July 14, 1999

To:Policy and Finance Committee

From:City Clerk

Subject:Redirection of Emergency Hostel Funding

Recommendation:

The Community Services Committee on July 14, 1999, recommended to the Policy and Finance Committee the adoption of the report dated June 28, 1999, from the Commissioner of Community and Neighbourhood Services respecting the Redirection of Emergency Hostel Funding.

City Clerk

R. Dyers/tl

Item No. 11

(Report dated June 28, 1999, addressed to the

Community Services Committee from the

Commissioner of Community and Neighbourhood Services)

Purpose:

This report provides information on the Provincial Redirection of Emergency Hostel Funding Initiative (REHF) which was announced in March. The report seeks approval for gross expenditures of up to $2.5 million during the last half of 1999 for a cost to the City of $500,000.00 representing the 20 percent cost-sharing required for this program.

Funding Sources, Financial Implications and Impact Statement:

The Redirection of Emergency Hostel Funding Initiative will allow municipalities, during their 1999 operating year, to spend an amount up to 15 percent of 1998 actual emergency hostel costs for innovative prevention programs that will reduce emergency hostel use. Eligible 1998 operating expenses in Toronto, as calculated by the Ministry of Community and Social Services, total $50.28million for a maximum of $7.54 million allowable for the redirection initiative. The funding is to be cost-shared 80/20 provincial/municipal. The annualized City share of the total fund would be $1.51 million.

The announcement of this program was made on March 23 of this year. City staff have only recently finalized administrative and funding details with the Province. Given these time frames, and the Province's requirement to receive detailed business plans prior to releasing the money, staff estimate expenditures of $2.5 million gross for a 1999 cost to the City of $500,000.00. This money is not currently included in the 1999 budget and will be covered through Departmental underspending. This initiative is funded with "new" money and the funding envelope for emergency shelter beds will not be reduced by the Province in 1999.

It is anticipated that new programs funded through this initiative will eventually be successful in slowing growth in or reducing expenditures on shelters. Due to a time lag between program expenditures and savings realized, staff are projecting savings from emergency hostel funding of $100,000.00 in 1999. Provincial requirements are that once the program is fully operational, funded projects must result in dollar for dollar savings from the emergency shelter funding envelope. Thus in the year 2000 and beyond savings will, at a minimum, equal expenditures and there will be zero net cost to the City.

Recommendations:

It is recommended that:

(1)Council approve the expenditure of up to $2.5 million gross on the Redirection of Emergency Hostel Funding Initiative during last six months of 1999 which represents a cost to the City of $500,000.00 which will be partially offset by projected savings of $100,000.00 for a final net cost of $400,000.00 to be funded through Departmental underspending;

(2)the City seek provincial approval for funding of Project Going Home and the expansion of the Housing Contacts program through the Redirection Initiative;

(3)based on consultation with emergency shelter operators and other community agencies, the Commissioner of Community and Neighbourhood Services be authorized to select the other programs which meet program criteria and the needs of the City of Toronto, and within the funding limits established submit the necessary business plans to the Ministry of Community and Social Services seeking approval;

(4)this report be referred to the Policy and Finance Committee for their consideration; and

(5)the appropriate City officials be authorized to take the necessary action to give effect thereto.

Council Reference/Background/History:

On June 17, 1999, the Community Services Committee approved a report on the City of Toronto Homeless Initiatives Fund. This report briefly described the Hostel Redirection Initiative and indicated that a further report would be brought forward detailing this initiative.

Comments and/or Discussion and/or Justification:

REHF Program Overview:

On March 23, 1999, the Province announced a number of funding initiatives related to homelessness. One of these was the Redirection of Emergency Hostel Funding (REHF). The objectives of this program, as described by the Province are to:

(1)change the culture and practice of service delivery to the homeless from short-term emergency use to more effective responses of prevention and early identification, which will help people find and keep stable living situations; and

(2)to develop an opportunity for creative and innovative approaches to service delivery.

This initiative will allow municipalities currently providing emergency shelter services to spend up to 15 percent of their hostel funding on innovative prevention programs with the goal of reducing emergency hostel use.

The objectives of this program are to move people from emergency to permanent accommodation, or to help people maintain or obtain permanent accommodation without having to use emergency shelters. Only new programs are eligible for funding under this envelope; however, the Province has made it clear that the intention is not to create a new layer of service, but to expand existing resources or facilitate connections with programs already in the community.

Municipalities will be expected to submit detailed business plans for each program that they wish to fund. These business plans will need to demonstrate that the redirection of funding will reduce current or anticipated emergency hostel use and costs. In the business plans, municipalities will have to set service target outcomes/measures that will demonstrate that objectives and savings have been achieved. Suggested outcomes include:

(1)a reduction in the rate of growth, no growth or a reduction in the number of emergency shelter beds;

(2)a reduction in the average length of stay; and

(3)a reduction in the cost per unit of service.

