How Can Ottawa Help Cities House Their Citizens?

Right now, housing the 25,000 Syrian refugees expected in Canada by the end of February is capturing a lot of the headlines and our new government's attention. But those aren't the only commitments about shelter the Liberal party campaigned on. And for many Canadians, those other promises are no less pressing.

Among them, the campaigning Liberals committed to spend $19 billion upgrading the country's infrastructure over the next decade. Needs for that money are numerous: new childcare spaces, capital upgrades to universities, museums and art galleries, and renewing existing and building additional social and affordable housing.

Interest groups are lining up to fill ministers' ears with all the reasons their cause should get a cheque. But cities have a special case.

Since an earlier Liberal government devolved responsibility for social housing to the provinces in 1996, many have downloaded the job further to municipalities, either formally or informally. Few municipalities received any extra resources to play what was previously Ottawa's role.

The previous Conservative government had started the process of abandoning decades-old social housing support agreements as they expired, potentially cutting loose tens of thousands of households.

But while the new government may have promised change -- and cities and towns may know their housing needs best -- as Constitutional non-entities they don't usually get a seat at the federal-provincial-territorial tables where critical, Canada-wide policies get decided.

The Federation of Canadian Municipalities (FCM), which represents 90 per cent of Canada's towns and cities including Toronto, Vancouver and other major centres, wants to change that.

Earlier this month its director, Brock Carlton, sat down with Tyee Solutions Society to talk housing strategy, how much money is needed, and who should be responsible for housing Canadians. (Some responses have been edited for brevity and clarity.)

TSS: What would the Federation of Canadian Municipalities like to see happen with that $19 billion?

Brock Carlton: We think it is critically important that a significant proportion of that money go to social housing to shore up the decline in the support for operating agreements. That's $1.7 billion a year.

And the point isn't that the operating agreements should just be renewed. The point is that there's a federal investment in the system, and that investment needs to stay in the system. It could be re-profiled in a way that responds more to the current challenges as opposed to the challenges of the time when the operating agreements were put in place.

The second thing is that it's really important that, as the thinking is being done about how this money is invested in social housing, that municipalities are partnering with the [federal] government in the discussions. Through FCM representing the municipalities in a partnership with the federal government, we can be really practical about what the reality is on the ground as this money's being invested in supporting the community.

What challenges do housing providers face today that they didn't when the operating agreements started [in the 1970s and 1980s]?

One of the big challenges is that a lot of the housing stock is old. When those operating agreements were first put in place, it was to support new or relatively new social housing units. So the capital repair costs are significant.

And in fact, of the 600,000 housing units that are supported by the operating agreements, the estimate is that about 30 per cent of them are essentially unusable. And if there isn't some mechanism for capital repair, they're just going to fall out of the system altogether. You'll lose those housing units.

The other challenge is that about 30 per cent of those units that are supported by those operating agreements are seniors' housing. And seniors on fixed income simply will not have the capacity to pay market value for some of these units.

When you say a significant percentage of the $19 billion should go to social housing, can you give me a ballpark of what that would be?

Maintaining the status quo would be $2 billion a year. So if the federal government is going to renew its leadership in housing, and reinvigorate social housing system in the country, it's got to do more than the status quo.

In the wake of downloading the housing portfolio to the provinces since the 1990s, how, if at all, do you expect the new government to impact who's responsible for housing?

I don't imagine, and we would not be advocating for, a federal government to realign the housing responsibilities in the country. I think it's a bridge too far. It's not, I think, a realistic expectation that a federal government would look to make that kind of realignment.

I think what we're looking for is an acknowledgement from the federal government that municipalities are a key player in this, and if we're going to solve this problem, the municipalities, the provinces and territories, and the federal government need to be together in a co-ordinated approach to program design and implementation.

The other thing I would say is it's really important, if there is any further download to municipalities, that that downloading is accompanied by the appropriate resources. It so often happens where responsibility is downloaded and there's no commensurate resources to go with it. So municipalities are left having no choice but to add to their responsibility load without adding to their resource base. So it just stretches the property tax to even greater extremes than it already is.

What form would you like those resources to take? Would it come in grants or new taxing powers?

There isn't one strategy that fits all in terms of funding. So it would need to be a co-ordinated suite of tax incentives and direct funding, and maybe cost-sharing arrangements. It would be a very complicated mix that would involve some serious discussion with people who really understand all of the complexities of the housing system.

You have to think of this as a system. In a simplistic form, you've got the single family home, you've got rental, you've got social housing, and you've got the street. If you play with one part of the system, it's not going to be as effective as if you can come up with a broader set of initiatives that will impact the [whole] system in different ways.

Because you can imagine if a single family home is too expensive, then people go to rental. And that drives up the rental costs, reduces the accessibility to affordable rental, so then that pushes the low-income people into social housing, that increases the wait times and pushes people onto the street.

I don't think there's any question that the pain point that is most dramatic is in the rental market.

So if you made a change just to the rental market, would that benefit the whole system?

It would if the change enabled an increase in an availability of rental, particularly at the lower end of the affordability scale. What you can't do is think that you're going to isolate one thing and say that's going to fix the housing system.

So, for example, there's a lot of commentary about the value of the Housing First [social-service delivery model]. And Housing First is quite a viable model for helping get people off the street. It doesn't fix the housing crisis, it doesn't affect the rental system.

Would it be fair to say then, because low-income rental is in the middle of that continuum, that if you bolster the middle it affects both ends?

It's going to help, absolutely. So if there's a priority focus, it would be on social housing and the low-end rental.

Ideally, would you want changes beyond that?

Ideally you'd have a federal government that would understand the instruments to reduce housing costs for single-family homes as part of a suite that involves [incentives for] rental builds and improving the social housing stock.

[But] in the context of limited resources and limited capacity to affect the broad economic realities in the market, I would think incentivizing and developing low-cost and affordable rental units is probably the biggest bang for your buck.

Is there anything else municipalities would like from the federal government in terms of housing?

The partnership approach is the key.

What form would that take? For example, there used to be a minister responsible for urban affairs: would that be the kind of partnership you'd want?

No -- [but] it's not 'no, that's a bad idea.' The federal government, whatever they do, they're going to make a pronouncement about something that's important to them. They're going to put some resources on the table, and they're going to design a program to move those resources.

So for us it's important to be part of the mechanism that has a conversation about the volume of dollars, and most importantly the design of any kind of programming. It means convening tables with municipal officials, federal officials, provincial/territorial officials so that the design work that enables money to flow is done in a way that will maximize the benefits to the communities.

The partnership is kind of a two-prong thing: one is, it's the people who do this stuff on a daily basis working together to find solutions; and then it's the political conversation between our president or mayors, and the minister or the prime minister, that provides the political oversight that says, 'This is important, this is the direction we want to go, figure out how to do it.'