January 10, 2000

To: Community Services Committee

From: Commissioner of Community and Neighbourhood Services

Subject: Implementation of Tenant Defence Fund and Rental Housing Office

Purpose:

To set out guidelines for funding under the Tenant Defence Fund and to update Council on establishment of a Rental Housing Office.

Financial Implications:

Funding for the Tenant Defence Fund initiative was approved at the November 23-25, 1999 Council meeting for a total budget of $300,000.

Recommendations:

It is recommended that:

1. Council approve the structure for the Tenant Defence Fund Program, within the total approved budget of $300,000, as outlined in Appendix A and including:

a) Purchase of outreach and coordinating services at a cost of up to $150,000; and

b) Grants to tenants groups' disputing applications for above-guideline rent increases using the remaining budget.

2. Council approve a Tenant Support Grants Program as set out in Appendix C and delegate the administration of Tenant Support Grants to the Commissioner of Community and Neighbourhood Services.

3. The Tenant Support Grants be deemed to be in the interest of the municipality.

4. Council authorize the introduction of any necessary bills to give effect hereto.

5. The Subcommittee to Restore Rent Control be renamed as the "Tenant Support Subcommittee" and its mandate be revised to provide direction to the Tenant Defence Fund initiative.

6. The Chair of the Subcommittee to Restore Rent Control canvass existing members of the Subcommittee, and report back on a revised terms of reference and membership of the new Tenant Support Subcommittee.

7. The appropriate City Officials be directed to take the necessary action to give effect thereto.

Background:

On November 23-25, 1999, City Council took a number of actions to support tenants, including:

- Establishing a Tenant Defence Fund of $300,000 to help tenants dispute applications for "above-guideline rent increases" (AGI's) at the Ontario Rental Housing Tribunal;

- expanding of the Tenant Hotline Service funded by the City as of July 1, 2000; and

- setting up a Rental Housing Office to co-ordinate and develop information and advisory services for tenants.

This report responds to a request made by the Community Services Committee on November 4, 1999 that staff prepare a report on a process for issuing grants through the Tenant Defence Fund.

This report also addresses the following requests made by Council on November 23-25:

- that staff report on options for a six month temporary expansion of the existing eviction hotline provided by the Federation of Metro Tenants' Associations; and

- that staff report on the feasibility of establishing a Rental Housing Office in each of the four districts.

Comments:

Design of the Tenant Defence Fund

Over the past few weeks, staff have consulted various parties, including those who developed the original Tenant Defence Fund proposal and a recently revised model, representatives of Legal Aid, the Federation of Metro Tenants' Associations, agents who have represented tenants at the Tribunal, Housing Help Centres and Tribunal staff. These discussions have focused on minor differences between the model proposed by staff and the revised model put forward by the Subcommittee to Restore Rent Control in November of 1999.

Based on these discussions, we have concluded that the following objectives should help guide the design of the Tenant Defence Fund Program:

a) Provide a Range of Services to Assist Tenants Disputing AGI's - There is consensus on the key functions of the program, which include: outreach/organizing of tenants; pre-hearing support/representation at the Tribunal; and provision of professional expertise (e.g. expert witnesses at hearings).

b) Minimize Potential Liability to the City - Legal staff have advised against having City staff, or agencies contracted by the City, provide "advice" to tenants or represent tenants at the Tribunal. To limit potential liability the City can use its granting powers to ensure tenants have effective advice and representation and use a purchase of service arrangement for other non-advisory support (e.g. outreach, information and organizing services).

c) Grants to Tenants' Groups Should be Timely and Effective - There is consensus that grants should be relatively modest (i.e. a basic grant of up to $1,000 to help cover the costs of representation; grants of up to $5,000 for professional/engineering expertise) and the criteria straightforward, so that a larger number of tenants' groups can benefit from the limited funds available and City funding will not replace other funding sources (e.g. Legal Aid, or fundraising). Legal staff have advised that the administration of a grant program approved by Council can be delegated to staff if the discretionary policy decisions regarding the amounts of the grants and the eligibility requirements for such grants are approved by Council.

Proposed Model

Taking these factors into account, we propose the model shown in Appendix A. The model outlines the functions of the Tenant Defence Fund as well as the new Rental Housing Office. The Tenant Defence Fund will provide direct and indirect support to tenants facing above-guideline rent increase applications. The Rental Housing Office will provide support to the tenant sector as a whole on broader issues and also be a resource to Councillors in dealing with tenant/landlord issues.

