Bill 128 will mean layoffs. As your government bails out of social housing, our members will be laid off. Our members at public housing authorities will be laid off as the services they provide are cut back and privatized.

The minister claims that Bill 128, section 51, protects the terms and conditions of our members when they transfer to the new employer. That is just simply wrong. In fact, Bill 128 says that new employers can change terms and conditions of employment as they see fit. Bill 128 could protect terms and conditions of work but it doesn't. You chose, instead, job instability and lower wages.

Under this law, our members lose the right to take their union with them. You ripped that away with Bill 7 and you've done it again with Bill 128.

You treat OPSEU crown employees differently. You consistently single them out and deny them the rights that other unionized workers enjoy. Employees in other sectors get to carry their union with them. You could have provided for successor rights in Bill 128. You did not.

Bill 128 also tells our members that they have a supposed choice, a popular word with the government these days. They can either quit or accept the transfer. In subsection 51(8), unionized employees are treated differently and are hit just for being union employees. First, if our members quit, Bill 128 denies them access to employment insurance, unlike non-union employees. Second, Bill 128 overrides their collective agreement and denies them termination pay as they leave the Ontario Public Service.

Bill 128 should give our members a real choice in the midst of this massive upheaval. They should have the same choices as the non-union employees, something I think the Minister of Labour was talking about a couple of weeks ago. They should have a choice to go with a severance package or to accept the transfer. The government should treat these loyal employees with the respect and professionalism they deserve.

Bill 128 claims to transfer our members' rights to severance pay under the Employment Standards Act, soon to be gutted, but at what rate of pay, when the new employer can change the terms and conditions of employment?

There are even more ways our members' rights are ripped up.

Bill 128 takes away their grievance procedure and ends any possible retroactive remedies on outstanding grievances. Their benefit plan is gone and transferred without negotiation. Their personnel files are transferred without consent.

Their pensions are moved to a different plan, with fewer benefits and entitlements, without any discussion or negotiation. One of our members has a seriously ill wife who needs daily medical attention. He is six months short of his eligibility for retirement benefits under the OPSEU pension plan. Bill 128 takes this away. He has paid for his benefits through his pension contributions. That's just plain stealing.

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Bill 128, as it is drafted, overrides the Pension Benefits Act so that other members would not be able to claim access to their benefits in the OPSEU plan.

The government has choices. You have choices every day. You can do what is right. You can take action to benefit all people, not just the rich with their tax cuts. That's what governments are supposed to do.

With Bill 128, you chose not to invest in new affordable housing. You could have consulted the front-line workers and tenants to develop a comprehensive approach to the housing crisis and to improve social housing. You chose not to. You must ask yourselves what will happen two to three years down the road. I believe the housing crisis will be worse because of your actions.

In the short term, you need to amend this legislation. Minister Clement said he was holding public hearings to get it right: two days, three hours each, only in Toronto. God, I hope he gets it right. These amendments are urgently needed. Our recommended amendments to fix these most glaring errors are attached at the back of our brief.

Even better, you could withdraw Bill 128 and begin a new direction for housing in Ontario and take your role seriously. You can start to solve the province-wide housing crisis, you can start to build housing, you can improve social housing programs, and you can respect the workers' collective agreements. You know what? You could even introduce new legislation called the "Respect the workers and end the housing crisis act." It's time to give people real options and not simply a $200 cheque.

Thank you for this opportunity and we look forward to your questions.

The Chair: Thank you, Ms Casselman. Because of the time, there won't be time for questions, unfortunately.

CO-OPERATIVE HOUSING FEDERATION OF TORONTO

The Chair: The next speaker is Mr Tom Clement, Co-operative Housing Federation of Toronto. Good afternoon, Mr Clement. Please proceed.

Mr Tom Clement: Thank you for this opportunity. I thought I'd take a couple of moments and tell you about the Co-operative Housing Federation of Toronto, who we are and who we represent. The federation was founded in 1974, and we represent 163 co-ops in Toronto and York region. The people living in our housing co-ops total 45,000.

