Ottawa Citizen: Councillors pitch one-per-cent tax levy to increase affordable housing

By Joanne Laucius, Postmedia

Two city councillors behind a one-per-cent homelessness tax levy to jump-start construction of affordable housing are hoping the idea will be in the city’s draft budget on Wednesday.

Somerset Coun. Catherine McKenney and Rideau-Vanier Coun. Mathieu Fleury say

the proposed levy, beginning this year and continuing for the next four years of council, would yield $40 million for a “serious strategic investment” to build affordable housing. The levy would cost taxpayers about $23 a year.

The city rents hotel rooms at a cost of up to $3,300 a month for families awaiting housing, with some families waiting up to eight months, said McKenney and Fleury.

“It’s loud and clear to me that we will continue to waste money on temporary options until we have a solution,” said Fleury. “The plan has always been to get away from shelter use. But that hasn’t happened. The biggest issue is that there’s no rental market in Ottawa.”

The city’s emergency shelters are full, said McKenney.

“There’s no capacity. We gave upwards of 250 households in overflow in motels,” she said. “Ottawa Community Housing has historically moved about 2,000 families out a year. That is down to 1,200 because there is no low-to-middle rental stock. There is no place for families to move into as their circumstances improve. There’s a domino effect. At some point, we have  to do something.”

The idea for a temporary “catch up” levy is not without precedent in Ottawa, said McKenney, who points to a temporary infrastructure levy proposed in 2017.

“It doesn’t become part of the operating or capital budget. It would be targeted at housing stock.”

If the levy isn’t in the draft budget, the issue is expect to be on the agenda at the Feb. 21 meeting of the community and protective services committee.

As for how funds would translate into affordable housing, Fleury said multiple players would be interested, including Ottawa Community Housing, non-profits and the private sector. But there might be other strategies as well, including rent supplements and preserving existing affordable housing.

In the U.S., several cities have wrestled with increasing homelessness as housing costs have skyrocketed. Seattle, where costs have increased by more than 40 per cent the past seven years, is one example.

In December, Seattle Mayor Jenny Durkan announced that her city would spend more than $75 million U.S. on affordable housing projects. The money came from a city property levy, payments by real estate developers and federal funding, and is going to projects proposed by non-profits. The money will help to build about 1,200 new apartments with restricted rents. Recent investments have resulted in a record number of new affordable apartments, according to media reports.

There’s also the question of how long such measures could last.

In California, Sacramento voters agreed in November to increase the “Measure U” sales tax from half a cent to a full cent. First introduced in 2012 as a temporary tax, the money has been used to restore city services, including fire, police, parks and libraries that have been cut or scaled back. Affordable housing is one of the targets of the increased tax, but it appears that the measure is no longer temporary.

Fleury sees his proposed levy lasting for the remainder of this council term. If it’s accepted, he wants city staff to come up with a three-year strategy, then produce a report card on the results, to be up for debate in the 2022 municipal campaign.

Growing demand is coming from immigration and migration to Ottawa both from abroad and within Canada as well as other pressures such as family violence and family breakdown, said Shelley VanBuskirk, director of housing services for the city.

The shelter system is under considerable pressure, said Peter Tilley, executive director of the Ottawa Mission.

All three of the large men’s shelters in Ottawa are paid $44 a night to house and shelter each homeless client, and there have been no increases in recent years.

“We know that shelters aren’t the answer. No one believes it’s the permanent answer. But we’re here because people come to our doors,” he said. “I’m glad to see they’re starting some dialogue.”

Deirdre Freiheit, president and chief executive of Shepherds of Good Hope, agrees. “Given the urgent need, we look forward to working with them and all partners across the city to create homes for the homeless and precariously housed as quickly as possible.”

McKenney said she can’t tell people to wait for a new housing strategy anymore. “We have a moral obligation as a city to take care of our residents.”

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