HIGHLAND PINES CAMPGROUND PINE MEADOWS RETIREMENT COMMUNITY
WATERLOO REGION HOUSING COALITION
WATERLOO REGION COMMUNITY LEGAL SERVICES
KITCHENER-WATERLOO HOME BUILDERS' ASSOCIATION
ESTATES TENANTS' ASSOCIATION WATERLOO REGION TENANTS' COALITION
CAMBRIDGE HOUSING ACCESS LUTHERWOOD HOUSING
WATERLOO PUBLIC INTEREST RESEARCH GROUP
WATERLOO REGIONAL APARTMENT MANAGEMENT ASSOCIATION
PINE MEADOWS HOMEOWNERS ASSOCIATION
TENANT ADVISORY COUNCIL OF NORTH WATERLOO HOUSING
WATERLOO REGIONAL COALITION FOR SOCIAL JUSTICE
WATERLOO REGION TENANTS' COALITION
CONESTOGA TOWERS TENANT COMMITTEE
CONTENTS
Thursday 5 September 1996
Rent control
Mr Greg Lampert
Highland Pines Campground; Pine Meadows Retirement Community
Mr Don Vallery
Mrs Janet Vallery
Waterloo Region Housing Coalition
Mrs Catherine Heal
Mrs Christine Wilson-Whitehouse
Ms Bluma Teram
Waterloo Region Community Legal Services
Mr Larry Skoog
House of Friendship
Ms Deborah Schlichter
Kitchener-Waterloo Home Builders' Association
Mr John Schnarr
Mr Lyle Hallman
Ms Suzanne Taylor
Estates Tenants' Association; Waterloo Region Tenants' Coalition
Mrs Mary Pappert
Cambridge Housing Access; Lutherwood Housing
Ms Maxine Brake-Cheater
Ms Cathy Werner
Mr Peter Miller
Mr Burns Proudfoot
Waterloo Public Interest Research Group
Mr Daryl Novak
Waterloo Regional Apartment Management Association
Mr Robert Eby
Pine Meadows Homeowners Association
Mr Peter Brophey
Tenant Advisory Council of North Waterloo Housing
Mr Ron Dempster
Ms Angela Schlichter
Waterloo Regional Coalition for Social Justice
Miss Lisa Burke
Ms Lori Lafond
Miss Pamela Johns; Mr Doug Getty
Mr Paul Spencer
Waterloo Region Tenants' Coalition
Ms Barbara McGrath
Overlea Social Group
Mrs Carol Popovic
Conestoga Towers Tenant Committee
Mrs Lynn Piller
STANDING COMMITTEE ON GENERAL GOVERNMENT
Chair / Président: Mr Jack Carroll (Chatham-Kent PC)
Vice-Chair / Vice-Président: Mr Bart Maves (Niagara Falls PC)
*Mr JackCarroll (Chatham-Kent PC)
*Mr HarryDanford (Hastings-Peterborough PC)
Mr JimFlaherty (Durham Centre / -Centre PC)
Mr BernardGrandmaître (Ottawa East / -Est L)
Mr ErnieHardeman (Oxford PC)
*Mr RosarioMarchese (Fort York ND)
*Mr BartMaves (Niagara Falls PC)
Mrs SandraPupatello (Windsor-Sandwich L)
*Mrs LillianRoss (Hamilton West / -Ouest PC)
*Mr MarioSergio (Yorkview L)
*Mr R. GaryStewart (Peterborough PC)
Mr Joseph N. Tascona (Simcoe Centre / -Centre PC)
Mr LenWood (Cochrane North / -Nord ND)
Mr Terence H. Young (Halton Centre / -Centre PC)
*In attendance /présents
Substitutions present /Membres remplaçants présents:
Mr TobyBarrett (Norfolk PC) for Mr Flaherty
Mr AlvinCurling (Scarborough North / -Nord L) for Mrs Pupatello
Mr BertJohnson (Perth PC) for Mr Hardeman
Mr John L. Parker (York East / -Est PC) for Mr Young
Mr JosephSpina (Brampton North / Nord PC) for Mr Tascona
Also taking part /Autres participants et participantes:
Mr WayneWettlaufer (Kitchener PC)
Mr TerryIrwin, senior policy adviser, Ministry of Municipal Affairs and Housing
Clerk / Greffière: Ms Tonia Grannum
Staff / Personnel: Mr Jerry Richmond, research officer, Legislative Research Service
The committee met at 1116 at the Valhalla Inn, Kitchener.
RENT CONTROL GREG LAMPERT
Mr Wayne Wettlaufer (Kitchener): Mr Chair, welcome to Kitchener, God's country.
The Chair (Mr Jack Carroll): Thank you very much, Mr Wettlaufer. It's nice to be in Kitchener.
Welcome, everyone. Our first presenter this morning is Mr Greg Lampert, whose name we've heard bandied about very much in the last three weeks. This morning he gets to tell us exactly what his report said and gets to respond to some questions. Basically, the format is that Mr Lampert has 10 minutes. Each of the opposition parties, beginning with the Liberals, has 12 1/2 minutes, and the government has 10 minutes. That is an agreement that I understand was arrived at somehow.
Mr Alvin Curling (Scarborough North): There was no such agreement, Mr Chairman, but you've been such a good Chairman, I'll go along with it. I'm very upset about it, but I'll go along with it.
The Chair: Thank you very much, Mr Curling. I appreciate your support. Mr Lampert, the floor is yours.
Mr Greg Lampert: Thank you very much. I thought I was going to be talking for a little longer than 10 minutes, so I'll have to talk quickly. I will do my best. I was the author of the discussion paper The Challenge of Encouraging Investment in New Rental Housing in Ontario, commissioned by the Ministry of Municipal Affairs and Housing. The reason for the assignment was to try to identify the reasons no one was building new private rental accommodation in Ontario and to suggest ways that such investment could be encouraged.
The outline of my presentation today is that I'm going to give you some background. My report dealt with four public policy areas impacting on new rental investment: regulation, taxation, development costs and financing. I'm only going to talk about regulation and hopefully taxation a little bit today, and then the action plan to stimulate new rental housing that I recommend in my report.
By way of background, I'm sure you've seen these charts quite a lot. Why was I commissioned to do a report? I was commissioned to do a report because nobody's building new private rental accommodation. You can see the dramatic decline over the past several years. There also is a looming crisis in some parts of the province, particularly Toronto: Vacancy rates are coming down and they're going to get lower. No one's building, there's no new supply, and demand continues to increase.
Key elements that people have to understand looking at the rental market are:
Private investors won't build rental accommodation unless it makes economic sense. They can make 8.2% on their money on a 30-year Ontario government bond right now. If they can't look at higher returns than that from rental investment, they're not going to look at rental investment.
Not all private rental investors are the same. There are lots of different types of investors who will look at different properties, different potential investments, differently.
New private rental generally targets the high end of the market. This is reality, this is the way it's always been. If you get investment, that's where it's going to be.
The next point, though, is that that doesn't matter if you're looking at encouraging new rental investment to try to alleviate the tight markets we've got in Ontario. Filtering does work. If you build at the high end, it filters. You get an impact all the way down the line and you get vacancies all the way through the stock. There are some charts in my report that actually demonstrate that.
There's a significant gap between economic and market rents in many centres, particularly in Toronto. It's the main problem market for rental housing in Ontario. It's the tightest market, 0.8% vacancy in October. Only Barrie and Guelph also have very tight markets below 1.5%. Toronto is a special case. Most other markets in Ontario aren't in urgent need of rental housing. That's not to say that they can't benefit from it, but they're not in urgent need.
The Toronto rental supply is eroding due to the gradual sale of the oversupplied condos from the glut times. The economic-to-market-rent gap is widest in Toronto; that is, the gap between the market rent and what somebody has to pay in terms of cost is widest in Toronto compared to other centres. With no new non-profits and eroding condo rental stock because of the gradual sale of the oversupplied condos from the glut times, tighter rental markets are inevitable in Toronto.
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Regulation is one of the four policy areas I looked at. The key issue clearly is rent controls, as far as potential landlords, potential rental investors, are concerned. Rent controls are the paramount issue. Other concerns are:
The Rental Housing Protection Act. Also a concern, not as serious, but a concern.
Landlord and tenant relations. The problem of professional tenants and not being able to evict problem tenants quickly is a serious problem for landlords as well.
Also, and this is the thread underlying my report, is the danger of a later government changing the system yet again and reimposing strict controls. If we do something, let's make it fair for both sides, landlords and tenants, get a system that actually works for both sides so that future governments won't be tempted to tinker with it and change it again.
My conclusion was that substantial easing of regulations is required, but complete decontrol of the rental market is not in the long-term interest of either tenants or the housing industry.
My recommendation in the report was a model similar to that put in place by the BC NDP government. I think it's a great system. It provides protection for sitting tenants. It provides for arbitration of disputes between landlords and tenants, whether it's for rent increases, harassment of tenants by landlords or unacceptable tenant behaviour. The key element from the point of view of the rental housing industry is that there's no controls on vacant units. When that sitting tenant moves, the landlord is free to rent the unit for whatever the market will bear. I think that's a good system. That's what I recommended, something similar to that for Ontario. In fact, that's what the government basically has done. How am I doing?
The Chair: You're doing great.
Mr Lampert: Okay. I've got three more slides. I want to put a little plug in here for taxation. That's one of the other three major areas I looked at and it's key to rental investment. The key issues here are, first, income tax treatment. In the past there was very favourable income tax treatment for rental housing. That's not the case any more. Now it's treated much like any other investment. Landlords are having to treat rental housing as an investment, much like anything else. There's nothing anybody wants to do about that; that's just reality.
The next one is the GST. GST was very unfavourable for rental investment. If you buy a new house, you pay effective GST of 4.5%. If you build a new rental building, it's 7%. Harmonization, as it's being proposed in Atlantic Canada, will make that even worse. You'll pay effectively 15% on a new rental building. Harmonization, and I want to say this to the committee today because it's an issue which probably will come at some point, would be disastrous for rental housing unless specific allowance is made to reduce the rate, similar to what is done with owner-occupied housing.
The third point is property taxes -- a very unfair unburden on rental housing. In some municipalities three to four times as much property taxes are payable on a rental building compared to a similar owner-occupied building. That's just not fair and it's also crazy when we're trying to encourage new rental investment, and also when one recognizes that most of the tenants in rental buildings tend to be lower-income people, relative to owners. My recommendation from the report is that in the long term we've got to equalize the property taxes, particularly for new buildings, right off the bat. We also should be working to ease the GST and to harmonize the PST.
In summary, key elements are:
Rent regulation similar to the BC model. That would, in my view, provide assurance regarding a future rent control environment. I don't think another government would want to change it. Once it's in place it's a fair system.
Phase in fair property tax assessment -- an immediate reduction for new buildings.
Streamline regulations.
Harmonize the PST/GST with caution.
The final point is my views on the government's proposed package. I'm a very strong supporter of the government's package. The key elements of the package are similar to the BC model. It provides protection for tenants but also fairness for landlords. There's assurance there for new projects regarding regulations and a fair and workable tenant protection package. There would be less incentive, as I said, for a future government to change it. I'm hopeful also on property taxes, but that's beyond the scope of this commission.
The effect of the package on rental construction: I think the changes to the regulatory environment will be a very positive force to stimulate new rental activity, but you have to recognize that it's not the full package that I recommended in my report. It will be a very positive measure, but it won't be the full package. But the good news in that sense is that it's not an all-or-none situation. If you make incremental changes such as are recommended in the government's package, that will result in incrementally more activity. The more you do, the more activity you're going to get.
Mr Curling: Thank you very much, Mr Lampert. We awaited you a long time. We had hoped to get a much longer time with you, because I find that your report is extremely important. As a matter of fact, last night I picked up a report to read; while I was doing that, I thought I was reading your report, but it wasn't yours. It was the New Directions report, though the government distances itself from your report from time to time. I think it's a very important report, extremely important, but they only give me 12 1/2 minutes in which to do this, which I completely object to, because this is so important.
Based on this very extensive consultation you've done with representatives from the rental housing industry in Ontario, who did you consider to be in that group? Tenants and tenant advocates who appeared before the legislative committee, when they were asked about the input, stated that they were not consulted. Could you tell me who you consulted to prepare this report?
Mr Lampert: No, I did not consult with tenant groups. That's absolutely correct. That was not my mandate. My mandate was to discuss with potential rental investors and associations representing potential rental investors what would be required to interest them in building new private rental accommodation.
My mandate was to look at the supply side of the market, try to identify why people weren't building private rental housing, because they're not, and what would be required to get that working again.
Mr Curling: You're an economist, Mr Lampert, aren't you?
Mr Lampert: That's right.
Mr Curling: One of the greatest investors in any of the market are tenants in this kind of market, because they're the ones who are going to purchase it. You from time to time talk about economic rent and market rent, and one of the greatest friends of the free enterprise system in this situation is rent control which brought about legal maximum rent. Many of the landlords came to us and said, "There is legal maximum rent here and we just can't get it because the marketplace determined this." How do you feel about that? Isn't rent control -- said to be the greatest enemy, the great monster -- the greatest friendly monster, the greatest friend to the landlords in this situation?
Mr Lampert: Yes. Actually, you're right. For some existing landlords rent control has been a very positive factor, but not for the reasons you might suggest. The reason it's been a positive factor is that it's kept competition out of the market. It protects, to some extent, existing landlords from the competition that would come from new rental investment because it keeps that investment out. It ensures, in many areas, a very tight rental market, certainly in Toronto, and allows them the luxury of passing on the guideline rent increases all the time, for a large portion of the market -- not all the market, because a lot of the market isn't at its legal maximum.
But you have to draw a distinction here between the existing landlords, many of whom have been favoured by rent controls, who can pass along that normal increase, and potential renter investors, the people who are going to increase the size of the stock and get us back to a balanced market situation, which is where we want to get to.
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Mr Curling: Let me go to another economist, Reagan, who felt that --
Mr Lampert: Economist?
Mr Curling: Well, the trickle-down theory was there a long time and was made famous by Reagan and Thatcher. You stated that it works. How long would that take? Let me tell you who I'm concerned about: those very low-end-of-the-market people, those $20,000- or $30,000-in-income people who need accommodation.
If everything goes well -- rent control goes, regulations, the government props up the developers -- how long would it take for those people to be housed? Considering that all the non-profit housing has been cancelled by the government, and considering that the most vulnerable people have been gouged by the government for 21.6%, and considering also the regulations that will be changed in the meantime, how long will it take the investors to come and invest at that end of the market and how many units would you see being built?
Mr Lampert: As I said in my brief presentation, no one is going to be building at the low end of the market. That's not traditionally where the market for new private rental housing has been; they build for the higher end of the market. What happens -- and this is theory, but it's also reality -- is that by providing accommodation at the high end of the market, they pull relatively higher-income people out of the existing stock into those units, which frees up units in the existing stock, and a chain of vacancies starts to occur.
We saw it in spades in the early 1990s when the condo glut hit, a huge increase in vacancies throughout the rental market. The greatest increase was in the higher-rent stock, and if you want to refer to page 15 of my report, it shows the vacancy rates by age of building. It goes all the way down, the vacancy chain. The vacancy situation changes for the whole market; it doesn't just go up at the high end and leave the low end very tight. This is reality. This is how it will work.
Now, when will this all happen? It won't happen until we get new private rental investment actually in the ground and built. We're in for a tough time for the next few years while we wait for that investment to occur. That investment won't occur without changes like we're talking about today and hopefully with the property taxes as well. But as I've said, it's not an either/or situation. You don't need to have everything in order to get, all of a sudden, a whole pile of new rental investment. The more you do, the more you're going to get.
Mr Curling: Do you agree with the government to sell off the non-profit housing?
Mr Lampert: I'm not privy to those discussions. That's not really what I was writing my report about. My report was about stimulating new rental investors.
Mr Curling: That's right, and this is what happened. You're creating a demand. You're trying to chase those people out. I think this situation here is saying, "There are people who are paying too little for all these wonderful places they have and we have to chase these people out." Some of them are saying they're paying too little of their income in rental for these units, and they are almost creating a market for that. Some of the landlords have applauded that they should be selling off those non-profits because people are paying too little and the government is subsidizing them, subsidies that should really come to them.
Do you believe that shelter allowance is more effective? Do you also believe that the money that will be given as shelter allowance will increase if it moves to the shelter allowance aspect of things?
Mr Lampert: I'm a long-time supporter of a shelter-allowance approach as opposed to non-profit. I believe it's a much more cost-effective way to house lower-income people within the existing stock, where they already are living and where their main problem is the fact that they can't afford the rent. It's a much cheaper way in the long run, and I've done studies to demonstrate this, to assist these people with the shelter allowance approach than with non-profit. So I'm a supporter of shelter allowances, yes.
Mr Curling: I went jumping all over the place because I'm trying to get everything in.
Mr Lampert: I'm familiar with that; I had to do it with my presentation.
Mr Curling: It's a precious commodity. Even the book here, I couldn't get.
Maintenance: The condition of the stock now, they said, is that about $10 billion worth of repairs are needed to bring it up to scratch. Landlords are asking for more money now to do this. In your discussions, did they say what they have done with the money they got over the years, part of what they were getting through their guideline increases to maintain those buildings? In your consultations, did they say why they did not maintain those buildings? As you want a guarantee that government will not to change these laws forever, did they say they would guarantee that if they get some money now they will maintain those buildings to the standards that the purchase of those renters got?
Mr Lampert: My mandate was to look at what was required to stimulate new rental investment. If you want me to speculate on the condition of the existing stock, the condition of the existing stock is deteriorating, absolutely. Landlords in many cases are not getting the returns on investment that they are looking for. I tried to say that earlier. Rental housing is an investment. You've got 8.2% on a 30-year government bond. Rental housing is a long-term investment. You've got to make more money than 8.2% or you're not going to be in rental housing.
Yes, they are seeking those returns. Yes, the stock has deteriorated, and partly that's due to lack of maintenance. The best way to ensure that the stock becomes better maintained is to make them compete. Right now they don't have to compete on the market, certainly in Toronto; they have an almost guaranteed clientele because the vacancy rate is so low. People don't have an option.
My report was commissioned to identify ways to stimulate new supplies so we get the vacancy rates back to a situation where landlords have to compete again. That's the best way to ensure that people are going to maintain their stock and that we have a freely operating market.
Mr Curling: I've got about a minute and I want to put two questions in quickly. First, I don't know if you'll admit that your report is flawed because you did not look at the other people, like tenants and tenants' advocates. Also, the government approach to this should be having a comprehensive housing policy more than attacking one aspect of the situation, rent control; to look at a comprehensive housing strategy and policy to address this kind of issue. What are your comments on those two points?
Mr Lampert: First, no, I don't admit that my report is flawed. My report was to identify ways to stimulate new rental investment, and that's what the report does.
I would agree with your second point. It would be very desirable to have a comprehensive rental housing policy, where we start looking at ways to ensure that everyone is able to afford adequate accommodation. In my view, a shelter allowance approach is the way to do that. The government has, of course, a full agenda. I'm not part of the government; I'm an independent consultant. My preference would have been to have written a much bigger report dealing with all the issues.
Mr Curling: So you recommended that?
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The Chair: Mr Marchese, Mr Curling only used about a minute of your time.
Mr Rosario Marchese (Fort York): I'm going to take it away from you. Mr Lampert, it's good to have you. You provoked a few more questions than I had already in mind, so I'll try to keep them very short so we can get through them all. You said vacancy is going down, generally speaking, across Ontario. Is that correct, or just Toronto or some other big centres like that?
Mr Lampert: Mainly the problem is in Toronto. Other areas have a much higher vacancy situation. With no new supply, they will come down too, but the urgent need is in Toronto.
Mr Marchese: Of course. It was important, because in some other cities people talk about having high vacancy rates, that it's underestimated, they argue, for a variety of reasons, and that's likely to remain for some time. I disagree with that. I think it's going to come down in a couple of years, no doubt.
Mr Lampert: If you don't get new investment, gradually it will drift down.
Mr Marchese: And I don't see new investment happening.
Mr Lampert: Not unless we make some changes.
Mr Marchese: The other point you mentioned is the filter-down kind of approach. I'm not entirely convinced; in fact I don't think it's going to happen. You pointed to some evidence in the past where the filtering-down process worked, when people went into condos, you said. We've had a glut of condos in the market already. With the elimination of the Rental Housing Protection Act, we're likely to see more of that on the market. I'm assuming many are in the condo market at the moment and they could enter into it because there are many vacancies. I am not convinced that there's a rational reason why the person who has a high income in an existing rental accommodation is going to say, "I was waiting for a new building to be built; I want to go there," and that they will all of a sudden move to the other apartment and leave room for the other poor folks to jump right in. I just don't see it.
Mr Lampert: In the early 1990s we had over 20,000 new condominium units, new luxury condominium units at very high rents, a glut on the market. They were actually unoccupied. It was over 20,000 units unoccupied. They were at rents of $1,500-plus, and they all became occupied at those kinds of rents. If you want a demonstration that people will leave a relatively lower-cost type of housing and move to a higher-cost type of housing, just look at the general move-up market on the ownership side. People, as their circumstances change, find their current accommodation unacceptable: It's too small, it's maybe getting a little shabby, they'd like to move to something else and they can afford it, and they do that. It happens throughout the housing market, not just in rental but in ownership as well.
Mr Marchese: Mr Lampert, it's just going to be a matter of opinion between you and me. I'll disagree.
Mr Lampert: It's a matter of fact.
Mr Marchese: I realize you present it as fact, and that's where I have a problem, with the fact. It remains to be seen whether your facts will indeed be factual down the line. I just don't see it. This government is likely to carry through with your proposals, so we'll see in a couple of years, and maybe we can have another discussion then.
Mr Lampert: I look forward to it.
Mr Marchese: Do you think the government should conduct an impact study before moving ahead with these changes?
Mr Lampert: No. I think the changes are really urgent. I think we have a serious problem looming, particularly in Toronto, where we don't have any new rental supply coming on. It's very urgent that we look at this issue and get it settled and provide the kind of basis that's needed for people to make investment decisions.
Mr Marchese: So we don't need an impact study. We know, from factual information you're providing, that it's urgent to be done.
Mr Lampert: It's absolutely urgent to be done. We could study this thing till the cows come home and I suspect we still wouldn't convince some people that it's the best way to go. But in my view, and it's what I recommended in the report, it certainly is the way to go.
Mr Marchese: Your report alludes to the fact that rents will have to increase in order to attract new investment, correct?
Mr Lampert: In some parts of the market. No. The higher end of the market in Toronto now is not at its legal maximum, so they're not going to be increasing much. What's going to happen is that you're going to build at the high end of the market; you're going to replace some of those condominiums that were built during the glut and were rented out as a desperation measure. They're gradually eroding from the market now. You're going to replace some of those and you're going to pull more people out of the existing rental stock.
Mr Marchese: So we're back to the trickle-down almost.
Mr Lampert: Yes.
Mr Marchese: How will the low-income people move into that rental accommodation which is already probably very costly to get into?
Mr Lampert: Because all the way down the line you end up with people moving out of a $900-a-month unit into a $1,200-a-month new unit. That frees up the $900-a-month unit. The landlord looks around and somebody from a different unit moves into that. It creates a vacancy chain. No one can predict exactly where that will end up, but the general trend in a rental market is, if you don't have a glut when you build new rental accommodation, you don't end up with a huge glut in one particular part of the market and no effect on the other. If you build at the high end, the impacts will flow through to all of them.
Mr Marchese: I disagree with you, Mr Lampert, no doubt about that. I'm reading a line that is beautiful, and this is what I believe: "The end of the down-filtering chain is the slum" really is what we're getting at. In the 1970s and the 1980s, there were a lot of provincial and federal government programs, assistance, for developers to build. They probably would not have done so if it were not for all those programs: the assisted rental program, the Canada rental supply plan, the Canada-Ontario rental supply program, the Ontario rental construction loans program. You know them all, I suspect.
Mr Lampert: Yes.
Mr Marchese: That was bridge financing probably, as it might be called, for some of those landlords. Would you not consider that as a subsidy to the landlord?
Mr Lampert: Oh, absolutely, and I deplore them. I was never a fan of those types of programs. I would much rather see the rental market put on a sound financial footing where you have a regulatory environment and a taxation environment that allows them to treat it as a proper investment rather than have to provide subsidies. I recommended no subsidies in my report. I am wanting to get a solid investment environment for new rental.
Mr Marchese: Mr Lampert, the reason why they were building is because of those programs and the reason why they are not building is the absence of those assisted programs. Would you say that's fair?
Mr Lampert: The programs helped them get over the gap between market rent and economic rent, which is still present, and also the fact that the regulatory environment was not conducive. So they were a kind of subsidy to help them get over that gap and encourage them to build. Would they have built without it? No, they wouldn't have built so many without them, but as I said, I've never been a fan of those programs.
Mr Marchese: In fact, as you state in your report, we have seen a steady decline of rental accommodation over the last many years.
Mr Lampert: Because of the problems with the gap between what they can get and what it costs them due to the taxation environment and also the regulatory environment.
Mr Marchese: I understand. You commented and didn't comment on whether or not you supported non-profit housing, but by speaking to the whole notion of shelter allowance you're really speaking against non-profit housing, because this government says: "We support shelter allowances. We don't support government involvement through non-profit and cooperative housing." So is it fair to say you don't support government involvement in non-profit and cooperative housing?
Mr Lampert: I've always favoured a shelter allowance type of approach for the vast majority of tenants with affordability problems. There's certain a role for non-profit housing. There are many people with special needs: elderly, handicapped. Certainly in those kinds of cases I believe there is a role for non-profit. But to date the balance has been so weighted in favour of non-profit until recently. My view is the shelter allowance approach would be a much more cost-effective way to provide that accommodation, for everyone too. Let me just say --
Mr Marchese: Mr Lampert, I'm running out of time. I want to tell you this. Let me make a statement and then ask one final question or two if I can sneak it in. I'm not a big fan of shelter allowance.
Mr Lampert: I gather.
Mr Marchese: I am a great supporter of government building non-profit and cooperative housing because it builds according to needs, which the private sector does not take into account. It does not take into account the needs of people with disabilities, the needs of HIV people, the needs of seniors, the needs of sometimes families with their own supportive types of needs. That is why I feel we need to be in it. I don't think shelter allowances build housing. They don't build according to needs and they don't stimulate the economy. We've been stimulating the economy through the building.
One final question, if I can, before my one minute is up. Do you feel the government should announce its shelter allowance program as part of a tenant protection program?
Mr Lampert: My long-standing recommendation to all governments is that a shelter allowance approach is the best, most cost-effective way to assist --
Mr Marchese: Should they announce it so we know what they're talking about?
Mr Lampert: I don't have all of the pressures that a government has.
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Mr Marchese: What do you think?
Mr Lampert: My preference would be to have a shelter allowance program in place. That's always been my preference, whether the government has been Conservative, NDP or Liberal.
Mr Marchese: I understand. It's a different question. I was asking whether they should announce it.
But in terms of the Rental Housing Protection Act, do you think it's going to take away rental accommodation that we have when they convert to condos, by and large? The condo association says they're likely to convert, and they're very worried. Won't that take away rental accommodation?
Mr Lampert: There will be some landlords who will want to convert. Not all landlords want to convert. Many existing rental buildings are in fact condominiumized already, so they have the option to condominiumize if they thought there was a market there. There are certainly going to be some conversions, but you have to look at it two ways. One is it's a conversion of a rental building into a condominium, but the other way to look at it is that it's provision of relatively low-cost ownership opportunities which are not currently in the market. These are not going to be luxury condominiums like we're used to seeing being built lately. These are going to be relatively low-cost, affordable ownership opportunities. To that extent, it's going to actually reduce rental demand, because there aren't those sorts of affordable ownership opportunities for many tenants now.
Mr Bart Maves (Niagara Falls): Thank you, Mr Lampert, for coming today and making your presentation. Just to get it out of the way, in your report you have basically said what your mandate was. It was to examine the economics of private rental investment and to identify measures which the government could take to encourage the construction of new rental housing. So you didn't speak with ice cream or shoe salesmen; you spoke to people who build rental housing.
Mr Lampert: Not many ice cream salesmen, no. It was the summer when I wrote it, so there were one or two.
Mr Maves: Mr Marchese and the members of the Liberal caucus have always been quick to point out that your report says removing or relaxing rent controls won't do it. And I flip the page and I pull out a list of things you have for overcoming the gap: development charges and GST, some of the things you've talked about today. You say if we don't give them all of these things, they won't build. Is it an all-or-nothing proposition?
Mr Lampert: Absolutely not. It's a package. The more you do in terms of relaxing the regulations, improving the cost environment and taxation, property taxes particularly, the more rental accommodation you're going to get built. It's not an all-or-nothing situation. This is a very key part. If you do the other and don't change this, you'll get less. If you do this and don't change the taxes, you'll get less than you would have if you'd done them all.
Mr Maves: So incrementally with each change you'll get more construction.
Mr Lampert: Incrementally more. That's right.
Mr Maves: I had a gentleman in Hamilton tell me about a person from West Virginia who was in the rental apartment business, and he was interested in building in Ontario. The gentleman from Hamilton shipped him the acts governing rent controls and landlord and tenant and so on in Ontario, and the gentleman from West Virginia went to Quebec and built. How much of a psychological factor for landlords is the whole gamut of regulation and legislation surrounding rent control?
Mr Lampert: Huge, huge, huge impact. Landlords are frightened of anything that controls their potential return. They're happy to work in a marketplace, but many landlords see government regulation as capricious, subject to change every time the government might change, and that's worrying to them. That's why I was trying to recommend and I like the system that is being proposed, because I think it's fair to both sides. It's not total decontrol, as the industry has been asking for. I think it's in the long-term interests of the industry to have some measure of control, such as was recommended in my report and is part of your package.
Mr Maves: Can I explore that? Your reason for that is not necessarily that you don't believe from an economics point of view that decontrol doesn't work, but you believe from a politics point of view that if we move to decontrol, in the future another government would change it and that would make an unstable environment?
Mr Lampert: That's right. Inevitably there are cycles. The vacancy rates go up and they go down. At some future time, as there was in 1975, there will be a tight market and there will be a situation where landlords could have 20%, 30%, 40% increases. The political pressure under those kinds of situations is irresistible to do something about that problem. I think this type of package would eliminate that type of pressure and allow the market to operate still quite freely.
Mr Maves: Another problem we have: I've seen some numbers that in the Toronto market over 30% of renters have sufficiently high incomes that they could easily be homeowners. If we get wealthy renters out of that market and into the home ownership market, what kind of effect is that going to have on the supply?
Mr Lampert: Anything you do to either increase supply or reduce demand for rental accommodation is positive for the overall vacancy situation and positive for the market.
Mr Maves: There's an article in the Globe and Mail that says sales of existing homes in Toronto are up 5% from last month. It was cited that renewed uncertainty about proposed provincial rent control legislation is partly responsible for the push by first-time home buyers into the market.
Mr Lampert: I'm sure that's a factor.
Mr Maves: I guess if I'm a high income earner and I've got a rent-controlled unit, why move, but if rent controls aren't available to me in that unit, the ownership market looks better for me?
Mr Lampert: Yes, it does. It's a factor in some potential owners' minds. I'm not sure it would be a huge factor that would prevent many people from purchasing a property. I think most people who can afford to purchase would like to purchase a home because it's a good investment in the long run.
Mr Maves: If we don't solve this problem right now, if we don't act soon on something, what's likely to be the result, especially in the Toronto area?
Mr Lampert: You'll have a very significant problem. You're facing a very significant problem, whether you act or not, for the next year or so because it takes that long to build new rental accommodation, but if this is allowed to drag on, a situation with no new investment, you're going to face ever tighter rental markets and real difficulties for many tenants, particularly lower-income tenants. That's the people who will fall out the bottom most. In a very, very tight rental market, it's the low-income tenants who are penalized the most. So it's very important to get new supply.
Mr Maves: I've had landlords in my riding and we've had landlords here who have complained that the previous government's investment in housing cost them tenants and caused them not to invest in the market. Can you tell me what the cost of their programs was to the private sector market?
Mr Lampert: Certainly the non-profit program was in competition with private landlords and also in some areas, certainly areas with high vacancies, would have been detrimental to the operations of private landlords. As I said, I am not a fan of a large-scale non-profit housing program. I think they were a very, very costly way to provide accommodation for needy and market tenants. I think a much more cost-effective way would be to get the private rental market working and provide a shelter allowance type of approach for those who are on low income.
Mr Maves: My final question: Some builders have come and said, "This isn't enough to make us build." I don't know if they're taking a bargaining position there and they want more and more or where they're coming from there. Do you believe this proposal will help to create growth, increase the vacancy rate and stabilize rents?
Mr Lampert: Absolutely. You'll never get all developers saying the same thing. The key thing you have to look at, and it's in my report, is that in Toronto in particular there are a lot of very motivated potential developers. These motivated potential developers are the owners of a significant amount of land, over 100,000 units of apartment land, zoned, ready to go, sitting growing weeds right now. These people want to invest. I've talked to many of them. They've come to me about potential market studies for rental accommodation. They want to invest. If the environment is right and they can see a return, they will invest. There's nothing sacred about rental investment that's different from any other type of investment. They need a return. They're not going to invest unless they get a return. We have motivated potential investors, though, now.
The Chair: Mr Wettlaufer, Mr Maves has left you a minute.
Mr Wettlaufer: Mr Lampert, welcome to Kitchener.
For the past few weeks we've heard a lot of combative talk, if you will, from the opposition parties, and it reminds me of the old saying: "My mind is already made up. Don't confuse it with facts." We heard that, of course, from Mr Marchese, when you quoted your study. There's been a lot of talk about the Russell report and its publication in the Globe and Mail on July 2 talking about a 10% average return on investment over the last 10 years. I notice in your report there is nothing like a 10% average return. The Russell report used 24 buildings as a sample. I wonder if you could comment on the validity of such a sample -- not on the report, but on the sample.
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Mr Lampert: Yes. The sample is much too small to draw serious conclusions from. You also have to recognize that they're talking about the existing rental market, existing buildings. They're not talking about building a new project and what the returns would be expected to be from that project. What we need to do is get new built.