We've been involved over the years in the development of new co-ops. When there were housing programs, we developed 55 housing co-ops and 5,800 units. We were an organization that early in our history realized the importance of education for people living in non-profit housing and developed our education program starting way back in 1975. Today we offer approximately 80 workshops every year and we provide training to about 1,100 people.

We have set up a network and we work closely with the Co-operative Housing Federation of Canada and its Ontario region, and when a co-op has problems, we work to sort out those problems. If it's a federally funded co-op, we work with Canada Mortgage, and if it's provincially funded, we work with the ministry. Our role is to help co-ops in difficulty and to ensure that they remain strong, vital, democratic communities.

Another part of our education program is in partnership with the Co-operative Housing Federation of Canada, and that's the production of educational materials. We've produced approximately 30 plain-language publications on virtually every subject imaginable. Whatever somebody would need to know about living in a housing co-op and how to manage it, we have produced it. It looks like we are about to be presented with another new publishing opportunity with this legislation.

We also work to do bulk buying so that our co-ops have cost-effective budgets. We assist them by running a program that helps them to buy paint, carpets, floor coverings. We work with credit unions to ensure good rates on chequing accounts and term deposits and also that co-ops can buy government bonds.

We also do bulk buying of gas, satellite television services, hardware supplies and appliances. In addition to that, we work with the seven other regional federations in Ontario to provide bulk buying across the province. We also work closely with CHF, which takes a lead in providing insurance services and has been doing so for a number of years.

In looking at the legislation, we want to be clear that we're here to add our voice in protest to the legislation. In general, we think the legislation is a bad idea. Downloading to the municipalities is going to create many problems in the future. We'd also like to mention at this time that in addition to the cost of administration, the cost of the creation of new housing will pretty much guarantee that more families will be facing homelessness in the coming years.

Over the past 15 years in Ontario, what we've witnessed is a merry-go-round of public policy when it comes to housing. There's been a constant change. We believed that we'd seen it all, but in looking over the legislation and taking a look at the Social Housing Services Corp, my view, the view of the federation and the view of the co-op housing sector is that we're creating an entire new level of bureaucracy, an unnecessary level.

There's reference to bulk purchasing as a possibility in the legislation, and I just want to go back and remind people that this is already done by co-op housing sector organizations. One of the most important features of the buying that we do is that, in addition to working across the province, we try as much as possible to work with local suppliers. In the case of financial services, we work with credit unions. In the case of buying paint or floor covering, we try to work with locations that have local retail outlets so there are jobs in the community. The insurance is provided by Co-operators, which has insurance offices across the province. To simply try to remove the bulk buying away from the sector organizations and away from the local community, we feel would be a big mistake.

We feel that there are ways that housing costs can be reduced, but we really need to take a look. If we're talking about doing some sort of more intense purchasing, what are we really talking about if we're looking at a central agency? If we were looking at the supplies for an average co-op in Toronto, you would probably be looking at a co-op spending of about $40,000, most of which is already covered by our bulk buying programs. We're talking about a pretty small part of their budget. Is there more money to be saved? Maybe. We're not sure. We're trying to work on that. In trying to centralize the buying Ontario-wide, it's our feeling that the cost of centralization would far outstrip any savings, and this would only add to the cost.

The real savings-and I think the thing that the province has done very well-is in the mortgage. Any homeowner will tell you that the place to save money is in the mortgage and a better rate. This is why the mortgage market is so competitive. The better rate you get, the cheaper your cost. In a co-op or a non-profit, the mortgage forms an even bigger percentage of the cost of operating a building.

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The province has already done an excellent job, and if you look at a co-op or a non-profit that has a mortgage of $10 million or $11 million, the real place to save money is by reducing the mortgage costs. If the province can work to take 1% off the mortgage, we're looking at cutting $89,000 out of the cost of operating that particular project. That's where the savings are. If the province is able to get 1.25%, we're looking at savings of $110,000. So there are real savings to be made, but it's not in messing around and trying to centralize purchasing when often it can be done in the local area where it's already being done by the sector organizations.

I would urge this committee to limit the role of the Social Housing Services Corp and not create another level of bureaucracy. It's my feeling that the creation of this new level of bureaucracy, instead of cutting costs, would likely lead to an increase in costs.

