Ottawa·BUDGET 2017

Greater role for feds in social housing

After years of being out of the housing game, the federal government sets out a leadership role for itself in its 2017 budget and takes greater control of the purse strings related to spending for social housing and homelessness.

$11.2B allocated toward housing over next 11 years

A new national housing fund would also provide low-cost loans for building new units and fixing up existing ones. (CBC)

After years of shutting itself out of the housing game, the federal government is taking a leadership role its 2017 budget by taking greater control of the purse strings related to spending for social housing and homelessness initiatives.

Right now, up to 90 per cent of housing money flows through the provinces and territories, but the budget tabled Wednesday lays out a larger role for the Canada Mortgage and Housing Corporation (CMHC).

The government intends to put $11.2 billion toward housing over the next 11 years, and offered details about where that money will be spent:

  • $5 billion for a national housing fund run by the CMHC.
  • $3.2 billion for the provinces and territories for everything from building new units to fixing existing ones, and offering rent subsidies. This new deal will replace the current affordable housing investment program, which ends in 2018-19.
  • $2.1 billion for homelessness, and helping people get help for mental health issues and addictions, extending the homelessness partnering strategy past 2018-19. 
  • $300 million for the construction of housing in the territories and in the North.
  • $241 million for data about housing and research into new ideas.
  • $225 million for housing providers who serve Indigenous people not living on reserves.
  • $202 million to take federal buildings and land the government deems surplus and make it available for affordable housing developments.

"We're confident this ambitious agenda, which is historic, will make a big difference," said Finance Minister Bill Morneau.

The head of the second-largest housing provider in Ottawa likes what he sees.

"I'm hearing instantly from colleagues across the country that this is the most important housing budget in 25 years from the federal government," said Ray Sullivan of the Centretown Citizens Housing Corporation, a non-profit that owns and manages 1,600 units locally.

National housing fund

Nearly half the money for housing will come through a new, multi-pronged national housing fund, administered by the CMHC, a body better known for providing mortgage insurance.

For instance, if housing providers need to make their buildings more accessible or more energy efficient to bring down hydro bills, they could go to the CMHC directly to get money up-front.

The fund would also provide low-cost loans for building new units and fixing up existing ones.

More details about the fund will come out when the government releases its promised national housing strategy later this year.

But the federal government is promising the baseline funding for long-term operating agreements will continue for at least the next decade. Many housing providers and municipalities have worried they would expire.

As for the $5 billion for the fund, it won't flow in equal amounts over 11 years. About two-thirds will come in the final five years.

Ottawa Mayor Jim Watson, who once served as the Ontario minister for housing, is pleased to see the CMHC take a prominent role again on the affordable housing file, a role Watson said was shunted aside for a decade.

"So, it's nice to see them back at the forefront, leading a national housing strategy," said Watson. 

Surplus property for affordable housing

The City of Ottawa hopes to buy a parking lot at 289 Carling Avenue from the Canada Lands Company so it can be used for a supportive housing complex. (Google Street View)
An interesting opportunity for Ottawa could lie in the federal government's promise to spend 10 times more on getting surplus land and buildings ready for conversion to affordable housing. The property would be handed over to developers at little or no cost.

Right now, it has a small program worth about $2 million annually that makes land available for housing.

The city has applied to the fund for a supportive housing project planned near Dow's Lake, for instance.

Starting in 2018, the federal government plans to spend $20 million each year on the initiative, and will even pay to clean up contaminated sites.

"That's a big deal for Ottawa, where there's a whole lot of federal land available right here in the city," said Sullivan, adding that paying for land can be one of the most costly parts of building new developments and adding affordable housing stock.

Watson agreed. He had pushed the federal government to do more to make its surplus land available.

"If we can secure land, as opposed to cash, that helps open a whole lot of new doors to new apartments and new housing opportunities for people," said Watson.