The returns on existing rental properties over the last year or two have improved, and part of the improvement is due to the potential to relax the regulatory environment they're facing. But the key issue is to get new private rental building and not, as is in the Russell index, monitoring the past, because those are in the past.
Mr Marchese: What's the return?
The Chair: Mr Marchese, this is not your turn.
Thank you, Mr Lampert. We appreciate your being here this morning and giving us your input.
HIGHLAND PINES CAMPGROUND PINE MEADOWS RETIREMENT COMMUNITY
The Chair: Our next presenters are from the Pine Meadows Retirement Community, Don Vallery, president, and Janet Vallery, vice-president of marketing. Good afternoon. Welcome to our committee.
Mr Don Vallery: Thank you very much on behalf of my wife and myself. We have two issues to discuss with the committee today, first with Highland Pines Campground and second with Pine Meadows Retirement Community. We own and operate both of them.
Highland Pines Campground is on Lake Belwood, about 30 miles from here, 175 acres, 475 sites. We have about 400 seasonals and about 75 transient sites. We've been in business for 30 years.
The problems we have with the current rent control are in section 3(a) as it is in our presentation to you, where campgrounds are exempt from the Landlord and Tenant Act and rent control. Unfortunately the following paragraph stipulates that rent control and the Landlord and Tenant Act could apply if tenancy goes on longer than four months. I would show you the campground directory we have provided to you. If you take a look through there, most campgrounds in Ontario operate between May 1 and the middle to end of October, which is more than four months. I also refer to the Elora Gorge Conservation Area, which is in the Grand River Conservation Authority. If you look on the last page, seasonal camping is May 1 to October 15.
This is a problem for all parks. It doesn't matter whether they're private parks, municipal parks, conservation authorities or any other type of park. That particular clause for campgrounds that are campgrounds, not residences, should be extended to at least six months, if not eliminated altogether.
That's the item we have with the campground. Janet will deal with Pine Meadows.
Mrs Janet Vallery: We have a community called Pine Meadows Retirement Community. It's located just outside Fergus. We're four years into our project and we're just over halfway through to completion of it. We build high-quality, energy-efficient homes with full basements for seniors. The tenure of the land there is land-lease. A land-lease community is a distinctive form of home ownership. In the discussions you've focused on rental properties. These are not rental units; these are homes that are owned by the people living in them. In a land-lease situation, the fees they pay are for the lease of the land the home sits on and maintenance items. As a form of home ownership, land-lease is more similar to a condominium situation than it is to an apartment rental type of situation.
The problem we've experienced after four years of operation is that we're starting to come into extra costs that we cannot pass on because we fall under rent control, and there's some risk to the residents in our development in terms of the services they receive. We would like to make six recommendations or suggestions for changes to the legislation.
The first is that any new legislation should recognize land-lease communities as separate entities from apartment buildings. They're a unique situation, a unique form of home ownership and should not be treated in the same way that an apartment building is treated.
The second point we'd like to make is that a land-lease fee is charged for the lease of the land. We believe there should be some form of rent control on this, or alternatively, that you look at the consumer price index, which is a more accurate economic indicator.
Our third point, and this is where we're starting to experience problems that many other land-lease communities and mobile home park communities are experiencing: We believe that maintenance should be a pass-through expense to the homeowner.
There are three types of maintenance that can occur in a land-lease or mobile home park. There are the normal community services which are maintaining the roads, the water, sewers -- in our case we have three sewage treatment plants that we operate and maintain -- the lighting, the maintenance of the common areas. In normal situations this is handled by a municipality, and a municipality would be allowed to pass on costs for this through their taxation. Under rent control we cannot pass on these costs.
The second kind of maintenance activity is recreation and lifestyle amenities. These can be extensive or they can be a very small portion, depending on what amenities are offered. In our situation, we were mandated in our development agreements with our township to build an extensive recreation facility. We completed that in December 1995. The cost to us as the developers was $1 million. The recreation facility has been operated now for six or seven months. Under rent control we cannot recover the costs to operate that building; we cannot recover the costs to operate the hydro, the heating, the water, the cleaning of the facility that our residents are enjoying.
Another aspect that falls under maintenance in a community could be personal services such as the mowing of individual homeowners' lawns and removing snow from their driveways. We do not feel that it is appropriate for government regulations to control what should be a relationship between a provider and the person requiring the service.
The maintenance aspect is a serious problem. In our community we have a good relationship with our residents. We have a very high quality development and very high standards of maintenance that our residents enjoy. Under the legislation, if it doesn't change, because we're not recovering our costs we'll be forced into a situation where we will have to offer a declining level of service. That is not in the best interests of ourselves or our residents.
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Another problem arises because we've developed in phases and people have come in at different times. We didn't charge for the recreation building when it wasn't built. Earlier residents may be paying only $116 for maintenance, other residents are paying $129 and yet others are paying $149, so we have a disparity within what individual residents are paying. It's not fair to them that they all have equal services and equal recreation facilities and pay different rates for them. We'd like to be able to adjust it so that everybody pays the same.
We believe strongly that it be mandated in the new legislation that there be a maintenance committee formed of homeowners who meet with the land owner on a monthly basis. The purpose of this is to look at the cost of maintenance and appropriate levels of service. These are aspects that don't need provincial regulation; they can be worked out between the parties. We've been operating for four years, and for the past four years, even though we were under rent control, we have met with our residents' maintenance committee every single month and have worked out any conflict; we've worked out levels of maintenance and cost of maintenance. This is, I think, a key factor for new legislation.
These communities can be very similar to condominiums, where a set of controls is necessary to protect the integrity of the community and residents' property values. We feel that in the legislation it should be made clear that if there are rules, they should be in the documentation provided to people before they sign an agreement to purchase a home. In this way they know what they're getting into, what's permitted on the property, and they can decide at that time whether this is suitable to them.
In our situation we do not allow fences or sheds because we do all the grass care in the community. Maintenance costs would just soar out of sight if we had to worry about fences and sheds. Also, there's the aesthetic value. You don't know what a neighbour would do that would be unsightly and unacceptable.
We believe that in a resale, the lease should revert to fair market value. This equalizes the value of all homes in the community and gives all homeowners the same chance of selling their property. During startup, a project will often discount its leases to entice the first buyers to move in. They're pioneers, they're moving into an unknown situation, so it's quite normal to offer them an incentive in terms of a lower lease rate. These tend to be undervalued. We believe the benefit of that low lease rate should remain with people as long as they choose to live in that home, but when they decide to sell, we believe it should be readjusted to fair market value for the new home buyer. This equalizes the value of all leases and makes it easy to sell all the properties.
Under rent control we cannot offer new services because we cannot recover the costs of those services. Our residents would like more cable TV stations. The cost to do that is $3,500. We're in a situation where we can't recover that cost even though they want this service and they want to pay for it. So any new services that come on which residents and the landlord or land owner agree to should be passed on to the homeowners.
We've attached a grid that compares land-lease communities to condominiums and apartment buildings. It shows clearly that land-lease communities are more similar to condominium units. We've worked very closely with our residents on how costs should be appropriated. We would be glad to offer our community as a model and provide you with our documentation for any new legislation that you might be introducing.
Mr Curling: Thank you for your presentation. I'm looking through the extensive stuff you've got here. We have had people in that jurisdiction who have come before us and presented the same case as you said, to separate you in separate legislation.
But I also notice that what you're asking for -- is it fair for me to say that some of the things you're asking for, all the additional stuff that you have, you'd like this to be passed on to the tenants? In other words, you want the cable TV attachment and you want the removal of snow and what have you to be part of the rent. Is that so?
Mr Vallery: Yes, to separate the land lease -- if you look on the first page of our presentation, we have several fees. A monthly fee is, say, $450; $278 is land lease. That, we believe, should be still tied to rent control or to a consumer price index, but the maintenance and operation of the project should be a pass-through item.
The cable TV that you asked about, we currently have 19 channels. Quite a few of our residents would like more. We have an in-house station. We do not buy from Rogers or anybody else; we have our own in-house stations. So if our residents want more stations, we can't give them to them because we would be charging over rent control guidelines. So we can't benefit, we can't give them extra services.
Mr Marchese: Two quick things, Don and Janet Vallery. On the whole issue of campsites, we believe we have come to some understanding between us that would solve that issue. If the ministry staff could speak to that very briefly, then I'll have another question with respect to mobile homes.
Mr Terry Irwin: Yes. This is the issue that's been raised before and there seems to be an apparent contradiction in the acts between properties for the vacationing and travelling public and a clause that talks about four months' residency in vacationing property. We've heard this before and there is some agreement to look at that time frame.
Mr Marchese: I wanted to tell you that.
Mr Vallery: Thank you very much. That's very important.
Mr Marchese: I think so. The other question has to do with general maintenance and some of the tenants being quite frightened about this clause that speaks about higher costs passed through. We've heard horror stories from some of the tenants. I presume you're good landlords and not bad ones.
Mr Vallery: Our homeowners' association is here with us at the present time today and they will be speaking at 5 o'clock. We actually get along very well. We're here together presenting the same points. We have a couple of minor discrepancies that we don't agree on, but the maintenance pass-through we are unanimously together on. That's why we offer our project for the ministry to look at, because we have a system that works.
Mr Marchese: One of the problems that people were raising, yesterday in particular, is the incredible disagreements they have between them over everything; the fact that they get the general guideline increases, and at times possibly above-guideline increases, and they don't see that money going in to general repairs, so they see this cost pass-through allowance as an outrage.
The Chair: Does anybody have a question? Mr Danford.
Mr Harry Danford (Hastings-Peterborough): Thank you for your presentation. We have heard on other occasions about the four months, so it's not something new, but it is important. This is a discussion paper to give you the opportunity to bring it to our attention.
Mr Vallery: Yes, thank you.
Mr Danford: You mentioned either delete the four months or have it go to six. Do you have a preference?
Mr Vallery: Well, the less regulation the better.
Mr Danford: So you delete the four months.
Mr Vallery: Just delete it, yes.
Mr Danford: Okay, because that has been the position I think in some other cases. They've just taken the four months out.
Mr Vallery: That's fine. That would be great.
Mr Danford: When you look at extra services so that you can pass the charges on, do you do that through a committee and then you work by a majority of the owners?
Mr Vallery: We can't do it now at all.
Mr Danford: I know, but if you did, how would you do that?
Mr Vallery: It would be done on a consensus basis. If it was TV stations, you know, if you can come up with 90% that would agree that the charge would go through -- because if you put a new TV channel on the line, everybody gets it. Yes, there would have to be some consensus set up and I think with our homeowners' association we could set that consensus on a reasonable basis.
We do everybody's grass and snow. This is the killer. We don't know how much snow we're going to have to plow. We don't know how much grass we're going to have to cut. That is the killer on the maintenance fees. That is the huge item that's way out of whack and we've had to provide all these new recreation facilities under our development agreements, and we can't recover those costs. We spent $1 million on this building and we can't recover it. It's no incentive to anybody to ever get into this stuff. We started off, we could recover it. We were fashioned after two other projects that were operating where maintenance was a pass-through. That's how we started off and that's how we got into this. I'd have never started with this nonsense.
The Chair: Thank you very much, folks. We appreciate your input this afternoon.
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WATERLOO REGION HOUSING COALITION
The Chair: Our next presenter is the Waterloo Region Housing Coalition, represented by Catherine Heal, Christine Wilson-Whitehouse and Bluma Teram. Good afternoon. Welcome to our committee. The floor is yours.
Mrs Catherine Heal: Good afternoon. On behalf of the Waterloo Region Housing Coalition, I would like to thank this committee for this opportunity to express our opinions today. My name is Catherine Heal. Beside me is Bluma Teram and that lady over there on the far end is Christine Wilson-Whitehouse. We are all representatives of the Waterloo Region Housing Coalition.
Our coalition is composed of non-profit housing providers, co-op housing providers, support service providers and tenants as well. We are here today to represent the vulnerable tenants of this province, meaning low-income or moderate-income households, who spend much more than 30% of their gross income on rent. Five years ago, over 4,000 households in Kitchener alone fell into that category. That was five years ago, and we expect that figure to be much higher today. We are also speaking for the disadvantaged, namely, people with disabilities, the elderly, people with language barriers and other vulnerable tenants.
We know that the vacancy rate is high, and yet a large percentage of people we deal with every day are not able to find decent affordable housing. Like the majority of the speakers you have been listening to in the past month, we don't think the proposed change will solve the problem. Instead, the proposed change will harm those people who are already struggling to survive. It will create higher vacancies if landlords attempt to raise rents, but it will not create an incentive to build.
Instead, the proposed change is designed to accomplish six goals. They are listed on page 1 of this discussion paper that was distributed to different parties. All of the goals will benefit tenants and landlords if implemented in the way that indeed adheres to the goals. Our concern is that the proposed legislation will not accomplish those goals; it will only compound the problem. I will discuss each goal briefly.
Goal number one: Protect tenants from unfair or double-digit rent increases, evictions and harassment and provide strong security of tenure. The proposed legislation will only protect tenants who will never need to move. But may I bring to your attention that some tenants simply need to move for various reasons, and that need often doesn't come with an increase in income. From our observation, as a matter of fact, many people need to move because their situation, especially their financial situation, has deteriorated.
To give you a few examples, a senior widower might need to move to a smaller, cheaper apartment. Without a spouse, he's left with half the pension. There are abused women and children looking for a safe home. There are people with medical problems wanting to be closer to their families or medical facilities. There are people wanting to be closer to where they work. These are legitimate needs to move and are out of their control, and these needs don't come with an increase in income. The proposed legislation, we would like to point out, will not protect these people from rent increases. We also worry that the proposed legislation will encourage, not prevent, evictions and harassment.
The second goal: Focus protection on tenants rather than on units. The intent of the proposed legislation is to enable tenants to negotiate with their landlords about rent and maintenance issues. It puts the onus on the tenant to initiate a negotiation process, but not everyone is in a position to negotiate. We are concerned about the vulnerable tenants who are not well equipped to negotiate. Those who don't have the financial resources, the knowhow, the transportation, and those who are simply not comfortable with negotiation will never negotiate with their landlords and their concerns will never be heard. They need the protection of regulations. Don't leave it to negotiation.
The third goal: Create a better climate for investment in maintenance and new construction, therefore creating jobs. Many of us will be more than happy to see that happen, but eliminating rent control alone will not make that happen. The rents that will encourage development and cover maintenance costs will prompt the well-to-do tenants to buy homes, and that's great for the economy, but for those who are already struggling to make ends meet, those rents will force them to look for cheaper homes, possibly substandard homes, and we will see even more low-income households looking for affordable housing, while more and more units will sit vacant. But we won't see more construction starts.
Please consider this objective very carefully. Remember that a number of landlords and developers have pointed out to you that eliminating rent control will not encourage them to build.
The fourth goal: Improve enforcement of property maintenance standards. We welcome the proposed improvement in this area, if the proposal is enacted as stated and the cost of keeping properties to standards does not translate into unaffordable rent. We would like to caution this committee that the proposed change only deals with the symptom, not the root of the problem, and there is a potential for both the landlords and the tenants to suffer under the proposed legislation in this respect. The root of the problem is economic. The current market rent is lower than what a landlord needs to charge to cover maintenance costs and to make a profit, especially when they have to carry a high mortgage.
If the requirement to upgrade properties is translated into higher rents, tenants will be forced to moved to slums, while the repairs won't get done. It's a lose-lose situation for both parties. Streamlining the municipal enforcement process will help to make it easier for municipalities to convict those irresponsible landlords, but those changes in procedure alone won't make a significant improvement in that area.
The fifth goal: Provide a faster, more accessible system to resolve disputes between landlords and tenants. We support a faster and a more effective mechanism to resolve disputes, but it must remain fair, financially affordable and geographically accessible to all tenants. The judicial system must be maintained to deal with more serious issues. We support the inclusion of a fast-track eviction process for care homes in situations where the individual is dangerous to themselves or others. To ensure the safety of such tenants and others, we recommend that supportive housing providers be equipped with a process for immediate, temporary relocation of the tenants and that a full landlord and tenant hearing be sped up, allowing for an accelerated eviction process.
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The discussion paper does not provide details in many areas, such as the accessibility and the cost of the proposed system to tenants in particular. How much power would this tribunal have? Who will be on the tribunal and how would the members be selected? We ask that a full hearing on any changes to the current dispute system be conducted. The current system may just need some enhancement to make it faster. We don't believe that the current system has serious problems.
The last goal: Deliver a more cost-effective administration with less red tape. Like all taxpayers, we all welcome this recommendation or this goal, provided that it does not compromise fairness, accessibility for landlords and tenants, and adheres to the principle of tenant protection, which is the stated focus of the proposed legislation.
To conclude briefly, it takes much more than a change in regulation to solve all these problems. The proposed legislation clearly will not accomplish goals number one, two and three, and it will not make a significant improvement in goal number four. We regret that we are not able to comment much on goals number five and six because of the lack of information.
We caution against rushing into new legislation that will affect 37% of the population in this province. That is how many people are renters in this province -- 37%. More time and a more widespread consultation are needed. Encourage tenants in your riding to tell you what they need. Don't change the regulation to one that is ineffective and harmful to low-income and moderate-income households. The effects of the proposed legislation will be even more devastating to those who are disadvantaged, the people with disabilities, the elderly and other vulnerable tenants. We as a society have an obligation to protect vulnerable tenants. I thank you for your patience. I would also like to point out that there are other coalition members present today and they're mostly people who are sitting in the front row in the audience. I welcome any questions.
The Chair: Thank you. We've got about two minutes per caucus for questions, beginning with Mr Marchese.
Mr Marchese: I have about four questions, if I can. Thank you for the presentation. Did you read this -- you must have read this, of course, very well?
Mrs Heal: Yes, we did.
Mr Marchese: Were you here for Mr Lampert's presentation this morning? Some of you were? He said it was a fair package, both to the tenants and to the landlords. He felt we needed to do this. Do you see anything in here for tenants or anything that you think is fair for tenants? As quick as you can.
Mrs Christine Wilson-Whitehouse: I would suggest that tenants who have all the advantages will move quite easily in this system that's being proposed. They'll have the money to rent the units that they want. They'll be able to move when they want. They'll be able to negotiate. It will be a system that will be comfortable for those with all the advantages already. We suggest further that those people would be more inclined to buy homes.
Mr Marchese: Thank you. There's a lot more that could be said, I know, but there is nothing here for tenants. It's all focused towards the landlord, by and large. That's my reading of this report, and most tenant groups have been saying as much.
In terms of the trickle-down theory -- you touched on it as well just now and in your report you talked about it -- Mr Lampert came here this morning and he says there's a trickle-down theory. As you build more units at the high end, then those other people in buildings will move out to those places -- even though it will cost a couple of hundred dollars more -- and that will leave room for others to get into the rental accommodation. I don't think that's going to happen. I think it will create a problem, and you stated as much on page 4 when you say, "renters who would be able to pay such high rent could then opt to become home owners." That's my feeling of what would happen. "This will create vacancy at the high end of the market and no stimulus to build new rental housing." I just wanted to agree with that particular comment that you made.
In terms of what it means to low-income tenants, we are very concerned about the implications of this report because what's available is at the high end --
The Chair: Thank you, Mr Marchese. Mrs Ross.
Mrs Lillian Ross (Hamilton West): Mr Marchese and I have a fundamental disagreement on this process.
Mr Marchese: Profound.
Mrs Ross: Yes. If you look at pretty much every single commodity that is supplied to people anywhere, if there's greater competition -- for example, take clothing -- if there's greater competition in clothing, what happens is the price tends to go down. If you look at housing, the same thing. We talk about private housing as opposed to rental housing. I used to be in real estate so I know that when people buy new houses they move from a previous house which someone else down the line buys. The same thing in cars. When there's greater competition prices tend to come down and it's easier to find accommodation, clothing, cars, whatever you want.
I'd like you to tell me why you think that if higher-end accommodation is built and people move out of accommodation into that, it frees up their unit, somebody from another unit moves up, why you think that won't happen.
Mrs Wilson-Whitehouse: First, I must point out that housing is different from cars and clothing. Housing is an essential need. Everybody needs it. Those who have it have already the advantage because it's not a commodity you can choose. You must have it. There is some choice there.
We do hear from landlords pretty consistently that they're unhappy with the business of being a landlord. They're not able to make enough money. We're concerned that even the landlords who end up with the lower end of market units are still not going to be able to make enough profit to keep them in the business; they're going to have to sacrifice even further the condition of the units. They've been saying, "We're not happy with the current system," so the competition is going to be to increase the rents. I wonder what's going to happen to those landlords who are going to be, might I say, stuck with the lower end of market rents.
The Chair: Mr Sergio.
Ms Bluma Teram: Could I add to that?
The Chair: Unfortunately, we're stuck with some very tight time frames and we have to be quite stringent on them.
Mr Mario Sergio (Yorkview): Okay. Thank you very much. I have --
The Chair: Unless Mr Sergio wants to give you his time.
Mr Sergio: Do you want to, quickly? Quickly, so I can get my question in too?
Ms Teram: I just wanted to say that I think the argument is fundamentally flawed, and one of the reasons is the issue of supply and demand. There's high demand; there's very low supply.
The Chair: Okay.
Interjection.
Mr Sergio: Uh, uh, uh. Let's be fair now. I won't have many questions, but let me read you a quote from someone from Lindsay while we were in Peterborough. She said, quoting Mr Harris prior to the election: "We want to bring in a rent control program that will truly protect tenants and give them lower rents. We will replace nothing until we have a superior plan in place proven to work better." From your presentation, do you think the proposed legislation is superior to what we have now in protecting tenants?
Mrs Heal: No, we don't think so. In fact, we don't see any replacement or policies that will mean a higher supply of rental housing. I know the stated intent of this proposal --
Mr Sergio: Are you telling the government to go back to the drawing board and get something better instead of pushing this legislation through?
Mrs Heal: Yes.
The Chair: Thank you, ladies. We do appreciate your input here this afternoon.
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WATERLOO REGION COMMUNITY LEGAL SERVICES
The Chair: The next presenter represents Waterloo Region Community Legal Services, Larry Skoog, staff lawyer. Good afternoon, sir. Welcome to our committee. The floor is yours, sir.
Mr Larry Skoog: Thank you very much. Although my written submission talks about affordability, I may talk more about dispute resolution issues. As a lawyer I probably don't have much knowledge of financial matters, so I'll stick to other issues. But I wish to support the previous speakers.
Our clinic acts for low-income people in this region. We're mandated to do so. We are scared about some of the proposals, about the impact it may have on our low-income citizens. There is a problem with affordability for low-income citizens in this region in relation to apartments. Also, there was, when we had active not-for-profit housing building going on, competition for that and it lowered the price and it lowered the rents in the private market. Competition did work. When not-for-profit housing was being built, it kept rents down in the private sector. So there's where competition did work.
No doubt there will be some building here, and I have some newspaper quotes on my paper and it refers to a Mr Hallman, who's the major builder in this community. He indicated that while he was happy with some of the changes in the legislation -- it's at the back under "Renters Need Not Fear, Says Landlord" -- he forecasted, admittedly he said, a minor rise in rents from $600 to $625, 4%. For some people that would be difficult.
Let's look at what he said. He said: "Hallman also disputes Leach's belief that the proposed changes will result in the construction of as many as 20,000 new rental units in the next few years, since the private sector has had a virtual freeze on building new rental space. Not in this area it won't, because people won't pay $900 a month in rent. That's what we need to build a new apartment and that's why we have a foundation just sitting in Waterloo."
Somebody like me might benefit from this. I guess what I fear is my low-income clientele won't benefit. We're a relatively prosperous area in this region, but there is an underclass that's not really doing well with this new economy and, therefore, they're having difficulties with many things, and one is affordability in housing. What we've seen since the past year is not too many people going up because a lot of people on social assistance have had cuts and they've been forced to move down. So it's been the opposite effect.
But as I say, there may be some percolation in the future, but it would take a long time, and that's what we're concerned with. The vacancy rates are declining. In the mid-1990s there was up to about 5% or 6%, but now we're seeing the decline down to 2.4%, and I think it's below 2% the last thing I heard. Right now, if you took a snapshot picture in 1995, there was probably a proper vacancy rate and proper price range for most one- or two-bedrooms, but the trend is going the other way.
I just wanted to bring a point from Mr Hallman's report. Also, I've got a newspaper report about -- I don't know, I guess I've got nothing else to do on a Saturday morning, but I was reading about the BC election, and on May 9 it says, "Tenants Fear Repeal of Law Curbing Rents." I'm sorry about the small print. That's the best I could do. The copy I made is all -- my secretary had to straighten it out. It said in this: "Few new rental units were being built in Vancouver even before the legislation took effect. On average, 484 units were built annually in the five years before 1994. In the last two years, the average was 449." So you've got a hot rental market and the builders aren't building.
Now, admittedly though -- and this is something too: "Over the past 12 years -- including 10 years without the rent protection law -- " because Social Credit didn't have it "the average rent increase has been almost identical to the rate of inflation." So there was no problem with price range in BC; it was all the people coming into BC, but you weren't getting the building.
We've got our problems with vacancy decontrol. You've heard that before, but I think what I want to raise is, we are a university community, north of here in Waterloo, two universities. The students, with the co-op program, move a heck of a lot, so decontrol will matter quite a bit. This is one market where I say perhaps with the depressed market locally, we may not see the increases of rent you've seen in Toronto and Ottawa, but here's an area, you've got university students, all they want to do is live close to the university. So you've got a nice middle-class market. What I fear is that you're going to see a real increase for student housing price-wise with this, because there's a market there and they can pay it in the short term. It's going to cause some impact with the higher tuition rates and everything, but I think there's a real problem here with regard to student housing, and that's where we're going to see some big increases.
Generally, we're in favour of the anti-harassment unit. That's fine, if the government wants to create such an organization, but we also think there should be, besides the fines -- because the problem is that fines tend to be minimum or they don't go close to the maximum, but civil remedy should also be included, which includes damage actions to a court for landlords' actions. But, as I say, with the anti-harassment unit and also the dispute resolution, you can't do this on the cheap. There's got to be a lot of money being spent for this, because there are going to be a lot of complaints coming to this organization and it's got to be well funded for it to have any credibility.
In regard to rent control, as I say on page 6, the discrimination I think on tax issues should be looked at. Governments control taxes, all levels of government. Those tax discrimination issues should be looked at first. Get that settled and then go to rent control and look at that.
I guess it was up at city hall, and I hope I'm not misleading -- I'm reading here "residential development charge," and it's as of 1996. It says: "Single dwelling, per dwelling unit" -- like for full services -- "$4,940," but then you have apartment per dwelling unit, it's half of that, $2,655. There it shows the discrimination that you have per dwelling unit versus single-family residences.
We are happy that the government is trying to enhance property standards, but again, as you must note, the municipalities have been cutting back slightly in property standards. Right now, we find in our community that tenants have to write a letter first to the landlord before property standards will do an inspection. They're trying to say, "You try to solve it first with your landlord and then we'll come in." Also, because of the heavy caseload that they have, the tenants have to go and always ask them to come back if the landlords didn't do the work. It's all complaint-driven. So fine, we like property standards and good strong property standards are necessary, but we must remember it's a complaint-driven mechanism.
What I find many times is the tenants call the clinic and say, "We've got problems with repairs" and call in property standards, one week before they move out. That doesn't help with property standards because they don't know the place exists, and that's what we do. So we're hoping that the government will spend some money and help advise people of property standards and also advise them of the new dispute resolution system.
Also, we have some concerns with the RHPA. We must admit in this jurisdiction, conversions were allowed because the vacancy rates were higher, so conversions were being allowed with conditions. But with the vacancy rate going down, we've got some concerns with the repeal of the RHPA.
What our policy committee at the clinic wanted us to do -- what we're concerned with is some of the changes in the dispute resolution system. The example given in the discussion paper, five months to get rid of a troubling tenant, doesn't bear any experience in this local region. We have a very effective court system to terminate tenancies. Most of the applications in court are all landlords. They're going to lose in a cost-effective termination system -- and they're getting worried about it -- if you go to some sort of tribunal system out there, because in our jurisdiction you can get rid of a rental arrears tenant in 30 to 45 days, not the five months it says in the paper.
Also, the glory about the court system is it's based on a county system. So sure, we're great in Kitchener. We have an L&T court and we have a rent control office, but what if you're stuck up in Stratford or Orangeville? A landlord doesn't want to come down here and file a rental arrears application in Kitchener. I think there should be some local component to the dispute resolution system, and that's what we're afraid we're going to lose.
As I say, one local paralegal -- in our area mostly paralegals act for landlords -- they checked his files, and the longest it took from notice of termination to writ of possession was seven weeks, not five months. So you're losing a very effective court system and, as our policy committee was saying, if you're going to put everything into a tribunal, you're not going to get less people working at those courts, because it's been added on. Admittedly, they'd like it all to go to a tribunal, but you're not going to get any massive tax savings for the taxpayers, because the government paper quite rightly points out that they're going to give a strong mandate to this new tribunal. It's going to cost a lot of money to effect this, and that's what the purpose of our paper was, that it can't be done on the cheap. Right now, rent control offices have a heavy caseload with rent rebates and applications to reduce rent, but if you're going to add all the other mechanisms, like all the disputes from landlord and tenant court, it's very unfair on those people to do the same type of work. It's going to cause delays, and I would argue that parties, landlords and tenants, would lose confidence in the system. That's a concern we've got. We want a quick mechanism, whatever you choose, and a quick mechanism means proper staffing and proper funding. There's just no way around it.
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Also, we must submit here, because of the high vacancy rate which other people have mentioned in Kitchener up to now, tenants have moved out if they didn't like the landlord. They moved out, so a lot of the actions in court were in Small Claims Court, which is locally based too in many counties. That's where the business has been. Maybe in Toronto tenants fought because there was a low vacancy rate, so that's where the battles were in landlord and tenant court, in superior court. But in our jurisdiction, there's a lot of stuff going on in Small Claims Court, landlords suing tenants because they moved out without giving proper notice, and then you have tenants going against landlords because they didn't get repairs. They asked for damages.
When you consider the dispute resolution, as it says here, the superior court and the tribunal, a lot of actions are going on in Small Claims Court and that's a very accessible system. People don't have to be represented, and the costs for enforcing orders are quite inexpensive in Small Claims Court, so those are things you have to consider. If you're going to put everything in a tribunal, you're going to need extra staffing to be able to effect this quick determination, because nobody is going to benefit if it takes a long time to do it. Already, as I say, it takes two or three months for a rent rebate application. An application to reduce rent will take two or three months.
If a tenant wants to go to landlord and tenant court individually, you could probably get a repair application heard in about a month's time, so you're losing cost-effectiveness. I'm saying what the previous speakers have said. You should have trained adjudicators hearing this in an open and select process. I've indicated, because we admit that a lot of paralegals are acting for landlords and tenants, you should maintain the agency. You don't have to be a lawyer to provide representation, because if you want cheap representation, to have a monopoly by the law society may not provide that result. You've got to keep agencies in the legislation whatever you do, so a paralegal can still act.
Also, we're saying one level of appeal for divisional law. You don't want to have it like the old rent control legislation where you had two trial de novos, two oral evidence. Then tenants got rent increases two years down the line retroactively. You want one appeal system and you want a quick determination but a fair determination, and that's what you need. I've tried to set out in bullet form some of the things to be concerned with.
Also, I just wanted to point out, plain language -- and I put a copy of a form 6. This is a problem that landlords have. You can see here it's drafted probably by lawyers. It says, "I hereby give you notice to deliver up vacant possession and occupation of premises which you hold of me as tenant" on the blank day of blank. Who talks like that, "which you hold of me as tenant"? Nobody. Why can't you just say, "Get out," in simple terms? So you've got here, and this is what happens, and it's just not the ma-and-pa landlord that makes mistakes like this. Often sometimes you'll have a landlord dating this and say, "Please get out in 60 days." They don't understand it. They think that notice is saying you're holding this unit on the same date you date the notice, so they date the notice the same day as they date the "Get out." So when they go to court 60 days hence and they say, "Give this to the registrar," they say, "I'm sorry, the notice isn't valid because they don't give the 60 days' written notice," even though it says that on the back. But it's not that clear, plus -- and this is again a problem for landlords, because what I'm saying is the purpose of clear forms would be that people have access and the issues are decided on the merits, not if I can win on some technical defence.
Here's another example, "which you hold of me." You expect to get out in 60 days, tell the tenant to get out. You say the first day of the month, but if you pay rent on the first day of the month, the last day of the tenancy is the 31st, so if the poor landlord puts the first day of the month, he waits, he goes to court, and the judge says: "Sorry, that's not the last day of the tenancy. Try again." Just because he went one day over after giving 60 days. This is where you need it clear. Why can't you explain that the last day of the tenancy is the day before you pay the rent normally? It doesn't say that on this notice.
Also, the same thing about poor tenants getting repairs. You've heard this. There's no repairs form for tenants, so what do they do? They go to rent control, because it's an easier system to use. What we've found is that the tenants have been able to fill out the rent control forms themselves. They don't come to legal clinics for assistance, except for getting affidavits done. So it can be done, but this is just an example of the problems that you have, and it's not just tenants having trouble with accessibility, you have landlords.
The one problem I mentioned about the dating problem, I had doctors making a mistake, trying to kick somebody out on 120 days' notice, and doctors made that mistake. It's not clear.
I think I've talked as long as I should, but I've got other landlord and tenant issues here where I've indicated that should be done. What we are mainly concerned with is that the right to compensation for repairs be kept retroactive so that people can get repairs and compensation for an abatement of rent from the date the problems occurred until the date the repairs are done. That's the main thing we've got in here.
But as I say, if you're going to go to a tribunal system, please take the time. I don't think it can be done very cheaply. Also, I have to say you're losing a very cost-effective system. We may have some problems with the courts, but they've done a very good job and they've been doing it in a quick, easy way. I think, if you're going to go to a tribunal, you're going to have to spend a lot of money and you're still going to have the same expenses for those same courts, because they won't be withdrawing their staff. They've been doing the L&T stuff added on to what they already do now. I'm finished.
The Chair: I don't know about you, but I'm exhausted. We've got a quick minute per member. You did an awful lot with 17 minutes. Mrs Ross, we've got a minute per caucus.
Mrs Ross: Actually, I have no questions for you.
