HALIFAX, WEDNESDAY, DECEMBER 10, 2003
STANDING COMMITTEE ON PUBLIC ACCOUNTS
8:00 A.M.
CHAIRMAN
Mr. Graham Steele
VICE-CHAIRMAN
Mr. James DeWolfe
MR. JAMES DEWOLFE (Chairman): Good morning, ladies and gentlemen. I would like to call the Standing Committee on Public Accounts to order. With us this morning are witnesses from the Department of Community Services as we delve into issues concerning housing funding, federal funding, provincial agreements and so on. Before we commence the session, I would like to introduce our committee, starting at the far end.
[The committee members introduced themselves.]
MR. CHAIRMAN: I'm Jim DeWolfe, Vice-Chairman of the Public Accounts Committee. The chairman will be joining us a little later this morning. As usual with us, I would like to welcome from the Auditor General's Office, the Auditor General, Roy Salmon and with him is Alan Horgan. Alan is Assistant Auditor General.
So without further ado, I would ask you, Ms. Tyson, if you would care to introduce your committee and perhaps then you could provide your opening remarks.
MS. MARIAN TYSON: As Deputy Minister of Community Services, we welcome the opportunity to appear here before the Public Accounts Committee. I have with me today, on my left, Mr. George Hudson, Executive Director of Finance and Administration for the Department of Community Services. On my immediate right, Mr. Harold Dillon, Senior Director of Employment Support Income Assistance and Housing for the department. On my far right, Mr. Jim Graham, Director of Operations Support for Housing. We are planning to make a brief presentation to the committee outlining the province's Housing programs and we would be happy to answer any questions that the committee members may have.
1
First of all, I want to state that the employees of the Department of Community Services Housing programs are committed to improving the health and well-being of Nova Scotians through the delivery of a very wide range of housing programs and housing services. You have before you some slides and I will just refer to the slides as I go along.
The first slide following the cover page outlines the Housing mission and the main objective, the mission being to be a partner with Nova Scotians in fostering healthy communities through housing. The objective of the division is to provide safe, affordable, appropriate and sustainable housing.
In 2001-02, the department carried out extensive consultations with over 100 housing stakeholders in the community. This work reinforced the important connection between housing, population health and healthy communities. It also involved an in-depth evaluation which led to recommendations for the province's housing program, including the need to do more and continuous research.
If you would refer to the next slide, it provides some information on the housing profile in Nova Scotia. Our province has a unique profile and our programs and services are designed to meet the specific needs of the people of this province. Among some of the facts, Nova Scotia has some of the oldest housing in Canada and we have among the highest percentage of home ownership in the country. We also find that lower income Nova Scotians tend to be renters. I think that is probably typical across the country.
Housing clients include seniors, low-to-moderate income earners, income assistance recipients and persons with special needs. For example, our department assists approximately 25,000 senior households every year through our programs. We provide rental accommodation for about 9,000 seniors, age 58 or older, through approximately 7,700 public housing units. We also provide rent subsidies to qualifying seniors who live in private accommodation. So regardless of whether they live in public or private units, these seniors pay rent geared to their income and the average monthly rent is approximately $330.
We also provide grants and loans and adaptations that enable seniors to live longer in their own homes through programs such as the Senior Citizens Assistance Program, the SCPI Program, for those who are familiar with the housing acronyms. We provide up to $3,000 per person for that program. The RRAP, Residential Rehabilitation Assistance Program, which now provides up to $16,000 and the Home Adaptations for Seniors' Independence provides about $2,500 for seniors. We also deliver other housing related benefits to seniors, including property tax rebates of up to $400 per person and we provide those to approximately 14,000 seniors every year.
If you would refer to the next slide, that provides some information on some of the core Housing programs. Those core programs include public housing, home repairs, and loans and mortgages. We have about 12,000 public housing units in the province and the majority
of them, about 7,700 of them, are occupied by seniors; about 3,500 for families; and we have about 800 rent supplement units. All of the units are heated and include utilities, and tenants, with the exception of income assistance recipients, pay rent geared to income, between 25 per cent and 30 per cent of their income. We have 2,000 co-operative units and another 1,000 non-profit units which offer a range of rents to a mixed-income clientele. In terms of repairs every year, we have about 3,000 households and they benefit from $12 million to $15 million assistance for home repairs. Finally, Housing provides grants, loans and mortgages to purchase or build modest homes to a number of Nova Scotians every year.
The next slide provides some information on the federal/provincial agreements. There are three main federal-provincial agreements: the Social Housing Agreement, which was signed in 1997, whereby the province took over about 21,000 units from the federal government - that's a 38-year agreement, I think you should probably all know; the Residential Rehabilitation Assistance Program, which I referred to earlier, the RRAP program, which has just recently been renewed by the federal government and the province; and thirdly, the newest agreement, the Affordable Housing Agreement.
The next slide provides some data about the first of the three agreements, the Social Housing Agreement, and what it does. The province agreed to assume responsibility for the management of the Social Housing portfolio from the federal government, and that was transferred to the province. In return, the federal government agreed to provide an annual federal subsidy on a fixed schedule until the year 2035. Under the agreement, the province is able to retain any savings during times of reduced expenditures. That money can be reinvested in future or it can be invested in CHMC-approved programs or activities. The new RRAP agreement makes several improvements over the original RRAP program, including an increase in the maximum level of assistance from $12,000 to $16,000 and forgiveness of all loans under the program.
The next slide indicates some additional information about the Residential Rehabilitation Assistance Program. That slide indicates that there is $9.5 million spent annually, and that is cost-shared 75 per cent federal, 25 per cent provincial. There are multiple programs under the RRAP agreement, and they are listed in that slide, home owner residential rehabilitation, rental rehabilitation, home adaptation for seniors, disabled residential rehabilitation, and shelter enhancement.
The next slide provides some information about the Affordable Housing Program. There are four parts to that program. There's the ability to provide new rental housing, and there's the ability to preserve existing rental housing. There's the ability to provide new home ownership, and the ability to preserve existing home ownership. So we have four parts to that program. That program's design phase involved consultation with stakeholders across the province. Preliminary and ongoing research is identifying needs by area, household and housing type, which is important to get the right programs to the right areas in Nova Scotia.
Nova Scotia has announced two projects under the agreement, a 15-unit townhouse complex in the Annapolis Valley - that was completed last month - and Minister Morse has recently announced six new semidetached homes, which will be constructed in Halifax over the next six to nine months.
The home preservation component will commence soon and utilize existing departmental delivery network. We anticipate that there will be a request for proposals for potential new rental in the new year. The next slide will give you an indication of the maximum income levels that the department uses for most of its programs, for all federal programs and most of its own provincial programs. For clarity, a person earning an income of $35,000 in Halifax would expect to pay about $800 a month for a three-bedroom apartment. That would be based on 30 per cent of income for shelter. Similarly, a person in the rest of the province, earning $19,000, would expect to pay about $475 for a one-bedroom apartment.
The final slide provides some information on the department's financial contributions to the Housing programs. The Housing part of the department is approximately a $135 million-a-year operation. We take in $48.5 million in rent every year, approximately, and we receive, through federal, municipal and provincial contributions, another $86.5 million, approximately. We have $25 million to $40 million in direct lending and guarantees, and the department manages a mortgage portfolio of approximately $180 million.
[8:15 a.m.]
Overall - our operations - we maintain over $400 million of provincially-owned property and we monitor the viability of another $300 million in the non-profit sector. All in all, the department assists well over 40,000 Nova Scotians every year. The estimate is really between 40,000 and 60,000 Nova Scotians annually, assisted by all of the programs and services offered by the department.
In closing, Mr. Chairman, I would like to thank you for the opportunity to outline the province's Housing Program to the members of the Public Accounts Committee.
MR. CHAIRMAN: Thank you, Ms. Tyson, for those opening remarks. We will commence our session immediately, beginning with the NDP caucus. We will allow 20-minute sessions. The time is 8:17 a.m.
The honourable member for Sackville-Cobequid.
MR. DAVID WILSON (Sackville-Cobequid): Thank you, Deputy Minister Tyson. We have some questions here. The first few questions will pertain to the planned funding expenditures for CMHC. They had a chart set up for this Affordable Housing Agreement program. CMHC had planned to spend about $460,000 in the 2002-03 budget year, with
matching funds that could potentially put funding at about $920,000 for projects. We're just wondering, what was the dollar amount spent during that time period for Housing projects for our end of the bargain?
MS. TYSON: We've already completed the Middleton project, which I indicated, and we're in the process of providing funding for the Halifax project. That is the extent of the province's contributions to the Affordable Housing Program this current year. However, in addition, the province has spent a considerable amount of time over the past year meeting with and consulting with stakeholders to determine what the stakeholders believe we should spend our money on, what's the best way to do that, and staff have been doing research, and are still finalizing that research, to determine what areas in the province need what type of housing the most.