The following components are included in the model:

1) Outreach/Coordinating Team - An outreach/coordinating team is now being selected via a proposal call process. In the interest of time, an RFP has already been issued for the purchase of these services, and will close in late January. Appendix B provides a detailed listing of the services to be provided by the successful proponent. Once Council has confirmed the overall structure of the program on February 1-3, a contract will be signed with the selected proponent.

2) Tenant Support Grants - Appendix C provides detailed criteria for the grant program. We have taken into account the advice of Legal staff that only the administration of grants can be delegated to staff and that such a delegation requires the approval by Council of the grants program including clear, concise eligibility criteria so that staff are merely administering the program by processing applications.

3) Rental Housing Office - At the November, 1999 meeting, Council requested that new Rental Housing Office be up and running as of January, 2000. The Rental Housing Office is being initially established with a staff person, a phone line/referral service , and a web page on the City's internet site. As Council has requested, a Rental Housing Advisory Committee is also being established, consisting of representatives of tenant organizations, Legal Aid, housing help centres, various City departments and Councillors' offices, and it will meet for the first time in January.

We propose that a committee of four councillors be established to advise Council and staff on management of the Tenant Defence Fund Initiative. The committee would receive regular updates from the Outreach/Coordinating Team and staff on program activities, and help evaluate success of the initiative after six months and one year. We suggest that the mandate of the existing Subcommittee to Restore Rent Control be revised to serve this purpose.

Staff were also asked to report on the feasibility of establishing a Rental Housing Office in each of the four districts of the City. As the Shelter, Housing and Support Division has no regional structure, there is no framework in place to provide direct service in each of the districts. However, the Division's approach with all programs is to work with existing community-based agencies to deliver services wherever feasible. Thus the capacity of local agencies to provide service is enhanced, and services can often be provided at lower cost. We would propose that, as the functions of the Rental Housing Office are developed in the coming months, the Rental Housing Advisory Committee be consulted on the best way to provide such services at the local level. We would recommend against creating a district structure for the Rental Housing Office at this early stage, given the significant expense involved and the fact that the functions of the Office have not yet been clearly defined.

Temporary Expansion of the Eviction Hotline

On November 23-25, staff were asked to suggest options for expanding the evictions hotline (operated by the Federation of Metro Tenants' Associations) on a temporary basis for six months, pending the results of the RFP for the new hotline service.

Two reviews of tenant information and advisory services were carried out in 1999. The first created an inventory of the community services available to tenants and identified gaps to be filled by the City and others. These include suggested improvements to Legal Aid services, extension of an early intervention eviction prevention program, better information materials, and expansion of the Tenant Hotline service. A second review looked specifically at the Tenant Hotline service provided by the Federation of Metro Tenants' Associations (FMTA) and the organizational capacity of the FMTA to deliver it. While this review concluded that the Hotline should receive more funding (to meet the standards set by the City), the City auditor has recommended that a Request for Proposals for this service be issued to the community. The new service will not commence until July 1, 2000 in order to give the FMTA time to address its governance issues and to participate in the RFP. In the interim, Council has approved an extension of the FMTA service contract for the Tenant Hotline to June 30, 2000 at the current level of funding.

In addition to the Tenant Hotline, the FMTA operates an eviction hotline which is not specifically included in the service agreement with the City. The service review suggested that the FMTA should hire more staff and make improvements to its phone system so that both lines could be combined and the service be made more accessible and efficient. The RFP process will be designed to accomplish these objectives, but through a process which allows other community agencies to bid on the service. Consequently, we would advise against providing expanded funding to the FMTA for hotline services in the interim period prior to July 1, 2000 as it would compromise the RFP process.

Conclusion:

This report has proposed guidelines for management of the new Tenant Defence Fund. This initiative will provide outreach and coordinating support, as well as financial assistance to tenants groups that are disputing above-guideline rent increase applications at the Ontario Rental Housing Tribunal. Staff have also taken steps to establish a Rental Housing Office and a Rental Housing Advisory Committee to provide support to the tenant sector as a whole.