Mr R. Gary Stewart (Peterborough): I don't know whether I can talk as fast as you or not, sir, but it appears to me that what has happened in the past, as you have indicated in the examples today, has not been working, so I think what we're doing in the discussion paper is to look at things.
One of the concerns I have is, you're saying that what we're possibly proposing is going to cost a lot of money. Is what we're doing now not costing a lot of money?
Mr Skoog: You have duplication, I admit, in some areas, but still, rent control mostly handles things from the Rent Control Act and the courts deal with landlord and tenant disputes in Small Claims Court and in the superior court. What I'm saying is it certainly does cost you money, but the problem is I don't think you're going to be able to save money when you take it out of the courts and put it into the tribunal, because you're going to have to add staff to the tribunal and then you're going to have to put more money there, plus with the anti-harassment unit, and you're still going to have the same expenses because right now superior court I think is paid by the federal government. They're still going to be sitting there, and you're still going to have the same staff. They don't have an abundance of staff. They're still going to be used to handle the cases that remain in that court. That's what I'm saying. Our policy committee wanted to say the expenses would still be there for the courts for this province, plus you're going to need to spend more when you put it all over to the tribunal.
Mr Curling: Thank you very much for your presentation. Of course, every government would like to put their brand on their legislation, and this government wants to throw out the baby with the bathwater. What you have said has been said all across the province where we've been, that the system is not perfect, but that doesn't say you must throw the whole system out. There are ways it can be fine-tuned, because they have emphasized exactly what you've said, that putting this in place would cost you more. As a matter of fact, if you have a system that's working effectively -- people have stated that. The court is working and all they have to do is make it more effective and more efficient itself and give it more staffing.
Then, in the meantime, Lampert, who came here, is telling them, "Try and get it in and try and make sure that the next government can't change it at all." They want to guarantee something. I have an answer for them. Just turn the place as you do in a dictatorship, no more elections.
Mr Marchese: Is it Mr Skog or Skoog?
Mr Skoog: Skoog. It changes with the season. They call me Scrooge at Christmas.
Mr Marchese: No, no, I don't think so.
You obviously have a lot to say, and I appreciate your going at the pace that you did. I listened with keen interest. I just want to make some comments in relation to what you've said, because there's no time for a question. But first, on the simplicity of language that we use in forms, it has always been this way. In every committee that I've been aware of, we talk about simplifying forms. I'm not sure we ever get it right. We're amused by it all the time, but I'm not sure any government takes the time to undo some of those problems. But I think you're absolutely right.
With respect to solving the tax differential issue of buildings, I think you're right; it's complicated. No government wants to deal with the fact that if you all of a sudden take the tax burden from here and shift it somewhere else, someone is going to pay. It's a political problem, difficult, but I agree with you we should do that before we even talk about rent control.
The Chair: Thank you, Mr Marchese, and thank you, Mr Skoog. We do appreciate your input this afternoon.
Mr Marchese: I was trying to go fast too.
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HOUSE OF FRIENDSHIP
The Chair: Our next presenters represent the House of Friendship in Kitchener, Ms Deborah Schlichter. Welcome to our committee. The floor is yours.
Ms Deborah Schlichter: I will take less than 10 minutes to present my material, so you will have some opportunity for some questions and maybe make up some time.
I'm here today representing House of Friendship's response to the New Directions discussion paper on the proposed tenant protection legislation. I'd like to start by telling you a little bit about who we are so you can put my comments into some context.
House of Friendship is a multiservice charitable organization with a mandate to provide services to low-income persons. Along with community outreach services, we provide 144 beds of accommodation through our continuum of housing, which ranges from emergency shelter, rehabilitative programs to permanent housing. While we are a landlord, we are also sensitive to tenant needs and we work together to provide safe, decent and affordable living communities. Many of our tenants have special needs and require supports in order to live independently.
I want to share some of the concerns we have.
(1) As an organization that provides housing for low-income persons, our main concern with the proposed tenant protection legislation is that it does not deal with the current lack of affordable housing. You've heard this said a couple of times already, and I'm sure in the other areas where you've been you've heard the same statement, but I want to go over it again. In fact, some of the suggested changes in the legislation will only compound this problem, according to what we feel.
First, as is proposed, the landlords will be able to raise the rent to whatever level the market will bear for new tenants moving in. How will this affect the housing available to low-income tenants? What the market will bear is not affordable housing for many people. Low-income tenants already are struggling with covering their existing rental costs, especially those on general welfare assistance and family benefits mother's allowance with shelter allowance cutbacks.
For example, a single person on general welfare assistance now gets $325 a month to go towards their shelter costs. In our apartment that we have, the market rate for a one-bedroom unit, which is at the low end of market, is $502 a month. You can see the discrepancy already that exists.
Many others are lining up on waiting lists for the small supply of subsidized housing so they will not have to pay more than 30% of their income on rent. We run a subsidized housing project. We have many people on a waiting list. Our waiting list is not moving because people are not leaving. They're safe. They know they have the 30% protection. The people who are waiting on the list are not going to be getting in because that waiting list is not moving.
What will happen to low-income tenants if rent rates increase substantially is that they will either have to take these high-priced units anyway because of low vacancy rates, be forced to spend more income on rent and therefore rely more on food banks, soup kitchens etc for their other essential needs, remain in substandard, overcrowded, illegal and unsafe housing that is affordable, or be forced to continue staying in hospitals and emergency shelters. None of these options are acceptable. This will be even more of a problem for those tenants with special needs who require not only affordable housing but supportive housing.
Secondly, the proposed changes to the Rental Housing Protection Act will also have a negative effect on affordable housing. Our concern is that without the current legislation in place, the limited supply of affordable housing will be further reduced as property is redeveloped or converted for other uses.
The real problem here is that there is already not enough supply of decent affordable housing to meet demand. This is a point on which we agree, as you acknowledge that rental stock is aging, vacancy rates are low and there are few new rental housing starts. Where we begin to disagree is the cause of this problem.
The fact is that rents will need to be extremely high to cover the cost to build and manage rental housing, especially if landlords expect to have a profit. Only a few tenants are going to be able to afford this. We feel that by removing rent controls and changing other legislation, this will not increase the supply of affordable rental housing but will instead make the situation worse.
I'm going to quote some findings that were in a study commissioned by the Ministry of Municipal Affairs and Housing, November 1995: The Challenge of Encouraging Investment in New Rental Housing in Ontario. It noted that regulatory changes alone will not be enough to stimulate substantial amounts of rental investment in Toronto, which has the most serious supply problem in Ontario, and any new private rental starts in Ontario will target the high end of the market. That is our concern.
A second area of concern for House of Friendship is that we feel the proposed tenant protection legislation places even more responsibility on tenants than before. They need to challenge illegal rent increases, to negotiate with landlords for work done, such as a capital improvement or a new service, and to apply for relief of harassment. This means tenants will have to be even more aware of their rights and feel comfortable initiating these procedures. Who will be responsible for educating tenants, especially those who are vulnerable?
Our third concern is with the proposed creation of a new dispute resolution system independent of the courts. It is important that the system is a fair and accessible system for both landlords and tenants. The current system can work. Again I agree with the statement, "Don't throw the baby out with the bathwater." If the system can be made more efficient, let's work at that, the backlog of cases. If more time could be spent educating and supporting tenants and landlords on alternative ways of handling disputes, that could help deal with that problem. For example, since Eby Village opened in 1990, we've only been to court once, and we house what we call hard-to-house tenants. These are very difficult tenants to house and we have managed to stay out of the court system. It can be done. We try everything else first, with court as a very last resort. Unfortunately, it's hard to make any additional comments when the proposal for this new dispute resolution system is not yet developed.
Lastly, as House of Friendship operates emergency and short-stay facilities, we want to be clear about some of the terms that are used in the legislation. Can we confirm that "short-term accommodation provided as emergency shelter" will be defined as not being a residential premise, just as in the current Landlord and Tenant Act, and will the definitions and documentation for "facilities that offer temporary accommodations for therapeutic and rehabilitative reasons" remain the same as under the current legislation?
In summary, we have raised several concerns with the proposed tenant protection legislation, such as the negative effect on the supply of affordable housing, the increased level of responsibility placed on tenants, particularly vulnerable tenants, and the creation of a new dispute resolution system. We are also requesting more clarification of terms for those exempt from the new legislation.
We would like to add an additional caution of trying to make changes to several pieces of legislation at the same time without more consultation and time to think through all the ramifications, especially the effects on those who are struggling to find safe, decent and affordable housing. Thank you.
The Chair: Thank you for your presentation. We have about four minutes per caucus for questions, beginning with the Liberals.
Mr Curling: Thank you very much for your presentation. It seems to me you were here when Mr Lampert was here and he told us outright that he did not consult with tenants or other tenant advocacy when he was putting together his paper. He also stated at the end that the paper is not flawed in any way because housing -- I don't feel that either he or the government considered that you have any vested interest in how housing itself is being delivered, which is my concern.
I think, however, that having excluded you folks out of this consultation, after this is completed what's going to happen is that the government will write their report -- I presume they're writing it right now anyhow and the legislation is being drafted right now as we go. When the legislation comes forward I hope they would have another consultation to go around to see the legislation reflects what the consultation was all about. Wouldn't you like to participate at that time too, if the legislation comes out, to make some comments on the legislation?
Ms Schlichter: Definitely.
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Mr Curling: Another question I'd like to ask you: What impact did that 21.6% have in your area when the government blamed the entire system of deficits and debts on the poor and cut the most vulnerable people? What impact did it have on you with housing?
Ms Schlichter: Unfortunately, what people were looking for were some statistics to show a large number of people looking for housing or a large number of evictions, things like that. What happens is that low-income people just accept their lot. They don't come forward and complain. They assume it won't make a difference anyway, so their numbers out there will not show the extent of the damage that is done by those cutbacks.
Mr Curling: Your report showed too that you had rents there of $502 per month and people were getting $325. Those are the people who got the cut.
Ms Schlichter: Right.
Mr Curling: Did you have to cut within your area too?
Ms Schlichter: Fortunately, we run a subsidized housing project. People within subsidized housing already are paying lower than the maximum shelter allowance, so they did not have any reductions.
Mr Curling: Did the government beef up at all that amount of money coming to you, because the government pays you, I presume?
Ms Schlichter: We had decreases last year.
Mr Curling: The suggestion by the government and some landlords too is, and Mr Lampert feels, that rental subsidies should come directly to the landlord. How do you feel about that, that the money they get should come directly? "Just disregard the food and what have you. Just send the money for the rent across to us."
Ms Schlichter: This would be a much longer answer. I'll do a short one. I think the rent subsidy, a supplement program, has some flaws in it. In order to make that system work, I think the investment of money will be a lot greater than the current system already in place.
Mr Marchese: Ms Schlichter, thank you very much for your presentation. I agree with many of the things you've said and I want to point those out and then ask a few questions.
First of all, with respect to the new dispute resolution system, you, like Mr Skoog, obviously believe the present system works fairly well, and I have come to the conclusion that it does as well. Ninety-five per cent of all cases are settled. It's the 5% that are complicated, and the question is, how do you deal with it? A new system is likely to be very costly and the appointment process of those people who are likely to be there is very worrisome in terms of political appointments. So for a number of good reasons, it's best to make this system work better than creating a new system.
Ms Schlichter: I agree.
Mr Marchese: Including adding some simplification of forms both for tenants and landlords, which is I think a very useful suggestion.
In terms of a greater burden being put on tenants, I agree with that. This paper does nothing for tenants at all. In fact, it does put a greater burden, and when we talk about negotiating rents, it's an imbalance of power and therefore it's a problem.
In terms of harassment, people who are vulnerable -- seniors are not likely to go to the landlord to complain. It's complaint-driven, and for that it requires a great deal of confidence from people. Seniors are a bit more vulnerable. People with disabilities are very vulnerable.
Ms Schlichter: It's just not going to happen.
Mr Marchese: People without literacy skills are very vulnerable and so the education is not there, and many tenant organizations have already been defunded by this government, so we know where they're at.
Now in terms of the questions: They say the system is broken and as a result we need to introduce decontrol because we think that's fair to the landlord. Do you think it's a fair thing?
Ms Schlichter: I think whatever we do has to look at a balance of both the landlord needs and the tenant needs. We can't go one direction or the other.
Mr Marchese: They argue that it does do that for both.
Ms Schlichter: It doesn't.
Mr Marchese: There's a point you make here in terms of the problem, where they argue the real problem is that there is already not enough supply of decent affordable housing to meet demand. You've heard Mr Lampert, who said that's okay; when the private sector, if we give them a whole lot of things, builds down the line, then there's going to be a trickle-down effect, meaning the poor obviously will be able to get into those other rental accommodations that are at the very high end. He's an economist. Obviously we're not. But do you really believe that?
Ms Schlichter: Landlords are already not making enough money, and if they get a chance, they'll raise those rents. People already can't afford the rents that are in place now.
Interjection.
Mr Marchese: Mr Spina obviously disagrees with me. I look forward to hearing your question on the next turnaround to see how you phrase that one. The trickle-down effect in my view is not going to work. He presents that as fact. It will not build affordable housing and it won't be for people who can afford it, so if you have a question, you or your friends, I'd like to hear how you're going to solve that.
In terms of the reason for non-profits and co-ops, Mr Skoog made a very important point. He said the competition of the private sector with the non-profit and cooperative has been very good inasmuch as it has been able to lower rents. Isn't that a good thing for tenants?
Ms Schlichter: We don't think we're in direct competition to private landlords. We feel that we house the people that private landlords have not housed in the past and do not want to house. We house the hard-to-house people, the very difficult clients, people with special needs. We don't see the competition. We think we can work together and provide different services to the community. We're not trying to discredit what private landlords do. We think we both have a place in the marketplace.
Mr Danford: Thank you for your presentation. I think you've been rather straightforward, and that's what this is all about.
One of your concerns was with the dispute resolution system. I think we all agree that it has to be fair and accessible to both landlords and tenants. That's paramount. Given your excellent record -- as you say here, you've only been to court once since 1990, and I think that is exceptional. This is a discussion paper. We're looking for input from the public and I think this is an opportunity. I'd be interested if you would share some of the things that you think would improve either the present or what's proposed and how it could be done better.
Ms Schlichter: What works for us is that we try to stay away from the tenant legislation as much as possible. We work with our tenants very closely. They know what their rights are, they know they can take us to court if they want to on all sorts of things, but we follow what we're supposed to do to the letter of the law. We do more than that: We make sure our tenants are treated fairly. They are involved in the process and they are involved with the management of our building. We have less cost because of their involvement, and because of that we don't have the disputes other landlords would have.
Mr Maves: In your last point, part 4, you've mentioned, "Will the definitions and documentation for `facilities that offer temporary accommodations for therapeutic and rehabilitative reasons' remain the same...." Currently, it's defined as six months, I believe.
Ms Schlichter: Right.
Mr Maves: Would you like that to be extended beyond that in these cases if it's obvious that it's supposed to be temporary?
Ms Schlichter: Six months is fine for us, but what gets confusing is we've got two different answers: if it's by program or if it's by individuals within the program. We have some people in our emergency hostel situations who have to stay longer than six months because they cannot find affordable housing to move to. Is it by program or by the people within the program? It's some clarification. We've got two different answers. Those are the problems.
The Chair: Mr Danford, did you have another question?
Mr Danford: No, I think she has clarified it well enough. I was looking for something even more specific than the general answer you gave me, but I don't think there's time for that.
Ms Schlichter: You're invited to come to Eby Village and we'll show you more.
The Chair: Thank you very much, Ms Schlichter. We appreciate your input here today.
KITCHENER-WATERLOO HOME BUILDERS' ASSOCIATION
The Chair: Our next presenters represent the Kitchener-Waterloo Home Builders' Association, John Schnarr, the president, and Lyle Hallman, CEO of the Hallman Group. Good afternoon, gentlemen. Welcome to our committee.
Mr John Schnarr: Thank you for allowing us to speak today. My name is John Schnarr. I am the president of the Kitchener-Waterloo Home Builders' Association. With me today is Lyle Hallman, the chief executive officer of the Hallman Group and a member of our association. I'll present our opinion on how the association perceives the proposals, while Mr Hallman will focus on the impact from a property owner's perspective.
Just a little background on our association: It was formed in 1946. This year is our 50th anniversary. We are the voice of the residential construction industry in Kitchener-Waterloo. Our membership of 180 companies consists of building contractors, developers, renovation contractors, trade contractors, suppliers, manufacturers, property owners and professionals such as engineers, lawyers and planners. Kitchener-Waterloo Home Builders' Association is a member of the Ontario Home Builders' Association and very much supports the comments made by OHBA to this standing committee on August 20.
In addition to meeting the demands of people who have chosen to purchase their own home, our members have tried to address the needs of those who choose to rent. Whether through construction or through property management, we have endeavoured to provide the best- quality rental accommodation possible. We appreciate the opportunity to address the committee on this important topic.
We are pleased that the government has recognized that the existing rent control system is in need of a major overhaul. The introduction of rent controls in 1975 and the impact of rental legislation, particularly over the past 10 years, has severely diminished the incentive for builders to expand the stock of rental housing in Ontario.
It is our opinion that the proposed reforms are a good first step. On its own, it will not produce new market rental housing. There are many other facets which influence the decision to supply rental accommodation. All of these issues need to be addressed: important concerns such as streamlining regulations, development charges, discriminate property taxes and the goods and services tax. Unless the gap between economic rent and market rent is reduced, there will be limited, if any, new rental construction generated because of these proposed reforms.
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As you know, our rental stock is aging and has reached the point where major building components are in need of repair or replacement. Eliminating rent control on units becoming vacant should allow landlords the opportunity to generate revenue to assist in the financing of these needed renovations. This increase in renovation spending will have a positive impact and will increase employment.
Groups in favour of maintaining total rent control will raise the issue of affordability, especially since the financing of new social housing projects has been cancelled. The issue of tenants' ability to pay an affordable rent should not be a cost to be borne by the private sector. If tenants are unable to afford a market rent, then the people, through the government, must decide on how to assist those in need. The Ontario Home Builders' Association has advocated a system of shelter allowances as one alternative.
Also, there are measures to amend the Rental Housing Protection Act. The proposed changes are realistic, especially since existing tenants will have a protected tenure. Conversions of rental housing projects to condominiums have been successful as tenants have an opportunity to become homeowners. Another positive outcome is that there are usually significant renovations associated with these conversions.
As I mentioned, Mr Hallman has joined me today. He'll briefly provide the view of a landlord.
Mr Lyle Hallman: My name is Lyle Hallman and I am the chief executive officer of the Hallman Group of companies, including Hallman Property Management, and have been a member of the home builders' association since 1946; 1995 was the 50th anniversary of my successful business experience. We have built, and own and manage, more than 3,000 apartment suites in the surrounding area. I am well versed in rent control and the many rights and obligations pertaining to it.
I compliment the Ontario government for taking initial steps in the process of removing rent control and its restrictions. I would like to see the government remove all controls over a four-year period and let the market set the rent, not someone else. This can be accomplished by removing controls over rents over $900 in 1996; the rents over $800 for the year 1987; the rents over $700 for the year 1998; rents over $600 for the year 1999; and all controls as of December 31, 1999, entering the next century control-free.
I also point out that I am very much in favour of the rent supplement program, also known as shelter allowance, where the government provides funds for the truly needy to help pay for their rent. This will only work when properly trained staff thoroughly trained in the art of investigation investigate all actual applicants as to their actual needs. This approach will save us all money and eliminate those persons who are taking advantage of the current system. I might add that our company, Hallman Property Management, has worked closely and will continue to work closely with whatever system the government may initiate.
You have previously received reports and submission from the Ontario Home Builders' Association and several other bodies, and I would like at this time to refer you to the report from the government, which everyone has, Tenant Protection Legislation: New Directions for Discussion. I would like to save time and I'm sure you have read many of the sections I'm referring to. I'm referring you to several clauses in the above document with which I am in agreement: page 3, maintenance; page 7, the dispute resolution system; page 10, security of tenure and conversions. As I said, I am in agreement with the above; however, the one point I wish to bring out again for your consideration is that all rent controls should be removed over a maximum four-year period.
The proposed current system will allow leeway as to increases in rent when a suite becomes vacant. By the way, the rent control system was initiated primarily for the Toronto area in 1995, and we in the balance of Ontario have been suffering because of that. Their rents may be increased a little bit higher than they would be around here. Their current vacancy rate is 0.8%. Our area may only have a modest increase due to the 3% to 4% vacancy. My company would rather have full occupancy and hold increases to a minimum.
The wave of the future will be for the government to provide rent supplement programs to provide assistance to those who are truly needy, and I say it again -- truly needy.
Mr Schnarr: Our association is pleased with the direction of the reforms and urges the government to proceed. We're willing to discuss and comment on other initiatives which may be needed.
Thank you for allowing us time for this presentation. Lyle and I would be pleased to take questions.
Mr Marchese: Thank you both. We've heard many landlords who have come in front of this committee who have said that there will not be any increases as a result of decontrol. Do you agree with that statement?
Mr Hallman: Except when you have a 0.8% vacancy rate, the pressure becomes very tight to raise gradually. In this area, I would rather have a full building than bump the rent 50 bucks.
Mr Marchese: So you do agree there will be rent increases -- modest, no doubt?
Mr Hallman: There will be modest increases, but the market will dictate.
Mr Marchese: What do you think a modest increase might look like?
Mr Hallman: No idea.
Mr Marchese: Do you believe that those increases, however modest they might be, might have an effect on low-income people?
Mr Hallman: Along with this, I would suggest that the government is in the process of revamping the system to determine who does get shelter. The system today does not investigate enough, and there are a lot of people living in government housing who should not be there.
Mr Marchese: I understand and I want to get to shelter allowance in a second. You also make the point that somehow when you get this increase as a landlord you're going to put most of that money into repairs, that you haven't been able to do that before.
Mr Hallman: That's correct.
Mr Marchese: Do you at the moment get your 2.6% guideline increase?
Mr Hallman: Yes.
Mr Marchese: Pretty well every year?
Mr Hallman: If it's legal, we'll take it.
Mr Marchese: Of course. Have you ever applied for that above-guideline increase?
Mr Hallman: No, we haven't.
Mr Marchese: So most of the money that you've been receiving has been going back into repairs?
Mr Hallman: That's right.
Mr Marchese: You could almost demonstrate that if we asked you to?
Mr Hallman: Yes, if you would prepare me for that.
Mr Marchese: In terms of shelter allowance, you say you agree for those truly needy, and I understand that. Do you agree that the government should let us know in advance of this proposal what the shelter allowance might look like in terms of numbers? Should they tell us?
Mr Hallman: The numbers of what?
Mr Marchese: You agree with a shelter allowance?
Mr Hallman: Yes.
Mr Marchese: Do you think they should give us a figure in advance of this proposal?
Mr Hallman: So much a month, you mean?
Mr Marchese: Yes.
Mr Hallman: Yes, I think that would be fair.
Mr Marchese: Let's see what they say. They haven't spoken to this, but we'll see. Maybe they'll answer that.
There's a point that you speak about in terms of the effect it might have on tenants with respect to affordability and you say you should not be shouldered with that responsibility. That's why we as a government, the NDP government, built non-profit and cooperative housing: to house the needy. Ms Schlichter talked about that, because they house people with needs, with disabilities, with assistance that otherwise the private sector would not be providing. That's why we were into that whole field, because we knew the private sector wasn't providing it. We did it. Do you agree with that kind of approach to non-profit and cooperative housing?
Mr Hallman: No, I don't. Building properties is the most expensive way to house people. We can build a building for a lot less than what you can and the government can.
Mr Marchese: Do you build according to people's needs, for example, people with disabilities, people with mental illness, people with HIV? Do you take that into account when you build your buildings?
Mr Hallman: The last group of buildings that we built, because it was included in whatever it was, are wheelchair-accessible. That's all we have, wheelchair-accessible.
Mr Marchese: Are many buildings wheelchair-accessible?
Mr Hallman: Not all, no.
Mr Marchese: Do you think they should be?
Mr Hallman: No, because everybody is not in a wheelchair.
Mr Marchese: I understand that. You also say here on your first page, and it seems to be an apparent contradiction, "The introduction of rent controls in 1975 and the impact of rental legislation particularly over the past 10 years has severely diminished the incentive for builders to expand the stock of rental housing in Ontario," and you make is appear that is quite the significant factor. Then in the next paragraph you say, "On its own it will not produce new market rental housing." The one paragraph says "severely diminished the incentive"; the next one says, "On its own it doesn't do it."
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Mr Schnarr: At the point in time that rent controls and the other rental legislations came in, yes, it severely diminished it. That was one factor, along with these other factors which through time have impacted on it.
Mr Wettlaufer: Lyle and John, thank you for coming. I would like to point out, first of all, that Mr Hallman is the largest holder of rental units in this region and is recognized as being a very generous individual who looks after his tenants.
You said that while you're very much in favour of shelter allowance, "This will only work when properly trained staff thoroughly investigate all applicants as to their actual needs." We hear many stories from time to time that presently, with non-profit housing or shelter allowances or subsidized housing or whatever, the staff the government employs is not adequately trained. Could you give us an idea of what the shortcomings are and what the improvements could be?
Mr Hallman: Currently we have 217 units in our inventory with Ontario Housing, and it's gradually being depleted. We are being reduced because they can't find the people to put into them. Have you ever heard of that before? Well, it's happening in Kitchener-Waterloo. We at one time had over 250, but now they have cut off the leases we had with Ontario Housing. What was the question again?
Mr Wettlaufer: I was wondering what the shortcomings of the present system are and what could be done to improve it.
Mr Hallman: I think if the government is going to stick to its guns and provide housing for the truly needy, not for those who think they are truly needy -- people have to be trained not to give the product away. People have to be able to prove that they are needy. In some of our residences one person applies and three or four people are living there. That's not fair game or what it's for. They don't need more; they just need informed staff. They're acting on what the government tells them to do, and I think you're telling them the wrong thing. Go and get the guy.
Mr Wettlaufer: If the government set something up like this, would you be willing to sit on a committee to advise the investigators?
Mr Hallman: Yes, I'd be pleased to do that. What's the pay? I'm a landlord, you know.
Mr Maves: In your recommendations you say you endorse the proposals for maintenance that we have in the document. I'm a little surprised at that because some of these are very stringent: an increase in fines, things that are made an offence. Very few landlords have come forward and said they agree with some of these maintenance provisions. Could you comment on that?
Mr Hallman: Over the years my worst enemy has not been the tenant; it's my competitive landlord who does everything wrong. I'm in favour of tightening up the rules. We play by the rules, and if the other guy doesn't play by the rules, he's my enemy. I'm in favour of tight rules to get rid of the Johnny whatever you want to call him.
Mr Maves: If a property standards officer paid you a visit, told you of something that needed to be done in one of your units and you didn't do it, then the property standards officer was called back again because it was unaddressed, do you think it would be fair for that landlord to have to pay a fee for non-compliance for that second visit?
Mr Hallman: Yes.
Mr Sergio: Thanks for your presentation. I have absolutely no qualms in believing that you are a very respected and generous person. I hope that includes politicians as well; being generous too, that is. Are you familiar with the Lampert report?
Mr Hallman: No, I'm not.
Mr Sergio: Are you, Mr Schnarr?
Mr Schnarr: No.
Mr Sergio: You've never been contacted by Mr Lampert?
Mr Hallman: No. We're not listed in the phone book.
Mr Sergio: Oh, I'm sure that if they wanted to consult you, they would have found you.
This is a report produced by a consultant for the government on how to spur the economy to build affordable rental accommodation. It's a good report to be used as a base for the government, and we had Mr Lampert here making a presentation to our committee.
In summary, this is what he says: First rent control has to go, the most important thing; then he wants an assurance regarding the future rent control environment, which means he wants to tie up some future government so that rent control is not going to be reintroduced; phase in fair property tax assessment on rental buildings, immediate reduction for new buildings; streamline regulations and reduce costs for development; harmonize PST and GST with caution and whatever.
He thinks this would create new people to come back in the market and build rental housing. But then he said we also need a shelter allowance, otherwise the previous things won't do. Subsequent to that, a question from my fellow member here was, "How long would it take for you to come back in the market and start to build affordable housing if the government were to listen to your demands and give you everything?" His answer was, "No one will build for the lower end of the scale."
You are both a landlord and from the housing business. Given this information that someone has been paid by the government to produce a report, do you think this is the time for the government to get out of the housing business totally, cancelling every program, cancelling funding to every group, cancelling funds for the rent registry, cancelling funds for advocate groups? Knowing this, do you think this is the right time for the government to get out of the housing business totally, when its own consultant says that, given all that, no one -- you or you -- will come back on the market and build units for the needy? What would it take for you?
Mr Hallman: We can't build units for the needy. I'll just give you a choice for the record. We need, for a regular Chevrolet-type apartment, about $750 a month.
The Chair: Thank you, gentlemen. We appreciate your coming forward this afternoon and giving us your input.
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SUZANNE TAYLOR
The Chair: Our next presenter is Suzanne Taylor. Good afternoon. Welcome to our committee.
Ms Suzanne Taylor: I'm probably not the best public speaker, so I issue my warning and my apologies.
Before I begin, I just want to say I'm not party-conscious. I only vote on policies, never people nor parties. I don't know any of you, so I consulted the Hansard reports to try to get an idea of who you all are.
On May 9 a private member's resolution was brought forward by Mr Stewart which was supported by Mr Carroll, Mr Tilson, Ms Ross, Mr Wettlaufer and others. In Mr Stewart's words, it was a resolution in support of "freedom of speech in our democratic society." I know by this that you were all able to vote your conscience, and that's what I'm asking you to do in terms of voting again in favour of freedom and democracy.
I'm a tenant advocate and a front runner. I deal directly and quite closely with landlords and tenants. Mostly the complaints I receive are in regard to property maintenance, which I will speak about.
I also want to speak about levelling the playing field. I visited a Web site recently where I read the quote, "Socialism...condemns the less motivated to perpetual dependence on the state." I believe that less motivated landlords are going to become dependent on the state under this new proposed legislation. We don't want this to happen. If you're cutting back on handouts to other businesses, why are the landlords' hands still out?
I'm also concerned with effects in other sectors. Landlords' ceasing of maintenance and new buildings -- the same thing seems to be going on in other sectors also: Doctors are not going to take new patients; the quality of care in health facilities is deteriorating; user fees are running rampant; children are not permitted entry into schools unless they foot the bills. People, not just tenants, are not happy.
This playing field is far from level, and not just between landlords and tenants. According to your proposal, landlords will enjoy benefits not afforded to other businesses. In most businesses, capital expenditures are depreciated until they reach zero value. After that time they can no longer be used to shelter a portion of the business income. You are proposing to allow landlords to keep this shelter perpetually. Not only will they shelter greater portions of their incomes, but the tenants will pay for it. In what other business do you find customers providing shelters for suppliers? If you think this is level, then the instruments are off.
Concerning sitting tenants, the very first thing that came to my mind when I read "sitting tenants" was affirmative action. I think sitting tenants will eventually become token tenants.
I spoke with an 83-year-old engineer who's the inventor of the twist-top bottle cap, jukeboxes, a number of inventions. He has a wall of patents. He said that it never concerned him whether or not he was appointed to certain committees or given certain tasks based on his abilities. Now he doesn't want to be a token black; he just wants to be considered on his own merit.
For instance, what if these sitting tenants have free landscaping whereas a new tenant coming in has to pay a $20 fee? Eventually we won't hear things like, "He's in this position because he's this, this or this"; we will hear, "Oh, that's because that's a sitting tenant." It's the same thing. We're going to feel the effects of affirmative action. It's a term not well recognized here in Ontario but it will be; I really believe that. I've spoken to tenants and they believe it will create a new social barrier that wasn't there prior.
In terms of unfair rent increases, one of the worst I can think of is a municipality recouping costs in the form of taxes, which increases the tax, so the landlord raises the rent to cover that; meanwhile it's his own neglect that tenants are paying for twice, so they have to apply to reduce the rents. It's just bizarre, and I think that needs to be addressed really well.
You say that the landlord has no control over taxes and how they increase. Well, a tenant has no control whatsoever over the neglect of the property and how the property is maintained, so I think it needs to be equal there. I think it would be better for the municipality to collect rents directly from tenants in the form of a garnishee against earnings, as any other business does. This process may take a little longer, but it would not increase the taxes, and interest can be charged for the term of waiting.
Rent increases mutually agreed upon for capital improvements also needs to be looked at, because I know that landlords get trade rates. A tenant may think, "Oh, I know it costs $800 for this carpet," but that's not true. One of the largest landlords in this community is also a carpet manufacturer. His costs are going to be considerably lower. So I think that tenants should be privy to the actual costs. If I go to purchase any product, I can make an intelligent decision based on cost comparison. Tenants can't do that in terms of these capital improvements because the average tenant won't know. I think they should be made privy to the actual cost so they can make an intelligent decision concerning these new improvements.
Present legislation states that the landlord is responsible for the condition of the property regardless of the conditions when a tenancy begins. This protection must remain. Legislation should confirm that tenants are not required to compensate the landlord for any loss due to the neglect of the premises, as it does presently. Why should future tenants be responsible for the neglect of past years?
Also, tenant advocacy: As Mr Skoog mentioned, I really think that agents -- we read throughout legislation "the landlord and his or her agents," but we don't read that same protection regarding tenants and I really think that should be introduced. Oftentimes tenants can't afford lawyers and they need other affordable representation. With the defunding of advocates, I think that's a very cost-effective way for you to give them some additional protection. If they can find other means of affordable representation, they should certainly be entitled to do so.
Also, if matters are kept out of courts because they're able to work it through between themselves and a private mediator in the form of an advocate, that reduces court time, municipal involvement and cost to government and taxpayers. Stronger communities are developed through tenant associations and landlords become better educated. Hence, landlords are less likely to repeat the same offences and harassments decline. In the worst-case scenario, the landlord thinks he's merely a rent collector. This is the landlord who costs the most to the community.
It doesn't take long before landlords learn of the political unwillingness of the municipal enforcement officers to issue work orders. I'm presently dealing with a landlord who has had the municipality involved with his property over the past three years, and I have yet to see a work order. On this property, I'm telling you, I stood in the tenant's basement and witnessed the tenant flush the toilet and the toilet emptied into the basement. Okay? This was witnessed by property standards, and there was no work order issued. So I know this goes on. I know there's a political unwillingness of some enforcement officers to just simply not enforce. I really think the province should enforce where the municipality fails, because in some instances I've seen the municipality fail quite miserably.