They would have been doing that directly, they would be utilizing CMHC statistics and information, they would be using - for example, there was a presentation before the Social Community Services Committee, some research was provided at that time. So they would be using all sources of information to try to determine where the needs are, and they do differ. For example, we understand that in the Cape Breton area, in the Sydney area, the need is for renovations and repairs more so than additional units - there's more of a need - whereas in Yarmouth, the need would be fore additional units. In Truro, we don't have very much rental accommodation for low-income Nova Scotians. So it does vary considerably through the province, and we don't want to make mistakes, we want to try to get it right.
MR. DAVID WILSON (Sackville-Cobequid): Do you actually have the dollar figures that the department has spent on these projects?
MS. TYSON: I don't think that amount has been fully calculated at this point. We will have the figures when it's final, and that could be provided.
MR. DAVID WILSON (Sackville-Cobequid): The plan, through CMHC's funding expenditures for the 2003-04 year, increases substantially from this year's outlook to about $800,000, which, with the province's money, if they put in a similar amount, would be close to $1.6 million in new projects for next year. How much of that money will be used by the end of next year's budget? Have you had a proposal or a look at what you're going to expend next year?
MS. TYSON: I should add - I've indicated what we have done so far this year and what is in progress - we expect to spend more money this year on renovation and repair work, so we do expect to spend up to an additional $2 million this current fiscal year. The following year we will be looking for proposals and the amount spent will depend upon the proposals that we receive and the projects that people are interested in pursuing.
MR. DAVID WILSON (Sackville-Cobequid): That actually leads into the next question. With the federal-provincial agreement, I believe this allows the non-federal portion, our portion of our money, to come from charities and the private sector, is that correct? Do you have a figure on what you intend to follow through or search out and what projects? Do you know how much money you are depending on from outside organizations to help fund our portion of the money?
MS. TYSON: The program is a 50/50 cost-shared program, the federal government has agreed to put in $18.6 million and the province and its partners would put in the remaining $18.6 million. So we will be looking for partners in the Middleton project, the municipality partnered with us, they provided the land and the servicing. We will expect that organizations and municipalities who may wish to take advantage of this program with the province will be coming to the table, many of them with suggestions as to whether they would put in dollars, land, labour, staffing, it can take all of those forms.
MR. DAVID WILSON (Sackville-Cobequid): So the Middleton project, I believe, was about $375,000 for each part, for the federal and the provincial. I believe the municipality donated taxes or land for their portion. Was that over and above the $375,000 from the province, or is that incorporated in with the $375,000?
MS. TYSON: I will ask Jim if he has the answer to that question.
MR. JIM GRAHAM: The Town of Middleton provided the servicing and that was in addition to the contribution under the agreement.
MR. DAVID WILSON (Sackville-Cobequid): As of August, we were trying to find out a plan that the federal funding has spent, or the plan that the Department of Community Services had for the potential spending. Is there any plan in place as of today that you could provide to this committee or to the members of this committee on what you see for the term of this agreement on your spending over the next four or five years?
MS. TYSON: The department is still finalizing its research but intends to take full advantage of this program so that over the course of the program, which ends in 2007, we will expect to have taken full advantage of it between the partners of the province and the province, to have expended the $18.6 million. The four categories are: new rental accommodation, new units; preserving the existing rental stock in the province; some money in new housing units for individuals such as the Halifax project; and in preserving the existing housing stock in the province, which is what we intend to start with this current fiscal year. As I indicated earlier, we have a high percentage of home ownership in the province and this program will enable us to help people to preserve their existing homes.
MR. DAVID WILSON (Sackville-Cobequid): So far with the two projects that we have seen, the Middleton one and the one announced last week, it seems that this is targeting more the moderate-to-low income need in the province. Is there a plan right now or are you waiting for someone to come to you with a proposal to look at maybe disabled housing or to address the low-income need here in the province?
MS. TYSON: The program covers low- to moderate-income families so we will be flexible in the proposals that we receive. We haven't put out an RFP requesting proposals at this point, we expect to do that next year for new rental, but we certainly wouldn't discourage anyone from coming to us with any suggestions or proposals that they may have.
MR. DAVID WILSON (Sackville-Cobequid): The Middleton project, I believe you have to have a gross income of $22,000 to apply for those units in Middleton, is that true? And then I believe the projects here in Halifax, you have to have a gross income between $35,000 and $50,000, if I believe from the news release last week. Is that correct in assuming that that is the range for those two housing projects, that you are looking at an annual income?
MS. TYSON: I will ask Jim Graham if he can confirm those figures.
MR. JIM GRAHAM: Yes, those are essentially correct.
MR. DAVID WILSON (Sackville-Cobequid): Just that with concerns with minimum wage jobs and the annual incomes, if you had a minimum wage job it falls below those numbers there. I think we consider that more getting into the moderate-income level than to assess the low-income needs. I hope in the future the next few projects hopefully will address maybe a lower income than that.
Mr. Chairman, Marilyn is going to ask a few questions.
MR. CHAIRMAN: Ms. More, you have approximately 10 minutes.
MS. MARILYN MORE: You suggested that the department hopes to use up all the funding available under the affordable housing initiative. I believe originally the target was to have approximately 1,500 affordable housing units. I wasn't sure if that originally meant new. I realize it's important to fix up and maintain housing or other accommodations but I'm just wondering, is your target of 1,500 units going to be reached by the year 2007?
MS. TYSON: The target was up to 1,500 units and that would include rental and renovation as well, and yes, we do expect to reach that. The actual number will depend upon the proposals that we receive, the cost of the renovations and the cost of the new units, so it's up to 1,500 units.
MS. MORE: I'm just wondering, based on the consultations you have done this past year - you probably have a better idea of what the actual needs are - and some preliminary planning, do you have any idea what percentage of that 1,500 might actually be additional or new accommodations?
MS. TYSON: That hasn't been finalized and it will depend upon the proposals. There are guidelines in the business plan which set out what the department expects to spend on each of the components of the agreement, if I could just locate that. I understand the initial intention and thought was that we would spend approximately $20 million on new housing stock and approximately $17 million on renovation. That may change, depending upon the mix of proposals that the department receives and the cost of the new construction or the renovation, that was an estimate based on the research.
MS. MORE: I guess the reason I ask that question is I really had my eyes opened, as a new MLA, in terms of the number of concerns that constituents expressed to me around housing issues. A number of people in my constituency and many others are having trouble finding affordable, clean, safe accommodations.
When some of the representatives from the affordable housing coalition appeared before the Standing Committee on Community Services - and their comments and concerns were reflected in the Community Services 2000-01 annual report - it seemed that the federal withdrawal from affordable and social housing really had an impact in Nova Scotia in terms of the number of new units that were available for those years after 1993. It would strike me that we have fallen even further behind in Nova Scotia so I am really concerned, will your plan of action include steps to make up for those lost years and try to put Nova Scotia on a level playing field with some of the other provinces, in terms of, you know, safe and affordable housing?
[8:30 a.m.]
MS. TYSON: I think the withdrawal of federal involvement, financially, in housing did cause some challenges for Nova Scotia, as well as other provinces. The Affordable Housing Agreement and the $36 million committed is really the best thing that has happened to housing in Nova Scotia in 10 years. So we are very pleased to be able to utilize that funding to help preserve the existing housing stock and to add affordable housing units in the province. We are hopeful that as time goes on, there will be additional opportunities through federal-provincial-municipal and other partnerships.
MS. MORE: Housing, I understand, is a provincial responsibility and I am just wondering, perhaps, if in Nova Scotia, our provincial government does need to take additional responsibility to make up that gap.
MS. TYSON: As I indicated earlier in my opening remarks, the Housing staff provide services to 40,000 to 60,000 homeowners in Nova Scotia every year. They assist people in renovating their homes, they assist seniors to remain in their homes, we add adaptations, we supplement rent. I am very proud of the department's staff. They work very hard and I believe their efforts are very much appreciated by Nova Scotians. We hear back from Nova Scotians who have received help and I think we are doing very good work in the Province of Nova Scotia to help people with housing needs.
MS. MORE: I am not questioning the sincerity and the commitment of our Housing division staff. It is just that I think there are lots of people falling between the cracks and I am just wondering if we need to make a greater effort to provide a number of different options to meet people with varying needs.
MS. TYSON: I think this Affordable Housing Agreement, very fortunately, will help us to do that. I might add that we have many needs in the department. Staff are doing their best to meet all of the needs but it is difficult. It is a challenge to meet all of the needs all of the time. I think we are doing a very large amount and I think that that is appreciated by the people who benefit from the assistance.
MS. MORE: Do you have any plans to dedicate any of the new housing units to people with disabilities?
MS. TYSON: They would be covered, yes. We don't have a specific plan to devote a specific amount to that but that would be included in the proposals. We do help people with disabilities. It is important to help them so that they are able to stay in their homes.
