The credit crunch has forced one of Toronto’s affordable housing providers to prepare for the possibility of being denied credit that is vital to housing upkeep and construction.
On Feb. 2, the Affordable Housing Office (AHO) had an executive meeting in Toronto to present their action plan for the year, Completing AHP Initiatives, 2009.
Central to the plan is the development of 11 housing projects now under construction and cheduled to be completed within the next two years. A back-up measure was included as a precaution, in case the limited availability of credit affects the AHO’s partners.
“If the proponents suddenly ran into financial difficulties because the banks were making it too difficult for them to access money,” said Gill Hardy, a spokesperson for AHO, “… then we would go to city council and say: ‘We need to make sure this important affordable housing development is finished, and we have to. So we’re recommending the city provide the funding necessary to do so’.”
Hardy explained the AHO doesn’t think it’s inevitable that the banks will deny their partners credit, but it’s necessary to be prepared. The AHO would look to Toronto city council for the needed funding on a case-by-case basis.
“The three levels of government have invested money into important affordable housing developments,” Hardy said. “So we’re protecting that investment, in effect, so that it doesn’t come to a crashing halt because the proponents suddenly can’t access a line of credit.”
The 11 housing developments will provide 1,168 new affordable homes for families, people with disabilities, seniors, mental health survivors, and others.
Toronto’s affordable housing providers and those that rely on them have more to worry about than the credit crunch. Social Housing Services Corporation (SHSC) presented a report called Closing the Gap on their website, www.shscorp.ca, on Jan. 27. It identifies a shortfall in funding for social housing repairs in Ontario that will reach $1.2 billion by 2012.
Also, the federal government continues to gradually decrease its contribution to social housing every year.
But this year is different. The federal government announced a one-time investment of about $2 billion over two years for social housing nationwide in the budget two weeks ago. The new funding will be used for renovation, energy retrofits, support, and construction.
The SHSC, a non-profit organization that provides services to Ontario’s housing providers, was cautious in its enthusiasm for the new federal funds, saying:
“We sincerely hope that this announcement is not just a one-time infusion of desperately-needed funds, but is part of a larger commitment to meeting the needs of communities across the country.”
Roger Maloney, the chair of SHSC, pointed out that money has been badly needed for years. When the provincially run social housing units in Ontario were downloaded onto the municipalities about seven years ago, there were repairs that needed to be done and not enough money to pay for them, he said.
“Certainly a priority is repairing the units. We’ve been saying there’s a disaster waiting to happen,” Maloney said.