The Chair: We have time perhaps for one question each, starting with the government side.

Mr Beaubien: Thank you very much for your presentation, Mr Clement. I certainly don't disagree with you when you mention that we've seen a merry-go-round of public policy over the years. I don't think anybody can refute that statement.

However, I just heard the member Mr Smitherman mention a while ago that while he was canvassing he saw, in the management of the Metro Toronto Housing Authority units, that there were quite a few vacancies. I've heard people presenting from the co-op side that they manage their units very responsibly, and I concur with that.

What would your opinion be with regard to the management of co-op housing, generally speaking, across the province? Do you think they're all managed responsibly?

Mr Clement: First of all, we're not public housing, and I think Mr Smitherman was speaking in reference to Regent Park, where he canvassed. I believe that's in his riding. We're not public housing. We make no claims that every single co-op is perfectly managed, but what we do claim is that we've set up an infrastructure to assist in that management and that in general co-ops are very well managed. If there is a problem we work closely with the ministry, and in the future with the municipality, to solve those problems. But we wouldn't try to make the claim that everything is perfectly managed.

Mr Smitherman: Hi, Tom. Welcome. I rather wish that we were dealing with a piece of legislation that was designed to make our public housing look more like co-ops than what I fear we have before us, which is the opposite.

The words "self-governance" and "community" are used a lot. I have the advantage, I suppose, of having thousands of units of each in my riding: 5,500 co-op units, the largest concentration in the country.

Tom, I'd like to ask you: if there was one suggestion you could make to the government in terms of changing a part of the legislation that is before us to try and move them away from the watering down of the self-governance and community pieces, to try and preserve the best of what's there in terms of citizen and membership participation, what might it be?

Mr Clement: I think we need to be independent. We've been independent. We need to be able to manage our communities. Co-ops are fiercely independent-everyone knows that-and we need to have a clear agreement with whatever level of government to guarantee that we can be self-managed. If we have clear funding in place, then we'll take the responsibility to manage the co-ops, and when there are problems, we'll step in and help to solve those problems. That's what we feel we need to be independent. No matter how you cut it, there is a cost to operating any kind of housing. We have real costs and we need to have the funding in place to manage those co-ops.

Mr Marchese: Tom, as you can see, on an important bill like this we have two days, and opposition members are reduced to asking one question of the deputants. We used to get three or four weeks of hearings and now we're reduced to one day of hearings, and if we're lucky we get two. That's the level of democracy we're getting.

One of the problems I think we're having is that a lot of people just don't understand co-ops at all. I'd venture to say that if I hadn't lived in one, I probably would have been as ignorant as many. That's a sad thing, because what co-ops do is one of the most efficient things I've seen in terms of how you govern your own affairs. You manage yourselves as opposed to other people managing you.

The point of it is that you're saving government money. You're saving everybody money in terms of how you administer your own affairs. What do we do? How do we reach this government? Obviously, they chatted with you and you've been able to pass to them your model in terms of how efficient it is. Why is it that they don't listen or you haven't been able to reach them or they haven't been able to reach you? What is the problem that we've got? What do we do?

Have we got a few minutes?

The Chair: You've got about one minute to tell him.

Mr Clement: The one-minute answer.

Mr Marchese: Reduced to one minute.

Mr Clement: I think, again, that if we can work with all the parties to ensure that co-ops are strong and independent, if we can avoid creating a new level of bureaucracy-creating a new level of bureaucracy I think goes against the current government's thinking. I think this would be as far as I can get in one minute and as far as we can get before the end of the year.

CITY OF TORONTO

The Chair: The next presenter is Councillor Brad Duguid, chair of the community services committee; and Phil Brown, general manager, shelter, housing and support division for the city of Toronto. Good afternoon. If I may be so bold as to extend my congratulations to my councillor.

Mr Brad Duguid: Thank you, Madam Chair. If I had recalled you were Chair of this committee, perhaps we could have met at the Real McCoy and just hashed this out between the two of us.

The Chair: That might have been a good idea.

