July 6, 1998
To:Community and Neighbourhood Services Committee
From:Commissioner of Community and Neighbourhood Services
Subject:Change in Funding Responsibility for Supportive Social Housing
Purpose:
1.To provide information about the reduction in City costs for social housing due to the Province's recent decision to
retain funding responsibility for supportive housing portfolios; and
2. To recommend policy positions on supportive housing costs which have not been retained by the Province.
Funding Source, Financial Implications and Impact Statement:
Retroactive to January 1, 1998, the cost of social housing portfolios which are 100% dedicated to supportive housing as
defined by the Ministry of Municipal Affairs and Housing are no longer the responsibility of municipalities.
For 1998, $266,278,406 was set aside in the City's budget for social housing costs. The province has estimated social
housing cost savings to the City for 1998 are $11,784,329, after being adjusted by GTA pooling. This means that the
base budget for social housing costs has been reduced for this year and all future years.
Recommendations:
It is recommended that:
- Council strongly endorse the Province's decision to retain funding responsibility for 100% dedicated supportive housing portfolios. This recognizes
that providing housing for people who need support to live independently is a Provincial concern and should be funded by the Province.
2.Council forward to the Minister of Municipal Affairs and Housing a request that:
(a)the province not pass on the housing cost of any unit which falls under the definition of supportive, even if it is
located within a mixed project or mixed portfolio; and
(b)the province expand its definition of supportive housing to include social housing provided for tenants who require
support to live independently in their unit, and that the additional housing costs incurred in housing special needs tenants
be paid for by the province.
3.The Commissioner of Community and Neighbourhood Services and the Chief Financial Officer report back on
reallocation of $11.7 million which was set aside in the 1998 City Operating Budget for Social Housing Costs, and is no
longer required due to the Province's decision to retain funding for 100% supportive housing portfolios. Potential uses
for this fund would include providing support for affordable housing demonstration projects.
Background:
The Social Housing Funding Act, 1997, provides legislative authority for the province to pass on its share of the cost of
social housing to municipalities. Starting January 1, 1998, the City of Toronto became responsible for paying an
equalized share of the total social housing cost of the Greater Toronto Area. The total cost estimate for the GTA is
$509,697,881, and the City's share is $266,278,406 (about 52%), which has been included in the 1998 operating budget.
On June 12, 1998, the Province announced that it would no longer require municipalities to assume the costs for
dedicated supportive housing and domiciliary hostels. For Toronto, this means that the previous cost estimate for social
housing has been reduced, retroactive to January 1, 1998. The City does not have any domiciliary hostels.
The province estimated social housing cost savings to the City of Toronto in 1998 at $11,784,329, after being adjusted
by GTA pooling. The actual amount of savings, before equalization, would have been about $19,695,185 (based on
analysis of May 1998 data from province), which reflects the higher amount of supportive housing provided in the City
as compared to the rest of the GTA.
Comments:
Retroactive to January 1, 1998, the province will pay 100% of the costs of dedicated supportive housing (i.e. the
housing subsidy costs in addition to the support programming costs) for certain projects. These costs will be paid to the
housing providers by the Ministry of Community and Social Services, or the Ministry of Health, depending upon the
type of supportive program in place. In addition, responsibility for administering the 100% dedicated supportive
portfolios will not be transferred to the municipality when social housing administration is transferred.
Information provided by the province indicates that the social housing costs for 31 portfolios in the City will be
uploaded, representing about 150 projects (about 2,000 units).
"Supportive" social housing is defined by the province as a situation whereby the tenant receives supports through a
program funded either by the Ministry of Community and Social Services or the Ministry of Health, and these supports
make it possible for the tenant to live independently within a unit provided under the social housing program.
Some examples of supportive housing include housing for tenants with developmental disabilities, people with mental
health problems, people with physical disabilities, people with HIV/AIDS, people with acquired brain injuries, troubled
youth, frail elderly individuals, people with addiction problems, and victims of family violence.