On another occasion I've had to contact my local city council member to get results, which worked, so I know that additional pressures from superiors is good motivation. I've seen it work.
A tenant has done nothing wrong in contacting authorities, and advocates are not merely busybodies with nothing else to do. Tenants have a fundamental right to secure and enforce their rights without any hindrance and must seek the most affordable assistance. By reducing legal aid and defunding advocates, your actions speak contrary to your written intent. How do you hope to level the playing field when you have already so drastically tipped the scales in favour of the landlords? When both landlords and government interfere with the securing and enforcement of citizens' rights, you put tenants in a nearly impossible situation. When tenants complain, they're the bad guys. They're treated as though they have their nerve calling on authorities.
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The harassment and cold shoulder treatments from landlords are bad enough. When you couple it with a municipal enforcement officer who asks tenants if they have considered moving and suggests eviction to the landlord, the tenant's life becomes unbearable. In some cases I have heard that the tenants cannot even get these inspectors out of their offices to conduct any inspections. Additional powers will not solve this lack of political motivation. I really believe that their superiors have to be pressed upon to take more time and more consideration and to look more closely in overseeing the actions of these enforcement officers and also more closely in monitoring the results of their inspections.
Your paper suggests that the municipality will respond quicker and more favourably in future due to the officers' additional powers. What if they fail to act appropriately? Will you govern them and ensure that faster, more serious action will be taken? The system is tenant initiated. Throughout present legislation, again I state, we find the term "the landlord and his or her agent." I think it really helps, because I know that in a lot of cases the tenants have told me: "We've tried this. We've tried this. We've tried this. We've phoned, and we're not getting anywhere." I've been able to help them in getting through that in a cost-effective manner, and to this date I've managed to keep all matters out of courts. I've never advised a tenant to go to court. It's never been necessary.
Your proposal to increase maximum fines: I don't see that as solving anything because the minimum fines are clearly the problem. The minimum fines present a cost-effective means for the landlords to avoid compliance. Why would a landlord spend $25,000 on a roof when he can pay $300 and buy himself another year? If it doesn't come back, if nothing happens over the next six months, nobody can force him to do his roof in the winter, in which case he's bought himself nearly an entire year. That's what minimum fines do, and meanwhile the tenants are suffering. The proposal just turns up the heat in that respect.
I believe that minimum fines should increase, and prohibition orders should be automatic and not dependent upon a municipality's application. What if the municipality doesn't apply for a prohibition order? Then what?
You make too many assumptions regarding the municipality's anticipated eager participation. The pro-landlord attitudes of many officers will not change overnight. Don't count on it. Legislation must be in place for the province to enforce.
Also, once a tenant has notified a landlord in writing, and given adequate time to respond, enforcement should be instant. You don't want to duplicate the municipality. Well, tenants don't want the municipality duplicating them either. I had a case recently where a tenant properly notified the landlord, the legal owner of the property, of all necessary repairs, and then I had an enforcement officer tell me, "Well, the property management company didn't get that." When I clearly told the property management company the owners had that information, they made no attempt whatsoever to obtain that information from the owners and we had to start the whole process again. I had to then notify the property management company and begin again. It took us two months just to get an inspection because we had to give adequate notice twice. They don't want to be duplicated in that respect either. I don't know why I had to duplicate that, but it happened. Because of an outstanding city council member, adequate action was eventually taken and the problems on that property are being solved even as we speak. But municipalities are often reluctant to issue orders and it needs to be addressed.
They should also notify tenants. Tenants should receive copies of notices and orders, because how are they to monitor? The landlord shouldn't be the only source of that information. Tenants should contact the municipality. They're the ones who live there. They know best what's going on there, and especially in terms of fire protection, where it may be a threat to their health and safety, and losses suffered by the tenant as a result of non-compliance. The municipalities are not involved in the process of assisting tenants in recouping costs so we need a system that allows them to do that.
As for the right to enter, why not level the playing field between landlords and other businesses there too? Other businesses have to operate 9 to 5. Why can't landlords? Why does the landlord have to show up at 6:30 in the morning or 9 o'clock at night? People are getting ready to go to work, mothers are getting their children off to school or trying to put them to sleep at night, and this guy shows up with a hammer. It's just not decent.
You're saying on one hand we should give proper notices to landlords before contacting any enforcement officers out of sheer decency. I agree it is the decent thing to do and it's always done where I'm involved, but we want some decency as well. It's just not decent, and all we're asking for is that courtesy. And yes, I think it should be legislated. If you want balance, they should be balanced out with other businesses in that respect also.
That should also follow in terms of showing a unit. There's no reason why a landlord can't show a unit within decent and agreed-upon times. There's no reason whatsoever. Tenants are uncomfortable about having perfect strangers strolling through their homes at any time the landlord chooses, and it's not right. Often it's used as a form of harassment, because the tenants are on their way out. The landlord doesn't feel he owes them any additional respect or courtesy and doesn't give them any.
Rental agreement negotiations: They will vary socioeconomically. A poorer tenant may not opt to pay an additional $20 monthly for landscaping services, just as an example. When this lawn care is repeatedly overlooked, how long do you think it will take before other tenants figure out who has fewer finances to support additional services? The poor will be centred out. The tenants who are financially better off will soon feel the brunt of this as well. When they find out that some tenants are receiving this same service for free, they will resent having to pay the cost. That's why I'm saying it'll turn into something really ugly like affirmative action. I know a lot of people agree with affirmative action, but I've seen the worst of it. As I explained to you with the engineer, it wasn't fair to him.
I know that the hour is late for us all and I don't think your task is simple, that's for sure, and I wouldn't want it. I really would not want the job. But I do press upon you to vote your conscience, particularly in areas involving the socioeconomic factors. If your intent is to bring balance, then make sure that balance is brought across the board and balance landlords out with other businesses as well as with tenants.
The Chair: Thank you, Ms Taylor. You've got about a minute left. No time for any questions. Did you have any final comments you wanted to make?
Ms Taylor: No.
The Chair: Okay, thank you very much. We appreciate your coming forward today with your ideas.
ESTATES TENANTS' ASSOCIATION WATERLOO REGION TENANTS' COALITION
The Chair: Our next group is Estates Tenants' Association, Mary Pappert, Mildred Rodina and Matt Pappert. Good afternoon. Welcome to our committee.
Mrs Mary Pappert: We are with the executive of the tenants' association for the Estates Apartments and we're also members of the Waterloo Region Tenants' Coalition and we submit our brief on behalf of both groups.
We are here today to ask why the Ontario government proposes to repeal rather than improve six pieces of tenant protection which protects our members, to question the logic utilized to develop the many proposals and to outline the impact of these changes and how they would affect our tenants and to submit some constructive suggestions for your consideration.
I know we're in the cleanup spot. This is the last day of the hearings and you must all be very tired. We watched the proceedings on TV from August 19 to 23 and most of the points we want to emphasize have already been made, so what we're going to do is cite some of the issues of particular concern to us and personalize them by referring to the impact they will have on our tenants and give you a basis for comparison from some of the other presenters. I doubt we'll have any time for questions. I'm long-winded.
Like many of our tenants, we lived in a private home from 1953 to 1984, but we had divided our three-storey older home into apartments, so I've had some 30 years' personal experience as a landlord. When we decided to move away from home maintenance 12 years ago, we looked at several apartments and we finally decided to move into the Estates because it appeared to be a well-built, moderately priced, 131-unit, 12-storey building opened in 1966, moderately well-maintained and housing mostly seniors. Our apartment is owned by a large company which owns approximately 12 apartments in our region and other cities. After talking to many other tenants from other buildings and exchanging experiences, I believe that our owner's method of operation is fairly representative of most of the apartment owners in our area. Therefore, I believe our comments are relevant.
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Like most other tenants, we invested hundreds of dollars to paint, paper and install rugs, shelves, lighting, ceiling fans and improvements of all kinds in our apartment homes, and we plan to stay there for many years. With few exceptions, our building's tenants are clean, quiet, responsible people who maintain their homes carefully. Many have resided in our apartment for 15 to 20 years, some since the building opened in 1966. You will notice I say "apartment homes." I'm not saying "units" and I'm not saying "investment properties." I'm saying our homes. These are our castles. It's where we live.
Currently, of our 131 apartments, 90 house seniors over 60 years of age; 63 house women who are living alone -- we have primarily widows; 27 house people with some health problem, either sight, hearing, maybe they use a cane; and we've got many relatives living our building. We have a very nice family atmosphere.
But because we are responsible tenants, our owner benefits from reduced maintenance costs, less vandalism and less wear and tear from frequent moving. We pay our rent regularly and we seldom move, so our owner has minimal vacancy and a stable financial base. Because of the improvements our tenants make within their apartments at their own expense, the owner's equity in our building is enhanced. Good tenants, like good customers of any business, should be appreciated and encouraged.
With regard to the rents we pay and condominium conversion, although our tenants' incomes vary, most are on fixed budgets with minimal increases for pensions or small wage increases. Most moved into our building from private homes and plan to stay and they cannot afford, financially, physically or emotionally, to move from their apartment homes. They can't afford to pay much more than their current rents, and they certainly don't want to adopt the financial responsibility of buying and maintaining a condominium. That's why we moved to an apartment in the first place.
They know that the cost to maintain our 30-year-old building will escalate in the next few years. Heating, plumbing, wiring and appliances are going to need upgrading; the cost of this should be paid by the current owners but would fall to the tenant-owners if the condominium conversion was allowed. We strongly oppose the relaxation of controls for condominium conversions and the threat it holds for our tenants.
The mortgage on our building was paid off in approximately 1990. The owners have presumably saved mortgage financing payments since that time, yet the cost of financing was built into our rent; it's compounded annually and we're still paying it. We assume that prudent owners should have budgeted these extra moneys into a fund for the upgrading they know will be required in a 30-year-old building.
Our rents are really within the average range in our building in the K-W area: one-bedroom units from $504 to $535; two-bedroom from $568 to $631; three-bedroom $721 to $801. We pay, in addition, $327 for underground parking or $42 a month if you take it for short periods.
Is our owner receiving sufficient rent increases to maintain our building? By our calculation, in the calendar year 1996-97, our owner will collect rents totally $933,851 plus several thousand dollars from underground parking. That's close to $1 million. In the 12 years from 1985 to 1996, Ontario tenants paid rent increases of, when compounded, 66.8%. That's in 12 years. Compare the cost of living just in the last seven years. In Ontario it went up 17% compounded, nationally 18.7% compounded, but our rents have compounded at 38.3% in the last seven years. Our rents have increased twice as much as the cost-of-living expenses. You'll find statistics in the two appendices to substantiate what I've just said.
Is that enough to maintain our apartment? How does it compare to costs? Why remove rent controls when rents are already producing increases such as these within rent controls? How much more incentive do landlords need to maintain their buildings and how much more can tenants afford to pay?
Each year the owner gets 2% to use to maintain our building. Tenants are never permitted to see how these rents are utilized to pay the expenses, nor are they allowed to question what profits their landlords realize from their investment. We are stakeholders, much as stockholders in a corporation, yet we're never given a profit and loss statement. Since the legislation in 1992, even the Ministry of Housing is not allowed to ask the owners for this information as they adjudicate rent increases above guidelines or rent reduction applications. Profit and loss statements are necessary to make just decisions.
I would like to comment on how our experience has been working within the legislation that's currently in place. In 1986 our owner refused again to meet with us to discuss the escalating deterioration of our apartment building. Many seniors in our building were intimidated by management and unable to speak individually.
We decided that the only way we could get our owner to listen and improve was to have a collected effort by forming a tenants' association. We formed in 1986 and for the next five years made every effort we could to communicate with our tenants and our landlords. We had numerous meetings and surveys. We had inspections by the property standards officer and the fire department to support our position. We documented the problem we were having with our superintendent as well and the continual deterioration of our maintenance and we substantiated everything with photographs.
In spring 1992 we compiled the information in a letter to our owner asking for a meeting to sit down and talk about our problems and we also asked if there were any plans scheduled to replace the 28-year-old rugs and wallcoverings etc. He would not meet with us. He would not discuss anything with us. He would do nothing. His reply was, "If you don't like the building, you can move."
Therefore, in 1992 we were forced to file for a rent reduction hearing as the only tool we had to improve our situation. We weren't looking for a rent reduction; we just wanted the owner to take better care of our property. We waited for a year and in December 1993 we had our hearing. With the assistance of our lawyer, we won our case.
In May 1994 an order was issued by the Ministry of Housing granting a rent reduction of 2% retroactive to July, and every tenant in the building received that, but there was nothing within the legislation which allowed the ministry to impose or force the owner to improve the overall maintenance of our building.
The results from our hearing were that only the improvements ordered by the property standards officer or the fire department were actually implemented. No changes were made by the management to the day-to-day maintenance of our building, nor was there any improvement in our superintendent's efforts or skills. Although the owner stated he had an open-door policy, that tenants were welcome to speak to him directly, he still refuses to speak to us. The only way we can communicate is by letter.
Our recommendation is that a better mechanism be developed for judgements in cases of rent reduction hearings to oblige the owner to perform regular maintenance of apartment buildings and provide documented proof that the 2% annual increase is in fact used for maintenance.
Our general comments about the rent reduction process from our personal experience are that our tenants were able to function within rent control as it exists because we are well organized and we're well supported by our members, but we may not have won if it hadn't been for our lawyer. Our owner was represented by two lawyers, their accounting staff, their property manager. Though we documented carefully and videotaped our building and had many tenants support us, without our lawyer's thorough knowledge of the laws and technical terms, we would have been at a distinct disadvantage.
The protection for our tenants' association lies within the Rent Control Act, and without that protection I am afraid that owners would harass the leaders and members of tenants' associations. Many owners have an adversarial manner in referring to our associations. Our own owner refuses to even allow us to meet in the common areas of our building, although we pay for rent for all the common areas of our building and some of our seniors can't get to meetings out of our building.
Superintendents are a prime source of most of the day-to-day problems in apartments. Superintendents who maintain large buildings with complicated heating, plumbing and electrical elevator services and are responsible for the health and safety of hundreds of people, particularly in emergencies such as fires, power failures and accidents, are not required by law to have any special skills or training. Large apartments need skilled superintendents on duty at all times. Firefighters need superintendents who know their tenants, who have a master key and can assist in cases of fire. When tenants are trapped in an elevator, service people need keys to equipment rooms.
Our tenants were fortunate that the services of our former superintendent were terminated in September 1995. Since that time, we've had a competent new superintendent who's made every effort to perform regular maintenance duties. He communicates well with our tenants and we are cooperating with him. The general maintenance of our building has improved significantly and it's because our superintendent is doing his job conscientiously.
Our recommendation therefore is that a certified training course be developed to teach superintendents basic skills, cleaning methods, plumbing, heating, emergency planning, record-keeping and communication with tenants, and that legislation should be passed requiring that a certified superintendent must be on the premises of large buildings at all times.
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Maintenance is definitely the responsibility of both owners and tenants. New Directions says that many tenants are living in buildings that desperately need maintenance. Why? The dirt, garbage, vermin, sewer smells, worn rugs, peeling paint and things of that nature in buildings are evidence that some landlords don't care about their buildings, don't provide competent superintendents and do not monitor their buildings. Obviously they are not spending the 2% for maintenance. Regular application of soap and water, wax and polish, garbage removal, vacuuming the floors, paint touch-ups and minor repairs are not expensive and are basic necessities for any building's maintenance and must be done by landlords and tenants alike.
Why don't landlords evict bad tenants? The Landlord and Tenant Act was explained to you. We can do that easily in our community, yet some owners continue to rent to repeat offenders who vandalize their buildings, harass and disturb other tenants. Don't our owners care? Don't they want to protect the quality of their investments, or is this a calculated plan to let the building deteriorate and then ask for a rent increase above guidelines?
Communication and individual tenant negotiation with landlords: The Landlord and Tenant Act requires that the legal name and address of the apartment owner be posted somewhere that can be easily seen. That's a basic requirement, yet it's seldom enforced. Many tenants can't even find out who owns their building, yet New Directions say a tenant should sit down with his landlord, negotiate the work to be done, sign an agreement for a rent increase to cover the costs, with no Ministry of Housing approval. Vulnerable tenants don't understand the responsibilities of owners and they're going to sign things unwittingly. Tenants cannot and should not negotiate rent increases in this way.
The ministry proposes more maintenance enforcement by property standards officers and no rent freezing by the ministry. Our association has had limited success with property standards, and if the city takes on more work, it's going to be more staff and more funding, and I don't know that they will do that. The Ministry of Housing's penalty for freezing rents has been effective against owners. The ministry staff is very helpful; they're knowledgeable in our specific concerns. If our local office is closed and replaced by an 800 telephone number and a tape in Toronto, that's going to be a great loss to our tenants.
New Directions proposes the repeal of all the tenant legislation. Why? Rent control and housing protection have existed in some form since 1975, so the legislation is needed and it's accepted. The current legislation does provide tenants with relatively good protection against unfair double-digit rents and eviction and harassment. It does protect tenants who form associations, does provide the methods for reasonable owners to evict bad tenants and does provide a 2% increase and 3% for major capital expenditures or extraordinary costs. So why repeal them?
Our recommendation is that you update and consolidate the current legislation and develop flexible legislation which recognizes and addresses specifically the differing needs of large and small owners and the differing problems in different communities. Toronto and Kitchener are entirely different. Then enforce the legislation with some common sense.
New Directions says that sitting tenants will be protected by rent controls. Some can stay in their units, but many have to move because of family needs, employment changes, physical ability. They're going to be penalized. Obviously, with this financial advantage, landlords will look for every excuse to move tenants and the peace and security of our tenants is going to be in question. Sitting tenants are going to be sitting ducks.
New Directions would eliminate the rent registry. The rent registry provides essential information and must not be eliminated. That's the only way we can check to find out what the maximum rent allowable is for our units, what we should pay, what the previous tenant paid and what the other tenants are paying in the building for a basis of comparison.
New Directions says that landlords have no incentive to invest in their buildings, which are becoming rundown. What are they going to do with these older buildings that are more and more run down? Are they going to be too expensive to repair? Should we as tenants just abandon them and move to newer buildings that the landlord can ultimately again let become more and more run down? Will older buildings be torn down for tax losses or will they be allowed to deteriorate and provide only the housing that the most desperate would live in? Surely that's not the intent.
Our recommendation is that more effort should be made to build a new supply of reasonably priced basic units which are safe and quiet, which have a stove and refrigerator and adequate parking, and which feature improvement of design, which will allow for easy access to pipes and wiring for repairs and thus reduce maintenance cost. Most new buildings feature swimming pools, exercise rooms, four or five appliances and many other features that increase the cost of construction and the maintenance for those buildings. Expensive units will not increase the rental stock for the average tenant. Only the wealthy need apply.
The Chair: I'd just let you know you're on your last few minutes.
Mrs Pappert: Okay. I will close by giving a couple of questions I would like answered by the Ministry of Housing. If the main purpose is to provide incentive for builders because there's a shortage of units, why is the government facilitating more condominium conversions in its proposal? Condominium conversions will further reduce apartments available for average tenants.
Why do tenants in apartments pay property tax, which is included in their rent, and have to pay three to four times more than the property taxes for residential owners? Apparently, apartments pay 7% GST and condominiums only 4.5% and that cost is passed on to us. If the government did equalize property tax and GST, what requirements would they put into place to make sure the tenants would get comparable rent reductions if they reduce it for the owners?
Finally, our recommendation is that there are probably some situations that are grossly inequitable and we believe that some reasonable mechanism should be put in place for individual corrections for landlords and tenants.
To summarize our submission, it isn't broken, it could be improved, but don't repeal it without providing something better. Bad owners won't use more money to maintain their buildings and good owners already have the tools they need for reasonable increases. Thank you.
The Chair: Thank you very much for your presentation. We appreciate your coming forward and giving us your input.
Mrs Pappert: Can I make one comment? You had a lady, Mrs Sibal, on September 23 from the Scarborough tenants. She had some excellent ideas for maintenance proposals, and I hope you read her things very carefully.
The Chair: Thank you very much.
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CAMBRIDGE HOUSING ACCESS LUTHERWOOD HOUSING
The Chair: Our next presenter is the Cambridge Housing Access, Cathy Werner, a counsellor, and Maxine Brake-Cheater. Good afternoon. Welcome to our committee. The floor is yours.
Ms Maxine Brake-Cheater: Good afternoon. My name is Maxine Brake-Cheater, and this is Cathy Werner. Between the two of us, Cambridge Housing Access and Lutherwood Housing, we have served over 700 tenants in the last year who were looking for housing. We're now former housing counsellors for that program.
I am concerned that the government's proposals will hurt the tenants of the Waterloo region. The two issues I would like to address are affordability and availability.
I should like to speak against any changes in legislation that could result in higher costs of housing. We have had tenants and landlords indicate here today that, even though they may be modest, there will be increases with the loss of rent control. Since 1995, the government has halted the construction of non-profit housing units, reduced shelter allowances, closed housing registries and has indicated that it intends to dismantle our current housing legislation and sell Ontario Housing Corp units. These changes have been too fast and too severe. Families are suffering from these changes, and they cannot cope with the reduction in income or the threat of the loss of their homes. They have given up hope of ever living any other way except from bill to bill, let alone from paycheque to paycheque.
The cost of shelter in the Waterloo region is the single most stressful financial commitment for low-income families. The cost of housing for families living in poverty causes more stress than the combined costs of the other basic necessities of food and clothing. This has been documented time and time again in our participant case files. The reasons for moving invariably include affordability. We have participants who are spending 86% of their take-home income to keep a roof over their head.
All across the region and the province of Ontario, housing costs far exceed what families can afford. Homeowners and tenants alike are finding it difficult to stay afloat financially. Our program has seen a steady increase in the number of families who have to walk away from their homes due to bankruptcy or inability to pay rent and utilities. Any further increase in rent for low-income families will result in increased homelessness, family breakdowns and family violence, as well as the spinoff effects of poor nutrition and poor school performance of our children. Children living in poverty in our region are already living deprived lives because the parents are forced to use whatever money they can muster to pay for their rent and utilities.
I know families whose lives are constantly disrupted because they have to move to find something cheaper. These moves are not the result of poor money management but rather of the high cost of rent and utilities. One of the first things a housing counsellor examines when assisting a person or family looking for housing is the monthly income. We look at the fixed expenses and the income and start our housing search for units within that defined budget. Too often, we've found that adequate and affordable housing is not available with this amount.
If the housing counsellor identified multiple barriers -- including discrimination due to source of income, language or literacy -- besides financial, it became apparent that the private market may not be the best choice for us to work in. Because these same barriers affect a person's job search, it was anticipated that the family would have a fixed low income for more than a year, and we would therefore recommend rent-geared-to-income housing as an option for permanent housing.
Since 1989 Cambridge has had over 1,000 rent-geared-to-income units added to the housing stock. Through our coordinated access we were able to refer families in this disadvantaged position. However, since July 1995 any hope of finding affordable housing in a non-profit housing complex was diminished when these developments were halted. Wait lists for RGI units are so long that they are no longer a realistic solution for families in need of immediate or near-future housing. Cambridge Non-Profit has nearly 700 families and seniors waiting, and it will be at least a five-year wait list. Kitchener Housing has an even longer wait list and is closer to a 10-year wait for a unit.
For the last year as housing counsellors we have relied almost exclusively on the private market for permanent housing. We have found that landlords have been understanding in instances where tenants are unable to pay the last month's rent, but the bottom line is whether the individual or family can afford the cost of the unit over the long term. We review the fixed monthly costs, and too often the expenses exceed the revenue and we therefore have difficulty recommending that a family take the unit. The lack of ability to pay is a real problem for many of the people that Cambridge Housing Access and Lutherwood Housing have served.
The government has said that non-profit housing and rent control have deterred landlords from building. This is not the case in the Waterloo region, where the region's largest landlord has been quoted as saying that the proposed changes would not encourage him to build more units.
In the tenant protection legislation summary put out by the communications branch under "What Works...and Won't Change," it states that there will still be rent controls and annual set limits, yet the unabridged document states that the current rent guideline formula will be retained just for sitting tenants.
This is not acceptable. It puts unreasonable pressure on tenants that their housing is insecure, and it will encourage landlords to default on repair and maintenance or, worse, harass the current tenant to leave. The current legislation does allow for a 2% increase for maintenance and repairs plus the cost-of-living increase. We need rent control. The current legal increases are already more than most salaries and pensions increase annually. If the government gets rid of rent control, tenants will not be able to cope with the expected increases in rent. Tenants should be given similar choices to homeowners, who can set their monthly fixed payments for up to five years.
In October, social assistance recipients had a 21.6% cut in shelter allowance. A single person now receives $325 a month for shelter; a single parent with a child receives $511 for shelter. Local housing registries will show that there is very little choice for one- and two-bedroom apartments in this price range. In a survey of rental accommodations of three local papers over a period of two months this summer, the average of a one-bedroom is $441 and a two-bedroom is $617. If this individual is to spend 30% of their budget on housing, they would need to be earning or have a fixed income of $1,455 monthly; for a single parent with one child in a two-bedroom apartment, he or she needs to be earning $13.75 per hour. Our experience is that the current employment market is geared towards part-time and offers minimum wage.
Young adults, single parents and seniors make up the majority of our tenants. With the disappearance of freedom of choice, tenants will be forced to stay for fear of higher rent in the next unit. Even if they continue to stay in their units as sitting tenants, they will continue to be faced with higher rent increases than the current law allows. Besides the 2.8% increase annually, it's proposed in this legislation that a further 4% can be added for capital expenditures, plus increases in utilities and taxes can legally be passed on to tenants. For example, a senior on a fixed income of $900 a month paying $600 in rent can potentially have an increase of $54 per month under this proposal. How will seniors cope with such increases on fixed incomes? They will do without proper nutrition, medical attention and such necessities as a phone and transportation.
The cost of housing is already causing incredible hardship for thousands of singles and families in this region. The region's food bank has confirmed that their demand increased by 40% by the end of May and is expected to go to 50% by the end of the year. The Salvation Army in Cambridge has had over 50% of their clients already collect their quota of four emergency hampers for the year. As one person so succinctly said, "I hardly exist."
Ideally, we would all love to spend 30% of our gross income towards the cost of housing. But for low-income families, 65% of the net income is what's being spent on housing, with absolutely no hope of relief. If a family is fortunate enough to acquire full-time employment at $6.85 per hour, the take-home pay would be $930 a month. In order to keep that job, they must have access to a phone and transportation to and from work, at an approximate cost of between $100 and $125 per month. Rent for a one-bedroom will average $475, leaving a total of $80 per week for food, clothing, personal hygiene and medical needs. The scenario is even worse for a single person on assistance. Their net income is $520 per month, leaving less than $20 per week for food and personal needs to survive.
This is all happening at a time when unemployment continues to rise. If we lose rent control, tenants will live in constant fear of increases. Fluctuation in housing costs make it difficult to balance family budgets.
Loss of rent control will reduce the mobility of our citizens to seek out new quarters, move closer to their work, accommodate new life circumstances or leave abusive family relationships. They will fear giving notice because they will not be able to find an affordable unit. People must be able to move around in our towns and cities without the threat of diminished housing opportunities.
This proposed vacancy decontrol will have a very negative effect on landlord-tenant relations. The government has admitted that the proposal will lead to harassment of tenants by landlords. The government is proposing to set up an anti-harassment unit to deal with the problem it will be creating. This means a new bureaucracy. The reality is, however, that most tenants harassed out of their apartments won't spend the time filing anti-harassment forms. In the last four months in the Waterloo region in the courts we've received one tenant complaint. Tenants feel intimidated by landlords and/or cannot speak up for themselves. They simply spend their time looking for a new apartment in the now decontrolled market. Allowing the market to set rents on vacant units will simply force families to do without the necessities of food, clothing, transportation and telephones. Unless members of this panel have been in a position where there is no money to pay your bills, you cannot expect to understand the reality that many of our citizens are living.
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Unfortunately, tenants were not given proper information about these proposed changes and were certainly not given enough time to respond. The announcement came out late in June and by the end of August there was no opportunity to respond to the proposed changes. Again, these sweeping changes are causing severe hardship on Ontario residents.
Secondly, the availability of affordable housing stock is decreasing. As families get behind in rent they will have no choice but to give notice. As they vacate, this proposed legislation will allow the landlord to freely charge whatever he or she can get. On the average, 25% of the units turn over each year. So we can expect that within a five-year period 70% of the rental stock will be affected by the vacancy decontrol, resulting in more people not being able to pay their rent. The housing registry strives to list units that are priced within the participants' means, but the recent survey demonstrated that fewer units are available than a year ago. The cost of housing continues to increase as families' incomes continue to decrease.
There will always be a percentage of our population that will require support services to meet their personal needs. Cambridge Housing Access has helped 1,177 families over the last six years. In many cases our participants have multiple barriers which the housing counsellor was able to break down. In many instances, they required support and guidance for three to six months, but eventually they secured adequate housing and went on to find employment and experience a more rewarding existence. Those in need in the Waterloo region have benefited greatly from past supports financed by the government such as the community partners program. I fear that the elimination of these supports in the Waterloo region will result in greater social problems for our community.
The tenant protection legislation recommends that demolition, major renovations and conversions of rental buildings to condominiums or cooperatives will no longer require municipal approval. Currently, the Rental Housing Protection Act is the only means tenants have to voice their concerns on changes that affect the residential status of their housing. I am most concerned that many tenants do not have the means or desire to own their own accommodation, and turning apartments into condominiums forces sitting tenants to move unnecessarily and severely reduces available housing stock. If this act is abolished, seniors in particular who found housing they consider permanent will live in constant fear that their housing can be taken away from them with a minimum notice. This does not protect the tenant at all. Home owners and tenants are both taxpayers and should be valued equally. This value should be expressed in the government's legislation so that tenants are indeed protected.
The vacancy rate that's given out by CMHC only gives a partial picture of the true housing availability. Homeless individuals are not included in the rate and neither are the second-generation families who have been forced to move back with their parents because they cannot afford to pay their rent. Our statistics indicate that the number of people who leave or are evicted due to non-payment of rent or utilities is going to increase. If rents are increased, as we expect they will with this proposed legislation, what is the government's plan to house the homeless and those families who are living in stressful, overcrowded conditions? And what will happen as the population increases and the landlords still have not built new units?
Thank you, and I'd like Cathy to take a moment to give you a true story of a participant case that would be certainly exemplary of the participants we serve.
Ms Cathy Werner: Good afternoon. I would like to tell you about a day in the life of someone who has been seriously affected by the high cost of apartment rentals in her struggle to maintain a decent standard of living. Her lifestyle is not unlike many others in her situation. She is in some ways better off because of her creativity and her desire to live. This is her story. She was not able to make it here, by the way, today. We expected her to be here.
She is a middle-aged woman who is living on a social assistance cheque of $520 per month. She is currently paying $450 per month for her rent. She pays for electric heat in the winter months. Because of these basic living expenses, she is left without money for food, hygiene and other necessary products. She does not have money for transportation. You might be wondering at this point how she is living. As I mentioned, she is a highly creative person. She volunteers at various outreach agencies and is able to outfit her apartment and clothe herself through the donations given at the agencies. Sometimes she is able to take clothing and barter it for bus fare. The bus fare enables her to get to the food distribution centre to receive a food hamper. Because of her special diet restrictions, she's unable to eat some of the foods offered to her. She takes the food she cannot use and barters it for something she needs, like shampoo or boots for the winter. She visits a soup kitchen for a meal and she stays to receive leftover doughnuts to eat over the weekend. The next day she awakens to find herself in the same situation.
Yes, she has chosen to live in an apartment that leaves her with about $17 a week to pay for food, hydro and other basic needs. She has lived in places for less money but she's refused to go back to picking cockroaches out of her cereal boxes and tolerating harassments from a slum landlord who refuses to fix leaking taps or faulty wiring.
Should we really expect her to live any differently than we do? Her days are spent literally on survival. That's something we all take for granted. She does not have time to look for meaningful employment. When the new tenant protection legislation is passed, how can we expect her to negotiate a rent increase with the landlord because the eight-year-old carpet needs to be replaced? How can we expect her to move back to a place where we wouldn't want to live ourselves? This woman is poor. She's not stupid and she's not lazy. Every day she fights for a minimal but decent standard of living. Removing rent control legislation will only create more of a hardship for this woman and for many others like her in her situation.
The Chair: Thank you. We've got just about a minute left. Did you have any final comment that either of you wanted to make?
Ms Brake-Cheater: I'd like to leave you with the questions. Cathy?
Ms Werner: No, thank you.
The Chair: Thank you very much. We do appreciate your input here this afternoon.
PETER MILLER
The Chair: Our next presenter is Peter Miller. Good afternoon, Mr Miller. Welcome to our committee. Should you allow some time for questions in your 20 minutes, they would begin with the members of the government. The floor is yours, sir.
Mr Peter Miller: I think I will let you give some questions. You're probably hankering to have something to say, having been cut off for over an hour. I've presented a paper which has been given to the clerk and you can read through it. I'm not going to read it, because it would take too long and then there would be no questions. I will just start out by stating that when I read the discussion paper presented by the government my first reaction was, this isn't a change of anything and will not accomplish any of the aims that the government has stated it wishes to achieve.
The problem I see with the legislation is that it does not recognize the fact that a landlord can make a profit. It seems that profit is a dirty word. Everything else in this society is built on profit and it is rewarded for profit, so why should not landlords be? If you control the rent, you also should be controlling the costs the landlord incurs, but that is not done. The landlord is at the mercy of municipal tax reassessments, utility increases, tradesmen's rates going up, damages done by tenants, and he has no recourse to get the extra costs back in rent increases.
The current legislation, the Rent Control Act, is a very negative piece of legislation when you approach it from a landlord's point of view. When you read through part I, which is the rent control provision, it seems that every time a landlord turns around he cannot get a rent increase or he will have his rents reduced. There is no carrot in there at all to reward a good landlord who's trying to do something with his building that he can get some more money to do that. It just seems that, "You can't do anything and we expect you to provide a palace at rates that would only subsidize a shack."