MS. MORE: I was wondering if you had a figure on the number of units in public housing that are presently unoccupied?
MS. TYSON: Unoccupied?
MS. MORE: Yes.
MS. TYSON: Mr. Dillon may be able to answer that question.
MR. HAROLD DILLON: Sure. I know, pretty closely, the vacancy rate here in metro, which is the largest housing authority, we have about 4,400 units that come under the public housing regime. The vacancy rate, the last time I checked which was probably in the summer, was hovering around 1 per cent. It fluctuates on cycles every three to five years, depending on a whole range of factors around the economy and so on, but currently around 1 per cent.
Elsewhere across the province, the vacancy rate typically fluctuates 3 to 5 per cent. Higher in some areas where, perhaps, population decline is occurring and so on. I could certainly get you a much more detailed province-wide picture if that is what you are looking for.
Perhaps Jim might - Jim has been more intimately involved with the public housing portfolio management piece, and he might have a little more carefully determined numbers than that.
MR. CHAIRMAN: Mr. Graham, would you like to comment?
MR. JIM GRAHAM: I think the only thing I would add is, there are two kinds of vacancies. There is the kind that occurs naturally as people move out so at any given time, you will have a percentage of your units that will be empty, as they are repainted and released. Then we have what we call chronic vacancies where we have projects that were built a couple of decades ago in communities that are in decline. There are not the populations left to sustain all the units being full all the time.
MS. MORE: Would the vacancy rate be affected at all by the need to make major repairs and, perhaps, the housing authority is not having the money to do that?
MR. JIM GRAHAM: No, there are no vacancies now as a result of major repairs. There was a building three or four years ago that was empty for a while as it was totally refurbished. We have done that. But most vacancies now, in the normal course, are just waiting for paint, flooring and the normal kind of refurbishing that takes place.
MR. CHAIRMAN: Okay, thank you. The time has expired for the NDP caucus. Mr. Graham, I believe you are going to start, and just before you do, I just want to thank our clerk, Mora Stevens, for handing out the Community Services presentations, so all members should have that now, and those figures. Mr. Graham, the floor is yours.
MR. DANIEL GRAHAM: Thank you, Mr. Chairman. Thank you for coming in and spending some time with us today. This is a particularly topical issue, fortunately, for the first time in some while. The issue of housing has grown. It sort of pops up from time to time and our hope would be that this remains on the radar screen for some period of time into the future.
I recall the announcement with Minister Collenette last year and the hope that was greeted with that announcement. I would like to pick up, starting with that point. It relates to the cuts. I know that your minister has not described them as cuts, the $4.5 million in modified increases, or however it is being described, I want to make sure we are using the same language. I want to get a sense of whether or not, indeed, that cut came from the federal-provincial Affordable Housing Agreement.
MS. TYSON: First of all, Mr. Graham, there was no cut in the budget or the funding of Housing programs or services. We spent and expect to spend exactly the same amount this year as we did last year and the year before. Our programs were not affected by that $4.5 million figure.
MR. DANIEL GRAHAM: The budget was reduced by $4.5 million, approximately, and I just want to get a sense of where that reduction came from.
MS. TYSON: The overall budget was not reduced. It remained exactly the same as it did the year before. I believe what you are referring to is the fact that the province has the ability - there is a surplus fund which has been built up. As I indicated, when the social housing portfolio was transferred to the province along with a schedule of payments, if the province, through good management or reduced interest rates, or whatever, was able to save money, that money was able to be put into a fund for future use or other housing programs.
The province some years is able to spend less money of its own money and more of the money from this fund, and some years the province contributes money to the fund. It is a variable fund used and designed for contingencies, interest fluctuations and so on. So I believe what you are referring to is the fact that the province was able to draw down from that fund $4.5 million.
MR. GRAHAM: This was money that . . .
MS. TYSON: It has nothing to do with the Affordable Housing Agreement and it won't affect, at all, the Affordable Housing Agreement.
MR. DANIEL GRAHAM: Okay.
MS. TYSON: It is a separate fund.
MR. DANIEL GRAHAM: When this surplus is built up as a result of, you mentioned good management, interest rates, could it be built up as a result of a lack of the use of particular funds and that's where the interest accumulates?
MS. TYSON: When the federal government transferred the program, the payments that they transferred were based on certain things, and one of the factors was a particular interest rate, which was about 9 per cent. Those payments keep coming at 9 per cent, but if the interest rates drop, which, fortunately, they have, there are additional monies there which are not needed to provide maintenance and to provide administration of the Housing portfolio. That is the money that goes into that fund from the federal payments. The province has also put money into that fund from time to time.
MR. DANIEL GRAHAM: Correct me if I'm wrong but the core of this money was intended for affordable housing.
MS. TYSON: The payments were intended to support the Housing portfolio, which was transferred to the province, in terms of the mortgage payments, the maintenance and the administration.
MR. DANIEL GRAHAM: And when it was sitting there, prior to the decision within the last month, it had beside that sum of money the notion that it was going to be used for Housing, correct?
MS. TYSON: Yes, it's essential that any money taken from that fund is used for approved Housing programs or services.
MR. DANIEL GRAHAM: So it was intended to be used for Housing and it's no longer going to be used for Housing.
MS. TYSON: That fund will be used for Housing because that's the requirement to draw down that fund.
MR. DANIEL GRAHAM: The $4.5 million was intended to be used for Housing and it's no longer going to be used for Housing.
MS. TYSON: I'm not sure I understand - I will try again. The province has the flexibility of adjusting the amount that it puts in to Housing and, from time to time, drawing on this reserve fund. All of the money that was intended to be used for Housing this current fiscal year will be used for those exact same purposes. There is no change, it's business as usual.
MR. DANIEL GRAHAM: But, with respect, this reserve fund had beside it the notion of Housing, or a label called Housing beside it.
MS. TYSON: Yes, and it still does.
MR. DANIEL GRAHAM: And you've taken from that reserve fund that said Housing beside it and put the money towards something other than Housing.
MS. TYSON: No, any money taken from that fund is required to be used and has been used and is used for Housing.
MR. DANIEL GRAHAM: The $4.5 million then came from where?
MS. TYSON: The $4.5 million drawn from the reserve fund would be used for Housing.
MR. DANIEL GRAHAM: The $4.5 million worth of savings for this year that was registered, that was supposed to be spent in this year, that the minister said he's realized a savings on will that money go towards Housing?
MS. TYSON: The department did realize, and as part of its budget exercise and process, identified, $4.5 million as an opportunity for the province to save that amount from provincial funds and instead substitute and maximize our use of federal funds. So we're maximizing the federal dollars, that's what we're actually doing.
MR. DANIEL GRAHAM: Is this funding - let me try it a different way . . .
MS. TYSON: So the province spent $4.5 million less in the department as a result of the budget process, in an attempt to assist the province with the budget savings. Fortunately, the department was able to maximize our federal funding to recover that $4.5 million, so that our programs and direct services have not been affected by the reductions in the department's budget.
MR. DANIEL GRAHAM: So the province is spending $4.5 million less, but the federal government essentially backfills that amount.
MS. TYSON: We're drawing down from that fund, which is actually in the hands of the Housing Corporation.
MR. DANIEL GRAHAM: Was this from the federal-provincial Affordable Housing Agreement?
MS. TYSON: No.
MR. DANIEL GRAHAM: I want to touch on the federal-provincial Affordable Housing Agreement. We have a target of 1,500 units by the year 2007, and we've proposed, I understand, 21 so far.
MS. TYSON: That's correct.
[8:45 a.m.]
MR. DANIEL GRAHAM: So with 44 left, unless my mathematics is wrong, we need to, for every month, on average, build 34 units per month for the next 44 months in order to meet our 1,500 figure, in order to make up the remaining 1,479 units. Do those figures sound roughly correct?
MS. TYSON: Mr. Graham, it's up to 1,500 units, so the exact figure is yet to be determined, and it's new units plus renovated units. So they're not all new units.
MR. DANIEL GRAHAM: It may not be 1,500, it could be 500?
MS. TYSON: No, I don't expect it to be 500, I expect it to be significantly more than that. It will depend upon the proposals and the cost of the new units and the cost of the renovations. If the new units are less expensive or the renovations are less expensive, that would enable us to do more. It really will depend upon the projects and proposals that we receive. We will do as many as we can, but we want to do the right things in the right areas. So it really will depend upon the proposals that come in.
MR. DANIEL GRAHAM: You would agree that we need to accelerate the process in order to realize the full potential of this program?
MS. TYSON: No, I think the process is proceeding as was intended.
MR. DANIEL GRAHAM: I know that there has been a varied pickup, I suspect that you have a sense of what some other provinces are doing well and what some others are not doing well. I understand Ontario is not doing well in its pickup of the federal-provincial Affordable Housing Agreement.
MS. TYSON: I'm not sure whether Ontario has even signed yet.