Mr Duguid: It probably wouldn't have worked.

The Chair: I hope you're feeling better, by the way.

Mr Duguid: Good evening, members of the committee. I'm here today as the councillor for Scarborough Centre, and primarily as the past chair of the city's community services committee, to address you today and make some remarks on the positions council has adopted on housing devolution in anticipation of this bill. I am joined today by Phil Brown. He's the general manager of the shelter, housing and support division. Kathleen Blinkhorn is with us this evening as well. She's the project manager for social housing.

You may be noticing that this is not my usual voice. I'm suffering from a little of bronchitis that I gained in the last few days in the municipal election. If by chance I start coughing and can't make it through my submission, I'm sure that Mr Brown will be able to ably carry on.

The city of Toronto has a wide range of observations on Bill 128 and its implications for Ontario municipalities. As one of 47 service managers across Ontario, we share common concerns about the bill with other municipalities. We also have concerns that are specific to the city of Toronto.

Toronto has a unique portfolio of social housing. Once transferred, it will involve a gross budget approaching $500 million annually, one of the biggest city services that we'll be providing, along with transit, police, and Ontario Works. The 95,000 units of social housing we'll be administering represent 37% of all social housing in Ontario. It also represents about 20% of all rental housing in the city of Toronto. That's all rental housing. These units are run as well by more than 230 separate non-profit and co-operative housing providers.

Just to put it in perspective for those of you who may not be from Toronto, and even for those of you who are, the population residing in social housing in Toronto right now is about the equivalent of the population of the city of London. So it's an incredible amount of units for an incredible amount of people.

The public housing stock in the city is some of the oldest in the province and is indeed in need of repair. Our social housing has a greater proportion of rent-geared-to-income units and has relatively more units facing a gradual phasing out of the federal subsidy.

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Before getting into specific comments on the bill, I think it is important that I reiterate the city's position on the social housing transfer. We and other municipalities have repeatedly expressed concerns over the inadvisability, the lack of foresight and the inequity of putting social programs, including social housing, on to the property tax base. This is an ill-considered policy decision and a step that no other jurisdiction has taken. It is difficult to predict the future costs of such programs and the impact of the economic cycle.

The property tax system is not an appropriate tax base to deal with income redistribution programs. I know the government has heard this before and has indeed chosen to ignore it. I'm not here to whine about it, because I think we've heard enough of that too. But I think it is important that you are aware of what our original position on the downloading of social housing was and the fact that it still has not changed.

Bill 128 is very complex and unwieldy. The process for consultation on the bill is extremely short and we have yet to see the myriad of regulations that are a critical component of this transfer. With incomplete information and short timelines, municipalities really are unable to assess the full implications of the bill, particularly with regard to future financial risk. Yet in just over 40 days, we are going to be taking on ownership and management responsibility for public housing.

Many financial risks are associated with the transfer of social housing to the city. Many of them are really unknown and they are very difficult to predict. Some of the factors I'd like to discuss with you briefly here this evening are:

(1) Interest rates: we are starting from a point of historically low interest rates. We face the risk of rising mortgage interest rates at renewal and resulting subsidy increases. This can have an incredibly large financial impact when you look at the number of units that the province will be managing and will be owning. This could have an incredible financial impact on the property taxpayer. Will the province be there to help us out when that happens or will those costs fall on the backs of Toronto property taxpayers? We are not quite sure but we are very concerned about that.

(2) Subsidy pressure: we are concerned that subsidy requirements will rise over time as geared-to-income rents inflate more slowly than operating costs. Again, will the province be there to assist us if this happens or will these costs again fall on to the backs of property taxpayers in Toronto? We are still not sure.

(3) The loss of the federal subsidy and expiry of the agreements: the prescribed multi-year phase-out of federal subsidy, especially related to the prescribed service level standards, will no doubt put pressure on us to make up the difference. By "us," I mean municipalities. Will the province be there to assist us when this happens or will those costs be a burden for the property taxpayers of Toronto?

(4) Greater Toronto area equalization: when we look at the risk of sharp changes of GTA assessment or provincial policy decisions to change the funding formula, again, we will be looking to the province to be there if that should happen. We are not sure whether they will be.