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The procedure in the act is also such that if a landlord makes a mistake, he's back to square one and loses whatever he might have had. The only upturn at the present time is the maximum rent concept, which allows the rents to creep up, even if it is not charged. If the economy turns around and the landlord feels he can charge more and he is not charging the maximum, he can bump his rent to the maximum rent provided by the legislation.
I think that is the background we have to look at when we examine the new proposals. My view is that the new proposals are not a light at the end of the tunnel -- just another bend in the tunnel with more of the same as in the past.
It is conceded there are unscrupulous persons in all sectors of society, and abrupt termination of rent control could lead to certain injustices. Therefore, there need to be phase-ins to let the market rule the rental housing industry. That is for the committee to consider and to review, because dropping rent controls all of a sudden may not do too much, at least in the Kitchener-Waterloo area. The rents cannot be raised because many landlords, I know, are not even charging maximum rents. If they try to bump the rent, the tenants give notice and they have a bunch of empty apartments.
The statistics that were included in the discussion paper seem to show that there are many units in the province renting at below maximum rent. Any attempt to obtain such maximum rent will send the tenants elsewhere.
The proposal to decontrol rents on a change in tenure is an illusion. If you negotiate a new rent with a tenant in a bad economy, the rent is low and then it is frozen there and it cannot be raised other than by the guideline until that tenant vacates. Existing tenants who had their rents reduced to retain them are liable to have their rent raised to the maximum at the next appropriate increase date. This is a benefit that landlords are going to lose with the proposals.
Caps on rent increases seem to be repugnant in a free-market society because there is no cap on the costs to a landlord.
Dealing with the capital expenditure in the proposal, it is my view that there should be no special rules made and that industry norms be accepted. The idea is to have less bureaucracy, and it is my feeling there are enough rules and guidelines out there that can be adopted to serve any purposes.
Inadequate maintenance of rental buildings is a problem with no easy solution. The issue that needs to be addressed is, where does the money come from to do maintenance? May it be required to increase the rent to give the landlord the money to do it, or do you reduce the rent so he has less money to do the maintenance? There is no easy answer to that, and certain landlords do have deep pockets; others don't. If they don't have the money, how can they do what is required?
The tenants are entitled to decent accommodation, and I submit that the Landlord and Tenant Act provides adequate safeguards in that regard. I've personally taken a number of landlords to court for providing substandard accommodation and obtained substantial results. The only benefit of a court process is that once the unit is back to good condition, the rent goes back to where it should be. The rent control proposals reduce the rent and leave it there, never to go back up. There's no incentive for the landlord to do anything to get his rent up.
Making the violation of a property standard an immediate offence also seems to fly in the face of justice. Why should a landlord be charged for something that he does not know? This leads itself to tenant abuse, where tenants refuse to let landlords in and then they call the inspector and say, "Aha, the landlord hasn't fixed the peeling paint in my bathroom which I haven't told him about."
Interruption.
Mr Miller: I hear some laughs in the back. There are bad landlords and good landlords, and I think the committee has generally been hearing about the bad ones. The good ones have contented tenants and they are not complaining too much.
The other thing is when tenants get their backs up, they insist on the 24-hour notice requirements, which puts a crimp in the landlord trying to get tradesmen in at the tenants' convenience to effect repairs. The committee should probably consider what homeowners do. If you've got a problem in the house, you call a tradesman and he says, "I'll be there when I get there." Some guys are nice and show up as required; others are late or they have other emergencies.
Increasing the fines can go both ways, depending on your philosophy. If you fine a landlord, are you taking the money away that is needed for repairs, or are you really punishing him because he's got such a big bank account? We don't know what happens.
Putting in provincial inspectors for maintenance probably adds more bureaucrats, and I submit there are enough local building and property standards inspectors around to do the job. If there is some help needed, the legislation can empower them to do more things.
You've probably heard of all the bad landlords who don't repair. The committee might consider some legislation to do what the municipalities do in their snow bylaws. If the repairs aren't done or the landlord doesn't come up with a plan to do the repairs in short order, then the municipality should step in, do the work and add it to the tax bill. The job is done and the money will be paid as a first charge on the property. Again, fining a landlord or sending him to jail is probably counterproductive and gets an attitude problem.
The proposals also deal with the Landlord and Tenant Act, and part IV of the current act deals with residential tenancies. I would submit that locally the system is quite good but it's still drawn out. It takes at least five weeks from the initial notice to a tenant for non-payment of rent before the sheriff escorts him out the door. If the tenant has paid last month's rent, the landlord is out at least one month's rent, or probably two months' rent, because if he gets a decent tenant, that tenant will give proper notice at his prior residence. He will evict the tenant and have it vacant for two months before the new, good tenant moves in. There might be some thought given to adding some legislation to charge the tenants who are being evicted with this loss of rent, which might jog their memories or convince them to be more fiscally responsible.
One other possibility would be to consider moving the enforcement of the residential part of the Landlord and Tenant Act to Small Claims Court. Most of the claims under the act are probably for less than $6,000 in rent. If it should still stay in the General Division, maybe there should be a provision to register judgements in Small Claims Court to make it easier for enforcement of money judgements. The system in the higher courts is too complex for the unsophisticated tenant or landlord.
Reducing the time frame is a problem. The only way I could see is having the appeal period and the sheriff's eviction period running concurrently, so if the tenant doesn't do anything in the seven days that are currently required, then the sheriff puts them out, again subject to manpower constraints at the court office.
The privacy provisions are in need of some clarification. I would suggest that making some exceptions for permitting tradesmen to enter when they arrive to fix items should be enshrined in the legislation. Nowadays, if the tenant is mad at the landlord, he says: "No, you can't come in. You do it at my convenience next week." That doesn't help the repair of the building or go for good relations. The other suggestions in the discussion paper are valid.
The harassment area can be a minefield, especially with the personality conflicts. The committee needs to consider the level playing field for both the tenant and landlord so that it does not end up that the tenant gets subsidized in his fight and the landlord has to pay for his own representation. If there is going to be something inequitable, maybe there should be cost consequences to either the landlord or the tenant for ill-founded complaints or defences.
Restraining orders are completely bad, because the landlord has to maintain the building. If he's restrained from dealing with the tenant, you've got the problem of how does he get in there to fix things. If the tenant is unscrupulous, he will charge the landlord for breaching an order. There's no easy answer to that.
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Interest on rent deposits: The 6% should probably be reduced, because nobody these days can get 6% by sticking the money in the bank in any form. Tying it to standard bank account rates might be a solution. There should also be a provision that the interest can be accumulated by the landlord and added to the deposit to cover future rent increases. Whether it's simple interest or compounded is an opinion decision.
A dispute resolution system is not really needed. We have the courts, and I think they do a pretty good job. We don't know what any new body would do. We know what type of time frames the courts use. The adjudicators and such need to be appointed. We don't know where they're coming from, where the hearings will be and how their actions are to be appealed if one is not satisfied. Here, again, it might be useful to have the dispute resolution done by a simple application, either in the Small Claims Court under the Landlord and Tenant Act or using existing court processes with some extra funding in that area, which would help the enforcement of the act and also might be useful in clearing court backlogs.
Security of tenure and conversions: The Rental Housing Protection Act and related legislation should be repealed. I think it is a fundamental idea of any free and democratic society that land owners should be able to determine what to do with their buildings and investments, free from government control.
The committee has probably heard of fire traps and slums. Maybe those buildings need to be demolished from a business perspective because it's cheaper to tear down and rebuild than try to fix what is in very poor shape. It seems the rental housing area is the only segment of the economy where people are told what to do with their money. Anybody else can do what they want. Private industry can pack up and leave, but landlords can't pack up their buildings.
The statistics attached to the discussion paper would seem to say that new construction needs rents at such a level that tenants will not pay them, because the general amount of rents currently being charged is less than an owner would need to make a new building economically viable.
I would suggest that the current part IV of the Landlord and Tenant Act has quite adequate provisions for hauling a slumlord into the courts for a rent reduction. If the landlord then straightens up and repairs it, he gets back to the rent level he had before he let his building deteriorate.
It is my view that the rental housing industry needs to be streamlined and left again to landlords and tenants to strike their own deals. Some protection, however, is also needed against unscrupulous landlords and tenants.
Those will be my submissions. The paper I've presented amplifies most of those comments.
Mr Maves: You prefaced your remarks on the dispute resolution system by saying you didn't think any was necessary. But we've heard from both sides, landlords and tenants, how cases can be drawn out for several months. Landlords would just keep using the system to not have to fix their buildings; tenants would keep using the system to avoid paying rent. What specifically can we do to reduce that and keep the existing system?
Mr Miller: One thing is that the act should require that if rent is not being paid, it be paid into court before any defence can be entered. I've found that once you have to put up money a lot of disputes evaporate. If you don't have to pay, you can fight. If you have to pay, "Well, maybe I'll consider not fighting." Also, fast-tracking it or saying that this is where you get into court, you get your hearing and it's done. Like I said before, if repairs aren't done, maybe the municipality should step in, do the repairs and charge them to the tax bill. That gets the job done and there's no argument.
Mr Curling: I like what you said, and thank you for your presentation. There's an old commercial that says, "Pay me now or pay me later." The fact is that if you have a car and you don't change the oil, later on you may have to fix the transmission. Just on that point, you said, "What is so bad about making a profit?" Then you said: "The profit is set by the market. Some people make a handsome profit, others lose their shirt. The market determines which scenario occurs." "If he does not have a chance to make a profit and build a surplus for upgrades or major replacement for things like a roof, furnace and parking lot, then the landlord has real problems."
Inside the guideline that they get, they do get the money to make that maintenance. Therefore, what has happened over the years is an accumulation of about $10 billion -- you hear this all the time -- of repairs to be done that are not being done. In fact, if they had done that, maybe we wouldn't have that problem today. But profits are there in that business; a matter of greed anyhow.
Mr Miller: I would answer that one by saying that the profit is there but the profit is also used by the investor or landlord for his other living expenses. It's not just there to be spent on the building and not used for anything else.
Mr Marchese: I've got a problem with that statement and I want to preface it by another remark. Mr Wettlaufer asked Mr Lampert about profitability in the business and he quoted some study that I often quote which says there was a 10% annual profit from the buildings -- not average, but annual -- and then he asked, "Is that a correct study?" and all that. Mr Lampert said that it wasn't a very good study because it looked at only 20 buildings. He rambled on around everything except to say whether or not they were doing well. It was an easy question.
We believe the industry is doing okay. Whether it's 10% a year -- let's say it's wrong; maybe it's 5% a year -- we think they're doing okay. We are not saying "profit" is a dirty word. Nobody is saying that -- certainly not they. Even the tenants are saying you're entitled to a profit, but you get the 2% increase. The Estates Tenants' Association says that's what they get. They're not even allowed to see whether or not that is being spent. They believe it's not being spent. What do you say to that?
Mr Miller: What I say is that it may be allowed but the landlord may need that money for his own living expenses.
Mr Marchese: Not for the maintenance of the building? What about the building?
The Chair: Thank you very much, Mr Miller. We appreciate your being here this afternoon and giving us your input.
BURNS PROUDFOOT
The Chair: Out next presenter is Burns Proudfoot. Good afternoon, sir. Welcome to our committee.
Mr Burns Proudfoot: Mr Chairman, members of the committee, my name is Burns Proudfoot. I'm a tenant.
It is right and meet that we are here in Kitchener's Valhalla, set astride this alley like a colossus, to discuss tenant protection, for it was here in this very alley, Hall's Lane, that families saw their homes lost and their lives blighted by the acts of unprincipled men. The time was 1933.
This core was a Potemkin village. Behind the façade of King Street ran the back slum Hall's Lane. It always stunk then from the city gasworks just back of it, but the people here didn't mind that much. They lived in cold-water flats and converted sheds and tenements. There was a real class distinction then. The mayor talked of "the two classes that we serve." The place was not as it is now. Mr Wilfrid Bitzer, the West German consul here for many years, was the Dun and Bradstreet man here in charge of rating the factory owners on the basis of character, capacity and capital in the 1930s. He described the German establishment here as "the old feudal system" with "employer-owned houses" and employees with "not much future." Other employers owned their workers' mortgages.
During the bitter winter of 1933, unemployment climbed to a dangerous level. Close to 4,500 persons, or 15% of the city, were dependent upon relief for their existence. The provincial relief schedule was found to be inadequate for survival in Kitchener because of substantially higher rents here. A dispute between landlords, the provincial relief authorities and the local relief board arose over rent payments. Provincial withdrawal of financial support of rent payments was threatened if Kitchener did not conform to the formula. The landlords threatened massive midwinter evictions if rents decreased one cent. There was no legislation to prevent this.
Early in January 1933 a decrease of 10% was made in the relief budget of each family in Hall's Lane and other enclaves of families without work. There were reports of immigrant girls here working in local factories for as little as $3 a week. The chairman of the relief administration said that no one would be allowed to starve. The single aliens and the married aliens without children and without jobs were deported, even political refugees, to save money in the Kitchener relief fund. The other single men were transported to the north for the same reason. The situation was becoming so desperate that many families sold their basic furniture in order to buy food.
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Steve and Josephine Slusarik and their two daughters were evicted from their cold-water flat at 176 Hall's Lane because Steve could no longer afford the rent. The place the city moved them to was, in the words of Mr Hudson to Kitchener city council, "unfit for habitation." The Slusariks, like the other families in Hall's Lane, were self-reliant, honest, hardworking people who raised fine children with happy memories of Hall's Lane and lifelong friendships with the other children from here.
A comment on the Lampert report: Mr Greg Lampert in his report for you on how to encourage construction of rental housing etc advises you on crafting new legislation and takes great pains to ignore the human factor -- tenants. He does not consult a single tenant, tenant organization, tenant brief or tenant publication.
Mr Lampert advises you to in effect give special help to immigrant developers, builders and landlords through immigrant investor loans. Based on many years as a tenant of immigrant or offshore people, I would advise extreme caution here. You should take steps to ensure that these investors are men and women of principle prepared to abide by our laws and our justice system. In my own case the developer, builder and original landlord of the row housing where I live is Helmut Oberlander, who is reported to have knowingly concealed his membership in the German Sicherheitspolizei and SD and Einsatzkommando 10A, liquidation task force, a mobile killing unit that executed hundreds of thousands of people -- men, women, children, infants. This person is in hiding now. The present owners are three people in Munich who vex and harass tenant leaders and other tenants here without mercy.
Harassment of tenants: Profiteers, slumlords and their associates have been harassing tenants for a long time. It would be best if you would clean up the massive backlog of injustices here rather than creating more. I find your New Directions paper to be a Clockwork Orange: daft, indigestible, unfixable. It would be best if you would strengthen the Rent Control Act, not maim it by making sitting tenants a special target for landlord harassment, classic harassment being eviction.
In a report by Carol Goodwin in the March 29, 1993, edition of the Kitchener-Waterloo Record, Mr Tony Keller, at a meeting held right across the street in a Market Square boardroom, painted a picture in the minds of the downtown landlords there. He portrayed tenants as criminals. He advised landlords on how to fight "scumbag" tenants, that landlords should change locks and wait with a gun. "Don't be hamstrung by the nicey-nicey Landlord and Tenant Act that was designed by people who most likely believed in Marquis of Queensbury rules," he said. Keller said landlords may need physical courage to ignore the act in order to get rid of undesirable tenants. "Be innovative and aggressive with the problem," he said. To get around the Trespass to Property Act, forms were distributed to fill out that authorize police to evict undesirable tenants. Curtis Rutt suggested that a landlord could enter a tenant's home on the pretence of doing maintenance work and place hidden recording devices in strategic places. Mr Keller is a member of the Law Society of Upper Canada. Mr Rutt is a member of the local police force. What are the views of this committee on the use of deadly force against tenants?
Landlords should not be permitted to be above the law. A recent report from the beautiful state of New Jersey records that a landlord was ordered by the municipal judge to serve part of a 100-day sentence under house arrest in his own run-down apartment building at 39 Lincoln Park in Newark. The inspection manager in Newark said that the sentence sends a message that the city is serious about providing its residents with decent affordable housing.
Mobile homes and mobile home parks:
(1) The Land Lease Statute Law Amendment Act, 1994, subsection 125.2(1), holds that a landlord shall not prevent a tenant who owns a mobile home that is situated in a mobile home park from placing on the mobile home or the residential premises a sign that a home is for sale. Subsection 125.2(2) prohibits signs in certain cases, such as if there is a reasonable alternative.
Selling a home is quite difficult enough. Signs, I suggest, should be permitted in every case on the mobile home or on the mobile home's leased land -- regular, full-sized real estate agents' solid signs on posts, if that is what the mobile home owner wants. Page 13 of New Directions uses the words "bulletin board" and "signs in the windows of their homes." These are not new rights but are the loss of the present rights and practices.
(2) Infrastructure upgrades should be anticipated by the landlord and the costs and profits should be his at the present level.
(3) New Directions fails to address the issue of religious freedom and freedom of worship in mobile home parks. Why is this? The people in Ontario have an historic right to freedom of worship. Our small pioneer villages were permitted to have a church or churches. Mobile home parks are often small but can become the new villages for many.
What are the views of the committee on mobile home churches? The words "church" and "minister" should be taken to mean the places for people of all religions. Should mobile home churches be permitted or excluded from mobile home parks? Must they be occupied by ministers or can they be vacated while the minister does a circuit of three or four of them? Can they have signs out front giving times of worship? Can they have bingo? Will the land on which they are placed be taxed or tax-free? Can they have traditional or modern church architecture or must they come skulking in like some hydro stations in the city disguised as houses? Should they be permitted in trailer parks with mobile homes? Can mobile home churches be shared with other religions? Who is to decide all this: the landlords or the government? Thank you.
Mr Curling: Thank you for the historic overview. It's what you learn on these missions at times. Of course, you put a good face on Kitchener.
Let us understand where we are. I think you have a good grasp of what's happening here. One thing you touched on that I'm extremely concerned about, and I presume it is fate that had Mr Lampert here this morning who confirmed exactly what you've said, that part of this scenario, part of this proposal excluded tenants completely. As a matter of fact, if I interpreted him correctly, I almost felt he said they didn't have any great investment in the development of housing or homes here, that he consulted only investors like landlords and developers. It is the same feeling of the government, because the New Directions paper took the same slant, to consult only the developers.
How do you feel about this? Do you see anywhere in this New Directions package any hope at all of improvement for any sector of tenants?
Mr Proudfoot: Mr Curling, I don't see a great amount of hope. As I said, I read the discussion paper thoroughly. I described it as a Clockwork Orange. I don't think it can be properly repaired. I am for making repairs in the Rent Control Act and making improvements, as I made some suggestions, but I think it's seriously flawed in that it ignores people, the tenants who are to live in these places.
Mr Curling: The government has created this legislation. They say this is a discussion paper and it will generate the legislation. I presume that people would like to see if they have listened to you and the hundreds of people who have sent deputations. Would you like to have an opportunity to respond to the legislation when it comes out?
Mr Proudfoot: Very much so. I find it very difficult to respond to this kind of paper.
Mr Maves: Thank you for your presentation. The question I have is about something you brought up right at the end of your presentation that we have not heard anything about. No one has ever said that they tried to get some kind of religious worship or a church or anything on their property and weren't allowed to. I was kind of confused where that came from. Have you had an incident where you wanted to have a church?
Mr Proudfoot: No incident. I visited the three main parks in this community, two of which have official mobile home parks: Bingham Park, Kitchener, and north of Waterloo, Martingrove Village. There's another trailer park which is zoned agricultural in Waterloo that has an official policy that it does not have all-year residents, but I checked it out and it does. So there are basically three.
I've asked if there was an interest, and there isn't much. People in mobile home parks in the main don't go to churches and many of them do not feel welcome by city people. It only takes one look and you're never going to go back. This isn't a known demand but it does make sense, and it's your job to plan for the future, I think.
The Chair: Thank you very much, Mr Proudfoot. We do appreciate your input here this afternoon.
Is Daryl Novak here? Is Alexandra Lawson here?
We will recess for a short period until one of the next two presenters arrives.
The committee recessed from 1511 to 1517.
WATERLOO PUBLIC INTEREST RESEARCH GROUP
The Chair: Welcome back to our committee. Our next presenter is here representing the Waterloo Public Interest Research Group: Daryl Novak, coordinator. Good afternoon, sir, and welcome.
Mr Daryl Novak: Thanks. The Waterloo Public Interest Research Group is a student-funded and -directed organization with a mandate to foster research, education and action on issues affecting our campus, municipal and global communities. Our membership is comprised of over 12,000 undergraduate students at the University of Waterloo.
Today we're focusing on the impact the proposed tenant protection legislation will have on our constituency. There are roughly 10,000 UW students who live off campus. September welcomed students back to an increase in tuition of 19.8% after a summer where the unemployment rate among students returning to school hovered at about 17%. These figures alone should indicate to you the substantial financial burden faced by people who want to improve their education.
The lives of students can be broken down into five general categories: food, shelter, employment, and their social life, all of which affect the final category, their learning environment. Students require housing that is affordable, well maintained and conducive to studying; in other words, reasonably quiet and free from harassment. Their living environment has a profound impact on their ability to do well in school, and as all levels of government have been saying, higher education is a requirement to even have a possibility of employment in today's economy.
Will the proposed legislation improve affordability for students? No. Students are earning less and paying more for tuition, and with the elimination of rent control they will be paying more for housing. This is especially true for UW students, as our school has a very successful co-op system where approximately 3,000 UW students attend school for four months and then leave on a four-month co-op placement.
The provision to permit rent increases without being subject to any form of rent control as units are vacated will have a profound effect on many students, and we're not convinced the market is going to be able to dictate prices that are going to be fair and reasonable and reflective of the type of housing that students are going to have to be living in.
Other proposed changes allow capital expenditure increases capped at 4%. Rent increases related to extraordinary costs won't be capped. There's also the problem of what those extraordinary costs will be, how they will be defined.
Vacated units: With students coming and going all the time, often what will happen is somebody will talk about a unit that they're living in and they'll then have a friend move into it. Will that be considered a new tenancy? That will also be exacerbated by requiring that the landlord's permission be gained for subletting, and also that the permission can be refused.
Allowing rent increases even with the non-compliance of property standards is also going to have a detrimental effect on students. Will the proposed legislation ensure that landlords maintain their properties to adequate standards? Unlikely. Lack of maintenance is the most common complaint among students. For those students who use the rent registry, they often find they are paying in excess of the guidelines but they're still living in a dump.
We attempted to get some input from students for this hearing, but school has just begun; students are just returning now. We attempted to get some input over the Internet. We did get some responses. These ones relate mostly to maintenance. One woman sent an e-mail to us saying that their plumbing hadn't been maintained for almost six months and they couldn't even do the laundry without flooding the kitchen. Others talk about appliances that break down and go unrepaired for some time. One student wrote saying that once a water heater broke in February and he didn't fix it for a week. "We had mice living in our kitchen cupboards." After repeated attempts with the landlord, they still were unable to get him to do anything. This is also a landlord who made them sign a document saying they would promise never to sue him. Of course, their statutory rights can't be infringed upon. However, most students are pretty naïve, so when they're faced with this kind of situation, they'll sign all the documents. Maybe they're not going to get the type of advice they need, so they'll just sign away. Even though they can't sign away their statutory rights, often they don't know this, so they will live under whatever rules a landlord has given to them.
We are encouraged that there's more power going to be given to property standards officers, but we're worried that this may not work. How will the government ensure that there are enough property standards officers in each municipality? Has the government consulted with municipalities on how the legislation will impact on them?
Will the proposed legislation promote housing environments that are conducive to learning? Unlikely. Our off-campus housing office has a database of over 5,000 records advertising units for rent. A large portion of those listings are situations where students are living in the landlord's own house and without a separate entrance. This situation, of course, isn't covered under the current Landlord and Tenant Act, and issues of privacy and interference by landlords are commonplace, another situation where there are many complaints by students.
There's a particular landlord who's known in Waterloo. When a unit becomes vacant, he'll advertise it, and as people come to his place of business he'll hand keys out to them, ask for a $15 deposit or driver's licence or something, and let them go off to the unit without notifying the current tenants. So people end up going through people's apartments without them even knowing that's happening.
We have a legal resource office on our campus. It's staffed by volunteers. During the past school year there were over 170 complaints. They ranged from repair and maintenance complaints to people complaining about damages, utility deposits that they did not get back, mid-tenancy rental increases, refusal of receipts and copies of leases, no privacy, free access by the landlord, and abuse of existing statutory tenancy protocol, for instance with the ending of a lease. A person signs a lease for a year. It comes towards the end of the year and the landlord says, "Well, you have to move out." Of course, they have a right to stay in that unit beyond that one-year lease.
I think these examples point out how the current legislation is still being abused. Landlords still find ways to go around it, to completely ignore it, and students suffer. They don't know what their rights are. So the proposed legislation I don't think is going to improve things, especially since the details about how the enforcement unit to prevent harassment or to investigate harassment, how that will work -- it doesn't seem like the legislation does much to prevent harassment.
In terms of a power dynamic, the reality is that landlords have power over tenants. A landlord can make life hell for a tenant. A tenant can maybe spoil the profits of a landlord, but really when it comes down to their life and living in a space, that can be very much disrupted by a landlord who wants to do that.
The other concern is, how will this spur new housing? I think this sort of single-shot approach isn't going to work, and that's been echoed by various organizations that represent developers. Simply put, the proposed legislation presents a poor argument for encouraging new affordable housing starts.
One of the keys is better consultation. I don't think this is adequate, just these hearings. At the very least, the larger cities in this province need to conduct comprehensive and meaningful consultations in altering legislation pertaining to rental housing.
Take this hearing as an example. The type of in-depth research that our organization would like to conduct is beyond our means. We have two staff people. We have competing priorities. Our student government also has limited resources and competing responsibilities.
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Perhaps the government should contract out and pay people to conduct the type of consultations that are necessary in coming up with an action strategy that is truly balanced, getting much more input in round table discussion, not in this type of intimidating hearings.
It's different maybe for a developer to hire a consultant to review their strategy and to look at what the impact of government legislation is going to be on their business, but what about the tenants' associations? How are they funded? Where are they going to get the money to do that? We operate as a non-profit. We don't have the funds to do this kind of research, and I think it's necessary. It's necessary especially when we're talking about affecting the lives of millions of renters in this province.
A 17-page document that's put out for people to look at and to consult on and to comment on is not adequate. Perhaps the government would like to employ workfare recipients to do this kind of research. I hope not. I think people should be paid a decent wage, and contract out. We have skilled people who are worth the money to pay them to maybe look at the student aspect of this, to hold consultations within the student community.
I think in some ways these types of hearings are a charade. We have the government on one side, the opposition on the other, all grandstanding, all wanting to make a public statement that this is true consultation. I don't think it is. I don't think it works. It's incumbent on the government to present us with options, show us the rationale, give us the means to do the research so that we can do true consultation. I think it's a mockery of the fiduciary responsibilities of government. We should be presented with options. The public and the organizations that represent different groups in the public should be consulted more effectively.
The Chair: We've got just a quick minute per caucus for a statement or a question, beginning with Mr Marchese.
Mr Marchese: Thank you for the presentation. We've had a number of students who have come in front of this committee worried about the effect of increases that this will have on them. Just to ask a quick question again, because I'm interested in that point: The Conservatives argue the system is broken. You've argued the current system is broken. So they've come up with a proposal to help tenants out. Is there anything in this proposal that helps you to deal with the concerns you've raised with respect to one of the 170 complaints you've received?
Mr Novak: I think, to be fair, some of the provisions around property standards enforcement; that is certainly in the right direction. But particularly with elimination of rent control and some of the other provisions that are going to affect rental increases as they pertain to students, as they pertain to our campus and our co-op cycle, I don't think it does. Students are hurt certainly the most by this.
Mr Maves: Thank you very much for your presentation. Just quickly on sublets, because I know that's important to a student who goes back to where he or she is from in the summer and sublets to somebody: We had a gentleman last night, a lawyer, who cited a case where a unit was sublet out to someone who was a crack cocaine dealer and they had a great deal of trouble getting the person out and so on. I can see the landlord's point of view when things like that happen. How can we get the proper balance in that area?
Mr Novak: As far as I know, most students are not crack cocaine users.
Mr Maves: I'm not saying that they are. I'm saying there are instances where --
Mr Novak: Certainly there are instances where this occurs, but with that specific problem, we haven't had an exhaustive look at it.
Mr Curling: Mr Novak, thank you for your input. It is unfortunate that the government chose a time to have this consultation when students are busy trying to get back to school. They are going to be greatly impacted, because New Directions is really putting students out especially. One of the greatest costs they have is tuition fees and next is accommodation. So much could be learned from students coming forward, people like yourself, who are saying this has a great impact and the consultation process is flawed. Would you need an opportunity, when they have this legislation put together, to have some contribution towards this legislation in the New Directions way? Would you like that opportunity?
Mr Novak: We certainly would like it; however, with one proviso. Students are busy surviving, doing school work and trying to do well, and they spend some volunteer hours doing things. That's finite. In order for us to have meaningful input, we need to be able to do consultation that is more lengthy, that reaches out to the vast majority of students, not just five students and use that as an example; and to consult with the various agencies at the university and within the student community that would have something to say about this. We're prepared to do that.
The Chair: Thank you, Mr Novak. We do appreciate your coming forward today with your input.
WATERLOO REGIONAL APARTMENT MANAGEMENT ASSOCIATION
The Chair: Is Alexandra Lawson here? She has designated her time, and she was supposed to be here to introduce Mr Eby, the past president of Waterloo Regional Apartment Management Association. Good afternoon, Mr Eby. You have 20 minutes. Should you allow any time for questions, they'd begin with members of the government.
Mr Robert Eby: Good afternoon. My name is Robert Eby. I am the past president of the Waterloo Regional Apartment Management Association and I own one rental unit. I have managed over 3,500 units in the past 20 years, some under rent control and some exempt. The exemption of course was taken away when the NDP convinced Mr Peterson to agree to put all buildings under control. I guess some politicians will compromise others' rights just to become Premier. I sincerely hope Mr Harris does not turn out to be just like all the rest.
I would like to congratulate the Progressive Conservative Party and its leader, Mike Harris, on the excellent job they have done so far.
When you were campaigning you made some promises. You promised that you would abolish photo-radar, and even though you had some strong opposition, you went ahead with your promise. You promised to cancel a number of labour laws and really stuck to your promises, notwithstanding the tremendous pressure the unions brought to bear. You promised to cut back the civil service and you're well on your way to accomplishing this. I believe the public is still impressed with what you promised to do and what you have done so far. Keep up the good work.
I think it was in 1973 that the PCs were elected and one of your promises was to bring in rent controls for three years. You kept your promise, but at the end of your mandate it was impossible to eliminate rent controls and get re-elected. So here we are today still discussing rent control.
My point is that before this last election you made a promise to eliminate rent controls, and I am here to ask you to keep your promise, just like you did with all the other promises you made.
When it came to finances, you promised to cut back welfare to 10% above the national average, and you did, and now you want to make landlords responsible to provide housing to those who require assistance at our expense, since you cut some of your expenses. Well, it's totally unacceptable. Landlords are people too and we should not have to shoulder the burden of housing the less fortunate. This is a taxpayer problem for all taxpayers of Ontario, not just landlords.
I believe Canada is the best country in the world. The reason it is are the freedoms and opportunities we have. In addition to the major freedoms and rights we have, we also have the freedom to move anywhere in our country without the fear of being told we can't; the opportunity to apply for a job that we think we can do and the freedom to quit if we don't like it; the freedom to put money away for a rainy day or to buy a house; the opportunity to select where we want to live and, if we're renters, give notice to the landlord if we want to leave. He can't make us stay.
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We as landlords want the same freedoms and opportunities as every other taxpayer. We put away the money, we purchased the home or purchased a multifamily home or an apartment building or a town house or a group of town houses. The reason we did was because we thought it would be an excellent place to put our money into until retirement; then we would not have to rely on the government to give us handouts to live. If you allow us to have the freedom to compete in the marketplace without your intervention on the rents we charge, you might find our properties will improve in the standard of maintenance and overall the tenants will be better served. Give us back the rights to our property. Set the rules fair to both the landlords and tenants as far as maintaining and operating our buildings are concerned, but allow the landlord to set his own rents.
You've all received copies of the submission made by the Fair Rental Policy Organization and I'm sure you've all read it, so there would be nothing to gain if I resubmitted what was said in their report. We at the Waterloo Regional Apartment Management Association agree that if you will not eliminate rent controls then please look at this submission with an open mind.
When we talked to our members at several of our meetings we received some of the following comments.
One member said: "Landlording is a business. The previous government said housing was a right. You should now revert back to treating our business as a business. If you do not regulate the price of food and clothing then do not regulate the price we wish to charge for our rental accommodations."
Another pointed out that you should not penalize all landlords with rent control in the province of Ontario because of the housing problem in Toronto. Perhaps we could all try to find ways to solve Toronto's rental problem.
Someone else indicated that we voted you in believing you were for responsible free enterprise, but now you are continuing to add to the socialist ideas of the NDP by continuing to promote rent controls.
We were asked by a member: "Is the government again saying rent controls do not apply to new construction? Why should we believe them? They first said rent controls would only last three years. They also said prior to the last election that they would eliminate rent control." What do you reply to our member?
A question for you from another member: "If you will not eliminate rent controls for all buildings in Ontario, how about a compromise and at least take off the controls on all post-1976 buildings that were originally exempt?"
One member suggested, "When it comes to requests for maintenance, make it mandatory that tenants must first request repairs in writing and that the tenant must let us in to fix the repairs."
We understand you will combine all acts into one and make it simple. "It's an excellent idea," said one of our members.
In a straw poll we found that 60% to 70% of all rental units are not at legal maximum rents in areas other than Toronto. Has the government ever completed this study? What the government proposes to do is to allow us to set new rents when a tenant vacates but then come under rent control again. This suggestion is worse than the NDP ever proposed. And don't get me wrong; I'm in no way giving praise to the NDP.
Many landlords wanted to know, when it comes to tenants who are on some form of social assistance and they do not pay the rent, why won't the municipality pay the rent direct to the landlord? The regional social services say you can only get a rent paid directly to the landlord from those on general welfare and not for any other form of social services, for example, mother's allowance. Why? In the past we have gone to social services and informed them that a particular tenant is not paying his rent. They then deduct the rent from their client and keep it. We ask that if they deduct it from the client they pay it to the landlord who did not receive it. I believe you can change those laws to allow us to get rent paid direct.