MR. DANIEL GRAHAM: But provinces like Manitoba, which have a comparable size to ours, have had a significant pickup with this program, do you agree?
MS. TYSON: I'm not aware of exactly what units Manitoba has so far produced. Nova Scotia was the first province in Atlantic Canada to sign the agreement, and as Minister Mahoney indicated just two days ago, Nova Scotia is on track with the other provinces. It takes six months to a year, he said, to gear up, for provinces. We've already announced two projects. It's slower at the front end of this program, which is a program that is in existence and ends in 2007. We will be spending more money as we go along in this program. That's normal, and we feel we are on track. Minister Mahoney has indicated publicly that he feels we're on track as well, with the rest of the provinces.
MR. DANIEL GRAHAM: If Manitoba had designated hundreds of units, they would be on track as well, they would just be further ahead of us.
MS. TYSON: Some provinces may be further ahead or further behind, we in Nova Scotia are at a stage that we expected to be at this time.
MR. DANIEL GRAHAM: You're required to do multi-year funding and multi-year budgeting?
[8:47 a.m. Mr. Graham Steele took the Chair.]
MS. TYSON: There can be adjustments in the program if that's necessary, in terms of how much is spent from one year to the next. Is that your question?
MR. DANIEL GRAHAM: My assumption is that you've done multi-year budgeting with respect to this.
MS. TYSON: We have estimates, yes.
MR. DANIEL GRAHAM: And do you have an estimate of how much you're going to spend in the next several years, and how many units are going to be taken on as a result of the Affordable Housing Agreement?
MS. TYSON: Mr. Graham, through the department, provincial contributions and partner contributions, we expect to fully utilize the $18.6 million. So we expect to spend $18.6 million in provincial-municipal- partner dollars or labour or land or other contributions which are acceptable to the federal government, over the course of this agreement. And we expect to build up to 1,500 units.
MR. DANIEL GRAHAM: So you must have done projections with respect to that?
MS. TYSON: That was based on research done by CMHC and by our own staff, and that's just being completed, it's not quite completed yet. It's just in the process of being completed.
MR. DANIEL GRAHAM: When do you expect that to be completed?
MS. TYSON: I expect the research to be completed within the next few weeks.
MR. DANIEL GRAHAM: Would it be possible for the committee to have a copy of that once it is completed?
MS. TYSON: Yes, certainly.
MR. DANIEL GRAHAM: Have there been projections that have been done inside the department leading up to this, that we would have available now?
MS. TYSON: Projections with respect to the number of units?
MR. DANIEL GRAHAM: The number of units or the amount of the expenditure.
MS. TYSON: Well, as I said, Mr. Graham, through all four of those programs we intend to spend the full $18.6 million. I expect if we did not receive as many proposals in one area as we had hoped, we would utilize that money in another area.
MR. DANIEL GRAHAM: Of our $18.6 million, the sort of provincial component, how much of that would come from the provincial government actually spending money, as opposed to having partners, land and transfers, and municipalities stepping up?
MS. TYSON: We will be looking for partners and we will be welcoming partners and their contributions. The balance that we do not receive from our partners, which would be by far the largest amount, I would expect, would be from provincial contributions.
MR. DANIEL GRAHAM: Do you have an estimate of what that is?
MS. TYSON: We won't know that until we receive proposals and have discussions with our partners. We are looking for partners, inviting partners to step up to assist. Whatever is not received from partners will be the provincial contribution.
MR. DANIEL GRAHAM: This is a program where we are able to realize 50-cent federal dollars, if we put up our 50 cents then they will match it.
MS. TYSON: Yes.
MR. DANIEL GRAHAM: There are other programs that have similar types of formulas, I think you referenced some of those in your remarks earlier. I want to touch on the issue of unused federal dollars and whether or not there are unused federal dollars in matching funds that exist in any of the funds for the Home Adaptations for Seniors' Independence program or the Senior Citizens Assistance Program, or the RRAP program for example, whether there is an amount that isn't being used that the federal government is making available to us.
MS. TYSON: Do you mean that we just don't use and it goes back to the federal government?
MR. DANIEL GRAHAM: Or the time lapses on them for example.
MS. TYSON: I don't think so, I will refer that to Mr. Dillon.
MR. DILLON: Annually, we make every effort we can to ensure that we are able to identify the required matching money for any federal money coming in. As the deputy minister mentioned earlier, programs like the RRAP family of programs, which have 75/25 federal-
provincial funding, we make every effort possible to ensure that we can provide our share of that. To my knowledge in the last eight to 10 years, we haven't seen a cent of that money returned to Ottawa unmatched.
Similarly for the social housing agreement, the money we get from the federal government under that agreement, which comes under the agreement as essentially a contribution annually, it in effect does not require any matching, it's a commitment the federal government has made to simply provide that money to support the public housing or social housing portfolio. We have not returned, I don't think to my knowledge, a red cent of that money back to Ottawa, we keep, use and retain every cent of that. The Affordable Housing Program, of course, will also require 50/50 cost sharing and as the deputy has indicated, we don't anticipate having to return any of that money to Ottawa.
MR. DANIEL GRAHAM: A program, for example, like the HASI program, the Home Adaptations for Seniors' Independence, I understand that's a federal-provincial cost-shared program. Our percentage contribution under that program is what?
MR. DILLON: It's 25 per cent.
MR. DANIEL GRAHAM: And it's 25 per cent up to what figure?
MR. DILLON: On an individual homeowner basis, it's $3,500 maximum assistance per homeowner and we get an annual budget for CMHC's share of that program, I'm not sure what the actual number is this year. Essentially, they indicate to us what they are prepared to put in and we identify a source for our 25 per cent and that's how the program rolls out. Every year we spend that entire budget 100 per cent and in fact, we do it usually in fairly short order, a three- to four-month period.
MR. DANIEL GRAHAM: And the Senior Citizens Assistance Program?
MR. DILLON: The Senior Citizens Assistance Program is historically a 100 per cent provincial program, it's not a federally matched program.
MR. DANIEL GRAHAM: There's no federal money associated with that whatsoever. I want to touch on the issue of aging public housing stock. From time to time we have witnesses coming before us who indicate there is a deferred capital maintenance problem in schools, hospitals and so on. I note, Ms. Tyson, that on your message from the deputy in the Nova Scotia Housing Development Corporation Business Plan dated 2003-04, your first bullet says, "We have an aging public housing stock which continues to need major capital replacement and improvement expenditures . . . " I'm just wondering whether or not this is a serious problem and whether you have done a calculation on a deferred maintenance problem in this department?
MS. TYSON: As I indicated earlier, Mr. Graham, we have a large percentage of home ownership in this province, I think about 70 per cent, and therefore to maintain that stock is of critical importance to the department. Yes, we put dollars in that every year and will continue to do so through our programs. We need to maintain the stock that we have, as well as add stock.
MR. DANIEL GRAHAM: Are you up to speed, are you up to date or have you been falling behind in your capital maintenance?
MS. TYSON: I'm going to refer that to Mr. Dillon, he has the details on that.
MR. DILLON: Just as a point of clarification, I understand your question is directed principally to the issue of the public housing stock versus the general stock of the province, is that correct?
MR. DANIEL GRAHAM: Yes.
MR. DILLON: About five or six years ago we retained a consultant engineering firm to do a province-wide scan of our public housing stock and to prepare a modernization and improvement maintenance plan for that stock so that we would be able to ensure that we made the right decisions around maintaining, modernizing and improving that stock over the ensuing number of years. From that study we developed a comprehensive year-to-year modernization and improvement plan that foresees the expenditure of somewhere between $5 million to $8 million a year directly toward the modernization and improvement of that stock. We are continuing to fund that on an annual basis on the strength of that study, and we update the study within the department on an annual basis working with our partners in the various regions, the six regional housing authorities and their general managers.
MR. CHAIRMAN: We will now move on to questioning from the Conservative caucus.
The member for Waverley-Fall River-Beaver Bank.
MR. GARY HINES: Thank you for coming in and being with us today. I think what I want to do is go back to square one with the federal housing funding program and just have you outline the objectives of the Canada-Nova Scotia Affordable Housing Program.
MS. TYSON: The objectives of the program are to increase the available housing stock for low- to moderate-income families across the country and that can be done through various programs. We have identified four programs that we will be taking advantage of under that program. One program will enable us to add new rental stock and that would be particularly important in places where the vacancy rate is low such as the metro area. The second part of that component is to enable the province to maintain and keep the rental stock
that exists now and so that program is developed to undertake major repairs and renovations in order to preserve that rental stock. In the rental part of the program it's building new rental units and preserving existing rental units.
The other two parts of the program deal with enabling low- to moderate-income families to actually have an opportunity to own their own homes. That part of the program will enable the province to build new homes for low- to moderate-income families. The fourth part deals with preservation of existing homes and through that program we will be able to do significant repairs to homes of low- to moderate-income families which will enable them to stay in their homes and maintain their homes. Overall, we have a four-part program over the next four years which will add significantly to the availability of affordable housing in the province.