Contact Name:

Derek Ballantyne

Acting General Manager, Shelter Housing & Support

Tel: 392-7885

Fax: 392-0548

Shirley Hoy

Commissioner, Community & Neighbourhood Services

APPENDIX A

PROPOSED MODEL

TENANT DEFENCE FUND: To support tenants who are disputing above guideline rent increase applications

TENANT SUPPORT COMMITTEE

outreach $ for representation

organizing $ for experts

support

TENANTS' GROUPS

support agencies

who support tenants

APPENDIX B

SERVICES OF OUTREACH/COORDINATING TEAM

The goal of this component is to ensure tenants have the means and information they need to get organized, obtain necessary legal and/or technical assistance and participate effectively in the dispute process before the Ontario Rental Housing Tribunal. The community organization to be selected will act as an "Outreach/Coordinating Team" and develop and implement a program to provide the following essential services and assistance to tenants (these have been included in the RFP already issued to the community):

(a) Undertake Tenant Outreach and Education Activities, which include:

· Contact tenants in all buildings where landlords have applied for above-guideline rent increases ("Applications")

· Develop and gather information materials pertaining to the Tribunal's dispute resolution process and the Tribunal's procedures (e.g. a step-to-step guide) for distribution to tenants/tenant groups

· Develop and deliver workshops for tenant groups about the dispute resolution process and procedures, and how to organize (e.g. basic information about notices of meetings, setting up a bank account) in conjunction with legal clinics, housing help centres and tenant service organizations

(c) Review Pending Applications before the Tribunal, including:

· Request and obtain Tribunal data about Applications which have not been scheduled or have not yet been heard by the Tribunal

· Identify Applications which could be precedent-setting (e.g. relating to municipal interest in preserving affordable rental housing stock) and "test cases", and bring such Applications to the attention of the City and the Housing Specialty Clinic to be established by Legal Aid Ontario and provide rationale for selecting the precedent-setting or test cases

· Monitor and analyze with City staff the outcome of the Applications to evaluate the effectiveness of proposed strategies and to assess trends of Tribunal decisions

(d) Provide Assistance for Tenants Organizing to Dispute Applications, including:

· Facilitate tenants' meetings regarding Applications and related issues such as organizing and fundraising

· Assist tenants in obtaining meeting/office space

· Arrange to obtain, and cover costs of photocopying Tribunal's file regarding the Application where necessary

· Provide general information about how to review landlords' application files and how to prepare a response to the landlord's Application

· Inform tenant groups of options for representation, e.g. self-representation or retaining a lawyer or other agent (Note: The Team shall not represent tenants at the Tribunal or recommend particular lawyers or agents)

· Encourage, wherever possible, communication and negotiation between tenants and landlords

· Coordinate with community agencies and refer tenants to their services

· Assist tenant groups in applying for and securing Legal Aid where possible

· Provide information about the City's Tenant Support Grants. Details of the Program will be considered by City Council in January 2000.

· Determine whether an Application is so technically complex that professional technical expertise would be helpful. If so, inform the tenants' group and advise the City that the tenants' group may be a suitable candidate for an Additional Grant under the Tenant Support Grants Program.

(g) Produce Reports on:

· Detailed program activities

· Analysis and evaluation of results of the Applications involved in this program in relation to the activities and strategies undertaken

· Recommendations for improvements to the Tenant Defence Fund Program and strategies, including all forms of assistance to tenant groups dealing with Applications

(c) Provide advice to City staff with respect to eligibility of specific tenant groups for assistance under the Tenant Support Grants Program.

APPENDIX C

GUIDELINES FOR Tenant Support Grants

Objective: to provide financial assistance in the form of grants to tenant groups who wish to dispute their landlords' application for an above-guideline rent increase under the Tenant Protection Act.

Total Budget: $150,000

Tenant Support Grant Program

The Tenant Support Grant Program consists of the following two grants programs:

A. Basic Grant Program: $75,000 (maximum $1,000 per grant)

1. (a) Upon receipt of a Basic Grant Application from a tenant group in accordance with paragraph 4, the Commissioner of Community and Neighbourhood Services (the "Commissioner") will assess eligibility for Basic Grants in accordance with this Basic Grant Program.

(b) Basic Grant will be committed by the Commissioner to Eligible Groups on a first-come, first-served basis. When Basic Grants in the total amount of $75,000 have been committed by the Commissioner, no further tenant groups will be eligible to receive Basic Grants under the Basic Grant Program.