A member asked that you look at the cost to the taxpayer to administer rent control. Isn't this an incentive to get out of the rent control business?
Another member thought that if you eliminate rent control, some tenants might get rent increases and they just might start looking at alternatives like buying a house. Many tenants stay in rent-controlled apartments because there is no incentive to move out. Ask Mike Harris. He lived in one.
"What can we do for people who are allergic to animals who are now in our building and a new tenant brings an animal into the building?" asked one of our newest members. What's your response? She went on to ask, "Will you reconsider allowing us to make agreements with our tenants about pets?" Our member also added: "Let the landlord decide if she wants pets in her building. It should not be the tenant's right to bring a pet into the rental unit. It should be a privilege."
We agree that "common sense" is your slogan. Use it now. I wish to thank you for the opportunity to present some of our concerns. I sincerely hope you will not treat us like the past government and you will truly make this consultation with fairness in mind. Please feel free to ask me any questions that come to mind.
The Chair: Thank you, Mr Eby. We've got about three minutes per caucus, beginning with Mr Stewart.
Mr Stewart: We've heard a number of times over the last couple of weeks and have heard three or four times today that shelter subsidies may be the answer, paid direct. Needless to say, you comment on pay-direct as something you support. What about the shelter subsidy? Do you feel that if the landlords know they're going to get paid, they will then get involved with new construction because they will eventually get a return on their money?
Mr Eby: I don't think landlords or developers are going to build buildings simply because you allow -- general welfare tenants already can pay direct, but if you allow mother's allowance people to pay direct, I don't think developers are going to be building buildings at that rent level, no. They can't afford to.
Mr Stewart: The problem we have now is that we've built them over the last 10 years to the tune of $100,000-plus per unit. The private sector could do them for about half of that. One of the comments was that it appears that a lot of the landlords and property management people don't want to get involved with social assistance people or low-income people or whatever you wish to call them, because they are concerned that they're not going to get paid.
Mr Eby: My comment was that existing landlords with existing buildings will rent to people who are on mother's allowance, social assistance and so on. They do now. However, when someone does not pay, we don't have recourse to get the money. If you allow us to get paid direct, then we don't have to worry about the tenant not paying the money, and I believe more landlords would openly rent to people who are on assistance.
Mr Stewart: That's my point. We've heard continuously about accountability on behalf of the landlord. What about accountability for tenants?
Mr Eby: Meaning should the landlord tell the tenant where he spends his money?
Mr Stewart: No. What I'm saying is that a landlord doesn't usually go into his own apartment and smash holes in the wall. Should there be more accountability in legislation for the tenant to have concern over the property he is renting?
Mr Eby: I'm not sure how you would legislate it. I think our system, under the Landlord and Tenant Act, allows a landlord to evict a tenant because he's done damage.
Mr Stewart: But the repairs and everything else go along?
Mr Eby: Yes, it would be nice to recoup that money.
Mr Curling: Mr Eby, you were quoting from some of your colleagues who gave you some of their concerns. You omitted one. Someone else asked, "Why do you propose to eliminate maximum rent?"
Mr Eby: I'm sorry. Did I miss that? Yes, I did.
Mr Curling: Yes. That's an important one, you see, because legal maximum rent was created by rent control. Could you expand on that? Would you want the government to eliminate maximum rent?
Mr Eby: I did say that we would be in a worse position than we were under the NDP system. If you eliminate maximum rent at this point -- our economy says that 60% to 70% of all landlords in this area are not getting maximum rent. If your maximum rent is $700, because of the way the economy is you rent for $600; the new tenant comes along and the economy is a little worse now compared to when you rented to the guy at $600 a couple of years ago, so you only get $550. You're now telling the landlord he's stuck at $550 and if the economy gets better two years from now he can't go back to $700 with that same tenant? We're saying leave maximum rent, absolutely.
Mr Curling: Definitely, because rent control will help you to get there.
Mr Eby: Yes.
Mr Curling: So you like rent control.
Mr Eby: Oh, absolutely not, sir. I would rather be able to have my rent level anywhere I choose to put it because it's my building and it's my investment.
Mr Curling: Rent control has created that for you. You want to have your cake --
Mr Eby: No, rent control did not create the $700 for me. It limited me to $700 because at some point in time prior to the economy we're in now, instead of getting $700 I could have got $1,100 and you prevented me from getting it.
Mr Curling: Let me ask you this: Was it rent control that caused the economy to be where it is today?
Mr Eby: I don't think so.
Mr Curling: Rent control didn't cause it, so therefore the problem --
Mr Eby: Therefore, if it's not a problem, take it away. Get rid of it. It doesn't belong here.
Mr Curling: The problem, the reason people do not access your building for the kind of money you'd charge at legal maximum rent, is a matter of affordability.
Mr Eby: No, it's a matter of the economy. They won't pay $600 for a two-bedroom that looks like mine when they can go down the street and get the same two-bedroom for $550.
Mr Curling: You said there should be consultation, Mr Eby.
Mr Eby: Yes.
Mr Curling: Lampert, who created the report for the government to write New Directions, did not consult any tenants. Do you think the government should be speaking to tenants and tenant advocacy groups?
Mr Eby: I don't know his report. I haven't seen it.
Mr Marchese: Mr Eby, as a preface to many of the questions I have for you, I want to say that I am not unsympathetic to landlords who have difficulties with tenants who don't pay or who cause damage. There is recourse in the law, but at times you don't get the money back. This is true. Having said that, I have some questions for you.
You own one building?
Mr Eby: One house that I rent to a tenant, yes.
Mr Marchese: You're doing okay in terms of the return from that renter?
Mr Eby: No. As a matter of fact, I have to subsidize the cost of my house to the tune of about $3,000 a year.
Mr Marchese: It's costing you money?
Mr Eby: Yes.
Mr Marchese: Why are you doing it?
Mr Eby: Because I would lose $50,000 if I sold my house.
Mr Marchese: I see. Do you take the guideline you are provided by the current legislation?
Mr Eby: I have not raised my rent in two and a half years.
Mr Marchese: Why not?
Mr Eby: Because I can't get it. If I raised the rent the tenant would move, and if I tried to rent my house today I would not get the amount I'm getting right now from a new tenant.
Mr Marchese: That's interesting. You can't raise the rent because if that person leaves nobody would come in, is essentially what you're saying.
Mr Eby: I'd have to decrease the rent to get a new tenant, yes.
Mr Marchese: But you would like to be able to have the power to be able to raise the rents however much you want.
Mr Eby: Absolutely.
Mr Marchese: So you can get that increase now, which is 2.8%, but if rent control weren't there you'd be able to charge whatever you like and you could get it?
Mr Eby: No, I didn't say that. I said let me charge whatever I can get. If two years from now I can put the rent back to $1,000 that would break me even, then let me charge it. Stay out of my business.
Mr Marchese: I understand that. You want property rights for owners. Do you think the same should apply to those who own 100 units or 200 units, however many units there might be in a building?
Mr Eby: Absolutely.
Mr Marchese: What about the tenant? In that environment that you're describing where the landlord has absolute rights to do whatever he likes, and in most cases they do now, do you think --
Mr Eby: We're talking about charging rent. There are some things the landlord cannot do and should not do.
Mr Marchese: So you're saying they should charge whatever they like and if tenants can't afford it, tough luck, they'll move out and find some other arrangements. More or less, is that what you're saying?
Mr Eby: I'm not using those words. I'm saying that if I have a business of operating a 100-unit building, let me operate my building. You are not telling the food people to charge $4 for whatever.
Mr Marchese: I understood you, but my question is different. You're saying you own a property and you want to be able to raise rents to whatever amount you'd like because it's your right; you own the building, you said.
Mr Eby: Yes, that's right.
Mr Marchese: Who protects the tenants if they are unreasonable rates?
Mr Eby: But they can't be. If they are unreasonable, then I will have an empty building and I will not be able to afford my building and I will lose my building.
Mr Marchese: So you're saying --
The Chair: Thank you, Mr Marchese. Thank you very much, Mr Eby. We do appreciate you coming forward this afternoon with your input.
We are now recessed until 5 o'clock.
The committee recessed from 1555 to 1701.
The Chair: Good evening. Welcome to the resumption of our hearings.
PINE MEADOWS HOMEOWNERS ASSOCIATION
The Chair: Our first presenter this evening, representing Pine Meadows Homeowners Association, Peter Brophey, the president. Good evening, sir. Welcome to our committee. Should you allow some time for questions in your 20 minutes, the questioning would begin with the Liberals.
Mr Peter Brophey: Thank you very much, Mr Chairman. I don't know whether it's heartening or not to hear you say "Good evening" when the sun is still shining out there. But good evening to you, sir.
The Chair: Thank you.
Mr Brophey: You heard Pine Meadows very well and accurately described at noontime today by the land owners of that project, Don and Janet Vallery, when they spoke at 12 o'clock noon.
I'm president of the Pine Meadows Homeowners Association, which comprises all 202 retired homeowner residents of that community, living in 104 homes. The present investment by us, the homeowners in the community, totals about $18 million in the homes that we own there which we estimate to be probably around three times the land owners' equity.
Our major message is really the same as the one delivered by the Vallerys at noontime today, and that is that owned-home, land-lease communities differ very, very greatly from traditional rental situations, and I'm sure you've heard that during the appearances before you these last couple of weeks. This is because we purchase our own permanent homes. They're not mobile homes, they're not trailers or even, for that matter, condos. These permanent, stand-alone homes are built on full basements on land rented by the homeowners from the land owner development.
Essentially, we homeowners make three different kinds of payments to the land owner-developer. The first kind of payment, usually ranging from $150,000 to $200,000, is for the outright purchase of the home when we buy it. The second kind of payment, generally about $250 per month, is for monthly land rent payments to cover the prorated one-time land acquisition and initial development and infrastructure costs. The third kind of payment, up to about $150 per month, covers two distinctly different kinds of maintenance costs, and these were explained in some detail by Mrs Vallery. The first is community maintenance and upkeep, like snow removal from internal roads and sidewalks, street maintenance, sewer and water system operation, parks and recreation, and electricity and upkeep for street lighting etc. In a different kind of community, these costs would be provided by the municipality, not by the land owner. They would be provided by the municipality and would be paid for by taxes. Of course, we all know that taxes flow through to the homeowner and are borne by the homeowner outside of the present 2.8% annual rent increase cap. The second kind of maintenance cost which we pay monthly represents home services like lawn care and driveway and front walk snow removal, cable TV etc. Again, in a different kind of community, some of these services would be performed by the homeowner, while others are contracted out by the homeowner at a freely negotiated price, not subject to rent control.
In Pine Meadows, both of these community and individual maintenance operations and costs are carefully reviewed monthly by a very effective land owner-homeowner committee. With respect to these three important matters, we make three recommendations which are more formally presented in the paper which we have submitted to you.
Our first recommendation is to treat owned-home, leased-land properties separately and distinctly from traditional rental properties, condominiums or trailer parks in all legislation. We are none of these. We're not a condominium or a traditional rental property or a trailer park. We feel that we and the government officials responsible shouldn't have to interpret whether legislation and regulations aimed at landlords and tenants apply to us.
The next recommendation is twofold: The monthly land rent and maintenance payments should be clearly separated from one another in any regulatory regime. Let me elaborate on these next two recommendations. Our second recommendation is that monthly land rent payments should remain controlled because they represent money spent at a fixed time in the development's history, the beginning of the development. They do not increase through time. Consequently we recommend that the controlled rent increase on the land-lease monthly land rent payments should be 0% instead of the maximum across-the-board annual rent increase of 2.8% which applies to conventional rental properties. Not surprisingly, this is one of the two points which Mr Vallery mentioned this morning that we were not in agreement on, the land owner and the homeowner.
Our third recommendation asks for full pass-through of all maintenance costs after review for reasonableness by a land owner-homeowner maintenance review committee. We believe that this review process is the key to making pass-through work effectively and fairly, and we and the Vallerys are in full agreement on this issue. In our opinion, implementation of these three recommendations would dramatically improve the fairness and the equity of owned-home, leased-land transactions, both for land owners and for homeowners.
We're making a fourth recommendation and that is with respect to the Planning Act, which presently limits land-lease terms to 20 years. We understand that there were good reasons for this, reasons associated with the integrity of municipal planning. But the recent growth in numbers of land-lease communities and homeowners requires consideration of the situation in which homeowners will find themselves upon lease expiry only 20 years after home purchase. This situation becomes more critical when one considers that the majority of such homeowners -- owned-home, land-lease homeowners -- are retired seniors. Many of them increasingly are younger retirees or early retirees. We are suggesting that a lifetime or a 40-year term would be a more practical and compassionate alternative than the present 20-year limit on land leases under the Planning Act.
We're also concerned about the discussion paper's proposal that rent controls should cease or be interrupted when the lease expires. Again, we and the landowner do not agree on this particular point in Pine Meadows. In a conventional landlord-tenant situation, it's an intrusion into the private negotiating process for the sale of owned-home, leased-land homes. We feel that such artificially and inappropriately increased land rentals will depress the resale value of our homes, transferring more of our home equity to the land owner. We believe that the lease and its terms should pass with the home and the 0% land rent increase recommended by us should continue following the sale of the home for the remainder of the lease term. Permitting land rents to rise after sale of the home is yet another example of the inappropriateness of combining owned-home, leased-land properties with traditional landlord-tenant situations.
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We're in general agreement with the discussion paper's proposals regarding mediation. As a matter of fact, our lease agreement at Pine Meadows already provides for mediation of disputes which might concern maintenance charges. We also endorse the measures already enacted concerning homeowner rights.
We appreciate the opportunity to share with you our concerns as owned-home, leased-land homeowners, and we join the Vallerys in inviting members of the committee or the ministry staff to visit our community if this would assist in understanding the unique nature of owned-home, leased-land communities.
The Chair: We've got about three minutes per caucus for questions, beginning with Mr Curling.
Mr Curling: It's good to see you. I'm disappointed that I see you out here. You should be back in Scarborough where you really belong.
Let me take you up on the last point you made. You say that maybe we should all visit Pine Meadows to understand the concept there. My feeling about consultation too is to be onsite. This process lacks contact with people, contact with all those who are involved with what the legislation is going to reflect. You know the old saying, "Laws for the people, by the people." I think we've got to understand that. I can't tell you that I'm an expert or have full knowledge of what this is all about. I'm getting the drift as I go along from people like yourself who have presented those kinds of concerns.
You said you are in full agreement with the harassment process the government has put in place. Is that part of what you are saying, the settlement resolution --
Mr Brophey: No, I didn't use the term "harassment," Mr Curling. Harassment?
Mr Curling: The mediation proposal.
Mr Brophey: Mediation, yes. There's a great difference.
Mr Curling: It's the same thing as the harassment tribunal that they want to put in place. Is that what you're saying?
Mr Brophey: Well, the paper suggested that a mediation process -- yes, I guess it was a tribunal -- should replace access to the courts for disputes in rent settlement, and we're saying yes, that's a good idea. We would much rather go to mediation on any disputes we had with our land owner than take it to court. We already have that process in place for any disputes that might arise on maintenance matters.
Mr Curling: Do you feel too that if it would work in your quarters, the same thing would work with landlords and tenants outside? You are slightly different, as you said. You come to this table and say, "We are quite different," and I understand that. We have to be sensitive to all of that. But in the meantime, do you think the same model that would work for you would work in general across landlords and tenants better than what we have now?
Mr Brophey: I really couldn't speak to that one. I would like to think it would, but we have a spirit of cooperation in most of the owned-home, leased-land communities where we're accustomed to negotiating and dealing with the land owner and among ourselves constantly. I don't get the sense that that spirit exists in the conventional rental marketplace.
Mr Curling: I'm not going to have many questions. Maybe my time is running out. I have to, again, understand fully some of the complexity and some of the things you are talking about that need to be looked into. I hope when the legislation comes in, you will be given an opportunity to see that the legislation reflects the things you need. Would you like that opportunity?
Mr Brophey: Yes, I would, and we would like the opportunity again to show members of this committee or of the ministry what a land-lease community looks like. If you'd never seen an apartment building, you'd probably want to tour one and see what it looked like. Our communities are different and I think tasting the pudding is the best test.
Mr Marchese: Mr Brophey, would you say that you have a well-organized tenant group?
Mr Brophey: A homeowner group, yes.
Mr Marchese: It seems to me that you are well organized, unlike so many other groups we've seen, although today we had a wonderful presentation by a group that was, I thought, strongly organized: Estates Tenants' Association.
Mr Brophey: Yes, I heard that one.
Mr Marchese: I thought if everybody was as organized and as articulate, things would get solved. Unfortunately, things are not always so, and when that is not the case, then you have a problem between those who own and those who obviously lease land as you do. Have you heard of other communities like yourselves where they are not as well organized?
Mr Brophey: There undoubtedly are some. There's a wide mixture of them. We've heard of many, one of which is only about 20 miles from here, that are as well organized as we believe we are and communicate effectively and well among themselves and with the land owner.
Mr Marchese: It's impressive.
In your recommendation number 3 you say, "Maintenance costs, after review by homeowner-land owner committee, should `flow through' and not be subject to rent control." That seems ideal. Because you have a situation where you are able to communicate very well with each other and with the owner, something like that could work, I suppose. But if you have a disagreement, how do you deal with that disagreement prior to flow-through?
Mr Brophey: To date the disagreements that have arisen have been negotiated by ourselves using reason and common sense. I would say we win some and we lose some, but we usually come up with better solutions because we negotiate and we compromise at times.
Mr Marchese: I appreciate that, but it doesn't always work. We know there's a power relationship that isn't equal, and in some areas where the land owner obviously isn't as good as what you seem to have in this situation you've got a problem. The imbalance of power doesn't allow for that sort of relationship to occur. How would you deal with those situations that are quite different from yours, obviously?
Mr Brophey: With respect to the power situation, there is equality. Our investment, which I mentioned, is about $18 million in the homes that we have. The land owner's investment is less than a third of that. I think there's a pretty good power-sharing climate in that place; plus, he's still trying to sell houses and doing it quite successfully.
Mr Stewart: Thank you, sir, for your presentation. Going back to the maintenance and flow-through costs, you're suggesting that there basically should be three forms of payment: first for the rent on the land; second, a flow-through for maintenance etc. What about capital costs? Are you going to include that as capital costs or would it be through the flow-through mechanism as in maintenance? Not in your particular operation or your mobile home site, but we're hearing that people are finding, after they've owned them for three or four or 10 years, that they've got to put a whole new infrastructure under them and of course they don't have the dollars and can't raise the rents to do it. In the one you have -- it's four or five years old -- if they have to spend some major capital costs over the next number of years, should it be the third part of the payment and only for the length of time it costs to do that capital expenditure?
Mr Brophey: First of all the maintenance cost should include an amount for building up a reserve which could be used to replace or enhance important services in the community. Second, if, let's say, we were to make an addition to the recreation centre or some of our town facilities, I'll call them, we would be charged for the depreciation on those expenditures over the asset's lifetime. Under the committee concept which we practise, we would vote as a community on whether or not we wanted those improvements done. We could probably at that time determine how that would be paid for. We'd like the land owner to pay for it and then charge it out over the life of the building or the facility he put in, but we might opt to build it cooperatively as well.
Mr Stewart: One concern we're hearing from tenants is, "If they want to do a maintenance thing in our particular apartment, they put a percentage on and it goes on forever." What I was trying to get at was, if it's a capital project, should it be divided over the period of time that it's going to be payable?
Mr Brophey: The balance? That would be our belief. I remind you again that what's good for an owned-home, land-lease community may not be applicable or good for a more conventional rental situation, because we are homeowners.
The Chair: Thank you, Mr Brophey. We appreciate your input this evening.
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TENANT ADVISORY COUNCIL OF NORTH WATERLOO HOUSING
The Chair: Our next presenter is the Tenant Advisory Council of North Waterloo Housing: Ron Dempster, chair, and Angela Schlichter. Good evening. Welcome to our committee.
Mr Ron Dempster: My name is Ron Dempster. I'd like to have a tenant from one of our complexes, Angela Schlichter, do her presentation first. Thank you.
Ms Angela Schlichter: I would like to thank this committee for hearing my views on the discussion paper New Directions. My name is Angela Schlichter. I am a single parent with two young boys. I have had an opportunity to read your paper and I am concerned about several areas of discussion. My first concern is in regard to the government's intentions regarding Ontario Housing. My second concern is that housing must remain available to families on limited income. My third concern is that a lack of rental controls and removal of tenants' rights will increase the difference between rich and poor.
First, although this paper does not say what the government intends to do with public housing, the present government made it clear in its run for office that it would sell Ontario Housing. In your discussion paper, the conversion of rental units into condos will enhance the government's ability to get rid of housing units. Even if the government gives first options to buy to current residents, it is not feasible for most people in my position to buy their units. With the conversions, most families in financial situations similar to mine will have to move and find alternative rents that will be suitable to our incomes. The removal of rent controls will mean that we will be put on the streets, negotiating for rents that have no controls, leaving us at the whims of landlords. Even as I speak, rental units or buildings are left empty as landlords would rather claim them as losses than reduce rents.
Second, I am concerned that housing will remain in the reach of families on limited incomes. As my income is limited, I need an affordable rent to make ends meet. Presently I am able to do that because of housing. I work in a contract position for Club Presentations. That means I am not given guaranteed hours. I do not necessarily know from week to week if I have work. I get paid $7.50 per hour on either a 27- or 30-hour workweek. My income is supplemented with child support. In a good month my income could be about $1,500; however, sometimes it's as low as $900. I currently pay $403 a month in rent with Ontario Housing. This means that in a bad month I have less than $500 to pay for child care, buy groceries, clothe my children and supply them with any medications they may need. I do not have health benefits. I also have to cover optometrists' and dental costs. As things stand, I have had to cancel eye appointments for my children because I cannot afford to buy their glasses. I wonder how they will manage at school without them. Will they be able to read properly or see the blackboard without them?
Furthermore, most financial experts state that no one should pay more than 25% of their income on rent. I already pay 28%. If the minister goes through with his considered plan of reducing contributions to rent-geared-to-income subsidies by raising the contributions required of renters by as much as 40% of income, this would mean a possible rent increase of as much as $250 a month for me. At this rate I have not the faintest idea where I could cut my budget enough to cover such a difference. As it stands, my wage covers only essentials.
Third, the lack of rent controls and the removal of tenants' rights will further segregate people by classes: those who have and those who do not. The removal of rent controls for non-sitting residents will make a decent rent out of reach for me and my sons. We will be forced to rent apartments that are not suitable for raising children. These apartments are dirty, infested with cockroaches and unsafe. People are already having to live in these slums. This is not an environment that I want my children to live in. Even when people voice their concerns about these living conditions, city standards officers do not respond because they have loosely defined guidelines that cannot be acted upon. You do not discuss in your paper the minimum standards that landlords must provide. Provincial minimum standards should be outlined and easy to enforce so that my children will have a clean, safe place to live. Also, the premise that increased rents will lead to money being put back into buildings is still not enforceable. You are relying on the goodwill of landlords to do that. We recommend that they be legislated to do it.
In conclusion, families on limited incomes must be able to afford clean, safe housing. The removal of rent controls will remove that right. People should not have to choose between the necessities of life. Children need food, clothing etc. This government does not recognize the need of low-income families and their rights to affordable housing. This government needs to make decisions that will support families and their children. Our children are our future. Thank you.
Mr Dempster: I am 63 years old, married and a resident of a seniors' building managed by North Waterloo Housing.
In an effort to save time -- I think you've got the copies in front of you -- I'd like to move over to page 2 and the reason I'm here: to speak to you regarding the consultation paper on rent control, to ask the government of Ontario to take a closer look at the proposed changes to the Rent Control Act, the Rental Housing Protection Act and the Landlord and Tenant Act, and to examine how these changes will affect the quality of life for low-income tenants and pensioners.
As a tenant and member of the Tenant Advisory Council of North Waterloo, I'm very concerned about the discussion paper New Directions. The proposed changes listed in this report will have a significant impact on low-income and fixed-income tenants relative to our housing needs and potential impact on other life essentials if affordable rents are not maintained for decent living accommodations.
In a recent meeting with Wayne Wettlaufer, MPP, we were informed that the government will be selling off Ontario Housing units. Assuming this sale takes place, what protection will be afforded the 1,645 tenants of North Waterloo Housing to alleviate the impact of these properties being sold? Affordable housing will not be available in the private market due to the proposed changes in rent control and the availability of affordable housing in our community. If rent control is removed, protection for tenants is at great risk.
My wife and I are living in North Waterloo Housing as a necessity. If we had to move to a one-bedroom apartment at market rates, our choice would be rent or food. The Kitchener-Waterloo vacancy rate for a one-bedroom apartment for anything under $399 is 0% and for anything under $400 to $619 is 1.9%. I've attached the CMHC report to the back of my presentation to you. Living on a fixed income, we could not afford the proposed increases. My wife is diabetic, and with no health plan coverage we are barely getting by each month. We are not alone. Many people in North Waterloo Housing are in the same situation or worse. For example, the maximum rate for a single person on social assistance is $325 per month for accommodation costs. Families on social assistance are in a worse situation because they have to clothe, feed, educate and house their families.
The availability of affordable family housing in Kitchener-Waterloo is also very low. According to the CMHC report -- I won't read this because we're getting close to the time; it's on the back page, as I mentioned -- for example a family of six, four children and two adults, living in one of the North Waterloo Housing complexes: The father works at construction, which is seasonal, and receives minimum wage. This family could not afford to pay market rent for their unit. In another unit, a single mother who is working has two daughters in high school who could not survive on her wages without Ontario Housing rent-geared-to-income housing.
Approximately 60% of family tenants in North Waterloo Housing are working, some only part-time and often earning a low wage because employment is difficult to obtain. I know several single mothers who are working and have trouble making enough to pay their babysitters since the recent cutbacks. Other residents are on disability but still have their home and pride, and now they're in danger of losing both. There are families in North Waterloo Housing that are barely making it through the month now without going to the food bank. If the housing complexes are sold, what will happen to these people when rent control is removed? Is this community prepared to take 1,645-plus families and seniors into their homes or see them out on the street?
The seniors living in North Waterloo Housing are extremely upset, as they do not know what's going to happen if their building is sold. The tenant advisory council and North Waterloo Housing have received literally hundreds of telephone calls from the families of these seniors who are concerned with what will happen to their mother or grandmother living in subsidized housing. Their incomes are fixed and they could not afford to pay market rents.
The government is seriously considering reducing its contribution to rent-geared-to-income subsidies by raising contributions required of renters to as much as 40% of gross income. As an example I've illustrated here, from the $12,000-per-year gross, 40% for rent leaves less than $600 per month for necessities. Many seniors receive less than this figure, which I have found out. Also, the group between 55 and 65 are in a worse situation as they receive no medical, dental or drug assistance.
This is a huge increase for seniors based on the yearly increase they receive on old-age pensions. The government has said they would protect people with special needs such as the elderly and disabled by continuing rent control indefinitely for such tenants. How can this be achieved if these buildings are sold to private enterprise?
The following questions and comments are from fellow tenants:
(1) What assurances can the government give to tenants that under the new tenant protection legislation public housing tenants will not be adversely affected by a revised rent control system or changes to the Landlord and Tenant Act -- for example, the proposed sale of OHC units?
(2) What is the current government's position on the proposed restructuring of OHC, and what plans are in place or being considered by the minister to improve the efficiency and accountability of OHC?
(3) What is the current government's position on the introduction of a shelter allowance or subsidy to individuals, has the government analysed the enormous cost of such a plan, and how is the government going to run the plan and the administration?
We recommend retaining public ownership of OHC housing stock. Ownership could be transferred to local incorporated bodies, formed through the amalgamation of local housing authorities, who would have the mandate of managing and maintaining assets. We prefer local ownership and control. In particular, North Waterloo Housing has become adept at managing housing and has coordinated support for the frail elderly and disabled through partnerships with local service providers. In general we feel the North Waterloo Housing managers and staff are unrivalled for efficiently, delivering and excellent service at modest costs.
Finally, I hope the ministry will make use of the expertise of local housing authorities and allow them and North Waterloo Housing to continue to manage their local provincial housing portfolios. We feel this restructuring would meet the government goals of expenditure reduction, less government, less dependency on government and better customer service.
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Thank you for this opportunity to provide a realistic insight into our concerns and to the potential real-life impact.
Mr Marchese: Thank you both for coming. Thank you, Angela Schlichter, for your presentation. This is the reality we are trying to focus on as well. Part of what I'm concerned about is how we protect people with low incomes. We heard a previous landlord who said: "This is my building. I should be able to do what I want and I should be able to increase rents to any extent I want." When landlords speak about the free market, allowing the market to set the rents, they're basically saying the same thing. Then we ask them, "But how would that affect people with low incomes?" Their answer is that it's not their responsibility to worry about that, governments should worry about that, but they support a shelter allowance.
The shelter allowance is something you raised. Do you believe this government should state in advance what that shelter allowance is, what the amount is?
Mr Dempster: Yes.
Mr Marchese: Are you worried in not knowing in advance what they might --
Mr Dempster: Definitely. From the phone calls I've gotten, I'm quite worried.
Mr Marchese: I have to tell you, I read briefly the Fair Rental Policy Organization report. Mr Clayton wrote that report for them. The way I read it and the way it's explained, you wouldn't be getting the same subsidy you have at the moment in terms of shelter allowance; it would be less.
Mr Dempster: Correct.
Mr Marchese: That's why I'm worried and that's why I want them to explain to us what that amount is. Some of you might feel a little more secure thinking you're not going to be getting $200 or $300 less, in addition to some of the cuts we've experienced, in which case you are really in trouble, and society would be in trouble.
Mr Dempster: Definitely. Particularly the senior population will be very hard hit.
Mr Marchese: We, the New Democrats, built non-profit housing and cooperative housing because, first of all, we were the only ones creating housing, and therefore stimulating the economy, but we also built housing that was suitable to people's needs -- people with disabilities, people with HIV, people with low incomes, the elderly and so on. Do you believe it's the government's role to get involved or not?
Mr Dempster: I believe it is.
Ms Schlichter: I think the government should support its people, not put them down.
Mr Marchese: I have to tell you I'm absolutely concerned about the government's desire to sell public housing. I'm not sure what their plans are, but if they then permit it to go into the market, depending on who the owner is going to be, we have a serious worry. I'm not sure whether the tenants realize this is about to happen, but I hope they know it's going to happen. You ask, "What assurances can the government give to tenants that under the new tenant protection legislation public housing tenants will not be adversely affected?" You're not going to get any. But it's a good question for them.
Mr Maves: Thank you very much for your presentation. I will note that a lot of the housing projects that we did remain committed to and did see built were special-needs housing, so we realize there's a role for government to play in that area. In our first year, many of the projects that we kept alive were indeed special-needs projects.
In one of your statements -- page 5, question 2 -- you end up talking about how the minister can "improve the efficiency and accountability of the OHC." I wonder if you can expand on that a little bit.
Mr Dempster: I feel that the present local housing authorities have been very astute at handing back to OHC the problems that are being encountered in every provincial area they represent. Consequently, if that's removed, all that background and work is just going to be washed away, because a new landlord will say: "This is my building now. I don't care what happened before." We have no safeguards whatsoever.
Mr Maves: So this statement about improving the efficiency and accountability of OHC is not because you feel that it's inefficient and unaccountable now, but you fear for --
Mr Dempster: I feel that if it is abolished, then we're going to be in an awful lot of problems, but if the government decides it can't continue with some sort of a format and dispose of OHC, I think it can save the government an awful lot of headaches and an awful lot of problems from a lot of tenants who are living in housing authorities right now.
Mr Maves: One number that you quote in here about this 40% of income -- where is that from?
Mr Dempster: That was published by the social services. Someone had made a comment. I don't have it, but if you like I can get you the written copy I took that from. There will be another person speaking later on and she has the same draft. He was incorrect. He said that they're presently paying 27%, which is incorrect, because in the local area right now we're running at about 31%. His proposal was that he felt it should be raised to 40%. That was issued from social services out of the city of Toronto.
Mr Maves: Which is who from the provincial government?
Mr Dempster: I haven't got that with me. I should have brought it, but I can address it to you, Mr Maves.
Mr Maves: So this is the city of Toronto?
Mr Dempster: It was from the city of Toronto, at a meeting that they had. This was published. Our Waterloo regional committee supplied us with that information.
Mr Maves: Because I had never heard anyone in the provincial government quote that figure. Where did it come from?
Mr Dempster: We have it.
Mr Curling: Thank you for your presentation. You've really put a face to it. The thing that comes out to me is when you talk about the quality of life. That's what housing is about. That's the difficulty we have with this government and that's the difficulty I have even with Lampert -- who decided the bottom line and who they should be consulting. You people are left out of this. They're trying to put a figure on that, a cost to that quality of life. You have put that. You have said to them, how can you expect your kids, your boys, to read the blackboard if they don't even have proper glasses at school? That itself has a profound effect later on. The social cost is tremendous. We're talking about education, we're talking about literacy, but I'm not quite sure the government has grabbed that.
I just want to go back quickly on the selling of the non-profit housing, Ontario Housing. There are 85,000 units that the government is speculating to sell off. It goes further than that. They're going to use your money to improve it, to sell it. I've said all along the government wasn't the greatest of landlords either. Their buildings are in terrible shape too. They couldn't fix it then, but they will now fix it on your back to sell it to the private sector and subject you to that. I think if you ever get a chance -- and you should -- organize yourself and make it very loud to your members that they should take their hands off those homes, because it's the only place, your home, which they're going to sell from under you. Where do you go? They've already made terrible attacks on people like yourself, Angela, who are on social assistance and other people who --
Ms Schlichter: I'm not on social assistance.
Mr Curling: You did say that you have worked and are subsidized.
Ms Schlichter: On social assistance I would be receiving $820; $220 of that would be my rent, never mind my other bills, and my other bills are just essentials. I do not have credit cards and I do not have loans. Mine are cable, phone, rent, appropriate insurance and, all totalled, came to $500 a month when I was on assistance. That would have left me $300 a month to feed and clothe my children.
The Chair: Thank you very much, Mr Dempster and Ms Schlichter. We appreciate you coming forward this evening with your input.
