Operating Agreements for City-Owned Buildings

Receiving Federal Funding Under the Residential

Rehabilitation Assistance Program

The Community Services Committee recommends the adoption of the following report (June 28, 1999) from the Commissioner of Community and Neighbourhood Services:

Purpose:

To seek authority to enter into operating agreements with the Canada Mortgage and Housing Corporation (CMHC) to accept funding for three City-owned properties (11 Ordnance Street, 349 George Street, and 156-158 Munro Street) under the Residential Rehabilitation Assistance Program (RRAP).

Funding Sources, Financial Implications and Impact Statement:

The RRAP program is funded by the Federal Government and administered by the City. Funding to the three City-owned properties is provided in the form of forgivable loans, to be secured by debentures issued by the City in favour of CMHC. Interest and principal payments associated with the debenture will be forgiven by CMHC provided that the City adheres to the terms and conditions of the operating agreements.

Recommendations:

It is recommended that:

(1)authority be granted to enter into operating agreements with the Canada Mortgage and Housing Corporation for receipt by the City of funding under the Residential Rehabilitation Assistance Program for the renovation of 11 Ordnance Street, 349 George Street, and 156-158 Munro Street, in a form satisfactory to the Commissioner of Community and Neighbourhood Services, the Chief Financial Officer and Treasurer, and the City Solicitor; and

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

Council Reference/Background/History:

At its meeting on April 13, 14 and 15, 1999, Council agreed to accept federal RRAP funding to upgrade three City-owned properties (11 Ordnance Street, 349 George Street and 156-158 Munro Street) as affordable housing. In order to implement this decision, two actions are required. Firstly, the City must enter into operating agreements with CMHC for the term of the RRAP loan for each property (as recommended in this report). Secondly, Council must adopt a debenture by-law (to be recommended in a separate report to Council from the Chief Financial Officer) to properly secure the loans.

The operating agreement generally stipulates that, in return for receipt of a forgivable loan, the City will provide housing/hostel accommodation at affordable rent levels determined by CMHC, based on median rent levels in Toronto. Previous reports to Council have addressed the affordable housing programs on the three sites: 11 Ordnance Street is a transitional youth accommodation/skills development project; 349 George Street is an existing transitional shelter for homeless men; and 156-158 Munro Street are two vacant semi-detached houses that are available for community agency use at nominal rent. CMHC has indicated that these projects meet their program requirements under RRAP. The terms and forgiveness periods of the loans, over which forgiveness would be earned, range from 8 to 15 years according to the following table.

Property AddressTerm of Agreement

11 Ordnance Street15 years

156-158 Munro Street15 years

349 George Street 8 years

It should be noted that consultations are underway with the local community on the housing program for 156-158 Munro Street and, should this project be modified or fail to proceed, staff will inform the Committee on or before July 14, 1999.

Contact Name:

Joanne Campbell

Tel: 392-7885/Fax: 392-0548