(c) Each eligible tenant group (the "Eligible Group") will be eligible for a Basic Grant in the amount of their Eligible Expenditures, up to the maximum amounts for each Eligible Expenditure set out in paragraph 2, and up to a total maximum amount of $1,000.00.

(d) Upon receipt by the Commissioner of the Basic Grant Report in accordance with paragraph 5 from an Eligible Group to whom a Basic Grant has been committed, the Commissioner shall pay to the Eligible Group a Basic Grant in the lesser amount of :

· the Basic Grant commitment approved by the Commissioner under paragraph 1(b); and

· the amount of Eligible Expenditures for which invoices are provided in accordance with paragraph 5.

2. Eligible Expenditures: The following expenditures are Eligible Expenditures, and the following corresponding amounts are the maximum amounts that any Eligible Group will be allocated with respect to that Eligible Expenditure:

Eligible Expenditure Maximum Amount

Cost of hiring a qualified agent and/or lawyer $1,000.00

to represent the Eligible Group at the Tribunal

Cost of renting meeting and/or office space $100.00

Printing and production costs, cost of postage, $500.00 (combined total)

cost of translation and interpretation services

Cost of photocopying the Tribunal's file $200.00

regarding the landlord's Application

3. Eligible Groups: A tenant group is eligible for a Basic Grant in the amount set out in paragraph 1, if it meets the following criteria:

(a) The landlord has filed an application for an above-guideline rent increase (the "Application");

(b) The Application does not relate to rent-geared-to-income units;

(c) Only one tenant group will be eligible for each residential building for which the landlord has filed an Application, and only the first such group from that building to apply for a grant will be eligible;

(d) The tenant group has the support of the following number of tenants in disputing the Application:

· if less than 100 units are affected by the Landlord's Application - 50% of the tenants residing in the affected units at the time the Basic Grant Application is made; and

· if 100 or more units are affected by the Landlord's Application - 33% of the tenants residing in the affected units at the time the Basic Grant Application is made;

(e) The following number of units in the building have a current rent at or below average rents for the City of Toronto based on the 1999 CMHC Rental Market Survey (i.e. $626 for a bachelor, $772 for a one-bedroom, $924 for a two-bedroom, and $1,099 for a three-bedroom unit):

· if less than 100 units are affected by the landlord's Application - 50% of the affected units; and

· if 100 or more units are affected by the landlord's Application - 33% of the affected units;

(f) The tenant group has submitted to the Commissioner a Basic Grant Application in accordance with paragraph 4, and a Basic Grant Report in accordance with paragraph 5.

4. Basic Grant Application: Each Eligible Group must submit a Basic Grant Application in a form satisfactory to the Commissioner, and such Basic Grant Application must be accompanied by the following documentation:

(a) A petition in favour of disputing the Application signed by the following number of tenants, stating the name of each signing tenant and an acknowledgement by each signing tenant that the rent he or she currently pays to the landlord is at or below the amount set out in paragraph 3(e) above:

· if less than 100 units are affected by the landlord's Application - 50% of the tenants residing in the affected units at the time the Basic Grant Application is made; and

· if 100 or more units are affected by the landlord's Application - 33% of the tenants residing in the affected units at the time the Basic Grant Application is made;

(b) Copies of the Notices of Rent Increase or Notices of Hearing relating to the Application served by the landlord on each of the tenants who have signed the petition in paragraph 4(a) above;

(c) A synopsis of the tenant group's reasons for disputing the Application; and

(d) An estimate of the amount of Eligible Expenditures that the Eligible Group expects to incur.

5. Basic Grant Report: Within three months of the disposition, other than appeals, of the Application, each Eligible Group to whom a Basic Grant has been allocated, must submit to the Commissioner a Basic Grant Report in a form satisfactory to the Commissioner, and such Basic Grant Report must be accompanied by the following:

(a) An order of the Tribunal, in which the Eligible Group is not noted in default; and

(b) Invoices for each of the Eligible Expenditures incurred by the Eligible Group.

B. Additional Grant Program: $75,000 (maximum $5,000 per grant)

1. (a) Upon receipt of an Additional Grant Application from a tenant group in accordance with paragraph 4, the Commissioner of Community and Neighbourhood Services (the "Commissioner") will assess eligibility for Additional Grants in accordance with this Additional Grant Program.