Mr Dempster: Thank you very much. We appreciate that.
1740
WATERLOO REGIONAL COALITION FOR SOCIAL JUSTICE
The Chair: Our next presenters represent the Waterloo Regional Coalition for Social Justice, Lisa Burke and Lori Lafond. Good evening. Welcome to our committee.
Miss Lisa Burke: Marc could not make it, so I'm speaking on his behalf.
There are some issues about youth between the ages of 16 and 18. They fall through the cracks of the community. They cannot sign leases. That's a major issue in this community, especially for me. I was very discriminated against when I got turned down from 10 places because I was in that age category. Sorry, I'm a little bit nervous. I was very discriminated against because I got turned down from all these places because I could not sign a lease. I was married and I had children and I was recognized as an adult, yet I wasn't fully recognized as an adult because I couldn't rent a house or an apartment. That's one of the major issues. I have some ideas to change that, if you can hear me. Just bear with me for a minute.
You can lower the ages for prospective mature renters, or we can expand family and children's services for adolescents as self-help, finding places or allowing some superintendents to act on for renting out to mature students or single mothers. I'm so nervous.
Interjection: Take a deep breath.
Miss Burke: This is actually my first formal public speaking.
Mr Sergio: I thought you were a professional.
Mrs Ross: You're doing well.
Miss Burke: Okay. Family and children's services cut out a lot. They only recognize children. The age category I'm really worried about is 16 to 18. Through my own life experience it was very traumatic trying to find a place to live. I was married and I could not even sign a lease. I was legally an adult, and that's what really hurt me the most. I'm over the age of 18 now. Now it's not a problem, but I'm just worried about the other people: the mature students, the mature people that don't have families or come from separated families and cannot live at home any more due to circumstances I'm not sure of. Mine were very different because I was married and separated, but everyone has their own individual reason why they cannot live at home.
I think it's a real necessity for 16- to 18-year-olds to find appropriate housing. The John Howard Society and CODA and Lutherwood cut back the counselling services for housing or appropriate housing. I think that's a real necessity to have. They have the self-help books, I realize that, but it's still not working out to benefit for 16- to 18-year-olds, or even the single mothers. They're having a very difficult time trying to find appropriate housing. Rent costs are extraordinary, especially if you're a family of three and the mother is single. For people on the poverty line there are not enough jobs to pay rent. Welfare does not cover first and last rent. I think that there should be something for the single mothers from the ages of 16 to 18.
I have a couple of ideas for housing services -- to have one in each place. Mike Harris did not have to cut back all of the housing. There's none in the K-W area; everything's cut back. It is a real necessity for the youth. The same with another thing, Ontario Housing. The waiting lists are very extraordinary. People who come in the shelters have nowhere else to go. They're on lists. Some people won't take people out of shelters and let them rent from them, because they think they're immature and why did they get to the shelter in the first place? They think they're trouble, and that's discrimination, really. It hurts me.
I've been living in shelters for the longest time, off and on, because I cannot find a place. I've been all throughout this community, Waterloo regional, Argus to Marillac to the YWCA, and nobody will let me in to find an appropriate apartment. They'll let me sign a lease now because I'm over the age of 18 now.
The renting thing, the first and last, there's not enough jobs out there too to pay for last month's rent. I don't even know why we need last month's rent. Can't we just give two months' notice and just keep on paying the first of the month? Because for the single mothers and the youth, it's very difficult to raise that kind of money, especially on the poverty line.
I think that's all I have on my list right now.
Ms Lori Lafond: Perhaps I can provide a little backdrop to what Lisa was talking about. I'm a residential support worker at Marillac Place, which is a home for young single mothers in the community here. We also take in some youth on a temporary emergency basis, and their issues range from abuse backgrounds, addictions, what could be typically classified as a street kid. So the issues move beyond pregnancy as well, and we're seeing more of that recently.
We have five spaces available. We've been full to capacity for the entire year and we have a waiting list that is very, very long. We've had to turn many youth down.
We teach life skills training through cooperative living. It's a cooperative living environment that the young women live in. We also have resident support groups on a regular basis there.
I guess to add to what Lisa was saying, beyond some of the more practical concerns that youth face when looking for housing, I think there's also an attitude change that is required here. I've spoken with many youths who've just simply been turned down from seeking housing because they're youth, because they're female and because some of them happen to be pregnant or with kids at a very young age. I think it moves beyond some of the practical concerns that she mentioned. Of course, living on social assistance and trying to find adequate housing out there in this area is very difficult. It goes beyond that. It's also the prejudiced attitudes that we're dealing with as well for youth.
Beyond that, we're open to any questions any of you have for us.
The Chair: Thank you. We've got about three minutes per caucus for questions, beginning with Mrs Ross.
Mrs Ross: It's Lisa, is it?
Miss Burke: Yes.
Mrs Ross: Lisa, I'm the mother of two children, a 19-year-old and a 22-year-old. We often hear from the opposition that members of the government don't have any compassion. I think that's wrong. I would feel absolutely destroyed if my daughters were put in the position that you were in.
Miss Burke: I didn't mean to say that you guys don't have children or anything. I have two girls. I know a lot of people who have children.
Mrs Ross: No, I just meant that I feel a lot of empathy for you. It's unfortunate that you had found yourself in the position that you found yourself in. None of us wants to see that happen.
You mentioned the housing waiting lists. I come from Hamilton, and in Hamilton we have several organizations. My understanding is that when you want a house, you go and register on a waiting list. That doesn't necessarily mean you get the first available house because on another waiting list there might be a house come up. So what you have to do is go and register on every single waiting list. Is that true here as well?
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Miss Burke: Yes. I've registered for co-op and they have Ontario Housing and there's subsidized housing. I'm registered on all three, but still they're taking the emergency people, the ones who are in domestic violence and whatever, first and they don't think about the people who are on the waiting list from the community itself who have been waiting three, four years to get into these places.
Ms Lafond: A lot of times that's because the shelters and group homes also have extremely long waiting lists.
Mrs Ross: What our government is trying to do is to streamline that process and have it all centralized so that when you register on a list, you don't have to go and register everywhere. You register once and you're on the list and you get points. I know you get points now for certain things. For example, if you've been on the waiting list for a year, you would have more points than someone who'd just gone on the waiting list. Would that make sense to you? Does that sound like a way of helping? If you have one place to go and register and you're put on the list, do you think that would help?
Miss Burke: Yes, but it's depending on how long it takes because the shelters --
Mr Marchese: A couple of thousand years.
Miss Burke: Yes, because of the shelters, right? The maximum time limit you can live in a shelter is up to a year, and to get on to the housing list, it could take two years to move into Ontario Housing or a co-op or even subsidized or geared-to-income. It takes so long. I've been to a couple of meetings for co-op housing and you have to do certain duties around the community to get into this co-op thing. You have to go to certain meetings to receive points. You have to attend the meetings to be on the lists or to get the next available house, and with two children that is very difficult.
Mr Sergio: Thanks for your presentation. Lisa, are you still living in a shelter now?
Miss Burke: Yes, I am.
Mr Sergio: You have two kids?
Miss Burke: They're with my parents right now, yes.
Mr Sergio: How long have you been living there?
Miss Burke: I've been living at Marillac for two months. I got dropped off at the door at a quarter of 11 at night. I've been living in shelter since I've been 12 years old. I've been on my own since 12.
Mr Sergio: Just a comment and then if I have time, I'll put a question. What we have heard from you we have heard also from other young people, including students. As Ms Ross said, I truly hope that not only will they have compassion but some common sense, and that if the government they represent is willing to go along and do the changes they are proposing, they will think about it a second time and change some of the things. What you have told us today represents exactly the types of questions when it comes to affordable accommodation. When we hear from all sides that affordable housing is a right of every citizen, I hope they will mean it and I hope that our Premier really understands that.
You are only one of those special-interest groups, as the government is saying, but there is a wider population out there. There are the seniors, there are the people who are not so mobile to go and look for another accommodation, there are students who are more mobile than any other class or group of people, the people on social assistance, and probably you'll find one when you knock at the door who says to you: "Well, where do you get the money? Do you work?" At the moment probably you say you're on social assistance, they don't want you in there. I'm not saying that all landlords are going to say that, but it's a widespread problem. So that is why more than ever we need government intervention. This is not the time to get out of the housing situation.
We have heard from developers, builders, landlords, that they will not build affordable, low-end-of-the-scale units. They won't. There is no money. There is not enough money for them. So tell the government today that they must keep on staying in the house business to provide for those the private industry will not provide for.
I hope your message gets through to the government because if they're going to go through with what they are proposing, it's not going to be any better than what we have now.
Mr Marchese: Lisa, I got your name. I'm sorry, I didn't get yours.
Ms Lafond: Lori.
Mr Marchese: Lori, we have a particular problem in terms of where this government stands and where we stand, on this side. They might say they have compassion, and I have no doubt they do. I'm not about to say they don't, and individually some probably have more compassion than others, no doubt. I judge them on their actions. They cut 22% out of social assistance recipients. You might say you have compassion. On the other hand, when you cut 22% of benefits, that speaks volumes about where they stand, don't you think? So we have to judge them by their actions, not by what they say.
We had Kitchener-Waterloo Home Builders' Association -- I was trying to remember the name of the person who presented -- Mr Hallman. He says this in his paper: "The issue of tenants' ability to pay an affordable rent should not be a cost to be borne by the private sector." Somehow they believe they are bearing the cost for some of you. "If tenants are unable to afford a market rent then people, through the government, must decide on how to assist those in need." So I say, we the NDP built non-profit cooperative housing because we believe in it, because it builds communities and it builds around people's needs. So I asked him, "Do you believe in that?" He says no. You ask them if they believe in that, they say no, it's just too costly.
So when you ask who takes care of them, their answer is, "Let's give them a shelter allowance." Do you believe they should tell us what this shelter allowance is all about? How much it might mean? What the government's thinking about shelter allowances? Lori or Lisa.
Miss Burke: Shelter allowance -- you don't get much when you live in a shelter, at all, plus you're there only temporarily, a maximum of one year. You don't even know where you're going after that. I don't even know where I'm going until July when next year comes around.
Mr Marchese: The problem with their shelter allowance idea, if it's based on some organization that's done this, is that the only way you would get some benefit out of the shelter allowance is if their rent is greater than 30% of their income, the recipient is then given 75% of any rent payments which exceed 30% of their income. That's the formula. So if you're paying 30% of your income on rent then that's the only time the shelter allowance would kick in, based on what this organization is saying, the Fair Rental Policy Organization. That's why I'm worried about what this government stands for, because I think they support that position. That's why I've been asking them to tell us what the shelter allowance program looks like, because some of you would want assurances that if they're going to take away the present system, what is the future shelter allowance program going to look like? Are you worried about that?
The Chair: Thank you very much, ladies. We do appreciate you coming forward this evening.
PAMELA JOHNS DOUG GETTY
The Chair: Our next presenters are Pamela Johns and Doug Getty. Good evening.
Miss Pamela Johns: I ask your indulgence because public speaking was never my strong suit, so here we go.
I thank you for the opportunity to come here today and be able to address these issues concerning the tenants' protection plan.
I'm not here today on behalf of landlords or any tenants' group but as a tenant or a person with a story to tell. I wish my story was unusual but I'm afraid it's not. I respectfully ask, as you listen to my story, that you try to put yourself in my shoes and imagine what this is like.
I live in a very aged town house here in Kitchener, run by an absentee landlord. Ted Studer, who is my landlord, lives several hours from the city and has owned this property for over 10 years. I've been in this town house well over three years and I'm a good tenant: quiet, I stay to myself and I pay my rent on time. I'm also a tenant on disability.
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I've noticed in the time I've been here a wide range of people have come and gone. Some stay no more than one year and move out from lack of repairs. Some are partiers who just don't care. In my opinion, Mr Studer seems to purposely be filling his places with these kinds of people in order to show a massive turnover or perhaps to demolish the building for putting up condominiums in the future.
A few people in the past have tried to get repairs done to their units. Mysteriously, they have been evicted. Some just stay very quiet, not even asking, even though their units are just as bad as mine. They're scared. As you see, I'm not one of these people who has been quiet, and I am desperately trying to get repairs done to my unit. I have had service discontinued to me several times because of this.
Harassment? I have a file at the police station that should be made into a book. Harassing phone calls to shut my mouth "or else." These I suspect were made by the old superintendent. Also, licence plates and a car radio have been taken from my fiancé's car, which the old superintendent told others he would do beforehand; even trying to poison my dog. Or, ladies and gentlemen, how about finding your super lurking in the bushes at 12 midnight at your unit? All for trying to get repairs done? I have gone through this hell.
These things I think have happened to serve two purposes: one, to try to scare me so that I'll keep my mouth shut and not make any more waves and, two, my fellow tenants, some of whom cannot read or write, see this going on and are too intimidated to get involved or speak up for themselves.
I have lived in this unit under conditions where:
My toilet was flushing into my basement. As well, when my neighbour flushed hers, it would empty into my basement.
I have a ceiling all ready to come down at any time from water damage.
There are cracked and broken windows with no screens in them, and in some windows there are no windows. They have never been replaced, letting in snow and ice in the winter months. This makes it extremely cold, not to mention that it plays havoc with my heating costs.
Water pressure throughout my unit is so bad that it takes 70 minutes to do a load of laundry and 35 minutes just to fill up the bathtub, if you are lucky to get water at all. Sometimes there is none at all, depending upon whether your fellow tenants are using their water.
There are rodents galore.
Just asking for a front doorknob or a front handrail, which I have not had in three years, goes unnoticed by my landlord.
In other units there are illegal third bedrooms that have no windows at all. Children are sleeping in these, with no means to escape in case there is a fire. Or the units that do have windows are also without screens. These are just to mention a few things.
I've brought in property standards three times and I have been told that I should simply move out.
I've gone out door to door with petitions where I've collected 250 names from my neighbours, private homeowners, who want to see the place cleaned up. I could have gotten more.
I live on $930 a month from my disability cheque. From this amount, I pay $679 on rent. Where do I go? When I have $251 remaining for bills and food, I can't afford to move.
I suffer from epilepsy that is not controlled and have landed in the hospital three times this year alone from stress and strain, causing many, many seizures. But that's why I fight so hard against what slumlords, not to mention my own landlord, are doing. I fight for what I should already have as a good tenant, because these conditions are just plain wrong. The principle behind my own cause is also one that affects the elderly, single parents, fixed-income families, disabled or challenged persons and of course the unemployed.
How did this happen? I'm still wondering. How did the place slip through the cracks like this? Is it all the landlord? Who else is to blame? I've suffered the full scope of these conditions and still I am wondering as to who may provide me with these answers.
I do know a few things. There has to be strict enforcement so that places like this don't fall along the wayside.
Enforcement: Now, that's another thing. Property standards have to do their job, not give advice such as, "Move out." What is that? To me, it's a simple copout, someone who does not want to do their job. They should be made to do their job. They are supposed to be public service employees.
Affordable housing: How can people like me survive? Al Leach says that we need $10 billion to fix up places. I say that tenants have already paid this much in their rents and then some. Where does it go? Well, I believe in my case right into my landlord's pocket, never to be seen again.
I have seen this tenants' protection plan, and it makes me very angry. I don't understand where protecting the tenant comes into this at all. As I see it, it protects you, first and foremost, and it helps protect the landlord as well. What about the landlord that does nothing? Do you throw the baby out with the bathwater? I can see no balance in this plan whatsoever.
Again, I say we need affordable housing for people like me; and also have existing housing fixed up. We're talking about our homes, and even in my case my castle so to speak, that we fix up. Our homes are our safe places. Yes, I am as poor as a church mouse, but I'm not an animal, and I should not be treated as such. So why am I made to live like this? I do the best I can, even by putting a few pretty flowers in front of my house.
You take this away for the sake of a buck? I'm very disappointed. When did money come before people's needs and livelihoods?
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That may sound naïve and idealistic of me. However, I still believe the human factor should count for more. I can't afford any more rent than what I'm paying. Even this much is too much. It's a catch-22. If rents go up any more, I'll be one of these people who have the street for an address. Our homes are what dignity we have left, especially those on disability or on fixed incomes. Please don't take what we have. Please don't take our dignity away.
Mr Doug Getty: I've known Pamela for seven years now and in that time I've seen some very serious seizures. I don't know if anybody here is familiar with epilepsy. She's had four seizures while she sat here talking to you people right now. I've come home and I've found Pamela in a pool of blood. What had happened was she fell while trying to make a phone call and hit the table and almost busted her nose. All this stress and all this crap that has happened -- and we're simply trying to get some repairs -- has placed her in such a strain where she was hospitalized for about 10 days just a few months ago.
We were on the verge of moving. We were looking for a place for her to live maybe a little bit better, because when you can't even go down to the basement because you have raw sewage floating around down there it's really disgusting. We didn't know what to do. All the places we found were going to leave her with about $150 a month to pay bills, which was unacceptable. Our only recourse, as I say, was to move, until we heard about a tenant advocate who helped us out. Sue Taylor has shown us a lot of really neat ways to get the place fixed up under the current legislation. I want to point out that the current legislation does work. Since we have met Mrs Taylor we have had the problem with the basement fixed, we have had electrical problems fixed. We used to have bare copper wires in the basement. Our house was built in 1927. It has a lot of character and it has a lot of potential if it's going to be kept up. But I just mean some simple things, like fixing the rain gutter and some stuff like that which the landlord refuses to do.
I just wanted to make you people aware that the current legislation does work. We are living proof of that. The fact that we've had repairs done for the first time in three years is an indication of that. I want to point out that tenant advocacy does work, because like I say, we were two days from giving our notice when we got Mrs Taylor's phone number. Since then, it has been a lot easier for us. We've had somebody who's borne the brunt of this landlord, his letters and his phone calls and his double talk.
So I want to say a few things. My point is that tenant advocacy works. I'm sorry if I'm repeating myself. The current legislation does work. I want to thank you for your time.
The Chair: Thank you. We've got about a minute per caucus. Mr Curling.
Mr Curling: Let me just say to you that your case is very moving. As you said, it's common and your appeal should not go unheard, because I think the government is listening. I think going around like this helps. I am sure that my colleagues over there understand that the bottom line should not be just dollars. It's the quality of life which you're striking for that is a right you have. I am glad you're there and I hope many of the cuts that came to advocacy groups are restored, that it works.
Mr Marchese: I thank you for your story and I want to tell you that when you say money should not come before people as not being idealistic -- it isn't. It should be a basic human practice. When money comes before people, then we have disarranged the whole of society.
We've had a Mr Eby come before us. He talked about his right to do whatever he wants with his property. That presumably is what some landlords want; I'm not sure. But there are some bad landlords and some good. I'm sure there are good landlords and they have problems from tenants, no doubt about that, but we've heard countless stories like your own where landlords are not doing the basic stuff they should be doing. If this present law doesn't work very well -- it took you three years -- imagine when you take the basic principles out and introduce something that supports the landlord. Then we're really in trouble.
Thank you for your story.
Mr John L. Parker (York East): I wanted to pick up on a few points you made, but in the time available I really can't. Let me just say this. You began your remarks by saying that public speaking was not your strong suit. I think you sold yourself short. You spoke very effectively and very eloquently today. You made your point very clearly. Thank you.
The Chair: Thank you very much. We appreciate you coming forward and sharing your experiences with us.
PAUL SPENCER
The Chair: The next presenter is Paul Spencer. Good evening, sir. Welcome to our committee.
Mr Paul Spencer: I would like to thank the committee for hearing me today. I will be speaking primarily on the proposed changes to the Landlord and Tenant Act and the Rent Control Act.
I come before this committee and the government with the assumption that it is fair and unbiased, that it is open to unpopular but reasonable points of view, and that it is prepared to act in the direction of justice even though it may cost votes in the next election. My cynical side says that politicians don't usually take action that will be met with voter opposition and that my efforts are a waste of time, but I must brush those thoughts aside, as I have little other recourse than to try and persuade the government through the power of reason and common sense to take up action that is right.
Provincial legislation dictates that I shall be known as a landlord. Although I simply own rental housing, this élitist-sounding medieval term, "landlord," is what I must be called. I do not want to be the lord over anything, and yet the law of the land insists that this derogatory term is what I must be referred to as. Many uninformed people portray the landlord as an unscrupulous hoodlum who exists in the underworld of greed. The government's own legislation portrays me and thousands of other people who provide privately owned rental housing for Ontarians as someone who must be controlled, and that people who are my customers -- the tenants -- must be protected.
I operate a small business with my brother. I am a fifth-generation small business man who tries to make a reasonable living from providing housing to people. I am an honest person and do the best to provide for my family. I believe that what I do is an honourable role in our society, and yet every day I am smashed down by a government that represents that same society.
Why does the government think it is wrong for me to expect to earn a reasonable profit for the service I provide? I am treated with such contempt that every single aspect of my business must be controlled and regulated. No doubt there are some unscrupulous individuals who become landlords, just as there are some unscrupulous individuals who become tenants and even politicians. However, to treat all property owners as the scum of the earth who must be controlled by the force of government is extremely unfair and wrong.
Why can't I deal directly with my customers? Why can't I come to an agreement with my customers about what service I should provide and at what price? Does the government truly believe that my customer and the customers of all rental property owners in Ontario are so incompetent and powerless that they cannot look out for their own best interests? Why does the government have such contempt for tenants?
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I do not feel any animosity towards my customers, yet the government has set up a system of laws that blocks me from dealing in an atmosphere of mutual give and take. My rights have been so eroded that I have no option but to protect them at every turn. Instead of having some flexibility about the way I manage my business affairs, I must preserve my investment to the detriment of the level of service I would like to provide.
I am not here to suggest that the government adopt a laissez-faire attitude. However, I do believe that governments have a duty to implement legislation that is unbiased and fair for both property owners and their customers. They must do this not because it is popular, but because it is right.
After all, what we are discussing here is private property. The property is not owned by the province or any tenant. I own it and am personally responsible for it. I bear all the risk of ownership. If the property fails as a business venture, I am the one who must answer to the bank with my personal guarantee. The government or tenants are not going to save me from bankruptcy. Why should they? However, property owners are not inelastic, a bottomless pit from which the government may extract more and more.
When compared to other forms of investments, I should be able to earn a return that reflects the inherent risk and effort required to own and operate rental housing. The government, however, says no. Profit is not a consideration of theirs when they develop these extremely complex systems of control. And yet they are puzzled about why there is no new construction or reinvestment into existing property.
Rent control legislation was first introduced in Ontario during a time of extreme inflation, wage and price control and political uncertainty. It was promised to be a temporary measure. Since then, successive governments of all three parties have not eliminated rent controls as inflation eased, but rather have made them even more severe. The reason: Politicians have lacked the courage to do what is right. They have lusted after votes of the largest special-interest group in Ontario: the tenants. The number of property owners pales by comparison to the voter bloc that is held by tenants. But, as I teach my children, might does not make you right. It is the proper role of government to ensure the will of the larger, more vocal group does not defy justice.
No other private sector in our society is as controlled as the residential rental business. In reality, it is expropriation without compensation. The government uses rental property owners as an unpaid extension of their failed social services department. It is a simple and easy solution for governments to use this small sector of society. By passing a law, the government shifts the burden of its social housing problem, which they have been unable to solve, on to private property owners, who must run the gauntlet of personal risk and failure.
The government has tried for over 20 years to manipulate the market to an unnatural end. The result is abject failure for both the property owner and their customers: unnatural because it goes against the interest of the two parties involved. For the property owner it removes the reward associated with providing a quality product at a reasonable price. For the customer it eliminates the benefit of diverse competition.
The proposed legislation will continue to pit owner against customer, to the benefit of neither. I cannot do my best job for my customer if there is no money to pay for the potential benefit. The law strictly prohibits me from doing so even when there is thoughtful agreement from my customer. I would like to be able to provide enhanced service to my customer at a mutually acceptable price. The government says this agreement, entered into freely and without compulsion, is wrong and that the force of the law will be brought down hard to block it. As a result, I am forced to tell my customer that they will have to make do.
What has become of our society when two individuals cannot come to an agreement on the simplest of transactions? I am not talking about the exchange of some illicit or dangerous product. This is about providing housing and related services to people wanting them in a free and open manner. Why is this so wrong? Why can the government not correct this serious inequity? Certainly the proposed changes do not do it.
It would be wrong for the government to force individuals to purchase my services against their will, just as it is wrong for the government to force me to provide my service against my will. Why does the legislation give tenants a right to my property which goes against my interests? By what moral principle does the government take this action? None. It is only the smell of election victory that is in mind.
What is the proper role of government in the area of private residential tenancies? I submit the government is right to establish rules of fair conduct and to act as an independent arbiter of disputes. This concept is not unique to the field of rental housing. It is the proper function of government in all aspects of society: the creation of laws by which free and independent individuals conduct business with each other in good faith, supported by a mechanism that will protect their interests.
What is the interest of the property owner? It is to earn a reasonable profit from their investment. As with any other investment, the market should determine the return. If the investment is in rental housing and there is inadequate profit or an atmosphere of uncertainty, as we now face, the results will be a significant reduction of new construction and reinvestment and a loss of capital, both of which we are witnessing today.
What is the interest of the tenant? It is to have a place they can call home that is clean and quiet and where the amenities are properly maintained at a fair price. A component of the fair price must be a profit. Any reasonable tenant would accept the notion that the property owner is not investing and working merely to cover their costs. While there is personal satisfaction in providing what should be an honourable service to society, it is absurd to think of property owners only as philanthropists.
The problem, however, is that this is exactly how property owners are treated by government. Against their will, by the force of law, they have been enlisted as unpaid employees of the Ministry of Housing. Their duty is to give up their capital, the fruits of their labour, to a much larger voting group.
It is time this is stopped. It must be stopped for tenants, who need a choice in rental housing at competitive rates. It must be stopped for property owners, who do not deserve to be treated as second-class citizens. Stop the mindset that says landlords must be controlled and tenants must be protected. The proposed amendments to the existing residential tenancy legislation fall far short of what is needed. I appeal to this committee and the current government to do what is right instead of continuing to do what is clearly so wrong.
The Chair: Thank you, sir. We've got about two and a half minutes per caucus for questions, beginning with Mr Marchese.
Mr Marchese: Mr Spencer, were you here for the presentation that Pamela Johns made?
Mr Spencer: I'm not sure. Just before me?
Mr Marchese: Just before you.
Mr Spencer: Yes, I was.
Mr Marchese: You didn't hear other people, did you, by any chance: Mr Dempster and Ms Schlichter and the Estates Tenants' Association?
Mr Spencer: I'm not sure of the names. I've been here for a couple of presentations.
Mr Marchese: What is your reaction to their stories, at least the ones you heard?
Mr Spencer: In what respect? If there is a need within society to support people who are unable to provide shelter for themselves, perhaps there is a role for government to play there. However, I do not think the private landlord should be the bearer of such a burden.
Mr Marchese: Ms Johns has got a disability pension. She's paying her rent. She's being harassed by the landlord. She catalogued a whole litany of problems with the landlord. How do you deal with that? How does one deal with that? Does the tenant need protection?
Mr Spencer: As far as I know, within the city of Kitchener there is a property standards department that acts quickly on such disputes and deals with them efficiently. That's the proper --
Mr Marchese: Right. The property standards people told her to move out. A typical story: "Move out."
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Mr Spencer: You should speak to the property standards officers then. I certainly don't deal with my customers that way.
Mr Marchese: I understand that. That's why I say that --
Mr Spencer: And many, many others don't deal with it that way.
Mr Marchese: I agree with that too.
Mr Spencer: The problem is that people, and especially people who oppose the concept of privately owned rental owners, feel that the burden should be carried by them alone --
Mr Marchese: No, Mr Spencer.
Mr Spencer: -- and that they are all painted with the same brush, which is that they are unscrupulous.
Mr Marchese: Mr Spencer, we've heard of case after case across this province of abuses of landlords against their tenants. That's why we put protections in place. It doesn't say all landlords are like that, but because of abuses in the system, we need protection in place, because there's a power imbalance.
Mr Spencer: There is protection in place.
Mr Marchese: But there isn't.
Mr Spencer: The property standards laws do protect the tenants against these types of things.
Mr Stewart: I want to talk to you about these property standards things too. You're bang on the money. The municipalities are passing the buck on this thing. The municipalities pass bylaws on property standards, and why aren't they enforcing them? We're hearing about the previous lady, and I feel for her. Those types of landlords should be out of the business or forced out of it.
Mr Spencer: It's not a lot of landlords.
Mr Stewart: We heard this afternoon from a gentleman who says if landlords like that will not do it, the municipality, under the property standards, should go in, fix it up and put it on the taxes.
Mr Spencer: I have no problem with that.
Mr Stewart: But they won't do that. Ontario Hydro does it. You can rest assured if the hydro isn't paid, it goes on.
My concern is I'm very annoyed that a lot of the landlords, as well as tenants, seem to be labelled, and municipalities have to start to take a little bit of authority on this.
My comment to you is, first of all, you're right. We've got a mindset in many folks' eyes that the landlord is the bad guy. How do we solve some of the problems? This is a discussion paper, and every time we go through this, Mr Marchese stands up and says, "What's in that that's any good?" Maybe none of it is, but it's a discussion paper that we want to talk to people like you and all these people out here to find out a better way, because sure as heck what we've been doing isn't working. So I would like you just to make a couple of comments -- and I'm rambling -- about how you see it could be solved.
Mr Spencer: Clearly, what has been done for the last 20 years hasn't worked. I don't think we're going to get any argument on that point, but I agree with the Premier when he says that an open marketplace is the best control of rent.
Mr Curling: Mr Spencer, I appreciate your contribution, and I have no doubt that you must be a very good landlord. We don't live in an ideal world, and that is why we have legislation. That is why we have government.
Twenty years ago or so, rent control was brought in when the landlords, those terrible guys -- there were terrible ones -- who were flipping and passing on the buck to the tenants.
Mr Spencer: A couple. Don't paint them with a broad brush, as you love to do, and as you continue to do.
Mr Curling: I didn't say all of them. I said those --
Mr Spencer: You said "landlords." There were two, if I recall.
Mr Curling: If you listen to me, I said those landlords who were flipping, who were flipping, those landlords, passing on the buck to those tenants.
In 1985, when I was the minister, I put together landlords and tenants and asked them to come up with a reasonable solution, landlords and tenants, not me, a politician, dictating. They did come up, FRPO and all came up with a solution, not perfect, but within that, Mr Spencer, they took into consideration profit and said we must recognize the word "profit" within it. They did get a profit.
Mr Spencer: I beg to differ. I was involved in the system when you were the minister, and there was no profit consideration.
Mr Curling: But today you have a legal maximum rent that you can charge for that. The problem -- you are right -- the problem is affordability. Those who'd like to access accommodation can't afford it. You who are the businessman, who'd like to charge more -- and you can; we give you that allowance.
Mr Spencer: Who says? What makes you think that?
Mr Curling: You can. The legal maximum rent is there to do that.
Mr Spencer: No, but you assume that the reason we want to have rent controls eliminated is to jack up the rent. I've been hearing it throughout these hearings.
Mr Curling: I didn't say that at all.
Mr Spencer: You just said the reason we want to do it is to increase rent.
Mr Curling: I didn't say any jacking up of the rent.
Mr Spencer: I don't want it for that reason.
Mr Curling: I said the opportunity is there for you to charge whatever you want. The free market --
Mr Spencer: We charge what is fair.
Mr Curling: You can charge whatever fair --
Mr Spencer: Whatever the market will bear.
Mr Curling: That's right.
Mr Spencer: I cannot charge what the market will not bear if the system were open and free.
Mr Curling: That provision is there, Mr Spencer, for you to do that.
The Chair: Thank you, Mr Spencer. We do appreciate you coming.
Mr Spencer: Thank you very much. I would just like to add that if there is some way in the future that I can participate and assist in any way possible to improve the system, I put my name forward to do just that. Thank you very much.
The Chair: Thank you. We appreciate it.
WATERLOO REGION TENANTS' COALITION
The Chair: Our next presenter is Barbara McGrath from the Waterloo Region Tenants' Coalition. Good evening. Welcome to our committee.
Ms Barbara McGrath: Good evening. As introduced, my name is Barbara McGrath. I represent the Waterloo Region Tenants' Coalition, which was formed as a result of the proposed changes in the New Directions for Discussion paper by a group of concerned tenants and different agencies which represent tenants in this region. The challenge before me in one of the last time slots allotted before the closure of these hearings and as you wind down another long day is to somehow try to retain your attention, present a meaningful message which will fully impact our concerns, while not repeating everything you have already heard several times in your travels around the province.
Because of the diversity of housing needs within the many different groups in our society -- the disadvantaged, the working poor, the homeless, single mothers, native and ethnic peoples, people with disabilities, women and seniors -- it would be impossible during the allotted time to make a presentation which properly addressed, represented and did justice to issues of concern on behalf of all parties.
Over the past three weeks, many representations covering the housing needs and problems within each of these specialized segments of our society have undoubtedly been made to you. I will not try to duplicate or condense those issues. Instead, I will try to cover the plight of the general housing concerns which exist in our region.
This is truly a stressful time in most people's lives. The major changes taking place within our basic social structure accelerate and compound the stress. The agendas at all levels of government are gloomy with restraints and cutbacks. Throw in the double-edged sword of unemployment, which affects income and, therefore, both an individual's physical and mental health, the lack of accessible and affordable housing against governments under pressure to reduce the deficit by cutting back on the social spending which would assist these individuals to regain their footholds in society, and you have a formula not only for the erosion of our community infrastructure, but a time bomb waiting to explode.
We hear constantly about the working poor, those individuals and families in low-paying jobs or who work several part-time jobs just to sustain themselves and who, due to the high cost of accommodation, have to pay more than the government acknowledges is a reasonable rent, often 50% or more of their income. Not only does this income become further eroded with each rent increase, but they slip further and further down the societal scale. How does one save enough money to accumulate the first and last months' rent demanded by most landlords, even if more affordable housing miraculously presents itself?
What happens to people financially when they become unemployed or have to leave work, with their only source of income becoming government assistance? It's called poverty. Throw in a disability, and you again have that double-edged sword. A lot of landlords don't want people who are on benefits or who have a disability. Often these two factors effectively shut out anyone from the general housing market. They are put on waiting lists or turned away with excuses.
