Change in Funding Responsibility for
Supportive Social Housing
The Community and Neighbourhood Services Committee recommends the adoption of
the following report (July 6, 1998) from the Commissioner of Community and
Neighbourhood Services:
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.
(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 percent
dedicated to supportive housing as defined by the Ministry of Municipal Affairs and
Housing are no longer the responsibility of municipalities.
For 1998, $266,278,406.00 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 $11,784,329.00,
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:
(1)Council strongly endorse the Province's decision to retain funding responsibility for
100percent 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; and
(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 percent 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 $509,697,881.00,
and the City's share is $266,278,406.00 (about 52 percent), 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
$11,784,329.00, after being adjusted by GTA pooling. The actual amount of savings, before
equalization, would have been about $19,695,185.00 (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 percent 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 percent
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:
(1)Supportive Housing Definition:
The definition of what constitutes a "supportive" unit for uploading is very restricted. It only
includes units in 100 percent 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; and
-Community Mental Health.
Ministry of Community and Social Services:
-Development Services (developmental disabilities);
-Youth Housing; and
-Stage I 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 a housing provider to carry out
support programs (called "enhanced management") will also continue to be funded by the
City (approximately $600.00 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
$1,436.00 for each unit per year in addition to the base manageable cost per unit
($2,000.00). 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.
(2)100 Percent 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 percent 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 percent 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 percent 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 percent 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
million. The women's shelter is 100 percent supportive and has 25 units (21 percent 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 $210,000.00 in 1998 (21 percent x
$1,000,000.00).
Reallocation 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 reallocated, 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 $1.4 million 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 reallocated, 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 $266,278,406.00 and can now be
reduced by $11,784,329.00 as a result of the Province uploading the cost of 100 percent
supportive housing portfolios, retroactive to January 1, 1998.
As the $11.7 million was originally set aside for social housing, we request that staff report
back on how the funding may be reallocated, 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 percent dedicated to supportive housing. Had these
100 percent 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 percent dedicated, regardless of the characteristics of its portfolio.
Contact Name:
Joanne Campbell
Tel: 392-6135/Fax: 392-3037