(5) Capital repairs: potential costs for capital repairs not covered by existing reserve funds or by capital budget levels in the subsidy envelope we inherit are of great concern to us. We will talk a little bit more about that in a minute. But will the province be there when these capital repairs come back to haunt us or will the costs fall on to the backs of Toronto taxpayers?

(6) The shift of liability: ongoing litigation and other legal claims associated with the public housing asset are being transferred to the local housing corporation. It looks as though the Toronto taxpayers may well be stuck with these liabilities unless the province is willing to step in and assist us with regard to those.

(7) Default: the risk of mortgage default is substantial and, more importantly, any unusual costs to prevent these defaults. Will the province be there to help us out when mortgages default or will those costs also fall on to the backs of Toronto property taxpayers?

Our concerns in these areas are not addressed in this bill. It's clear that the government, through this bill, appears to be passing a lot, if not all, of these future financial risks to the city. This is unacceptable, in our view, to the property taxpayers of Toronto.

After three years of paying for social housing, this bill will finally allow us some say for pay in the management and administration of social housing. We have been calling for this for some time. But it is a little disappointing to see that the province is still directly involved in most aspects of social housing management. The province still has a final say in almost everything we do. Even though the province will no longer pay for social housing and will no longer administer social housing on a day-to-day basis, the result will be likely be micromanagement by the province, diffused accountability and financial inefficiencies.

A case in point is the proposed Social Housing Services Corp. This new province-wide body has significant policy and operating responsibilities, yet the government's bill dictates the composition of the board of directors. The minister will appoint the first chair and CEO and all directors for the first three years. This doesn't seem to be getting the province out of social housing. This seems to be imposing the provincial view on how things should be run even though they are no longer paying for a say in that view.

We strongly believe the proposed Social Housing Services Corp has the potential to be too intrusive, cumbersome, and costly. It's simply not needed in our view and should be removed from the bill. We believe municipal experience is such that we should be able to manage these areas and coordinate these areas of potential efficiencies with the other municipalities across the province much more effectively than, or as effectively as, such a body.

We also note that responsibility for mortgage renewals, a key cost-driver decision in social housing, remains with the ministry and is not transferred to the city. This does not make sense to us. We recommend that responsibility for mortgage renewals be transferred to those municipalities which request it.

I'd also like to turn to the roles and responsibilities in coordinated access to social housing. This is an important issue to the 61,400 households currently on the waiting list in Toronto. We have great reservations about requiring municipalities to set up and operate a coordinated access system for special-needs housing. As you know, not all special-needs housing is being transferred to municipalities. Dedicated special-needs housing remains at the provincial level. We ask why, if that's the case, we would set up an access system for only a small slice of special-needs housing which is being transferred to us. That doesn't makes sense to us. We'd like the committee and the government to take a look at that. We strongly recommend that responsibility for access systems for all special needs-housing be kept at the provincial level.

There is much more in the government's bill that we believe would probably be more appropriately located in regulation. This is more of an administrative concern. But as municipalities gain experience in the management of the social housing portfolio, it would be unfortunate if the government's bill restricts their ability to grow and develop new opportunities or respond to challenges.

Just by way of example, the new funding formula for non-profits and co-ops is in the legislation. I wouldn't even try to explain the new funding formula to you. It is very complex. I haven't even got my head around it yet. It may well be a good idea and it may well be a good formula, but it is untested. If the formula does not work and needs to be revised, it would be a shame if it is stuck in legislation and you have to go through an entire legislative change to make that happen. It probably would be much more effective to be as a form in the regulations.

I'd now like to turn to the capital repair needs of the social housing stock. As I mentioned earlier, this is one of the biggest financial risks, in our view, to the city and probably one of our major concerns. The age of Toronto's public housing makes this a more immediate concern to us than perhaps to some of the other municipalities. City councillors in Toronto are often asked by their tenants-in fact, we are not asked; we are screamed at by tenants about the poor state of repair of some of the social housing units in our city.