In today's market, government-subsidized housing provides the main source of affordable housing for these individuals. The recent explosion in the number of homeless people, those who require shelter and no longer have a place to call home, has surpassed the ability of many local governments and social agencies to deal with the growing crisis.
The largest overall problem is affordable housing. Put quite simply, the demand outstrips the availability. There are few alternatives. Obtaining private, safe, sustainable accommodation is only a dream for many and beyond imagination for others. More housing options are required for individuals, couples, families, the disabled and seniors in order to offer a variety of choices to accommodate ever-changing lifestyles.
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Without addressing any of the other infrastructure problems, the proposed tenant protection package announces that it will amazingly be able to give tenants the choice both in where they live and how much rent they pay by (a) encouraging landlords and developers to invest in rental housing and making much-needed repairs to the existing stock, and (b) negotiating the rent charged on vacant units. If nothing else, these proposals can become incorporated into the aforementioned unobtainable dreams for most of us. Why? A good local example:
One of this region's largest developers and landlords, with more than 3,000 rental units, has gone on record stating that local building will not be stimulated in this area "because people won't pay $900 a month in rent. That's what we need to build a new building and that's why we have a foundation just sitting in Waterloo." Addressing rent increases, he indicates: "Once rent controls come off, all my competitors should jack their prices up by 50%. I'll keep mine down and fill my buildings." Yet this same builder, who is publicly heralded for his major philanthropic donations, let one of his buildings sit empty over recent years until he could get the rents he wanted, rather than provide affordable housing.
As a disabled and seniors' advocate, one of your own government agencies recently asked me to assist a couple of disabled tenants who were threatened with being evicted from one of this landlord's town house complexes. These individuals, both in wheelchairs, who had resided in two of the special-needs rental bungalow units, obtained and subsidized through a government authority, were unexpectedly given first option to purchase their units through phone calls from real estate agents. Totally unaware of what was taking place and in no position to purchase, they became traumatized when real estate agents began to constantly phone or appear unexpectedly at their door with clients.
Investigating, it was revealed that although the development had originally been built and registered as a condominium 10 years prior, due to the poor economic market since inception, it had been advertised and filled as a rental development. When informed, the government housing authority who indicated they had a contract for so many subsidized units within the complex would not admit their ignorance of the situation. The disabled tenants who were about to face losing their home faced a six- to seven-year waiting list for replacement accessible housing. Why was the status of this development kept buried for 10 years, affecting so many renters who now had to scramble to try to find other accommodation?
Since many of the owners in this developer's homes and tenants in his buildings are now senior citizens, and being an astute businessperson, this builder has recognized the rapidly changing demographics. He has recently diversified into both building retirement residences and specializing in the delivery of home health care and related services to the elderly. Go with the flow. In this instance, it means to follow the secure money. Why invest in competitive rental housing and negotiate over vacant rental units when an easier market is now readily available?
Another of the housing shortage solutions is not to reduce the stock of existing, let alone affordable, housing from the rental market by allowing it to be removed under proposed revisions to the Rental Housing Protection Act. Here I can relate firsthand experience, having lived through the conversion process for six stressful years. Due to time restraints, I will only highlight key issues.
Upon moving to the region in 1974, I was fortunate to rent a town house in a new development which had just been constructed under one of the federal government's housing initiative programs. The rent was at full market value, geared to income, established and maintained by CMHC for the first 10 years. In 1985, the development was sold to a numbered company. In 1988, this numbered company was split into 52 numbered companies and the units offered for sale as an investment in a cooperative.
This investment offering was challenged by me and altered. While empty units had been refurbished, existing tenants were informed, if interested, we could only purchase the unit in which we resided and do any repairs at our own expense. A very minimal rebate would be allowed. Through hidden flips and reflips, the units escalated in price. Since the owner held the land, he took back both the first and second mortgages against the investments. Meanwhile, unbeknown to the investors, the development was secured as collateral against the demand loan for this owner's expansion into other business ventures.
As mortgages came due in the depressed 1990s, they were not renewed and couldn't be by either the banks or anyone else. The investors discovered that without the land, they didn't own anything, but if they paid for the process of converting their investment into a condominium, they would. The conversion process started. The remaining tenants opposed it. The harassment began.
My tires were slashed 13 times, the windshield smashed twice. The storm door was kicked in. Gasoline was poured around the foundation of my unit and on my rosebushes. Flowerbeds were torn up or trampled. A German shepherd was ordered to attack me. Even my bicycle tires were slashed. For almost two years, the conduct of these upright citizens brought the police to the development on a continuous basis.
The other tenants began to move or make themselves scarce. I stood alone. I sought the protection of the mayor's office and the chief of police. Even though the development did not meet the conversion criteria, and despite the conversion refusal recommended by the municipal planning department, the city council approved the conversion. Lifetime tenancy was given to the few remaining long-term tenants.
Within a year after the conversion, most of the units were again empty, due to the downturn in the economy when many lost their jobs and others were forced into bankruptcy. One guess who picked up the units, often by default, at the depressed prices and resold them.
As part of the conversion process, replacement housing is supposed to be available or in process to replace the units exiting the rental market for the displaced tenants. The replacements were either sale units, student housing or empty lots which were covered by issued building permits. If there was no place to go then, where would a mass exodus of tenants go now if all restrictions were removed and wholesale conversions, demolitions and major renovations begun? Factor in the removal of rent controls and negotiations to the highest bidder for the empty units, and you will witness the unprecedented decay of a complete society.
The right of first refusal to purchase aging rental stock can be clarified in what happened in our development. Not only does a development have to be brought up to a certain conversion standard -- or is this why it is suggested municipal approval will no longer be required, ergo forgoing standards? -- but a year's basic operating cost must be kept in reserve, ongoing maintenance has to be funded, plus each owner is responsible for maintaining their own unit. Where the tenants who knew both the history and the condition of the development and units would not invest, many ignorant outside buyers leapt before investigating. Should this not be a warning sign to the regulators during any conversion process? Aside from the lack of money to purchase, why are the existing tenants not interested?
Instead of one landlord, the majority of units in our development are now re-rented by their new owners, novice landlords, unfamiliar with landlord and tenant policy, at twice the approved rents. Under current tax law, if they fail to show a profit in this new venture, they don't lose; it can become a tax deduction.
Lengths of sitting tenure for a conversion? If tenants don't have any place where they can move, whether it be a conversion, demolition or renovation, what happens to them? The wrong question is being addressed here. Add to this the fact that they will still have to move out at the end of their sitting tenure and are no longer protected by a reasonable rent that kept them sitting tenants in the first place; they will then become vulnerable to escalated rent increases by the simple act of being forced to move.
Move-out compensations were discreetly offered and taken by a few of the tenants in my development, ranging anywhere from a few hundred dollars to a few thousand. The tenants who took the buyouts soon returned, trying to get back into the development with a rent they could afford on an enduring basis.
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One of the stipulations of the conversion was that the maintenance level of the units occupied by the tenants, which had been ignored for years, was to be fully addressed. None of the expenses was to be passed along to the tenants in the form of rental increases or otherwise. Two years after the conversion, these repairs have still not been done. Contacting the city, I was advised they did not have the power to enforce this stipulation in a conversion. Why, then, was it made?
During the conversion process, many of the new owners started fixing up their units. One of the most common alterations was the addition of another bedroom in the basements, which, according to fire department inspectors, were illegal. Many of these units were subsequently falsely advertised and then rented out. For example, a two-bedroom was advertised as a three-bedroom unit. Many of the new renters who required and were paying for a larger unit, when surprised by a fire inspection, heard about this irregularity for the first time and were informed the alterations had to be removed immediately and of the possible fines and charges if not.
The ensuing problems between these tenants and the individual landlords became nightmares and bordered on fraud. Some of the owners who had purchased the units with the additions already in place were unaware of the violations. Many units were also discovered to be illegally or improperly rewired by these amateurs who were doing their own major repairs in order to save money, with the safety of the adjoining units and occupants obviously ignored. To remove the municipality and their standards during any proposed conversion or renovations would be an invitation for disaster.
However, the key issue I would like to address is the property tax. During the conversions process, this issue kept resurfacing as a bonus for the tenants. Both the condo lawyer and the city kept referring to the rent reduction that the tenants would benefit from due to the reduction of property taxes once the development changed from a commercial to a residential reclassification. Since it is the duty of the owner to pass this reduction along to the tenant in the form of a rent reduction, I patiently allowed a year to go by before starting my inquiries.
Property taxes are based on the value of property and are usually collected from the owner of the property. However, some cities collect taxes directly from tenants when the owners do not pay their bills, ergo the individual landlords now. All tenants pay municipal property taxes through their rents. Section 17 of the Assessment Act states, "Land shall be assessed against the owner thereof and against the tenant." Taxes are assessed on all rental housing, whether it is private, public or non-profit, with many tenants paying three or four months' rent per year towards property taxes. According to the Ministry of Housing, if a significant reduction in taxes occurs, then a form 5 application to reduce rent can be filed.
Imagine my surprise upon contacting the local assessment office to discover what really happens under the act. A rental unit does not get a tax reduction upon conversion unless the owner lives in the unit. Therefore, based on the listed market value of my unit, if the owner lived in the unit, the tax rate would be 4.8%, or $1,872. Since I, the sitting tenant, remain in the unit, the tax rate remains at 12.4%, or $4,836 for a 950-square-foot town house. However, if an owner moves into a unit and then moves out and re-rents the unit to someone else, the unit remains taxed at the lower owner-occupied or condominium rate, no matter what rent is charged. When the new actual value assessment system is undertaken across the province and prior to its implementation in 1998, it is sincerely hoped that the foregoing unfair tax assessment procedure will be thoroughly reviewed and revised.
A 1994 CMHC survey for the Waterloo region showed what most developers already knew about the market for condominiums in this area: There are too many. "About 51% of all apartment condos are in the rental market, rather than being occupied by their owners. About 36% of row condominiums were in the rental market, while 6% are still owned by their developers. The proportion of condominium units which are in the rental market or developer-owned and for sale reflects the extremely oversupplied condition of the condominium market." And this is from CMHC.
A recent report by a United Nations agency issued a crisis warning about the world's population shift from rural to urban living:
"The population shift is so dramatic the world population report predicts growth of cities will be the single most important influence on development in the first half of the next century. Such a massive population surge will put added pressures on cities already struggling to provide residents with adequate shelter. Many of the new urban dwellers, particularly women and their children, will be among the poorest people in the world. Poverty has not kept pace with urban growth. Still, the total number of people living below the poverty line continues to climb. People living in cities can't meet their basic needs for shelter, water and health resources."
We must not feel that this world report does not affect us. With more than 100,000 renters already in the Waterloo region, any removal of affordable rental housing from the market is a crisis. As our elected politicians, we have placed our trust in you and must assume that you will honour our trust in your decision-making policies.
As a seniors' advocate, I was also going to make a submission on behalf of the coalition regarding a major violation and issue of safety which should be addressed to protect all seniors who reside in retirement homes and are supposed to be protected under the Residents' Rights Act, but due to time, I see that I am followed by someone scheduled for a presentation covering care homes, so will trust that the issue is covered by her.
On behalf of the coalition, I thank you for listening.
The Chair: Thank you very much for your presentation, Ms McGrath. You've effectively used up your 20 minutes. We appreciate your input this evening.
OVERLEA SOCIAL GROUP
The Chair: The next presenter, from the Waterloo Region Community Health Department, is Carol Popovic. Good evening and welcome to our committee.
Mrs Carol Popovic: My name is Carol Popovic and I am from the Waterloo Region Community Health Department. I work in the adult program and a lot of my work involves work with seniors, and part of that work involves an advocacy role, especially when it comes to issues that will impact their health.
The group of seniors that I'm representing tonight is called the Overlea Social Group, a group of seniors who have recognized the need for improving their social atmosphere and have worked very diligently in making that happen for themselves in their building. My involvement with the group as a public health nurse is to help them enhance their own physical and social resources, which in turn will have a positive impact on their health. This group has had an opportunity to review your proposal, New Directions, and as a facilitator for the group I am speaking on their behalf. Oftentimes speaking in this manner is quite stressful and I wanted to help alleviate some of the stress in speaking for them.
As you've heard earlier, people on fixed and low incomes cannot afford rent increases, and I think that came across quite clearly when the North Waterloo Housing TAC people were speaking. It has only been through the support of Ontario Housing that this group has been able to meet the basic necessities of everyday living. The cost of this support is very minimal, and if you see appendix A, in part 2, you'll see the average cost per unit per month for maintaining North Waterloo Housing units.
However, the proposed changes in housing and rent control will place an additional financial burden on people and they will no longer be able to afford their basic needs. As you've heard earlier, most of their limited budget already has to include food, hydro and transportation, and for this group of people who are disabled and are seniors, it also has to include home support services, medical expenditures, telephone, etc.
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Although research may show that overall poverty among seniors is decreasing, there are several subgroups to which this does not apply. As you'll see in appendix B, some charts there show the average income of seniors. Some of the demographics of the at-risk group includes the following:
Poverty among the elderly has a gender bias. In 1992, 53.1% of single females were living in poverty.
The rate of poverty for unattached elderly individuals, at 43.8%, is still very high in a country that's rich.
A combination of government benefits for seniors overall have only lifted them slightly above the poverty line.
What does this mean for people like the Overlea Social Group? The realities of poverty are lived by this group every day of their lives. They are living proof of these statistics. For example:
Most of them are women or they live alone.
Married couples are a minority. Most of the apartment complexes in North Waterloo Housing have only two to three couples per 50 or 60 units.
Most of these of course being women, and being in the work era of their time, did not have long work histories or they worked in very low-paying positions.
Most of them rely on government supplements such as old age security, guaranteed income supplement or welfare, if they're below 65, for an income source.
Some of these tenants have mental or physical disabilities. A lot of the tenants -- I don't have a percentage for you -- are frail senior citizens. Their health is very precarious.
Presently their income barely covers their expenses. If you refer to the chart below, you will see what their operating budget is. Fortunately, most of them can afford their basic living needs because they've paid less than 30% of their income on housing. The chart below demonstrates their net income after the 30% deduction.
Over 65, you get an OAS and you get a GIS, which is income-geared, for a grand total of $870.81 a month. If you subtract your rent you'll get $609 surplus. If you're widowed, between 60 and 64, you can get a widowed spousal allowance, and if you subtract the rent, your operating budget is $545. If you're below 64 and you are living on general assistance or social assistance, the maximum you get is $520 a month and the maximum shelter allowance is $325 maximum. Not everybody gets this. So if you minus the 30%, you have an operating budget of $364.
Earlier I stated that most people are able to meet their basic needs because of the support given to them by Ontario Housing. But I want to stress that even with this support, some people are struggling. One of the group members I know personally must survive on an income of less than $500 per month. What is life like for this person? I asked her a few key questions, and you'll see it's attached; it's A Personal Story.
"Q.: What is life like living on such a limited income?
"Life is sheer living hell, living month to month without knowing whether you're going to make it, worrying, `Do I have enough money to pay my rent, get groceries and buy the essentials like medications?'
"Q.: How has it affected your health?
"Healthwise, things are tough. I have a lot of pain in my legs, my blood pressure and blood sugars are high. I get very depressed. But it's not surprising, because on this money you don't have a life. You can't buy anything. Others go out and buy little things for themselves. I can't. You want to go out with them but you don't because you are too embarrassed. You haven't got the money to pay your own way.
"Q.: What stops you from working?
"You don't want to be on welfare but you can't go back to work as the doctor states you can't," that you're not physically able to, "and when Canada disability pension turns you down, what other options are there?
"Q.: What will happen if you lose Housing and have to pay more rent?
"I don't know. There are days when you want to walk and not come back," meaning, "You just don't want to go on living."
We are asking the government to consider some of the long-term costs of the proposed policies in the health and social sectors. People who have limited incomes and cannot afford clean, safe housing will become sick and dependent on others. Some of the key factors in maintaining good health include good living conditions and social supports, and that came from the Premier's council on health. Income is a powerful determinant of health, as it determines the ability to afford a warm, safe shelter, healthy food, transportation and medical necessities such as medications and living aids. Any proposed changes that will further decrease the limited income of these people will have an impact on their health and the services they require.
For example, there may be an increased need for institutionalization of seniors if they're not able to live independently in Ontario Housing. Withdrawal of supports will impact their ability to maintain their independence. If they're not able to manage on their own and are not able to find suitable housing, they may be institutionalized. I did a little survey and I found that the cost for institutionalization is about nine times more than it costs to maintain these people in their own home in Ontario Housing. You'll see that in appendix A as well. The cost to government per month, minimal, for a local nursing home is $2,124. The operating cost -- these numbers were given to me by North Waterloo Housing -- is $240.81 per unit per month. If you divide the two, you get 8.8 times the cost.
Also, increased demands on overstretched communities or families may result in punitive attitudes towards seniors or the disabled that could result in higher rates of abuse. Studies have shown that caregiving stress may be a contributing factor in elder abuse and that a lack of societal concern, inadequate housing and community sports are high-risk factors which precipitate elder abuse.
The proposals in New Directions do not address the government's intentions with Ontario Housing, but this group is concerned, and the reason they're concerned is that they went to a local MPP's office and asked, "What does this government intend to do with housing?" and the answer that was given to them was that the government intends to sell housing.
They're extremely worried what this will mean for them. How will these tenants be assured that their sitting rights and their basic living requirements will be met? What happens to them if their building is sold to the private sector and their units converted into a condominium? As stated previously, these people do not have extra money to pay in shelter costs and many are not in a position to buy into converted housing. For many of these physically compromised seniors, finding another suitable rent that will fit their physical needs and pocketbook will be difficult. The only other option for some of these people may be a nursing home. Considering the social and medical costs of institutionalized care, is it not more prudent to provide adequate rental controls and continue support through Ontario Housing?
Our second concern is that there is a lack of affordable housing in the Waterloo region, and I'm sure you've heard that today. Some people are of the opinion that only large cities experience a lack of affordable housing, but this is a myth. Smaller communities such as Waterloo region are lacking too. I've included at the back an insert from CMHC's local market report of October 1995 that demonstrates the lack of affordable housing for people who are single. Vacancy rates for a one-bedroom apartment less than $399 per month is zero per cent, and if you remember, the maximum shelter allowance given to people on welfare is $325. Anything less than $619 is at 1.9%. You can look at the charts attached.
These vacancy rates do not meet the needs of people with limited incomes. For a general welfare person with maximum welfare income, they would be in a deficit of minus $99 if they had to rent an apartment at $619. As you see, excess funds are very limited for the other people.
Few of the people with this net income would not have enough money for food or hydro, and with the possible privatization of housing, these are the choices people will face. The question we must ask is, where will these people go? This government must ensure that housing remains within the reach of people like the Overlea Social Group.
We looked at some of the policies put forward in New Directions and we found that they do not ensure that the cost of rents remain affordable and the rights of all tenants are protected. We feel that some measures need to be taken to ensure that housing remains affordable and equitable. What we've done is we've listed our concerns with your proposal and then we listed the recommendations on the right-hand side.
Our first concern is that landlords will be able to have a sustained rent increase beyond the present 2.8% guideline due to proposed changes in capital expenditures and extraordinary operating costs, without a corresponding decrease after renovation or operating costs may have been decreased. We felt that this will encourage ever-spiralling rent increases. Our recommendations are that tenants should have direct input into the building costs through consultation and consensus; that once a cost has been paid for, tenants should have a subsequent decrease in their rents; and that perhaps joint tenants, landlords and government agency associations could form a local monitoring body so that the power and decision-making is equalized.
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Our second concern is that maximum fines for negligent landlords are not incentive enough. Our recommendations are: Landlords who fail to follow through on their renovations in a timely fashion would not be allowed rental increases, and those who do not provide a safe, clean environment should face a substantial minimum fine so they're not just getting a slap on the wrist.
Our third concern: Rent controls protecting sitting tenants only. Often the health of older adults changes rapidly, and today is a case in point. We had one individual who was very ill and couldn't come tonight, and another one is waiting to hear news of a loved one who is dying, basically. The health of these people is very tenuous. Often, their health changes rapidly and their housing needs change with it. We felt that all tenants require protection from exorbitant rent increases.
Our fourth concern is that with the removal of the rent registries, tenants will not know whether rent increases are legitimate. We feel that tenants need to know what the limit is for extraordinary operating costs and whether other rental increases are valid.
Fifth, many tenants who are aged or disabled will be more vulnerable to exploitation and landlord abuse. Some of these people require special access needs and apartment supports and may be seen as less-than-desirable tenants. The fast-tracking of evictions as proposed will only increase their vulnerability. We felt that your recommendation on a fast-tracked anti-harassment policy was good; however, the policies need to be clearly defined and easy to implement. To date, we know that harassment has been a very difficult charge to prove and to follow through on any kind of action.
Sixth, with the removal of the Ontario Advocacy Act and legal aid services, the most vulnerable will not have their concerns heard in a timely fashion at a cost they can afford. We felt that advocacy roles must be maintained to assist people who are vulnerable and who have limited resources to pay the proposed application fees in your discussion paper.
Finally, the new dispute resolution system will take time to operationalize and may be difficult to access. We felt that the system must be 100% user-friendly for all tenants. For example, many of the seniors still use a rotary phone. Have you ever tried to reach a government agency using a rotary phone. It's "Push 9 for so-and-so and 5 for the next office."
Lastly, the government must be willing to consult with special-needs groups to ensure that the new system will be accessible and affordable for them.
In conclusion, we feel that more protection is required for all tenants, especially for those who are income limited. Everyone in this province has a basic human right to warm, safe shelter. We expect our government to keep policies in place that ensure affordable housing. With the rich resources we have in Ontario -- even though we are feeling a little pinched now, we're still very rich -- no one should be forced to choose between shelter or food. The health and general welfare of our community is government business. More direction is needed in your proposals to protect the most vulnerable in our society and to give them a voice.
Members of the Overlea Social Group are here. I have two of the ladies, and I'm going to ask them to stand, if you have questions, and maybe they can join me at the table.
The Chair: Unfortunately, you have used up --
Mrs Popovic: Have I used up my time? I'm sorry. I just want to thank you for listening to our concerns. We do have faith that your decisions will reflect the input we've given you today.
The Chair: Thank you very much, Mrs Popovic. We appreciate you coming forward and giving us your input.
CONESTOGA TOWERS TENANT COMMITTEE
The Chair: The Richmond Tenants Association, the next presenters, have cancelled, so that brings us to our last presenter, representing the Conestoga Towers Tenant Committee, Lynn Piller. Good evening. Welcome to our committee.
Mrs Lynn Piller: I'd like it if you'd had that extra time to allow her to finish her presentation, but anyway, you didn't.
Good evening, panel members and concerned citizens. We have 163 apartments in Conestoga Towers. As president of our tenant committee, I represent both the tenants and the residents. Residents are defined as full-service care tenants who pay an extra charge for all the personal services, such as lunch and dinner in their own dining room on the main floor, nursing care, weekly bath, laundry, apartment housekeeping and recreational activities planned for them. So we have both in our building.
When my husband and I moved into Conestoga Towers on December 1, 1989, we were not told that a great upgrading of this building was planned for early 1990. We were not told that tenants would be notified of a 28% rent increase to them for this upgrading. We were not told that this building upgrading and costly unnecessary embellishments would be at considerable inconvenience to the tenants for many months.
All day long and often even into the evening we were inundated with noise -- pounding and hammering and sawing. This went on five and six days weekly. Also, our three elevators were continually in motion with these workers, equipment and supplies being taken for some five months up and down these 18 floors. This supreme effort was to complete the onslaught of work before the deadline of the carry-forward allowed under the newly effected Rent Control Act.
To give you a slight idea of this nightmare of just over a $1-million cost, all windows in the entire building were removed and replaced. All stoves and refrigerators were removed and replaced throughout the entire building. All lighting outside every one of the apartment doors -- 163 of them -- was removed and replaced with energy-efficient lights, but I didn't see any reduction in our hydro bill. All walls in the hallways of 14 of the 18 floors were completely replaced. That's the plasterboard, wallpapering, baseboards, painting and everything under the sun. Even our elevator walls had to be replaced twice. The first time, I guess they used improper materials, so they replaced them again. Our lobby was painted twice, the first time in an incorrect colour. They discovered that all the rest of the building was in old rose and grey; they repainted it, and now it's in wallpaper. The front of our building was embellished with red awnings, front and back, and this was only to help us look more like Victoria Place.
Please find in the back of your paper a detailed list of more of these things, because there were just so many of them it was ridiculous to try to mention them. However, tenants were expected to pay the 28% rent increase for the upgrading of our landlord's building, from tenant apartments to full-service resident care.
A few weeks after our day in court, I met with Mr Rozena. He's one of the two owners of our building. They also own four other buildings, besides ours. I was very impressed with this man. He seemed very gentle and understanding and kind, but I marvelled when I thought about it how even a seemingly good landlord could be persuaded to increase his profits and upgrade his real estate at the expense of tenants, many of whom are on fixed incomes.
If there hadn't been any rent control in effect at that time and no rent registry, we would have had to pay 28% rent increases monthly or find another home. If there was no rent control and no rent registry, we'd have had no knowledge of what our rents should have been, and of course if there was no rent control and no rent registry, there would be no rollback of illegal overcharges. If there had been no rent control, we would've had no tenants' day in court.
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With rent control and rent registry, of course, the picture was turned around and we didn't have to pay that 28% per month increase. With the rent control and rent registry most of the 163 apartments had their rents rolled back to the legal amounts.
With rent control, we tenants had our day in court, even though we had to represent ourselves against the landlord's representative and their two Mutual Life lawyers. However, we were able to be right here in Kitchener, which helped somewhat, so that some of the tenants who weren't working or weren't too ill to come were able to be there and hear the process and make their statements. This was one hardship that wasn't put upon them by changing the area and maybe having to have the registry in Hamilton or Toronto or London or some other place.
We did have a payback, however, of two years at 3%, which we as tenants felt was fair.
Before our day in court I prepared a petition and took it around to every one of the apartments to have signed. This petition was against the unfair actions of the owners to try to raise our rent this 28% per month.
I was shocked at how intimidated and fearful so many of the tenants were, but especially the elderly. They were afraid to sign the petition in case someone knew that they had signed and then they would be kicked out of their apartment. They didn't know where they would go. I had to try to persuade them. "Well, hey, if you don't sign" -- this was the other thing that I told them -- "and we lose because you have no signature and I have such a small group of people who are unafraid and are going to sign and are going to take this chance, then maybe we'll lose it. Then what are you going to do?" They didn't know how they were going to afford it because their pensions do not keep up with inflation.
An example here is myself. My rent increase of 2.9% would be $18 a month, but my old age pension increase was only $2 a month. Also our tenants in our building pay capital expenditures added on to their rent, so I pay $27.85 extra, over and above my rent increase in my normal rent, and this amortization will go on for 25 years. Some of it will drop off at 10 years etc, as I guess you know.
Many elderly, single-parent families, the handicapped and the poor want to know, what do they do and where do they go? There's less and less help for us, they're telling me. Isn't our government supposed to help us? Isn't our government supposed to protect our rights? Isn't our government supposed to be for the people? Where is responsible or balanced government if it's more important for developers and landlords to make bigger profits? Only you who make and change the laws can decide our fate. Please don't forget us. You're all we have, and maybe we are all you have.
All day you've been hearing how we as tenants, taxpayers and voters want you to know we need rent control as it now exists.
They've questioned you and you them. My life is much too hectic. I truly do not have the time or energy left to be involved in this struggle. These past two years, my husband has been in the advanced stages of both Parkinson's and Alzheimer's, and I still care for him at home. Nevertheless, I felt this fight was vital enough that I just had to come here and add my feelings and my voice to this important situation.
I'm hoping that you as a panel may realize that my experience, even with a good landlord, would've been absolutely disastrous without the rent control that existed.
Built into our rents and our yearly increases is a percentage of moneys for any honourable landlord to do repairs in his or her building as they are needed. Built into our rents and yearly increases is fair profit. What is needed is not deregulating, deluding and disappearing protection for tenants. What is needed for all apartment buildings are good tenant committees and fair landlords working together under our existing safeguards.
Whether you live in an apartment or a house, it should be home. No citizen, whether they be elderly, single parent, poor or handicapped, should have to negotiate for a space to live in our country.
I also took petitions from most of my floor captains throughout the building, and I'll leave this here for whoever would like to look at it. I didn't have all of my petitions but I've got most of them, so I have approximately 100 who have signed. I would like to leave this submission with you. Is there anything further you'd like to say? If not, thank you.
The Chair: You've left about three minutes per caucus for questions, beginning with the government.
Mr Danford: Thank you for your presentation and for showing us examples of how your improvements affected you as individuals and so on. It certainly was an extensive program, I see.
Mrs Piller: It was ridiculous.
Mr Danford: It was a complete program, certainly from the list here. Given the fact that was in place at that point in time and you had to go through the procedure to have it repealed and all that sort of stuff and work within the procedure that was in place, how would you suggest that it should be, having gone through that? What would your suggestions be?
Mrs Piller: First off, I think that any landlord who tries to ramrod in that much work in that short a time and put tenants in this kind of ridiculous position should've not even gotten anything back. I, for one, thought that 2% or 3% was fair. What I didn't think was fair was the amortizing of the roofing and all the rest of this pile of stuff for 25 years, whereby some drops off at 10, some 15, some at 20 and some 25, and you're saddled with this blasted thing forever and ever.
I remember reading in this paper that perhaps they were thinking of maybe including this type of thing in the rent and it would stay in it forever. I'd move right out of Ontario, I'll tell you that right now, if they did that kind of stuff because that's totally unfair. The real unfair thing was that the landlord even got away with any of this kind of stuff, tried to run it through under this policy and do this to us as tenants.
Mr Danford: As you are aware, there's consideration that there should be a discussion about it first before anything happens and that the tenants should be part of that.
Mrs Piller: There was no discussion.
Mr Danford: No, no, but I say under the proposal that's here. You reviewed that. How do you look at that? Is that reasonable?
Mrs Piller: Because the landlord gets a certain amount of money for doing his repairs, he should have to do his repairs with that money. He shouldn't be allowed to try to do a gigantic amount of things at once and then up the rent. There's got to be fair play here.
Mr Sergio: Thank you for your presentation. Do you know if there is a vacancy or what the vacancy is in your area?
Mrs Piller: There are some vacancies in our building, yes. As a matter of fact, attached in here was a little card that they stuck on everybody's door offering a $50 reward to -- well, it said "residents." I don't know if they meant residents per se as we know residents in our building actually, but there was a $50 reward if you got someone to sign, to have a year's lease, and that person also would get $50. I presume there are some vacancies.
Mr Sergio: That's good. Would you know if there is a waiting list?
Mrs Piller: A waiting list? I have no idea. At least, I haven't discussed that with them.
Mr Sergio: As you know, the government last year changed the rules. If you need assisted housing or one of the Ontario Housing units, you have to put your name down and then wait your turn. Given your case and that of many people on social services or seniors, whatever, in your own particular case, if you were faced with the possibility of moving from where you are --
Mrs Piller: I may be faced with that when my husband goes into the nursing home, so that's not too far off to think about.
Mr Sergio: If the controls were lifted -- let's hope that the government's going to have second thoughts about that, but let's say rent control is gone and you've got to move. With your husband the way he is and stuff like that, not knowing where you have to go or what kind of rent you will have to face, what would be the hardship on people like you?
Mrs Piller: First off, I think one of the things is that if you try to go to any agency and say, "I can't afford to pay my rent," they'll say, "Find a cheaper apartment." How cheap an apartment can you find, and where can you find it? If you own a car, you can't possibly run the car and own an apartment too, if you have my particular circumstance.
Mr Sergio: Are you saying that --
Mrs Piller: I'm saying I'll just have to live in my car.
Mr Sergio: -- the government should retain some control to protect people, such as your group, let's say?
Mrs Piller: I truly can't see where the government paper that they put out was interested in trying to help anybody in my particular situation.
Mr Marchese: A few quick things. First, I congratulate you for your ongoing activism and not giving up, as a way of protecting your own rights. Secondly, I sympathize with the problem you have with your husband's Alzheimer's disease. My father died of Alzheimer's disease. My mother took care of him for six years. It's a long, long battle for those of us who took care of him for six years.
Mrs Piller: I know.
Mr Marchese: The third point you made has to do with this government's intention, and it's in the paper, to remove what are called "costs no longer borne," which is what you were getting at. Under the present legislation, once the capital repair has been paid for through a rent increase, the rent is supposed to be decreased by the amount that has been allowed to pay for the expenditure. Once you remove that cost no longer borne, it would go into your rent forever. So you're absolutely correct. We don't agree with it. It's good that you told them that.
The other question I want to ask you quickly: Actually there are two questions. I'm afraid I might run out of time, so I'll ask you this. Mr Spencer is here and he deputed earlier, and he said this is in his paper: "Why can't I deal directly with my customers?"
Mrs Piller: Because they're usually not fair.
Mr Marchese: "Why can't I come to an agreement with my customers about what services I should provide and at what price? Does the government truly believe that my customer, and the customers of all rental property owners in Ontario, are so incompetent and powerless that they cannot look out for their own interests? Why does the government have such contempt for tenants?"
Do you agree with that statement? Were you, with your landlord, able to sort of negotiate, talk, air these things out? You have a whole page of why it didn't work out.
Mrs Piller: No. We had to take him to court. We had to go to court. But after the thing, that's when I put the tenant committee through and then we were going to work together. Of course, I don't know what they'll think about what I just did tonight, but I'll be telling them about it on Monday.
Interjection.
Mrs Piller: Yes, I might be sleeping in my car.
Mr Marchese: They argue rent control is the problem and that the system is broken as a result of that. They need to fix it. Part of what they're saying is the system is tilted towards the tenant at the moment; we need to change that. Do you agree that the system is tilted towards you at the present moment?
Mrs Piller: I don't see how it's tilted towards me when your landlord can have you paying for trying to change his building over from a tenants' apartment to a resident care building. I don't see how that's slanting anything towards the tenant.
The Chair: Thank you, Mrs Piller. We appreciate your input here this afternoon.
That concludes our hearings. Thank you to the people of Kitchener-Waterloo for your input and thank you to the members of the committee. The meeting is adjourned until 10 o'clock Monday morning in Toronto.
The committee adjourned at 1933.