Domiciliary hostels are permanent residences for people with special needs. The domiciliary operators enter into
agreements with a municipality, and receive a per diem to provide residents with permanent accommodation and some
supports to daily living. Residents are people with special needs, including individuals with developmental disabilities,
people with mental health problems, frail elderly individuals, and people with addiction problems. Unlike emergency
hostels, domiciliary hostels are permanent homes for their residents. The City of Toronto does not have domiciliary
hostels.
Types of Supportive Housing to be Uploaded
- Supportive Housing Definition
The definition of what constitutes a "supportive" unit for uploading is very restricted. It only includes units in 100%
dedicated portfolios, where the unit is linked to funding under program initiatives of the Ministry of Health and the
Ministry of Community and Social Services in six existing program areas:
Ministry of Health
- Long Term Care
- Substance Abuse
- Community Mental Health
Ministry of Community and Social Services
- Development Services (developmental disabilities)
- Youth Housing
- Stage 1 Shelters (Women's shelters)
Funding for social housing where the tenants require support programs which do not fall within those program areas
will remain with the City. For example, social housing costs for Stage II shelters for victims of family violence will
continue to be passed on to the City. Other social housing costs where funding was given to housing provider to carry
out support programs (called "enhanced management") will also continue to be funded by the City (approximately $600
per unit per year was permitted in 1997). Even where the cost of support programming is not linked directly to a unit (for
example, the support is provided directly to the tenant by a community agency) there can be substantive housing costs.
For example, in 1997 the Ontario Non-Profit Housing Association estimated that the cost of housing tenants with special
needs (in particular, the homeless and hard-to-house) was $1,436 for each unit per year in addition to the base
manageable cost per unit ($2,000). We know that MTHA, for example, has thousands of units which house special need
tenants and, therefore, have higher housing costs; however, only a fraction of those units receive funding under one of
the programs mentioned above, and none of the housing costs are being retained by the province.
This report recommends that the province extend its definition of supportive housing to include the additional housing
costs incurred in housing special needs tenants, and that the province pay those additional costs. Staff are doing research
to determine the number of units which fall outside of the provincial uploading definition and a cost estimate.
- 100% Dedicated Portfolios Only
Social housing is managed by non-profit groups on a portfolio basis. This means that one or more projects (buildings)
are grouped together under an operating agreement with the province. Subsidy payments are given to the group each
month; the group decides how to allocate the funding among the various projects in its portfolio.
The province will upload some, but not all, of the costs of supportive housing. The specific projects to be uploaded must
be part of a portfolio that is 100% dedicated to support; in other words, every unit and project in the portfolio would
need to be receiving funding under one of the provincial programs noted earlier in order for the costs to be uploaded. The
reason given for this restriction is because the operating agreements between the province and the non-profit housing
providers are not being changed and, therefore, the administration of 100% supportive projects cannot be separated out
from mixed portfolios. Therefore, for groups with portfolios that include a mix of supportive and non-supportive
buildings or units, the entire cost of social housing will remain with the municipality.
For example, the Metro YWCA has one building that is a women's shelter, and two other projects which are not
considered "supportive" under the uploading definition. The City will continue to pay the province's share of costs for
the women's shelter, even though if it had not been in a mixed portfolio, the province would have paid the shelter costs.
Further data and analysis is required to determine how many units and projects would fall under the uploading
definition of supportive but, because they are within a mixed portfolio, will continue to be funded by the City.
This report recommends that Council ask the province to pay the social housing costs of all supportive housing units
and projects, regardless of the characteristics of the portfolio. It is recognized that operating agreements, administration
standards and cost allocation must be taken into consideration:
Operating Agreements
If the province were to agree to pay for supportive housing costs (i.e. not pass on the cost to municipalities) this would
simply change a funding source and, therefore, should not require an amendment to operating agreements.
