Board approves $970.3-million budget for 2017

Board approves $970.3-million budget for 2017

December 08, 2016

​TORONTO, December 8, 2016—The Board of Directors of Toronto Community Housing (TCHC) today approved a 2017 budget of $970.3 million, which includes a $572.6-million operating budget and a $397.7-million capital budget.

The 2017 capital budget includes a $250-million investment in capital repairs funded through mortgage refinancing and grants from the federal and provincial governments, an amount equal to the 2016 budget for capital repairs.  This will enable TCHC to carry out almost all of year five of the 10-year, $2.6-billion capital repair plan approved by City Council in 2013. 

To address a $35.2-million shortfall in the 2017 operating budget, the board voted to apply $19 million from an anticipated 2016 cash surplus to the 2017 shortfall, and put any remaining surplus into reserves to fund future capital repairs. On the strength of proceeds from the sale of lands and standalone homes, and one-time gains in utility credits, TCHC expects to end 2016 with a cash surplus of at least $20 million.

Sources of funds for TCHC's 2017 budget include:

  • $315.4 million from rents (residential and commercial)
  • $267.3 million in cash from reserves, primarily raised by mortgage refinancing
  • $204.9 million in projected subsidies from the City of Toronto
  • $58.2 million from land sales and profit participation from Revitalization projects, as well as sales of stand-alone homes
  • $53.0 million from provincial and federal grants for capital repairs and energy retrofits
  • $35.4 million from grants for development projects
  • $18.9 million from mortgage refinancing
  • $17.2 million in parking, laundry and fees

The Board also approved the development plan for Block 16 North and Block 17 North in Regent Park contingent on the City or any other level of government securing mortgage refinancing or loan guarantees on behalf of TCHC. Management will report back on progress at the next Board meeting.


QUOTES:

"The Board has played a very active role in reviewing this year's budget and has made decisions that are fiscally responsible while keeping the focus on frontline services for tenants.  I want to thank Board members and staff for their strong efforts in developing a budget despite challenging financial circumstances."

— N.W. Bud Purves, Chair, Board of Directors

"With our Board and the City, we have developed a budget that will see us through the next 12 months while work continues through the City's process on the Tenants First report. The 2017 Budget approved by the Board will allow us to continue improving living conditions for tenants, repairing and maintaining our buildings, and delivering better services with the resources we have."

—Greg Spearn, President and Chief Executive Officer (Interim)

FOR MORE INFORMATION

KEY FACTS


2017 Operating Budget

TCHC's 2017 operating budget of $572.6 million includes:

  • Building operations and maintenance: $151.9 million
  • Utilities (gas, hydro, water and waste): $148.4 million
  • Mortgage and loan payments: $127.9 million
  • Corporate services: $36 million
  • Community Safety Unit: $18.4 million
  • Municipal taxes: $15.6 million
  • Human resources: $13.1 million
  • Information technology: $12.8 million
  • Resident and Community Services: $12.4 million
  • Other capital expense: $11.5 million
  • Other: $24.6 million

Based in part on its size and history, TCHC currently receives half the subsidy per unit that other social housing providers in the city receive (about $3,600 per unit, compared with about $7,200 per unit). TCHC must find the difference between what it receives in rent and subsidies, and the actual costs to operate its nearly 60,000 units.

TCHC's 10-year operating outlook shows flat revenues with little or no growth in subsidies and rent geared to income, combined with steadily increasing operating costs. TCHC will continue to face significant pressures from utility rates, which increase yearly well beyond the rate of inflation, increases in interest and principal payments from increased borrowing, and collective bargaining agreement costs for unionized employees.

The corporate services budget of $36 million (less than four per cent of the full $970.3 million budget) decreased by $2 million from 2016. These savings were achieved mainly by not filling vacancies. TCHC has redeployed these resources to increase the number of cleaners, maintenance persons and clerks in front-line positions.


2017 Capital Budget

The $397.7-million capital budget includes $250 million for building repairs and $147.7 million for construction of new rental replacement housing in the six revitalization communities.


Building Repair Capital

The $250-million capital repair budget includes a base program of $197 million funded through mortgage refinancing and $53 million secured from federal and provincial grants for capital repairs and energy retrofits.

The $250-million building repair budget includes:

  • $45 million for demand capital
  • $28 million for deep retrofits in nine buildings, from grants under the provincial government's SHARP program
  • $25 million to repair or replace major building components, systems, services and safety features, from grants accessed through the federal government's Social Housing Improvement Program (SHIP)
  • $17.35 million in demand component capital
  • $16.4 million in building envelope improvements
  • $11.9 million in accessibility upgrades to tenants' homes and common areas (18-per-cent increase over $8.5 million in 2016, and an almost five-fold increase from $2.45 million in 2014)
  • $10.1 million for energy capital
  • $7 million to upgrade security cameras from analog to high-definition digital and the addition of new cameras ($1 million increase over 2016); TCHC currently has 7,500 security cameras throughout its portfolio
  • $6.98 million to repair parking garages
  • $6.1 million for roof replacements
  • $5.9 million for plumbing replacements and upgrades
  • $5.7 million to augment fire and life safety systems
  • $5 million for in-suite repairs, including renovations of kitchens and bathrooms
  • $4.45 million to repair or replace heating and cooling systems
  • $4 million to respond to any issues identified by Municipal Licensing and Standards (MLS)
  • $3.97 million for structural improvements
  • $2.1 million to refurbish or replace elevators
  • $23 million in other repairs, plus
  • $22 million in additional repairs to be identified in January 2017

 

2017 Development Capital

The 2017 development capital budget is $147.7 million, the bulk of which will be used to continue construction at the six revitalization communities:

  • 250 Davenport ($4.3 million)
  • Alexandra Park ($9.4 million)
  • Allenbury Gardens ($10.2 million)
  • Lawrence Heights ($23.5 million)
  • Leslie Nymark ($12.7 million) and
  • Regent Park ($83.9 million).

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About Toronto Community Housing

Toronto Community Housing (www.torontohousing.ca) is Canada's largest social housing landlord, providing homes for nearly 60,000 low- and moderate-income households in neighbourhoods across the city. We are wholly owned by the City of Toronto and our 2,100 buildings represent a $9-billion public asset.

 

Media contact: 

Lisa Murray 416-737-1352 or media@torontohousing.ca.