Toronto Community Housing acts to further strengthen rent calculations

Toronto Community Housing acts to further strengthen rent calculations

April 22, 2016

TORONTO —Toronto Community Housing is taking additional steps to strengthen its processes for calculating rent after finding that a limited number of rent-geared-to-income (RGI) tenants were undercharged rent, or in some cases overcharged, as a result of errors in the calculation process. The incidence of undercharges occurred at a higher rate than overcharges. To date, 28 tenants have been identified as being undercharged and 21 tenants overcharged.

RGI rents are generally set at 30 per cent of a household’s gross income, which is determined manually during mandated annual reviews; approximately 45,000 files are reviewed each year. The calculations can be complex, as tenants often submit multiple sources of income, increasing the possibility of error.

As part of management’s internal review processes, errors were found in a small sample of RGI rent calculations from 2013 and 2014 which ranged from incorrect or duplicated data entry, mathematical miscalculation, or accidentally including exempt items as income. The median undercharge was $87 per month, while the median overcharge was $22 per month. While most rent calculations were found to be correct, additional action is being taken to reduce the chances for error going forward.

Based on these findings by management and with the approval of the TCHC Board of Directors, Toronto Community Housing is taking immediate and long-range actions that build on improvements already underway at the company. First and foremost, TCHC will notify and immediately reimburse all RGI tenants who have been identified as having been overcharged rent as a result of these findings. Staff will be in contact with the tenants shortly to advise them that they were overcharged and process their refund.

Toronto Community Housing’s board-approved action plan also includes:
  • Review of every RGI rent calculation as part of the 2015 annual review process. Staff will also concurrently review the 2014 rent calculations. If overcharges are found, tenants will be reimbursed for overpayments for both years. If undercharges are found, tenants will have their rents adjusted but will not have to repay past amounts.
  • Further enhancements to staff training, including more frequent refresher sessions.
  • Improve tenant file management by exploring options to automate all or a portion of the calculation process.
  • Directing the Chief Internal Auditor to include RGI rent calculation reviews as part of the annual audit work plan, and report back to the board.
  • Quarterly management reports to the board with steps taken and results achieved.

Toronto Community Housing has already made several improvements to its rent calculation processes, including adding administrative staff at Head Office to review and verify rent calculations, working with the City of Toronto for staff training, and establishing an RGI Review Body that provides tenants with a fair and neutral forum to review and challenge decisions about their rent.

Toronto Community Housing has made and will continue to make improvements to these processes with the goal of maintaining the confidence and fair treatment of tenants.

QUOTES

“While the board recognizes that the review involved a small sample and limited number of unintentional errors, Toronto Community Housing must strive to meet a standard of zero errors in order to maintain the trust of residents and the public. That’s why the board supports management’s plan to improve the company’s processes for calculating rent. While even one tenant being overcharged is one too many, it is also important that all tenants know they are paying the correct rent and we are putting in place a system to help ensure that.”

—Bud Purves, Chair, TCHC Board of Directors

“I apologize to the tenants who have been affected by these inadvertent errors. We will reimburse each and every tenant that we know has been overcharged rent. We are also addressing the root causes of the errors and applying best practices to improve our performance. This is part of our commitment to treating residents fairly and building a better company.”

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

About Toronto Community Housing

​Toronto Community Housing​​ provides homes for nearly 60,000 households with low and moderate incomes. By providing clean, safe, well-maintained, affordable housing, Toronto Community Housing builds better homes, better neighbourhoods and a better Toronto for all.

Media contact: ​Lisa Murray, Manager, Media and Public Relations, 416-981-4252 or media@torontohousing.ca​