Administration Standards
Administrative standards for 100% dedicated portfolios will likely change if administration, as well as funding
responsibility, is transferred to the Ministries of Health or Community and Social Services. This may allow those
ministries, if they so choose, to streamline support funding and administration. Changing the way that portfolios are
administered would likely require changes to operating agreements.
For mixed portfolios, which the City continues to pay for, the Ministry of Municipal Affairs and Housing has advised
they will be announcing a process to develop standards for supportive housing units within the next few weeks. No
further information about this process is currently available.
Calculation of Costs
The subsidy amount is totalled for all projects in a portfolio and given to the housing provider in a monthly lump sum.
The housing provider determines how to allocate funding among the various projects within the portfolio. Therefore, the
exact cost estimates for any one project within a portfolio are unknown.
In order to determine what amount of funding the province should continue to pay for mixed portfolios, an allocation
method will be required. Although there are numerous ways in which costs can be allocated, we suggest allocation based
on the proportional share of units in the portfolio. This method could be applied to dedicated projects and integrated
projects (less than 100% of units in the project are supportive). For example, the Y.W.C.A. has three projects with a total
of 118 units and estimated 1998 municipal costs of just over $1 M. The women's shelter is 100% supportive and has 25
units (21% of all units in the portfolio). Using the method suggested for allocating costs, this would mean that the
province would reduce costs passed on to the City by $210,000 in 1998 (21% x $1,000,000).
Re-allocation of Supportive Housing Funding in City Budget:
As a result of the province's decision to upload costs for supportive housing, the City budget for social housing can now
be reduced. This report recommends that staff report back on how this funding may be re-allocated, including having a
portion of the savings used to support affordable housing demonstration projects.
Municipal Strategy for Affordable Housing
On July 6, 1998, staff will be reporting to the Council Strategy Committee for People Without Homes on a Municipal
Strategy for Creating Affordable Housing. The purpose of the report is to highlight how the City can lever its resources
to create an environment which supports affordable housing development. One area to be researched is establishing a
housing trust fund, with a dedicated revenue stream, to be used for affordable housing.
The former City of Toronto had a Capital Leverage Fund that provided one-time grants and no-interest loans to support
the development of community facilities serving the homeless. The fund contained $1.4M in total that was allocated
through an open proposal call process, with the specific objective of leveraging community action and resources. No
ongoing operating funding is provided through the fund. Two projects under development with support from the Capital
Leverage Fund are 30 St. Lawrence (permanent housing for 40 homeless men and women) and 11 Ordnance Street
(transitional shelter/housing project for up to 50 street youth). This experience shows that strategic, one-time funding can
be used to create effective community partnerships.
An additional report is being made to the Council Strategy Committee for People Without Homes recommending that
the City support three affordable housing demonstration projects. It is anticipated that some level of financial assistance
from the City will be needed in order for these projects to be developed. The former City of Toronto's Capital Leverage
Fund is currently fully committed. This report recommends that the Commissioner of Community and Neighbourhood
Services and the Chief Financial Officer report back on how the $11.7 million funding may be re-allocated, including
having a portion of the savings used to support affordable housing demonstration projects.
Conclusion:
The budget for 1998 social housing costs was set at $266,278,406 and can now be reduced by $11,784,329 as a result of
the province uploading the cost of 100% supportive housing portfolios, retroactive to January 1, 1998.
As the $11.7 M was originally set aside for social housing, we request that staff report back on how the funding may be
re-allocated, including having a portion of the savings used to support affordable housing projects.
In addition, the province will not pay the cost of projects which are part of a mixed portfolio, even when the units are
100% dedicated to supportive housing. Had these 100% dedicated projects been developed under their own operating
agreement, the province would now be paying their costs rather than the City. Therefore, this report recommends that the
City ask the Province to not pass on the cost of any project which is 100% dedicated, regardless of the characteristics of
its portfolio.
Contact Name:
Joanne Campbell
Phone: 392-6135
Fax: 392-3037
Joanne Campbell
Interim Functional Lead for Housing
Shirley Hoy
Commissioner of Community & Neighbourhood Services