MR. HINES: What are the qualifications for the Canada-Nova Scotia Affordable Housing Agreement?
MS. TYSON: I'm going to ask Mr. Dillon to explain the HILS formula, the housing income limit.
MR. DILLON: The Affordable Housing Agreement's history may be needed initially here. The agreement was a federal announcement and initiative whose genesis came from the very tight rental market situation in Toronto. If you recall the federal announcement about three years ago, they quickly developed a program that was in response to that. When it came to Nova Scotia and we began the commencement of negotiations with them, we clearly needed to talk to them about profiling the program to meet the needs here in Nova Scotia. So a great deal of time was spent in developing the wording of the agreement to allow the flexibility for the department to respond to affordable housing need as it might be defined in any particular constituency, i.e. by individuals or by community.
[9:00 a.m.]
So the wording in the agreement on affordable housing leaves a wide flexibility for the department to determine what is affordable and who it is really intended to target. So terms in there refers to generally allowing housing that is at or below market price or market rent in an area to satisfy the agreement's definition of affordable. Clearly, some of the proposals we are likely to get and some of the needs research we are doing around the province indicates that definition of affordability in terms of income definition or who might qualify is going to vary widely.
One of the principles we have been using, and it is typically attached to federal programs, as Ms. Tyson mentioned, the HILS or Household Income Limit Schedule, which I believe is in your handouts there, that's a useful term or set of incomes to help us define where affordability really can start. Anybody with incomes underneath those limits, we can
pretty well predict will face affordability problems. So a great deal of the Affordable Housing Agreement is probably going to focus on households that fit under those household income limits. But the agreement doesn't limit us to that. Perhaps specifically in the area of home ownership, typically incomes for home ownership, in many cases, or many areas, require incomes higher than those limits. So if that turns out to be the case in some of the proposals we receive where the cost of the units are such that incomes higher than those amounts are necessary in order to afford home ownership, then we will be looking, with flexibility, at allowing incomes that go above those amounts.
For many of the preservation piece of the program, the income of the occupants of those units will be probably well below these limits. In the case of much of the rural housing that is in poor repair, people's incomes are probably, on a household basis, in the $10,000, $15,000 range. We will be helping a great many clients most likely through that program with those kinds of incomes. So if you read through the agreement, we are very careful to enable ourselves the flexibility to address affordability wherever it is, however it is probably measured with the clear intention of trying to help those with the greatest issue of affordability.
MR. HINES: So the agreement is administered by the Province of Nova Scotia?
MR. DILLON: Yes, that is correct.
MR. HINES: Who selects the projects? What is the process by which the projects are selected?
MR. DILLON: In the context of the agreement, where there is a description of the four programs and a projected expenditure pattern across the four programs, that sort of lays out the framework. We are going to be issuing, it is anticipated, a request for proposals. In advance of issuing that request for proposals, we will be establishing criteria that will be used to filter the request for proposal results to ensure that there is a match between the intentions of the program and the proposals that come in and get accepted. We haven't determined just yet what the filtering group will be, whether it will be staff, whether it will include community representatives and so on, that has not yet been determined. We are developing what the criteria will be. Some of them are predictable. We will be looking at, what is the current vacancy rate in that area, what are the costs of the project, is the project sustainable in the long run, if we put funding in, will it revive year two, year three, year four without further funding? They will be looking at who they are targeting, are they targeting particularly low income, are they targeting disabled, are they targeting individuals or families? All of that will be squared off against the research we are doing to determine whether proposals meet what we see as the need. So that will be the process. Hopefully that answers that question for you.
MR. HINES: Yes, it does. Thank you. In terms of selecting the projects, in my days in council, I know there was a project that came up for discussion with the councillor, Bob
Harvey, at the time regarding a project on First Lake that was to be looked at under housing to develop. There was some disagreement, or some discussion went on, as to what lands would be available for this project and what lands would be available for parklands and so on. It seems to me at the time that it would be somewhere in the vicinity of 50 units that might have been developed in there. Do you know anything about that project and where it might be now? Has it been abandoned or is the municipality still throwing it around or do you have any information you can reveal to us on that?
MR. DILLON: Yes, the lands you are referring to are approximately 60 acres of land the province owns on First Lake Drive in Sackville. The lands are an excellent potential site for housing for the community of Sackville. As they sit at the moment, they lie just outside the edge of the servicing boundary for the Sackville area, the approved municipal servicing boundary, in other words, the boundary which would allow you to extend sewer and water to these lands. So we have been in extensive negotiations with the municipality around the notion of what we would like to do on those lands to improve the availability of housing stock in Sackville and do it in an orderly and controlled manner, i.e. so it would feed off the existing sewer and water network, so it would provide a population base for schools and so on and so on. Because the lands are just outside the servicing boundary, for us to be able to proceed, we need agreement from HRM to allow the boundary to be adjusted and to make all the necessary other adjustments in their Municipal Planning Strategy and so on. So that is the extent of the negotiations.
As part of those negotiations, we have also been approached by people in the community to see whether we would allow access through those lands to some very valuable parkland in the area, in the Second Lake area, parkland which was set aside a number of years ago by the province to the Department of Natural Resources to be developed for parkland. So some of our negotiations deal with the issue of access through these potential housing lands to the parkland that surrounds them, about 700 acres or 800 acres.
So those negotiations are ongoing. We always remain optimistic that we will be able to move forward with that project. It will involve the creation overall of somewhere between 100 and 200 very good quality housing units. It would be a great benefit to the construction sector, to the real estate sector and everybody, as well as the community at large but those negotiations are simply ongoing.
MR. HINES: So you are telling me if the i's were dotted and the t's were crossed, we would have moved on that project at this time, we will be moving on that project?
MR. DILLON: Yes, ideally we would have moved on it two to three years ago but clearly we have to get our ducks in line with HRM. HRM has to foresee that it is a project that is in their best interest as well as the community and we haven't reached that point yet.
MR. HINES: Back in 1990, an individual who is very much in the limelight these days, in fact he takes over the major job in the country very shortly, Mr. Paul Martin was co-chairman at the Liberal Housing Task Force. He indicated an urgent need for national housing at that time and then tended to, as his governance went on, get away from the direction that he might have suggested that should have been taken at that time. In terms of the funding that is available, how long is that funding going to be available and do you see perhaps Mr. Martin being much more generous when renewal time comes?
MR. DILLON: Okay, funding. I will have to separate this out. The social housing agreement funding is locked in for 38 years, until the year 2035, by executed agreement between the province and the federal government. So in terms of the actual amount that is covered in that program, there is no ability for the federal government to renege on that piece, certainly not from my perspective and I'm not a lawyer, there's a lawyer next door to me, so I'm assuming that that one is locked in. The Affordable Housing Program funding is also subject to an executed federal-provincial agreement, so I can't imagine that they would draw that back. Similarly, the RRAP agreement is a three-year agreement, and we would not anticipate that they would start backing away from that.
If the question is whether they're prepared to get back in the game in a much bigger manner, certainly we will be making representations and we've made representations in the past, through several ministers, to the federal government, not only to get back in the social housing business in a much bigger way but to perhaps even consider renewing the social housing agreements with the notion of the federal government contributing even more money to them.
I think it's important for everyone to understand that when the federal government, in 1993-94, decided to discontinue their involvement in new social housing, that was a pretty difficult decision right across the country, for provinces to accommodate. In 1995, as a result of further federal restraint, they decided to freeze federal contributions, even under the current portfolio they were committed to, at 1995 federal dollar levels. That effectively means that the social housing stock since that time has had to run on the federal element that was fixed at the 1995 level. We go back regularly to the federal government and ask them to revisit that decision, can they remove the freeze on the existing portfolio that's already being managed, and in my opinion well managed, by the department, but there is a freeze on the federal piece. I think it's 1995 dollars or 1996 dollars. So we regularly ask them to thaw that freeze and to increase their contribution just to that portfolio, because of the challenges that portfolio will face over the next 38-odd years.
MR. HINES: Perhaps Mr. Martin will be reminded of his statement back in 1990, and maybe he will come forward and be a leader in renegotiations or in providing new monies. Something that's interesting to me is the new home ownership concept. Can you lead me through the steps, as to how an individual who has a low income or moderate income, who
would like to own their own home, how it can possibly happen and what the repayment program would be, and so on?
MS. TYSON: Are you referring to the Affordable Housing Agreement, that part of the program, the new home ownership part?
MR. HINES: Yes.
MS. TYSON: That will be developed, in terms of criteria, as to the criteria under which a person can apply for a project, a municipality or a non-profit or a for-profit organization or the province may itself, through its Housing division, build some new units. Those units will be able to be turned over to individuals through that program. In terms of the details of how that would actually work, I will ask Mr. Dillon if he can elaborate on that.