First, we don't know what the financial implications are. We don't know 20 years from now, over the course of the next 20 years, what the capital needs for our social housing in Toronto will be. We all have guesses, but we don't really have firm and fixed numbers. That's troublesome to us. We believe this is an important item and a costly item and something that we really should have some numbers on.

Madam Chair, I know that you're aware-we do have a fair amount of social housing in the part of the city that we both are privileged to represent. I know that you've been out yourself in those buildings on many occasions. When you and other members of committee see the provincial comments that the social housing stock is by and large in good shape, I know that many of you are going to give your heads a shake, because you know that it is not. You know that there are problems out there. You know, when you get out there and you talk to some of the tenants, that there are some major concerns out there on the condition of the rental housing stock across this city.

If the studies that have apparently been done are comprehensive and thorough and not just a small sample, there's no need for our city to replicate them, but we would like to see them.

Some time ago-it was last spring-I as chair of community services wrote to the minister and asked for this information, asked him for the condition of these buildings, and we're still waiting for the information. I don't mean to be critical, but I can't help but wonder what the government is trying to hide. Are we concerned that social housing stock repair requirements are a financial ticking time bomb? We can't help but think the government is passing it off to us, the city, knowing that at some point it's going to blow, and while Toronto taxpayers are picking the shrapnel from that explosion out of their backsides, the government will be out there talking about how great their surplus is. I can't help but think that is a potential happening down the road, and that is of great concern to us.

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When a homebuyer purchases an existing home, he or she hires a home inspector to take a look at it, and gets assessments done on it to make sure that if there are any foreseeable repairs in the future, they have the financial means to make those repairs and can prepare for that. In this case, we haven't seen that and haven't had that, and we can't help but feel somewhat blindsided by that.

We are also concerned that the government's bill explicitly states the province is not liable for the state of repair of the social housing stock to be transferred and is not liable to fix it. In the absence of further due diligence and inspections, we believe the province should retain liability for capital repair needs.

I know I'm running short on time, and I'll try to get through the rest of this as quickly as I can.

The province has emphasized the flexibility that Bill 128 supposedly provides to us with respect to the transfer of housing authority employees and the possible implications for labour relations. I'm not going into the details of that too much now because I don't really have time to, but my brief outlines four concerns the city has with regard to the labour relations environment. It's very important that we do everything we can, before this transfer takes place, to try to correct some of the potential difficulties in that labour relations environment down the road. If we do not, we may impede some of the flexibility the city may have of trying to put in place the best possible structure to try to manage this transfer. So it's a very important point. I'm going over it very quickly because it's in the brief, and all members and the public will certainly have copies of that brief.

In conclusion, in my remarks I have identified some of the broader challenges facing the city of Toronto as we prepare to take on the transfer of the social housing stock. Our review of Bill 128 has left us uncertain as to what financial risks we are taking on in this important portfolio. We're quite concerned about the intrusive provincial role in the new framework. A rebalancing of the roles and responsibilities between the municipal and provincial levels of government is necessary before the bill is passed, so we have the necessary say for pay and full authority to manage the system.

We have eight essential points that we recommend this committee address, with respect, in considering this legislation:

(1) We must have some protection against serious future cost risks we face from factors such as mortgage interest rates, overall subsidy pressure and loss of federal subsidy over time.

(2) The Social Housing Services Corp will duplicate what municipalities can do or already do, and should be deleted from the bill.

(3) Responsibility for mortgage renewals should be transferred to those municipalities which request it.

(4) Responsibility for access systems for all special-needs housing should be kept at the provincial level.

(5) Various matters, notably the funding formula, should be written in the regulations and not the bill.

(6) We need to review in advance at the draft stage the many regulations which are a critical component of the transfer.

(7) We need adequate due diligence and building inspections, and the province should retain liability for capital repair needs-a very important one.

(8) We need an ability to have labour relations considerations not be the main factor driving our choice of options for municipal housing operations, and to be reimbursed for the labour-relations expenses we will incur due to the transfer.

