1. A PRIMER ON AFFORDABLE HOUSING AND HOMELESSNESS By: Nick Falvo Presentation to United Church Women Location: Barrhaven United Church Ottawa, Ontario February 17, 2014

2. Overview Government support for housing Social assistance Social housing Homelessness “Housing First” Summary Nick Falvo: United Church Women (Feb. 17, 2014) 2

3. A Well-Kept Secret Direct Spending and Tax Expenditures Average subsidy per household Average pre-tax household income (2008) Homeowners $2,600$93K Private Renters $400$46K Nick Falvo: United Church Women (Feb. 17, 2014) 3

4. Ex’s of Support to Ontario Homeowners Type of SupportAnnual Amount Non-Taxation of Imputed Net Rent $2.9 B Non-Taxation of Capital Gains on Principal Residences $1.9B Exemption of Imputed Rents from GST $1.2B Nick Falvo: United Church Women (Feb. 17, 2014) 4

5. Imputed Rent When a landlord rents a unit to a tenant, the landlord is taxed on that rental income. When a landlord (effectively) rents to her/himself, that (imputed) rental income “is not taxed under the income tax regime” the way “net rental income” would be taxed if they rented to another person. It’s not actual rental income. Hence the term “imputed rent.” Nick Falvo: United Church Women (Feb. 17, 2014) 5

6. Capital Gains on Principal Residences “Capital gains realized on the sale of a principal residence are non-taxable under the income tax regime in Canada. In comparison, 50% of capital gains from other investments (e.g., equities) realized in a year are taxed at income tax rates.” — Frank Clayton Nick Falvo: United Church Women (Feb. 17, 2014) 6

7. The Economics of Newly-Built Housing New Housing in Toronto New one- or two-bedroom apt $1,500 Household Salary Needed $60,000 7 Nick Falvo: United Church Women (Feb. 17, 2014)

8. SA Shelter Allowance, Ottawa Nick Falvo: United Church Women (Feb. 17, 2014) 8

9. SA Shelter Allowance, Ottawa (cont’d) Nick Falvo: United Church Women (Feb. 17, 2014) 9

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11. Social Housing Social housing generally refers to housing for low- income households that benefits from substantial funding from senior levels of government. Usually, social housing is owned and operated by a not- for-profit entity. Nick Falvo: United Church Women (Feb. 17, 2014) 11

12. Social Housing (cont’d) A crucial point about ‘social housing’ is that a significant proportion of tenants who live there pay reduced rent. This is usually referred to as Rent Geared to Income (RGI). Though the precise rent scale varies across Canada and across programs (and years), tenants in RGI units typically pay between 25% and 30% of their before-tax monthly income. The highest amount of rent a tenant would be charged in social housing would be ‘break even rent’—that is, the actual market rent that would be charged on the private market. This happens in private non-profit and co-op housing (with tenants who are ‘middle-income’). These would not be RGI units. Nick Falvo: United Church Women (Feb. 17, 2014) 12

13. Rent Levels in Social Housing Compared Nick Falvo: United Church Women (Feb. 17, 2014) 13

14. Who Has Social Housing? Nick Falvo: United Church Women (Feb. 17, 2014) 14

15. Ottawa’s Waiting List City of Ottawa’s Centralized Waiting List, 2012 Household Type# of HouseholdsMedian Wait Time (in Years) Families (with children) 3,6653.1 Single Adults3,5435.4 Seniors1,9653.2 2 Adults5223.6 3+ Adults1502.9 15 Nick Falvo: United Church Women (Feb. 17, 2014)

16. Tenants 1/3 of social housing tenants in Ontario are seniors. Most prefer all-seniors buildings, and non-profit housing authorities find them to be very good tenants. 10% of Ontario’s stock of social housing is “supportive housing.” 16 Nick Falvo: United Church Women (Feb. 17, 2014)

17. Inadequate Housing, Children in Care “Two studies have been done in Toronto looking at the role of housing with respect to children in care. Results of both studies indicate that the state of the family’s housing was a factor in one in five cases in which a child was temporarily admitted into care. Results from the Toronto research also indicate that, in one in 10 cases, housing status delayed the return home of a child from care.” — Falvo, 2012 Nick Falvo: United Church Women (Feb. 17, 2014) 17

18. Developing Social Housing Nick Falvo: United Church Women (Feb. 17, 2014) 18

19. Social Housing in Toronto: Basic Math $200K to build new unit of social housing (including cost of land). Amount gets paid over 30 years $300/month (from tenant) to cover operating deficit. After 30 years, major repairs necessary. 19 Nick Falvo: United Church Women (Feb. 17, 2014)