MR. DILLON: Just to expand on what Deputy Minister Tyson is speaking about, the Canada Mortgage and Housing Corporation was not particularly receptive to the notion of building new home ownership through this program. As I mentioned earlier, they saw the program as responding to the rental market. That was their initial thrust. So it was Nova Scotia's pressure that led to them conceding, in Nova Scotia because of our unique circumstance, to allow a modest element of the program to be directed towards new home ownership.
In the agreement - and if you have a copy of the agreement - they conceded that within the context of those new home ownership units being in what they refer to as urban areas of revitalization, and this I guess I would say was the kind of compromised position we arrived at, that there are urban areas of this province that need revitalization. Our concern was revitalizing them and only building rental stock may not be what the community would be interested in. Certainly in some areas, particularly tight urban areas of Halifax or Dartmouth, there's probably a perception that there's enough rental stock.
We asked them to at least allow for the opportunity to build some affordable ownership stock as part of a revitalization effort aimed at getting a mix of renters and owners in those more dense urban areas. So that agreement ties the new home ownership element to that.
[9:15 a.m.]
The other caveat I would add to that is that is a restriction that is placed on the federal share of the program. My understanding is that the provincial share of the program allows a little more flexibility than that, and although we may still want to serve that same direction, using the program to improve urban areas, I believe we do have the latitude to extend that program, in some cases, to non-urban areas where there is a pressing need.
MR. HINES: It seems to me that that program is one that needs promotion for the simple reason that many who are in the low-income area, perhaps sometimes, are not aggressively pursuing avenues that might be out there for them. I find that many time they're not sure what direction to turn, where to go, but if they could find that direction and move forward in that direction, then their values in life become greater if they are able to attain something in this respect. I've seen people who have accessed this program who have been able to turn their lives around and, in fact, use that as a leverage or a stepping stone to improve their incomes and so on and become a whole lot more confident about going forward in life. So I applaud those programs. I realize I only have a minute or so left, but I'm going to hand off to Mr. DeWolfe.
MR. CHAIRMAN: The member for Pictou East, with slightly more than one minute remaining.
MR. DEWOLFE: Thank you for that heads up. In the second round I would like to talk about some perhaps new, innovative ideas that you may have regarding Nova Scotia's Housing strategy. I'm just wondering if you're looking to the future with some new ideas. I will just throw that out in the moments that I have left.
MS. TYSON: Mr. DeWolfe, the Housing division spent quite a bit of time meeting with people throughout the province, discussing with them their needs and what people thought the Housing Division and the Department of Community Services should be doing in the Housing area. Through that process and through research which has been carried out and will continue to be carried out, it's very apparent that Housing is greatly linked to the health of a community and to the determinants of health.
What the department is looking at is a more integrated approach to the Housing needs of the people in the province. We're currently working with the Department of Health. We have been working with the Department of Health and supporting certain projects, such as nursing homes and assisted living facilities. We will continue to do that. We are a small group and we are working with the Department of Health in looking at the broader picture, the role of Housing in the Province of Nova Scotia, and how Housing can support healthy communities.
That is the direction that the department is taking and will continue to take as part of developing a social objective or a social plan for the province. We will be working with Health. We also work with the Department of Justice and the Department of Education as well, but right now we're focusing on our relationship with Health and the broader needs of continuing care, people in continuing care, people with disabilities and the aging population, people in senior citizens residences and assisted living, which we believe we can help with. Housing is also helping considerably in the private sector, the private non-profit sector, and assists in term of shelters such as Phoenix House and that type of establishment. We feel that there is a major role for Housing to play there.
MR. CHAIRMAN: We will now move on to the second round of questioning, which will be done in 11-minute blocks. We will return now to the NDP caucus for the next 11 minutes.
The honourable member for Sackville-Cobequid.
MR. DAVID WILSON (Sackville-Cobequid): Mr. Chairman, I would like to maybe just return a little bit on the reserve fund. It's our understanding that this fund was created after the federal government transferred Housing to our province. This fund was intended to stabilize and protect the public housing stock that exists in the province. With the millions of dollars cut from the reserve fund in the last month or so, is this potentially putting our housing stock at risk? For example, what happens if the markets fluctuate or housing is damaged and in need of major repair, or say even income of the residents who live in our housing projects and our housing stocks go down? Can the government protect our housing stock if we keep cutting from our reserve fund?
MS. TYSON: The recent $4.5 million doesn't, in our view, affect our ability to protect our housing stock. The fund was established, as you pointed out, after the federal government transferred the Housing portfolio to the department. The federal government transferred certain fixed payments on an annual basis and I think I've mentioned that interest rates did drop from that time and that has enabled the province to accumulate a surplus in that fund. That surplus can be used for any of the approved programs or services which are approved by the federal government. It is a contingency fund, as it were, it can be used to stabilize changing interest rates, it can be also used on new housing programs or existing housing programs. So it is a fund and there is considerable flexibility in the use of that fund, provided it's used for the purposes designated by the federal government.
MR. DAVID WILSON (Sackville-Cobequid): Is there going to be a plan put in place to return the $4.5 million to this reserve fund over the next few years, maybe?
MS. TYSON: The government has actually put a fair amount of money into that fund over the past couple of years. I'm going to ask George Hudson to explain to you the history of the government's contributions to that fund in the recent couple of years.
MR. GEORGE HUDSON: If you would refer to note four of the financial statements of the Housing Development Corp., you will see the flow of funds through that account. It is known as the Fund for Future Social Housing Expenditures and the beginning figure two years ago, in 2002, was $13.8 million. It has increased from there to the year in balance, 2003, to $31.8 million, so that increase in that short period has been created in large part because of the provincial contributions to the cost of housing. The drawdown of the federal funding has been limited because of the provincial contributions which, as I said, the last few years the provincial contributions - as shown in that note - were $9 million in 2002 and $18.9 million in 2003.
MR. DAVID WILSON (Sackville-Cobequid): That $31.8 million, does the $4.5 million have to come off that? Is that what the fund's dollar figure is presently, $31.8 million?
MR. HUDSON: Yes, $31.8 million is the year end balance going into this year.
MR. DAVID WILSON (Sackville-Cobequid): So the $4.5 million would come off that?
MR. HUDSON: The $4.5 million will be a drawdown of that figure. It's because of the sharability of two particular programs that have been added under the envelope of shareable federal programs. As Deputy Minister Tyson has referenced, you can't take this money out for anything, it has to be within CMHC approved programming.
MR. DAVID WILSON (Sackville-Cobequid): So does the housing agreement that we signed with the federal government, the provincial funding, are they using this $31.8 million toward funding the projects that are going to be coming forward in the next few months? Can you spend that money for this agreement or is that separate funds?
MR. HUDSON: The funding for the Affordable Housing Agreement is separate from the deferred federal.
MR. DAVID WILSON (Sackville-Cobequid): So the province can't use the $31.8 million for any of those projects that will fall under the agreement with the Housing program?
MR. HUDSON: The draw down from this fund has to be within the agreements with the federal program, yes.
MR. DAVID WILSON (Sackville-Cobequid): Another question would be has CMHC expressed any concerns with maybe the slow start-up of us using the program or funding new projects in the program?
MS. TYSON: Not at all, in fact, a couple of days ago Minister Mahoney indicated publicly that this province is on track in terms of its initiation of projects under the Affordable Housing Agreement. He indicated that provinces which have entered into the agreement with the federal government typically take six to 12 months in order to get started and make announcements, and that Nova Scotia has now made the second announcement. We are not behind, we are on track.
MR. DAVID WILSON (Sackville-Cobequid): Also, I had a small discussion with Minister Mahoney, he has also indicated there is the potential for more funding in the near future, other than this program. I hope the department realizes that we have to spend the money and use this fund because he said - and I think he said it that day - there is more money allotted for more programs like this, so it is important. I think it is vital to our province to
increase the stock and make sure we do spend that money because as Minister Mahoney stated, there is more money to come in the future.
Another quick question would be, do you have any figures on how many seniors or families are waiting for housing in the province today?
MS. TYSON: We have wait lists for our programs, yes.
MR. DILLON: Are you interested in specific details on seniors or families for a particular authority or a particular area of the province?
MR. DAVID WILSON (Sackville-Cobequid): More or less it is to generalize the whole province on how many residents in our province are waiting for housing so if you want to give the total, that's good.
MR. DILLON: I mentioned earlier that across the province we have six regional housing authorities and the size and nature of their waiting lists varies considerably from authority to authority, vis-à-vis the mix between seniors, families or individuals looking for housing. Recent information I have here, culled from the various housing authorities around the province, probably adds up to somewhere in the area of 3,000 names for the approximately 12,000 public housing units we have available on a waiting list. The turnover in that stock varies anywhere from 8 per cent to 12 per cent annually, I guess, would be what you would consider the normal turnover. Based on 12,000 units we might have anywhere from 1,000 to 1,500 unit turnover annually and so people from this waiting list would gain access to that.