(b) Additional Grants will be committed by the Commissioner to Eligible Groups on a first-come, first-served basis. When Additional Grants in the total amount of $75,000 have been committed by the Commissioner, no further tenant groups will be eligible to receive Additional Grants under the Additional Grant Program.

(c) Each Eligible Group will be eligible for an Additional Grant in the amount of their Eligible Expenditures up to a total maximum amount of $5,000.00.

(d) Upon receipt by the Commissioner of the Additional Grant Report in accordance with paragraph 5 from an Eligible Group to whom an Additional Grant has been committed, the Commissioner shall pay to the Eligible Group an Additional Grant in the lesser amount of :

· the Additional Grant commitment approved by the Commissioner under paragraph 1(b); and

· the amount of Eligible Expenditures for which invoices are provided in accordance with paragraph 5.

2. Eligible Expenditures: Eligible Expenditures are the cost of Eligible Professional Services to assist with disputing an Application.

Eligible Professional Services are the services of a professional engineer, architect or forensic accountant who is registered with the regulating professional body of his/her profession (the "Eligible Professional").

3. Eligible Groups: A tenant group is eligible for an Additional Grant in the amount set out in paragraph 1, if it meets the following criteria:

(a) The landlord has filed an Application;

(b) The Application does not relate to rent-geared-to-income units;

(c) Only one tenant group will be eligible for each residential building for which the landlord has filed an Application, and only the first such group from that building to apply for a grant will be eligible;

(d) The tenant group has the support of the following number of tenants in disputing the Application:

· if less than 100 units are affected by the landlord's Application - 50% of the tenants residing in the affected units at the time the Basic Grant Application is made; and

· if 100 or more units are affected by the landlord's Application - 33% of the tenants residing in the affected units at the time the Basic Grant Application is made;

(e) The following number of units in the building have a current rent at or below average rents based on the 1999 CMHC Rental Market Survey (i.e. $626 for a bachelor, $772 for a one-bedroom, $924 for a two-bedroom, and $1,099 for a three-bedroom unit):

· if less than 100 units are affected by the landlord's Application - 50% of the affected units; and

· if 100 or more units are affected by the landlord's Application - 33% of the affected units;

(f) The tenant group requires Eligible Professional Services; and

(g) The tenant group has submitted to the Commissioner an Additional Grant Application in accordance with paragraph 4, and an Additional Grant Report in accordance with paragraph 5.

4. Additional Grant Application: Each Eligible Group must submit an Additional Grant Application in a form satisfactory to the Commissioner, and such Additional Grant Application must be accompanied by the following documentation:

(a) A petition in favour of disputing the Application signed by the following number of tenants, stating the name of each signing tenant and an acknowledgement by each signing tenant that the rent he or she currently pays to the landlord is at or below the amounts set out in paragraph 3(e) above:

· if less than 100 units are affected by the Landlord's Application - 50% of the tenants residing in the affected units at the time the Basic Grant Application is made; and

· if 100 or more units are affected by the Landlord's Application - 33% of the tenants residing in the affected units at the time the Basic Grant Application is made;

(b) Copies of the Notices of Rent Increase or Notices of Hearing relating to the Application served by the landlord on each of the tenants who have signed the petition in paragraph 4(a) above;

(c) The Eligible Services required by the tenant group and the tenant group's reasons for requiring such Eligible Services;

(d) A statement from the Outreach/Coordinating Team, in a form acceptable to the Commissioner, that it is the Outreach/Coordinating Team's opinion that the Eligible Group would benefit from Eligible Professional Services and the nature of the Eligible Professional Services from which it would benefit;

(e) A quote from an Eligible Professional outlining the Eligible Professional Services to be provided to the Eligible Group and the estimated cost of such services; and

(f) The professional qualifications of the Eligible Professional and proof of his or her membership in the regulating professional body of his/her profession.

5. Additional Grant Report: Within three months of the disposition, other than appeals, of the Application, each Eligible Group to whom an Additional Grant has been allocated, must submit to the Commissioner an Additional Grant Report in a form satisfactory to the Commissioner, and such Additional Grant Report must be accompanied by the following:

(a) An order of the Tribunal, in which the Eligible Group is not noted in default; and

(b) Invoices for each of the Eligible Expenditures incurred by the Eligible Group.