20. Social Housing in Ottawa Cost of Building a Large One-Bedroom Apartment (or Small Two-Bedroom Apartment) Construction$200/ft 2 Soft Costs i.e. architect, legal fees, other professionals An additional 10%-17% LandSometimes free TOTAL$200,000 Nick Falvo: United Church Women (Feb. 17, 2014) 20

21. Social Housing in Ottawa (cont’d) It might cost less than half of that to acquire an already- existing unit (from a private landlord, for example). But such a unit likely would not last as long as a newly- built one. And for some types of supportive housing (i.e. for persons with physical disabilities), housing must be purpose-built. Nick Falvo: United Church Women (Feb. 17, 2014) 21

22. Land Centretown Citizens Ottawa Corporation (CCOC) provides social housing in Ottawa. CCOC often pays full market value of the land for their units. CCOC cannot afford to buy land in downtown Ottawa at market rates and build new. But they can afford to acquire already-existing units downtown. For example, when carrying out new construction, CCOC could not afford to pay the full cost of land in the Market, Centretown, Hintonburg or the main streets of Little Italy or Chinatown. Nick Falvo: United Church Women (Feb. 17, 2014) 22

23. Land (cont’d) Sometimes the City of Ottawa (or another level of government) donates the land. Other times, a level of government will offer CCOC a long- term lease for one dollar (or for $30,000 or $40,000 a year). Nick Falvo: United Church Women (Feb. 17, 2014) 23

24. Land (cont’d) Government funding cycles make it challenging for non- profit housing providers to ‘jump on’ good land opportunities. City of Ottawa might issue an RFP in July and then announce results in November. But there might be a great deal on land in June; and owner of the land will not wait. Seller wants to close in three months. Nick Falvo: United Church Women (Feb. 17, 2014) 24

25. New Social Housing in Ottawa Nick Falvo: United Church Women (Feb. 17, 2014) 25

26. Examples of AHI Projects in Ottawa ProviderAddress# of UnitsYear Completed Ottawa Salus930-934 Gladstone192002 Ottawa Community Housing 380 Somerset W (Hartman’s) 602005 Multifaith Housing Initiative 138 Somerset102007 CCOC424 Metcalfe (Beaver Barracks – Phase I) 1602010 Shepherds of Good Hope 1053-1057 Merivale (“The Oaks”) 552011 26 Nick Falvo: United Church Women (Feb. 17, 2014)

27. Beaver Barracks Nick Falvo: United Church Women (Feb. 17, 2014) 27

28. Beaver Barracks (cont’d) Nick Falvo: United Church Women (Feb. 17, 2014) 28

29. Beaver Barracks (cont’d) Nick Falvo: United Church Women (Feb. 17, 2014) 29

30. Shepherds of Good Hope (“The Oaks”) Nick Falvo: United Church Women (Feb. 17, 2014) 30

31. Ex’s of New AHI Coop Units in Ottawa ProviderAddress# of UnitsCompleted Blue Heron Co-operative Homes 750 March Road832006 McLean Cooperative Homes 155-343 Parkin Circle632008 Eastern Ontario Christian Seniors Co-op 220 Viewmount Crescent 692012 31 Nick Falvo: United Church Women (Feb. 17, 2014)

32. Blue Heron Housing Co-operative Nick Falvo: United Church Women (Feb. 17, 2014) 32

33. MacLean Co-operative Homes Nick Falvo: United Church Women (Feb. 17, 2014) 33

34. Eastern Ontario Christian Seniors Co-op Nick Falvo: United Church Women (Feb. 17, 2014) 34

35. But Where Does This Leave Us? Nick Falvo: United Church Women (Feb. 17, 2014) 35

36. Canada Compared Rates of Social Renting Country% Netherlands34 Sweden32 France19 England18 Canada5 United States3 Nick Falvo: United Church Women (Feb. 17, 2014) 36

37. Rental Housing Production Nick Falvo: United Church Women (Feb. 17, 2014)

38. Homelessness Nick Falvo: United Church Women (Feb. 17, 2014) 38

39. Causes Traditionally, two schools of thought: 1. Individual risk factors 2. Socioeconomic factors affecting entire jurisdictions 39 Nick Falvo: United Church Women (Feb. 17, 2014)

40. Causes (cont’d) Ex’s of Individual Risk Factors: Mental health diagnosis Heavy use of drugs or alcohol Lack of education/skills 40 Nick Falvo: United Church Women (Feb. 17, 2014)

41. Causes (cont’d) Examples of Socioeconomic Factors Affecting Entire Jurisdictions High unemployment rate Lack of affordable housing Inadequate social assistance benefits Reductions in psychiatric beds 41 Nick Falvo: United Church Women (Feb. 17, 2014)

42. Causes (cont’d) Since early 1990s: convergence of opinions 1. Structural factors matter 2. Those most at risk tend to have individual risk factors 42 Nick Falvo: United Church Women (Feb. 17, 2014)