A couple of cautions, people sometimes go on the waiting list and are offered units but don't take them so the sheer number on the waiting list does not necessarily indicate that all of those people have a pressing need for housing, for example, senior citizens living in the Halifax area who have a preference to live in a specific project on a specific street and I will use the example of H.P. MacKeen Manor on South Street. They may be living in reasonably good accommodations somewhere else but want to move into that project so they will ask and apply to get on a waiting list for that project and they are prepared, in many cases, to wait years just to get in that specific project, while we offer them units elsewhere. So the waiting list number alone can be misleading in terms of the real measure of demands, that's the only caveat I would put on it.
MR. CHAIRMAN: The member for Dartmouth South-Portland Valley.
MS. MORE: I realize I just have a minute and a half left. First of all I want to commend the Housing division for its commitment to supporting healthy communities, I think that's an excellent approach. What I want to ask, Mr. Dillon referred earlier to matching the needs that result from your research and consultations to the interests of the various new partners. I'm wondering, if there are needs from various communities - not just geographical but communities of interest in need - who don't come forward to initiate funding applications, will the department take a leadership role in trying to support non-profit groups and municipal governments and others to help meet those gaps?
MR. DILLON: That's a long question and I'm trying to determine what the real root of it is. Is the question whether we would meet a gap between the proposals that come forward and the research . . .
[9:30 a.m.]
MS. MORE: Let's just say, for example, one of the high priorities might be people with disabilities or seniors in rural communities, something like that. If there are not a lot of advocacy or non-profit or municipal governments interested in initiating an application to get funding to start a project, would the department then step in and work more actively with a community group, so that their needs are not just bypassed in favour of a group that might have more advocates or a louder voice.
MR. DILLON: Thanks for the clarification. Yes, no question. We in fact anticipate we would be doing that through the Housing Development Corporation, in fact we anticipate there will be many instances where we are required to take the lead role in implementing the project. In some cases we may then retain ownership, much like we do public housing and manage it well for its original intended purpose, or we may negotiate and set up a partnership arrangement with a non-profit group to, in fact, accept ownership or lease the building from us and then manage it and maintain it for a specific clientele. Certainly that's something we've considered right through the piece as a likely role we will play. Depending on the proposals that we get, the quality of them, their ability to own, operate and maintain property as we have to do that less, if the submissions are of a weaker nature, then we may have to do more of that. So yes, we anticipate having a role that way.
MR. CHAIRMAN: Thank you very much. We will move on to the Liberal caucus.
The honourable member for Halifax Clayton Park.
MS. DIANA WHALEN: I have a couple of questions, if I could, for Ms. Tyson. If you like, you can pass it to others on your team. I would like to know, first of all, how you would define your ability to meet the demand now for housing from the moderate- to low-income and even the homeless people.
MS. TYSON: Our ability to meet the needs is determined by the various programs we have and the funding we have. We are meeting a great number of needs on an annual basis. We could always do more, but we feel we're doing the best we can to meet the needs we have now. We feel that we are doing a very good job for the people who are the beneficiaries of the services.
MS. WHALEN: You indicated that between 40,000 and 60,000 people in Nova Scotia receive some services through the many programs that you administer, but how many people are we missing? We've had the discussion about wait lists, and given that there may be some pluses and minuses to that, some people may not be urgent, but I'm sure you look at the urgency of some of these cases. Our experience here in HRM is that the urgency is increasing and that homelessness is increasing. Do you feel you're able to keep pace with the demand from what is becoming an urgent situation?
MS. TYSON: If there's an urgent situation or an emergency situation, that family is placed, is given priority, so that those situations are able to be addressed in priority and don't have to wait a couple of years. In terms of homelessness, it's difficult to keep up with the number of people who are homeless. The department does work very hard with the federal government on homelessness. In fact, recently the federal government, HRDC, put out a publication indicating the number of projects which have been undertaken over the past three years. There were more than 60 projects on that list. HRDC intends to spend an additional $900,000 this fiscal year, by the end of March.
MS. WHALEN: Can I ask you, is the province providing money with that program as well?
MS. TYSON: Yes, the province is required to satisfy the federal government that it spends at least the same amount on homelessness and does provide letters and numbers to the federal government, and the federal government has been satisfied over the years that the province has been doing what it's required to do.
MS. WHALEN: Could I ask you a question now about the trend in the amount of money we're spending on Housing in general, the entire package of Housing, in Nova Scotia over the last 10 years? In general, what is the trend line? I don't need the specific numbers. Where is the line going? Are we spending as much as we did 10 years ago or less? Provincial money, please.
MS. TYSON: I will just indicate that over the past 10 years, it's been challenging because the federal government had not been putting money in. With this new Affordable Housing Project, it's a very good event to have happened for Nova Scotia. I don't know the figures over the last 10 years, so I will ask one of my colleagues . . .
MS. WHALEN: Perhaps, if you would, I will just give you some figures and you can respond in general. I don't want to get into the specifics of the numbers. My indication is that 10 years ago, in 1993-94, the total amount spent, provincial money, Nova Scotia Government money, was $24.2 million, and that this current year, the 2003 year, we're looking at $17.5 million. I'm not sure if it's right, but the 2004 year is expected to be only $8.9 million. Now that actually was quoted in the article by Michael Shapcott, the University of Toronto Centre for Urban and Community Studies. If you're familiar with that article, then I think perhaps you may already have looked at it and perhaps even responded, so perhaps you would be able to tell me.
MS. TYSON: I did indicate that the province, fortunately, has the flexibility of being able to draw down on that deferred fund, which enables the province to vary the amount that it puts in, depending upon the circumstances that the province finds itself in. When all the departments were asked, as a part of the budget process, to determine whether they could find cuts, then . . .
MS. WHALEN: Excuse me, Mr. Chairman, my question wasn't about the cuts, it's about the trend line over the last 10 years. Just the total spending that the Province of Nova Scotia . . .
MS. TYSON: The total spending on Housing, I'm going to say over the past three years has remained exactly the same, although there's a variation as to where the funds are coming from. I will ask if Mr. Hudson has more information about the years prior to that. It hasn't changed in total, we have not been affected in terms of our programs.
MS. WHALEN: In the last three years.
MS. TYSON: Yes.
MS. WHALEN: Mr. Hudson, maybe you could just speak about the trend line, is it up or down?
MR. HUDSON: The last year, just to correct, the number is $25 million. The forecast that you're referring to is $17.5 million and then there was an additional provincial expenditure to make it $25 million. Coincidentally the provincial cost from 1993 to the year ended March 2003 is approximately the same number.
MS. WHALEN: So we've returned to the level of funding from 1993-94, that's what you're saying.
MR. HUDSON: In that particular year, yes.
MS. WHALEN: In this one year, so . . .
MR. HUDSON: But in the years preceding it, you will note that there is lesser provincial contributions than that . . .
MS. WHALEN: I can see that.
MR. HUDSON: . . . as the deputy referenced, with respect to the deferred contributions.
MS. WHALEN: That answers the question very well, thank you. Could you tell me the exact name of the reserve from which the funds were withdrawn, Mr. Hudson? The $4.5 million - I'm back to the $4.5 million now.
MR. HUDSON: In your package you have the financial statement for the Housing Development Corporation, and Note 4 to that set of financial statements is entitled, Funds for Future Social Housing Expenditures. That's a fund on the balance sheet of the Nova Scotia Housing Development Corporation.
MS. WHALEN: So it's clear to say that we've just withdrawn $4.5 million from a fund that was intended for future Housing expenditures.
MR. HUDSON: Yes, and it's a reserve fund over the 38 years of the agreement.
MS. WHALEN: I also heard the term used, a deferred fund. So funds are accumulating there so that you can spend them in future years.
MR. HUDSON: Yes, the offsetting reserve on the balance sheet account entitled, the Deferred Federal Contribution Account.
MS. WHALEN: My question really goes back to the $4.5 million, and I would like to just ask you whether or not that money was not intended to go to Housing?
MR. HUDSON: Yes, the money is used for Housing. All funds drawn down from the Deferred Federal Contribution Account have to comply with CMHC rules with respect to the Housing Programs.
MS. WHALEN: Do you have to get approval from CMHC to remove funds from that fund?
MR. HUDSON: The fund is audited annually by an independent auditing firm that reports to CMHC on those expenditures.
MS. WHALEN: One concern I have is that if we're able to remove funds because we have had a good time in terms of interest rates, we have been able to accumulate extra funds, what will happen if interest rates now rise suddenly - then that fund definitely would be shortchanged and even fewer units being built.
MR. HUDSON: Certainly those kinds of vagaries into the future are the reason that the fund exists, as a reserve against variations for the future.
MS. WHALEN: Very good. I think really when we were told of the cuts it was pretty clear in the presentation from the Minister of Finance that this was called, cuts to the Housing program, Housing services, that was how it was defined to us so I'm going to turn this over to Mr. Graham.
