Vancouver City Council |
ADMINISTRATIVE REPORT
Date: June 11, 2003
Author/Local: Jill Davidson/7670
RTS No. 03461
CC File No. 4553
Meeting Date: June 24, 2003
TO:
Vancouver City Council
FROM:
Director, Housing Centre
SUBJECT:
Residential Tenancy Act
RECOMMENDATION
That the Mayor on behalf of Council write to the Solicitor General expressing Council's concerns with the potential impacts on Vancouver tenants of the new Residential Tenancy Act and regulations and urging the government to amend the new Act and modify the proposed regulations prior to their proclamation into force to:
a) limit annual rent increases to either the Consumer Price Index or a reasonable percentage, but not both and not retroactively;
b) maintain the existing provisions which expressly authorize local government to enact a by-law setting a minimum notice period of between 2 and 6 months for demolition of rental accommodation;
c) ensure tenants are not evicted for "cosmetic renovations", where it is likely that the repairs could have been done with the tenancy maintained;
d) permit arbitrators to extend the time for tenants to pay the rent under reasonable circumstances;
e) provide adequate access to the Residential Tenancy Office for Vancouver tenants by either re-opening the office in Vancouver, or extending the hours of the Burnaby office to accommodate people who work during the day; and
f) provide additional resources to organizations that assist tenants in resolving disputes and accessing the arbitration process.GENERAL MANAGER'S COMMENTS
The General Manager of Community Services RECOMMENDS approval of the foregoing.
COUNCIL POLICY
Council's policy is to maintain and expand housing opportunities in Vancouver for low and moderate 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
At their May 13, 2003 meeting, Council requested advice on the impacts of the new Residential Tenancy Act enacted on November 26, 2002 and not yet proclaimed.
The Residential Tenancy Act governs relationships between residential tenants and landlords in British Columbia. Bill 70 was introduced in October 2002 and given royal assent in November, but has not yet been brought into force. This will likely occur in early summer, when regulations, which are being drafted, are ready for approval through Order in Council. Once in force, the new Act repeals and replaces the existing Act.
The new Act is written in plain language so that everyone can understand it. However it also makes some substantive changes from the existing Act. This report highlights the major areas of concern for the City of Vancouver and our tenants.
To provide Council with information on a broader range of the proposed changes, attached are the government news release (Appendix A) and a critique by the Tenants Rights Action Coalition (Appendix B) . (This is the only organization that has published its response.)
DISCUSSION
Rent Increases
Under the existing Act, rent increases can only be justified by increased costs experienced by the landlord. Under the new Act, rent increase limits will be set by regulation. In the government news release, these were described as "initially in the range of three to four per cent, plus a consumer price index adjustment". This is a concern because the rent increases could be high. During the past 10 years, annual changes in the CPI for Greater Vancouver have ranged from 0.5% to 3.6% so (under the new Act) rent increases of as high as 7 or 8%might be charged, and the tenant would have no ability to dispute the increase. A related concern is that the incentive is lost for landlords to maintain/repair their buildings in order to justify rent increases.
Another new feature is `catch up' rent increases. The new Act allows , through regulation, for rent increases to include not only an amount for the next year, but also for increases during the previous 3 years. The concern is that this amount could be so high that tenants would not be able to afford the increase in one lump, and would be forced to look for alternative, more affordable accommodation, when little exists. Vancouver's current vacancy rate is 1.1% and the vacancy rate for lower cost units is usually less.
Notice Period For Demolition
Under the existing Act, municipalities are authorized to enact a by-law establishing a minimum notice period of between 2 and 6 months for demolishing a rental building. The City's by-law requires that landlords give notice of 4 months, after all permits, including the demolition permit, are in place. The rationale was that, particularly in times of high development activity, many apartment blocks are up for demolition, leaving a large number of tenants trying to find new accommodation at the same time. A longer notice period increases the opportunities for tenants to find suitable alternative accommodation. The new Act sets the notice period for all terminations, including demolitions, at 2 months.
The Solicitor General has said that the City would appear to have sufficient powers under the Vancouver Charter to enable the City to regulate the process and time frame for obtaining the necessary permits to demolish a rental property, and thereby to give tenants sufficient lead time to find alternate rental accommodation, for example by delaying the approval process. What this might mean is the City adopting delay provisions, such as requiring tenant input and possibly mitigation. The City already requires mitigation to be considered where the rate of rental loss exceeds a set percentage in the West End, South Granville and Kerrisdale. This requires increased City resources and an increase in uncertainty for developers and tenants. Consequently it is recommended that Council ask the Province to maintain the existing provisions which expressly authorize local government to enact a by-law setting a minimum notice for demolition of rental accommodation.
Vacant Possession For Renovations
There have been situations where tenants have been evicted for "cosmetic" renovations -where it is likely that the repairs for things like new rugs could have been done with the tenancy maintained. The new Act does not address this situation. Accordingly it is likely that this practice will continue under the new Act. Alternatives could include something like the Ontario legislation which allows tenants to re-occupy the unit at a similar rent.
Extension Of Time To Pay The Rent
In the existing Act, arbitrators can grant extensions to tenants who have not paid the rent within 5 days of the due date, but who have a good likelihood of future income, for example where pay cheques are late or families who are waiting for crisis welfare assistance. In the new Act, the arbitrators can no longer order an extension, even in the case where landlords might agree. This could result in unnecessary homelessness.
Closure of Vancouver Office of the Residential Tenancy Office
The ability for City landlords and tenants to use the arbitration process has been limited because the Vancouver office of the Residential Tenancy Branch (now called the Residential Tenancy Office) has been closed and services are provided from the Burnaby offices. If re-opening the Vancouver office is not feasible, then consideration might be given to extending the hours to accommodate people who work during the day. The office hours are currently weekdays 8:30 a.m. to 4:30 p.m.
Resources to Agencies that Work with Tenants on Arbitrations
Tenants used to have support in going through the arbitration process with lawyers from the Legal Services Society. Provincial funding has recently been cut, leaving tenants trying to sort their way through a complex legal process. Also, the Province used to fund, and the City contributed to a housing registry and advocacy services for tenants. These ended when the Province cut back their funding in the mid-1990's. The Province could be urged to re-initiate these grants, and the City may then wish to re-initiate a partnership with the Province.
CONCLUSION
The Act has not yet been proclaimed and the regulations are in draft form and there is still opportunity for the City to influence the content. It is recommended that the Mayor send a letter to the Solicitor General advising of the City's concerns including:
- rent increases
-notice period for rental demolition
-cosmetic renovations
-extension of period to pay rent
-closure of Vancouver office of the Residential Tenancy Office
-resources to assist tenants with arbitration.* * * * *