Provincial expectations are that there will be at least dollar for dollar cost savings in current or anticipated emergency hostel use.

Municipalities will be expected to report to the Province six months after the start of the program. The Province will review targets and expenditures at this time. After this initial review, reporting and monitoring will be done on a quarterly basis. If, at any of these reviews, anticipated outcomes have not been achieved, municipalities will be expected to redesign their strategy and business plan. It is also possible that funding for this particular initiative could be withdrawn. It is acknowledged at both the provincial and the City level that this is a new method of funding and monitoring a program. Staff from both governments will be working in partnership to ensure that the program is successful.

It is clear that this initiative will make it possible to fund projects which have not previously fit within the funding and program guidelines of the City or the Province. However, City staff have already met with provincial staff to indicate their concern that the lack of affordable, adequate housing stock in the City of Toronto may make it a challenge to meet the program objective of assisting people in moving into permanent housing.

Funding:

In Toronto, the annualized funding envelope eligible for redirection is $7.54 million. This represents 15 percent of $50.28 million, which is the Ministry calculated figure of eligible 1998 expenses. This does not represent the entire budget expenditure for Hostel Services in 1998 as the provincial calculation allows only for the maximum $34.50 expenditure per night of bed care as opposed to the actual per-diem in the City of Toronto of $40.99. Additionally, the City of Toronto funds other programs through Hostel Services, such as Habitat Services, that would not be considered as eligible expenses.

The expectation of the Province is that the city would provide 20 percent cost-sharing in this program. On an annualized basis, the City's share would be $1.51 million. Due to the timing of the Province's announcement and administrative requirements, the City would not be able to expend the full amount available this year. Staff are projecting that gross expenditures on the project in 1999 would be $2.5 million, with the City's cost-sharing being $500,000.00.

These funds are not currently included in the 1999 Shelter, Housing and Support budget and will be funded through Departmental underspending. The intent of the program, however, is to reduce or slow the increase of expenditures on emergency shelter beds. Staff are anticipating that some projects, if approved by the Province, will result in a $100,000.00 reduction in expenditures on emergency shelter beds during 1999. As noted before, provincial program guidelines require that dollar for dollar savings be realized in order for funding to continue. As such, in the year 2000 and beyond expenditures through the REHF must produce equal savings in expenditures on emergency shelter beds resulting in a zero net cost to the City.

Funds from this initiative cannot be used to replace existing municipal expenditures. However, neither does the creation of this fund reduce the Provincial emergency shelter funding envelope available to Toronto during the 1999 .

Selecting Program for the REHF:

New Programs - On June 24, 1999, City staff met with the managers of hostels funded or directly operated by the City of Toronto. Staff briefed managers on the REHF and sought input from the providers regarding initiatives they feel would assist them in helping people move out of hostels or avoid hostel use. Many ideas were generated through this meeting with shelter operators consistently indicating that they need staff resources who are dedicated to assisting people in their housing search and to providing support and follow-up to residents once they have reestablished in the community. The ideas generated through this process will form the basis for the City's proposal to the Ministry. Staff will be following up with a reference group of shelter operators to refine the proposals and will also follow up with individual agencies to establish targets and develop business plans.

Existing programs - There are two programs already in operation in the City that staff feel should be eligible for funding. The first is Project Going Home. This project assists hostel residents in returning to their home community outside of Toronto if they so wish and it is clearly in their best interest. The program is entirely voluntary and individuals are only assisted if staff are able to confirm a permanent address in the home community. During the first year, approximately 113 people were assisted to return home. As of April of this year, the City contracted with a community agency to operate this service. Staff are projecting that up to 1,000 people may be helped by the end of 1999.

The second project for which staff will be seeking funding is Housing Contacts. This program, directly operated by City staff, assists families in finding permanent accommodation outside of the City of Toronto. Seven-hundred and forty people were assisted during 1998. This response to this project is significant and staff are hoping to expand operations to be able to serve an additional 260 people in 1999. Staff will be seeking funding through the REHF for the expansion of this program. An approach will also be made to the Province to make the existing program expenditures eligible for funding. It does not seem reasonable that a project that clearly meets the criteria of the redirect initiative would be ineligible simply because the City was proactive and initiated the project in 1998.

Conclusions:

The Redirection of Emergency Hostel Funding Initiative presents an opportunity for the City and its community partners to develop new programs that will assist individuals and families to leave the emergency shelter system for permanent housing. While the method of funding and monitoring this program is new, both City and Provincial staff are committed to making the project work. The City will be expected to cost-share 20 percent in the funding of this project, however the intent of the program is to reduce or slow the growth of expenditures on emergency shelter beds and staff are expecting savings of $100,000.00 to be generated through this program. Thus the total net expenditure would be $400,000.00 for the last half of 1999 that will be funded through Departmental underspending.

Contact Name:

Joanne Campbell

General Manager of Shelter, Housing and Support Division

Tel: 392-7885