ADMINISTRATIVE REPORT

Date: July 5, 2002
Author/Local: Jill Davidson/873-7670

RTS No. 02764

CC File No. 4656

Council: July 23, 2002

TO:	Vancouver City Council
FROM:	Director of the Housing Centre
SUBJECT:	Housing Agreement for 596 East Hastings

RECOMMENDATION

A. THAT the Housing Agreement for 596 East Hastings summarized in this report be approved in principle, subject to finalization to the satisfaction of the Director of Legal Services and Director of the Housing Centre, provided that this resolution does not create any legal rights or obligations and none shall arise until the agreement as authorized by a by-law is signed.

B. THAT the Director of Legal Services be instructed to bring forward a by-law to enter into the Housing Agreement.

GENERAL MANAGER'S COMMENTS

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

COUNCIL POLICY

Council's priorities are to maintain and expand housing opportunities in Vancouver for low and modest income households with priority being given to families with children; seniors on fixed incomes or in need of support; SRO residents; and the mentally ill, physically disabled, and others at risk of homelessness.

BACKGROUND

A development application (DE406180) is being processed for an innovative social housing project at East Hastings and Princess Streets. The permit is issuable, subject to the completion of a Housing Agreement. It is a 4 story building containing 89 suites for seniors with commercial on the main floor. The project sponsor is Grace Christian Chapel, a non-profit society incorporated in BC affiliated to the Mennonite Church BC. The society owns and operates the congregate housing project at 333 East Pender.

The project is within the Downtown Eastside Oppenheimer District (DEOD) which requires that for the building to be larger than 1.0 FSR, a portion must be social housing. The DEOD-ODP defines social housing as:

"residential units, purchased by a government or non-profit housing group using available government funding, for housing senior citizens, handicapped people or individuals or families of low income".

Staff have determined that this project qualifies as social housing on the basis that:

1. The SAFER (Shelter Aid for Elderly Renters) Program will be used to ensure affordability. This is a provincial government program providing rent supplements to low-income seniors.

2. The residents' incomes would be about $11,000, which is the median income level in the Downtown Eastside.

The land for the project will be donated by the current owners, Austeville Properties Ltd, to Grace Christian Chapel.

DISCUSSION

Terms of the Agreement
The major features of the proposed Housing Agreement are noted below. The Housing Agreement is attached in Appendix A.

1. The units will be occupied by people at least 55 years of age.

2. In choosing residents, priority shall be given to those residing east of Main Street.

3. One half of the units may only be occupied by people who are receiving $200 per month (singles) or $250 per month (couples) from SAFER. This means that the incomes of residents will be about $11,000 a year.

4. One half of the units may only be occupied by people who are otherwise eligible for SAFER except they do not meet the residency requirements. (SAFER requires that people have lived in the province for at least 10 years, and Grace Christian Chapel wants the flexibility to house more recent immigrants.)

5. Rents shall be no more than $650 per month for singles and $690 per month for couples.

6. If and when SAFER is restructured or terminated, the agreement will be modified by both parties, noting that the intent is to house people whose incomes are close to the median income of the Downtown Eastside. If there is disagreement about the terms, the matter shall be settled by a single arbitrator under the Commercial Arbitration Act.

Housing Agreement Limitations
This project is a public private partnership and the mortgage is insured by CMHC. In the case of default or foreclosure, CMHC requires that it and subsequent owners not be bound by the Housing Agreement. This is because they believe the Housing Agreement makes the project unsaleable (and CMHC would not be able to recover its mortgage loan). Staff will be reporting back on the implications of doing this for other projects.

Next steps
The development permit is close to issuance and will be issued immediately upon signing and registering of the Housing Agreement ahead of any mortgages other than CMHC's. The land will then be gifted to Grace Christian Chapel and Grace signing the Housing Agreement.

The Housing Agreement requires that a by-law be passed by Council, and this will be brought forward shortly.

CONCLUSION

This is an innovative social housing project involving a public private partnership. The Housing Agreement is the mechanism to ensure ongoing affordability and it is recommended that the agreement be approved in principle.

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(c) 1998 City of Vancouver