Securing Our Future The 2020 Vision Project

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Securing Our FutureThe 2020 Vision Project
Thom Armstrong Co-op Housing Federation of
BC CHRA Congress April 3, 2008
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Outline

• Overview of co-op housing in Canada
• The 2020 Vision Project
• The characteristics of a 2020 co-op
• The 2020 Vision challenge

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Co-op Housing in Canada

• Profile of Canadian housing co-ops
• 2,200 housing co-ops in Canada, with 91,000 units
  housing 250,000 Canadians
• almost all have been developed under government
  housing programs
• housing co-ops in Canada are rental co-ops,
  organized on a not-for-profit basis. Members own
  the co-op collectively but do not own equity in
  the co-op

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Housing co-ops in Canada

• BC 260 14,500
• Prairies 125 7,000
• Ontario 560 44,000
• Quebec 1,100 22,000
• Atlantic 150 3,300
• Territories 5 200
• TOTAL 2,200 91,000

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Co-op Housing in Canada

• Profile of Canadian housing co-ops
• members pay a share or deposit ranging from a
  nominal amount to 5,000 or more in some cases
• the share or deposit is returned if the member
  leaves the co-op
• no interest or dividend is paid on the share or
  deposit

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Co-op Housing in Canada

• The programs
• Almost all Canadian co-ops have been developed
  under government housing programs that have
  provided some or all of the following
• start-up grants or forgivable loans
• mortgage insurance
• continuing operating subsidy
• subsidies to low-income households

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Co-op Housing in Canada

• Beginnings
• Student co-ops
• 1913
• First continuing housing co-op in Canada, Guelph
  Campus Co-op, formed in Guelph, Ontario for
  students. Begun as a retail co-op, it expanded
  into student housing soon after

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Co-op Housing in Canada

• Beginnings
• Student co-ops
• 1930s to 1970s
• Further student housing co-ops formed, including
  Campus Co-op in Toronto (1936) a wave of them
  are formed from 1964-1973 under a federal
  government program

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Co-op Housing in Canada

• Beginnings
• Builder co-ops
• 1930s and 1940s
• Housing builder co-ops formed in Quebec and in
  Atlantic Canada through the Antigonish Movement,
  a community development movement begun in Nova
  Scotia

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Co-op Housing in Canada

• Beginnings
• Builder co-ops
• In the builder co-ops members built houses for
  each other. When all members were housed the
  co-ops disbanded

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Co-op Housing in Canada

• Beginnings
• Continuing family housing co-ops
• The first continuing family housing co-op, Willow
  Park Co-op, opened in Winnipeg in 1966

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Co-op Housing in Canada

• Beginnings
• Continuing family housing co-ops
• 1968
• The Co-operative Housing Foundation of Canada is
  established as a joint initiative of the Canadian
  Labour Congress, the Co-operative Union of Canada
  (now the Canadian Co-operative Association), and
  the Canadian Union of Students

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Co-op Housing in Canada

• Beginnings
• Continuing family housing co-ops
• CHF Canada convinces the federal government to
  make 30 million available for a small number of
  demonstration co-op housing projects to be
  developed under a pilot program in the early 70s

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Co-op Housing in Canada

• The programs
• Federal co-op housing programs
• 1973Canadian government launches the first
  program to develop housing co-ops for families
• Program combines capital grants and long-term
  low-interest mortgages from the federal
  government (through CMHC)

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Co-op Housing in Canada

• The programs
• Federal co-op housing programs
• 1973 - 1978About 7,700 co-op homes are created
  across Canada under the section 61 program, which
  ended in 1978

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Co-op Housing in Canada

• The programs
• Federal co-op housing programs
• 1979 - 198539,000 co-op homes are created under
  the s. 95 federal program (56.1)
• More co-op units than any other housing program
• Private mortgages replaced direct government
  loans

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Co-op Housing in Canada

• The programs
• Federal co-op housing programs
• The s. 95 program provided assistance to co-ops
  through
• mortgage subsidy
• rent subsidy for low-income residents

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Co-op Housing in Canada

• The programs
• Federal co-op housing programs
• 1986-199214,500 units delivered under the third
  and last federal program (ILM)

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Co-op Housing in Canada

• The programs
• Federal co-op housing programs
• The third federal program also provided mortgage
  subsidy.
• Help for low-income residents came from the
  provinces under a federal-provincial cost shared
  program

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Co-op Housing in Canada

• The programs
• Federal co-op housing programs
• The third federal program used index-linked
  mortgage (ILM), an idea borrowed from Europe
• The ILM kept mortgage payments down in the early
  years, reducing the need for mortgage subsidy

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Co-op Housing in Canada

• The programs
• Program administration
• Administrative oversight continues until project
  operating agreements or governing legislation
  cease to be in force
• In 2006, the new Agency for Co-operative Housing,
  a creation of CHF Canada, took on the
  administration of the co-op programs still in
  CMHCs hands

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Co-op Housing in Canada

• The programs
• Provincial co-op housing programs
• Ontario 1989 - 1995more than 14,000 co-op units
  are developed
  through a series of programs delivered by the
  Ontario government

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Co-op Housing in Canada

• The programs
• Provincial co-op housing programs
• In the 1990s British Columbia and Quebec deliver
  co-ops under provincial housing programs
• Only Quebec has an active development program
  today

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Housing co-ops in Canada

• BC 260 14,500
• Prairies 125 7,000
• Ontario 560 44,000
• Quebec 1,100 22,000
• Atlantic 150 3,300
• Territories 5 200
• TOTAL 2,200 91,000

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Co-op Housing in Canada

• Observations
• Very small percentage of housing stock
• Unevenly distributed across the country
• Patchwork of government programs
• Single providers
• Variable supporting infrastructure

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Co-op Housing in Canada

• Major challenges
• Deferred maintenance
• Expiry of government operating agreements
• Leadership renewal in a volunteer-based
  governance model
• 2020 Vision Project

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What is 2020 Vision?