It is unfortunate that the legislation had to come about at a time when municipal elections were going on. It did prevent us from going to council with the actual legislation in place and allowing members of council further input. However, we did have some discussions before-hand, and that's what I've really been able to discuss with you today. My discussions are based on some of our previous resolutions in council. Despite the municipal election, members of council have been watching and paying close attention to what is going on with this legislation, because we recognize the very large impact it will have on our city.

We are committed to working with provincial staff to ensure this social housing transfer goes smoothly. However, in order for that to happen we respectfully request that committee members consider our recommendations and respond favourably to them.

The Chair: Thank you for your presentation. Unfortunately we don't have time for questions. We have one more delegation before we have to go and vote.

Mr Duguid: Thank you for taking the time.

TORONTO HOUSING CO INC

The Chair: The last presenters are John Metson, chair of the board, and Derek Ballantyne, chief executive officer of the Toronto Housing Co.

Dr John Metson: Thank you very much, Madam Chair. There's a bit of preamble in the handout, which I'll bypass, consistent with your time needs, and move on to say that the Toronto Housing Co has been building and managing social housing since 1954. Our chief executive officer, Mr Derek Ballantyne, is here. If you have that one, single question you need to ask, I'm sure we can manage that between the two of us.

We follow quite naturally on the presentation from the city of Toronto, because the city of Toronto is our shareholder. It is the single shareholder of the Toronto Housing Co, which has approximately 28,000 units.

I would like, on behalf of the company, to make comments on the lack of a comprehensive view of how the housing program will work, which is a concern in this bill presented so far; some features of the funding model, which I think you've heard consistently through the day; the limits on the ability to streamline all housing programs that the bill presents; problems with the proposed coordinated access for special needs, which is a very key issue; a contract between a service manager and the housing provider-the clarity and the need for that; the capital requirements for repairs and mandated updates that will naturally follow from this legislation; and the development of new stock and the redevelopment of new stock.

I make these comments in the context that we are pleased to see legislation that can help us as a co to provide the housing we are mandated to provide. We are facing an unknown. The legislation clearly lays out for us unknown, uncharted waters. It sets out a funding model, but it contains very large gaps that are yet to be covered in legislation.

The regulations are not drafted. How is it possible to judge the merits of the funding model without having a complete view of the legislation and regulations in context? We urge that the government take time to consult sufficiently with service managers and housing providers on the development of regulations, it being very important for this kind of experience to be present at that table. Most critical is the development of the benchmarks-which obviously affect all of us very directly as providers in the province-that will establish the funding levels for housing providers for decades to come.

We understand the theory of the new funding model, and it should be workable, as I think it is similar to some past federal programs. However, the real test is in the implementation. There's a very limited time in which to get it right-I think I heard that comment from one of the previous speakers-and we need a process that ensures that all affected voices, particularly those of the funders and the delivery agents, are listened to and in fact heard.

In regard to the funding model, there are three sections of the legislation dealing with the funding model that we believe need change. The use of the operating surplus to cover the operating deficit: Toronto Housing Company has experience operating housing under almost all programs. This has demonstrated to us that it is not always possible to manage year to year within fixed budgets, and from time to time we end the year with an operating deficit. Those who are in business will understand that. This is normal for many businesses, both public and private. To cover such deficits we manage our affairs to generate a surplus in the next fiscal year or years. The proposed funding model does not allow for this, which is a big gap. We think this should be amended to allow that operating surpluses be used to cover any deficits, and then be shared with the funder.

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Secondly, the flat and declining market rents: the funding model is based on an assumption that rents will rise over time. Now, this is generally true, but it does not happen in all communities in the city, certainly not at the same time each and every year. The funding model needs to be amended to take into account such situations. Otherwise, housing providers will be put into a deficit on a formula- and calendar-driven basis, with no hope of being able to make up the funding shortfall with increased revenues.

When non-rental revenue declines: the funding model-and in the housing company we have significant non-rental property-is based on the assumption that non-rental revenues will increase at the same rate as residential rental revenues. This is not the case. For example, leasing commercial space generates much of the Toronto Housing Co non-rental revenues. This market, as we all know, is very volatile and there are often periods of falling revenues. The funding model must be changed to use a different approach in the calculation of non-rental revenue increase.

