ADMINISTRATIVE REPORT

Date: May 29, 2000
Author/Local: Shirley Chan/Ray Stensrud/7437

RTS No. 01486

CC File No. 5104

Council: June 13, 2000

TO:	Vancouver City Council
FROM:	Director of Non-Market Operations in consultation with the Manager of Real Estate Services
SUBJECT:	59 Powell Street: Lease to the First United Church Mission, of the United Church of Canada

RECOMMENDATION

THAT Council approve a lease from the City of Vancouver Public Housing Corporation (the "Corporation") to the First United Church Mission, of the United Church of Canada (the "Church") for a portion of the main floor and a portion of the basement of the building at 59 Powell Street as shown in bold outline on Appendix A (the "Premises") (on file in the City Clerk's Office) on the following general terms and conditions:

Term: One year.

Commencement Date: January 1, 2000

Rent: $740.00 per month inclusive of the property taxes as if levied and of utilities other than electricity and telephone.

Renewal: Every year thereafter, subject to a six months' written notice of cancellation by either party.

Rent Review: The rent to be established each year by the Director of Non-Market Operations after consultation with B.C. Housing Management Commission ("BCHMC") and the Church.

Other Terms: Such other terms and conditions to be drawn to thesatisfaction of the Director of Non-Market Operations and Director of Legal Services; it being noted that no legal rights or obligations shall arise until execution of the lease.

Approval of this Lease constitutes a grant to the Church equivalent to $760 per month, and requires eight affirmative votes of Council.

GENERAL MANAGER'S COMMENTS

The General Manager of Community Services RECOMMENDS approval of the foregoing.

COUNCIL POLICY

The below market rent charged over the term represents a grant which requires eight affirmative votes of Council for approval.

PURPOSE

This report seeks Council's approval to lease the Premises to the Church under the general terms and conditions listed under RECOMMENDATION in this report.

BACKGROUND

The property, known as Alexander Residence, is owned by the Vancouver Public Housing Corporation (the "Corporation"), a wholly-owned subsidiary of the City. It provides 30 low rental housing units for the harder-to-house.

Since 1979, a portion of the main floor and a portion of the basement of the building (the "Premises") has been rented to the Church for a drop-in and counselling centre (known as the "Dugout") for downtown eastside residents. Their lease was terminated in 1992 when the City and BCHMC initiated renovations to the building. The Dugout moved to a temporary space; returning once the renovations were completed; and entered into a monthly lease with the Corporation under the auspices of the Church.

The new Premises, comprising a portion of the main floor (1472.76 sq. ft.) and a portion of the basement (376.48 sq. ft.), was leased to the Church on a monthly basis effective January 1, 1993 at $600.00 per month inclusive of property taxes as if levied and the monthly rent was reviewed every year since. The monthly rent was established by the Director of Non-Market Operations in consultation with BCHMC and the Church.

Staff consulted BCHMC prior to establishing the rental rate for the Dugout because the operating budget for the Alexander Residence, including the Dugout space, is subsidized by the Federal/Provincial Partnership (CMHC and BCHMC) with BCHMC as the active partner.

CURRENT SITUATION

The market rent for year 2000 is estimated to be $1,500.00 per month, inclusive of property taxes as if levied and of utilities other than electrical and telephone. Fortunately, BCHMC is prepared to subsidize a below-market rent of $740.00 per month, retroactive to January 1, 2000. As the Church is unable to pay even the reduced subsidized rent, City Council on March 28, 2000 approved a Community Services Rent Subsidy Grant of $8,880.00 ($740.00 per month for a year).

As the rent charged the Church is $760.00 per month below market, this constitutes a grant which requires eight affirmative votes of Council for approval. There is, however, no actual cost to the City with the operating subsidy paid by the Federal/Provincial Partnership.

With Council approval, the City of Vancouver Public Housing Corporation will then, as landlord, enter into a lease with the Church, the lessee, for the Premises.

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(c) 1998 City of Vancouver