• End of federal operating agreements
• Section 95 between 2015 and 2020
• ILMs between 2016 and 2021
• Section 61 between 2023 and 2028
• 55,000 co-op homes by 2020
• No more contract obligations
• No more federal subsidy
• No government safety net

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In Ontario

• 260 co-ops funded under provincial programs
• Agreements replaced by SHRA
• Not clear which obligations end and which
  continue when mortgages are paid off
• Program funding ends
• No government safety net

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Our future
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What is 2020 Vision?

• Not just about end of obligations to government
• Housing stock is aging
• Renewal through development (or redevelopment) is
  difficult
• Co-ops face management and governance challenges
• Important to take the long view

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2020 Vision objectives

• Map a vision for the future of
• housing co-ops
• co-op housing sector
• Develop tools, resources to make that vision a
  reality
• Engage housing co-ops in the project

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Key questions

• Will we keep our non-profit status?
• Do the co-op principles matter?
• Are we well led?
• Are we well managed?
• Are our finances sound?
• Are our homes sound?
• Can we afford to live here?
• What kind of community are we?
• Does our housing meet our members needs?

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2006 Annual Meeting

• We put those questions to co-ops across Canada

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When our mortgage is paid off, we should keep
operatingas a non-profit co-op
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Our board of directors provides sound, principled
leadership in our co-op
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Recruiting and keeping good directors is a
challenge
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We have a solid, long-term plan for our
co-op'sfinancial future
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We only plan as far ahead as next year's budget
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Our homes are well maintained,they'll last for
many years to come
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Maintaining our homes the way we should is a
challenge
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Keeping our housing charges affordable is a
challenge
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When our mortgage is paid off, the co-op should
raiseenough revenue to help members who can't
afford to paythe full housing charge
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Deliverables

• 2020 designation
• Tools and resources

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Whats a 2020 co-op?

• A 2020 co-op has

1
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Whats a 2020 co-op?

• A 2020 co-op has

2
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Whats a 2020 co-op?

• A 2020 co-op has

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A capital reserve and investment plan
A 2020 co-op plans for the repair and replacement
of capital items and invests its capital reserves
wisely.
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Whats a 2020 co-op?

• A 2020 co-op has

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A long-term financial plan
A 2020 co-op has a long-term plan for its
finances that projects its reserve and operating
results and cash flows and its financing
requirements.
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Whats a 2020 co-op?

• A 2020 co-op has

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A comprehensive maintenance plan
A 2020 co-op keeps its property in good repair
and reduces replacement costs by planning its
maintenance and using timely and expert resources
to get the job done properly.
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Whats a 2020 co-op?

• A 2020 co-op has

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Good governance and principled leadership
A 2020 co-op demonstrates good governance and the
principled leadership needed to support it.
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Whats a 2020 co-op?

• A 2020 co-op has

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Sound management
A 2020 co-op understands that sound, expert
management is key to operating successfully and
offering its members good service.
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Whats a 2020 co-op?

• A 2020 co-op has

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A commitment to environmental sustainability
A 2020 co-op is committed to a sustainable
future, both for the co-op itself and for the
global community.
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What is a 2020 co-op?

• A 2020 co-op has
• A mission statement and a vision for its future
• A commitment to the values of the Canadian
  co-operative housing movement
• A capital reserve and investment plan
• A long-term financial plan

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What is a 2020 co-op?

• A 2020 co-op has
• A comprehensive maintenance plan
• Good governance and principled leadership
• Sound management
• A commitment to environmental sustainability

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Key questions

• Will we keep our non-profit status?
• Do the co-op principles matter?
• Are we well led?
• Are we well managed?
• Are our finances sound?
• Are our homes sound?
• Can we afford to live here?
• What kind of community are we?
• Does our housing meet our members needs?

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Becoming a 2020 co-op

• To become a 2020 co-op
• Register on the web
• Meet the tests
• Receive the certification

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The 2020 Vision Tool Kit

• The 2020 Compass, a tool to help co-ops
• take stock of where they are now
• decide what they value as a community
• incorporate those values in a mission statement
  and a vision for the future

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The 2020 Vision Tool Kit

• Software and guides for planning
• capital replacement requirements
• long-term financial forecasting
• investing

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The 2020 Vision Tool Kit

• Resources on
• updating, upgrading existing housing
• adding new units
• Redevelopment
• Aids to good governance and sound management

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The 2020 Vision Tool Kit

• Help with maintenance planning
• Legal protection for non-profit purposes
• Guide to making 2020 a reality for co-ops

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The 2020 Vision Tool Kit

• Guided consultations
• Plain-language publications
• User-friendly software and guides
• Workshops
• 2020 website
• Training for professionals and volunteers

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The 2020 Vision Challenge

• Stewardship for another generation, or
• Disposable housing