The limits on ability to streamline all housing programs, which is the intent, I suspect, of the bill: the legislation only changes the basis of the funding model and regulations in those programs in which there is a provincial interest. The legislation also contemplates a provider and a service manager voluntarily agreeing to put all programs into a single administrative framework. For the Toronto Housing Co, this would be a significant benefit. However, the legislation and the enabling agreements with the federal government do not clearly specify that the housing-provider and the service manager can replace the myriad of complex reporting requirements with a simple, clear, accountability system. It seems to be missing, and without such a guarantee, much of the advantage in creating a single housing delivery framework is lost for Toronto and the Toronto Housing Co. It is possible that we will be forced to maintain seven accounting systems and reporting structures if this is left as it is.

The special needs access: the proposal to change the access system for tenants with special needs must be radically changed or removed from the legislation.

The service manager is required to ask the Toronto Housing Co and other housing providers to accept a tenant through a "lead agency" referral, without a guarantee that there would be support services for that special need. It may also severely limit our ability as a company to bring support services to tenants in situ- and you'll remember we have 63% who are seniors-who require such support as a result of age or infirmity because they have not been placed through a provincially mandated referral service.

Toronto Housing Co has a number of very vulnerable tenants with special needs, so it's very important that we take this into account. The Toronto Housing Co works with a number of community agencies to deliver supportive service and neither the Toronto Housing Co nor the service providers, and least of all these very vulnerable tenants, applicants and their families, want these arrangements terminated, nor can they afford that. Furthermore, it would be very costly.

The need for contracts between service managers and housing providers: the present legislation proposed terminates all current operating agreements. From the perspective of a board of directors, this creates an open-ended liability in some cases that can go on for years and years, 150 years or more. We propose that the act should require that the service manager and the provider establish in contractual form the requirements made of the housing provider, therefore the board's liability being limited by that contract. The contract should specify the commitment to deliver RGI units.

The Chair: Dr Metson, I'm going to have to ask you to either speed it up or cut it short a little because you've got about two minutes left.

Dr Metson: OK, thank you very much.

The contract should specify a commitment to that delivery and they should also build in a termination.

The capital requirements are very important. Toronto Housing Co buildings-I think the city spoke to the state of repair, so it's very important that we have the facility and the flexibility within it to manage in a businesslike and cost-effective way the provision of the redevelopment or the repairing of buildings.

We have not received a proportionate amount for capital repairs in buildings, particularly in our older buildings. We need a capital reserve program that in fact takes care of this.

We must be empowered, with the housing providers and service managers, to determine the best way to sustain the level of rent-geared-to-income units and provide more affordable housing.

I won't speak to the condition of the buildings again. Perhaps there needs to be a special provision in Toronto, with this mass of housing, where we can take into account the need for the development and redevelopment of properties in whatever form is the most cost-effective way.

In addition, we need to have an amendment to the TPA which will extend the current social housing exemptions to housing built by corporations such as ours, which may not fit within the program but which is clearly destined for low-income households.

In conclusion, Madam Chair, the Toronto Housing Co provides good, affordable housing to over 39,000 tenants who would otherwise not be adequately housed. As a municipally owned company, the Toronto Housing Co's board of directors and staff are well aware of the requirements for public accountability for public funds. It is in favour of accountability but all too well aware of the unnecessary cost, and you've heard this before, of layers of reporting that do not achieve better accountability. As a housing provider we are held to a cost benchmark and a social and economic mandate in the public interest but also to a reporting standard of the public sector without adequate recognition of the cost. We are very interested in working with the municipal, provincial and federal governments to make any reform of the Social Housing Act, and the regulations attendant, to achieve the public good at the least possible cost.

Those are our points that we trust that you will build into your process and decisions. Thank you.

The Chair: Thank you very much, Dr Metson, for your submission. The meeting is adjourned.

Mr Caplan: On a point of order, Madam Chair: I was just wondering if you could help me. When is the time when we hear from anybody who is in favour of this legislation? Could you let us know?

The Chair: When the people phone in to be on this list, I have no idea if they're in favour or against.

The committee adjourned at 1758.