MR. CHAIRMAN: The honourable Leader of the Liberal Party with two minutes remaining.
MR. DANIEL GRAHAM: A question was asked earlier about the response of the federal minister to the pickup of the Affordable Housing Agreement. I think you accurately indicated, Ms. Tyson, that he is quite positive on how we have done things and that came in a joint announcement just in this past week, where there were six more added to the 15 that we had. I'm having trouble reconciling those comments and your comments that he's been positive, with the suggestion at least in The Chronicle-Herald dated August 13th about affordable housing, when Mr. Mahoney was here last time and there were just six fewer projects being built. He said, "Mr. Mahoney criticized the province for doing little with the $18.6 million it got from Ottawa last September for affordable housing. That was part of $680 million available nationwide . . . " He went on to say, "The province committed to match $18.6 million." Then he says, "'We've seen no development, no action - they haven't spent any of the money.' Mr. Mahoney said." Is it your understanding that these six much- needed units were enough to change his opinion in a 1,500 unit program?
MS. TYSON: Yes, I recall that article to which you refer and as a result of that article, I and others in the department were surprised to read that article and as a result, made enquiries directly with senior CMHC staff as to whether he was correctly quoted. I was told that the comments were taken out of context and it did not give an accurate interpretation of his comments on that day. We were very surprised because we met with Mr. Mahoney the preceding evening and discussed the province's plans. He did ask us what our plans were and he seemed satisfied at that time, so we were surprised to see the article and made enquiries.
MR. CHAIRMAN: We will move on to the Conservative caucus for the last round.
The honourable member for Pictou East.
MR. DEWOLFE: Thank you, Mr. Chairman. Again, welcome to the Public Accounts Committee. Thank you for the insight you have provided today on Housing. When I was passed the Chair a few minutes back, I was talking about the new, innovative ideas and I will tell you where I was coming from on that. Something that wasn't new in years gone by was continuing co-operatives and this concept was brought to my attention a number of years ago. We, in Pictou County, formed a Co-op Housing Development Board, a volunteer board. We were very careful with the people we put on this development board, we had a good cross-section of the business community, including a bank manager, a lawyer, so that we would have all the right people and be able to get all the right answers. As I said, this was a volunteer group of people who donated their time to this board.
It was a federally-funded program that came through St. F.X. Extension, they were the administrators of it. We developed a housing project and it started with the purchase of land, development of the property, essentially turning a field into a housing development, complete with streets, street lighting, storm sewers and constructed various styles of houses, various sizes like two and three bedroom, I guess there were four, three bedrooms and so on. We created, I think, a beautiful housing development. We also tendered for the work, spread the tenders out and we kept the price down very much so. We provided affordable housing at a very reasonable price and we also provided the residents who would join that co-op ultimately with some sense of pride in a peripheral way, pride of ownership, but also pride in managing the development.
[9:45 a.m.]
I became a strong believer in continuing co-ops but the federal government has since pulled the plug on it, I guess they felt it cost them quite a bit of money to provide these programs. Whatever the reason, those are gone now. Where I'm coming from on this is working with communities. You mentioned you were working with other departments and I was wondering if you were working with community groups, as well?
MS. TYSON: Yes, Mr. DeWolfe, on the co-ops, the province does administer the third-party agreement and provides annual subsidies to more than 9,000 co-operative and non-profit units. We have a large number of co-ops, we support them very well in this province and encourage them, and will continue to do that. It's often a very good way for low- to moderate-income families to be able to enter into an agreement and remain in a home for many years. In terms of the communities, we are working with the communities extensively. In terms of the Affordable Housing Agreement and in terms of the direction that the Housing services should take, as I indicated, there were consultations with over 100
community groups and through that process we gained some insight into the needs of Nova Scotians and the wishes of various communities.
In the homelessness area, we have the Community Action Committee, which actually selects projects, so they identify the needs and they select and recommend which projects should be advanced. Two members of the department are members of that committee, Jim Graham is one of the two Department of Community Services members, so we work very closely with the community in that regard. In addition, Housing Services, on a regular basis, connects with community organizations - I mentioned Phoenix House earlier. Community Services was able to work with that group and the federal government to assist that group in providing better and more extensive shelter for homeless youths in this area. That happens on an ongoing basis and I will ask, perhaps, Mr. Graham, if he could comment on other areas where we are working with the community.
MR. JIM GRAHAM: One of the initiatives we are trying to pursue and have actually pursued a couple of opportunities is working with community-based organizations that have residential accommodation, in a way that would see Housing more active in their property management issues, which would allow them to be more active in service delivery to their clientele. Over the past couple of years we have developed arrangements with Quest, the Brain Injury Association of Nova Scotia, where we have undertaken to do property management for them and allow them to concentrate on the delivery of service.
In terms of the homelessness initiative, we have a very competent technical staff, architectural assistants, architectural engineers, and we've worked very closely with community groups on their housing projects by providing them with technical services to help them get those projects off the ground, plan specifications, project management. Those have been contributions on behalf of the province to help those projects be put in place as cheaply as possible.
MR. DEWOLFE: I think what's key to my comment is that under the system that I mentioned, the continuing co-op, is the fact that we pulled the expertise together, volunteered to take this project on from the initial purchasing of property - and I chaired the continuing co-op, so I was very much involved and I was very pleased at the expertise that was there - that would provide time, free of charge, and their expertise along with it. That can be done today, where this group could be formed that would take on the challenge of providing this Housing project, perhaps in any corner of the cities or towns in Nova Scotia, and take on the entire project in the management and building, and then there you have it, you have the Housing project cleared for.
Essentially the management and building of it was all taken care of outside, by a community group. They, too, feel some sense of pride that they were responsible for providing this to the province. I think it's a win-win situation all around. I'm just throwing
that out as an option for future consideration. Perhaps you would like to comment a little more. I see some nodding going on.
MR. JIM GRAHAM: There's nothing in the Affordable Housing Agreement with CMHC that would preclude that happening again, that form of housing would certainly be eligible under the program. We work very closely with the Co-operative Housing Federation of Canada in terms of looking after the existing portfolio, but have also had some very general conversations with them so that they're well aware that those kinds of projects would be eligible under the program.
MR. DEWOLFE: I just want to mention that this week there was some criticizing being done by a former member of this committee, Russell MacKinnon, alleging delays in starting new Housing projects, and he also criticized the recent announcements that promote home ownership for low- and moderate-income Nova Scotians. As I said, several new Housing developments were announced this week, and I was very pleased to hear those announcements. I expect more to follow in a timely manner. I was just wondering if you would like to comment on that criticism that took place this week.
MS. TYSON: Yes, I did read that article, Mr. DeWolfe. We have announced new units being built, and that's part of the program. We know that in some cases some Nova Scotians of low to moderate income, without help, would not be able to become homeowners and have the privilege of owning their own homes. That is part of the program and it supports that part. The other parts of the program, though, will help people not in a position, even with help, perhaps, to own their own homes at this time.
I think, if I can just refer back for a moment, there is a particular project which the committee may be interested in hearing about that we're doing in Yarmouth. That's a project where the department is involved in helping a person acquire a home or building a home. At the same time, people are learning the trade of building, the community is involved in that project. We are very involved in that project and if any of the committee members would like to hear more about that project, we would be very happy to tell them about it. It is what we consider an innovative project and it accomplishes several objectives at the same time.
MR. CHAIRMAN: Thank you very much. That brings to an end the question and answer portion of our proceedings. Ms. Tyson, I would now like to invite you to make a closing statement of up to five minutes, if you wish.
MS. TYSON: I would just like to say once again how much we appreciate the opportunity to be here and provide you with some information in connection with the department's programs and services that we provide. I think that staff are working very hard to do the best they can to help the people of the province and they aren't always recognized. People seem to pick up on the problems but not as easily do people pick up on the very many
good success stories that we see every day. I just want to stress that staff are very committed and are working very hard to help Nova Scotians, and doing a very good job.
If there is additional information that we can provide at any time to any of the members, we would be more than happy to do so. Thank you.
MR. CHAIRMAN: That concludes the business proceedings for today. We do anticipate that we will have a meeting next week for an in camera briefing with the Auditor General on the contents of his 2003 annual report. My understanding is that the report is in the hands of the printer, it is not possible to specify the day, but I do anticipate members of the committee will have a day or two notice next week on the day that it is released. The purpose of the meeting is to ensure that members of this committee are informed as to the contents of the Auditor General's Report before it officially becomes public. We will do everything in our power to notify members of the committee, as soon as we know what date the Auditor General's Report will be released.
Are there any other items requiring the attention of the full committee before we adjourn today? If not, may I have a motion to adjourn.
MR. DEWOLFE: I so move.
MR. CHAIRMAN: Would all those in favour of the motion please say Aye. Contrary minded, Nay.
This committee is adjourned.
[The committee adjourned at 9:57 a.m.]