43. Impact on Health “Homeless people in their forties and fifties often develop health disabilities that are more commonly seen only in people who are decades older.” —Dr. Stephen Hwang 43 Nick Falvo: United Church Women (Feb. 17, 2014)

44. Impact on Health (cont’d) Homeless people more likely to have: 29X Hep C 20X Epilepsy 5X Heart Disease 4X Cancer 2X Diabetes Nick Falvo: United Church Women (Feb. 17, 2014) 44

45. Mental Health Depression 17% (8% in pop) Anxiety 11% (1%) Bipolar 8% (1%) Schizophrenia 5% (1%) Nick Falvo: United Church Women (Feb. 17, 2014) 45

46. Social Costs (cont’d) 2000 article in JAMA reported on death rates among homeless men in Toronto: → The mean age of death was 46 years. → The mortality rate for homeless male youth 8X rate of of their non-homeless counterparts. → Homeless men 9X more likely to be murdered than their housed counterparts. Nick Falvo: United Church Women (Feb. 17, 2014) 46

47. Social Costs (cont’d) 1998 Toronto study → Over half of all female street youth become pregnant. → 300 babies are born to homeless women each year in Toronto Nick Falvo: United Church Women (Feb. 17, 2014) 47

48. Violence More than 1/3 of homeless persons report being physically assaulted or beaten up in previous year Stranger 56% Acquaintance 38% Police 35% Another shelter resident 27% Partner or spouse 21% Shelter staff 15% Nick Falvo: United Church Women (Feb. 17, 2014) 48

49. Sexual Violence 1 in 5 homeless women report being sexually assaulted or raped in previous year. Nick Falvo: United Church Women (Feb. 17, 2014) 49

50. “Housing First” Nick Falvo: United Church Women (Feb. 17, 2014) 50

51. Throne Speech, 2013 “Our Government will…[b]uild on the successful Housing First approach and its renewed Homelessness Partnering Strategy to help house vulnerable Canadians…” — Throne Speech (Canada), Oct. 2013 Nick Falvo: United Church Women (Feb. 17, 2014) 51

52. Housing First My Definition (for the purpose of today’s class) Providing a homeless person with immediate access to permanent housing. The alternative to Housing First: the “treatment first” approach (also known as the “continuum of care” approach) — i.e. fix person’s behaviour (i.e. addictions, mental health, etc.) before giving them permanent housing. 52 Nick Falvo: United Church Women (Feb. 17, 2014)

53. Housing First Homeless Shelter placement Transitional housing Permanent housing Based on slide from S.Tsemberis Treatment First Client must demonstrate readiness for each step No requirement for readiness to move directly to permanent housing Difference between HF and Treatment First Nick Falvo: United Church Women (Feb. 17, 2014) 53

54. At Home/Chez Soi Study 5-city, random control study $110 million Results expected imminently Nick Falvo: United Church Women (Feb. 17, 2014) 54

55. Summary Senior levels of government in Canada provide various forms of support for housing, including for homeowners. Social assistance (i.e. ‘welfare’) provides assistance to many low-income Canadians, but, for the most part, not enough for appropriate private-rental accommodation. Fewer than half of very low-income Canadians are fortunate enough to live in “social housing” (which involves subsidized rent levels). Nick Falvo: United Church Women (Feb. 17, 2014) 55

56. Summary (cont’d) Indeed, there are lengthy waiting lists for social housing all across Canada. The percentage of Canadian households who live in social housing is considerably lower than the OECD average. Canada’s rate of ‘social renting’ is 5%. In The Netherlands, the rate is 34%. In Sweden, it’s 32%. Nick Falvo: United Church Women (Feb. 17, 2014) 56

57. Summary (cont’d) People who are homeless (i.e. sleeping in emergency shelters or outside) experience certain health problems at much higher rates than the general population. They also die much more quickly. They are also considerably more likely to be assaulted (both physically and sexually). Nick Falvo: United Church Women (Feb. 17, 2014) 57

58. Summary (cont’d) Over the past decade, it has become quite trendy for senior levels of government in Canada to claim that they believe in the Housing First principle. In other words, they state that they hold the philosophical view that homeless persons should be given immediate access to affordable housing. Note: This is not the same thing as agreeing to provide sufficient funding for every homeless person to live in affordable housing. Nick Falvo: United Church Women (Feb. 17, 2014) 58

59. Summary (cont’d) Results of the At Home/Chez Soi study will be released later this year. Some people believe that these results will make it more palatable for senior levels of government to provide more resources so that homeless persons can be provided with more affordable housing. Nick Falvo: United Church Women (Feb. 17, 2014) 59

60. Thank You Nick Falvo PhD Candidate (Public Policy) Carleton University falvo.nicholas@gmail.com Nick Falvo: United Church Women (Feb. 17, 2014) 60