I will commit to the Member that we’ll prepare a briefing note with an update and status. I think there are approximately 25 units in Deline that are being renovated right now. So I’ll get an update and a status and expected finish date and then he can relay that on to his constituents. Thank you.

Thank you, Minister McLeod. I have nobody else on my list. Mr. Krutko.

Thank you, Mr. Chair. Again, I do have concerns with the loss of $7 million in the area of grants and contributions. I think that’s a major cut to the programs that a lot of people depend on, and knowing that there’s probably going to be less money but more demand, I’m wondering if the Housing Corporation has considered looking at maybe cutting back on some of the delivery side of the programs knowing that you have less dollars to allocate. Maybe look at less program officers on the ground, put the savings back into the programs to offset the $7 million cut from the federation government. I mean, if you look at it, that’s almost half of the grants and contribution monies that are

there and I think people have to realize that there’s already a demand there and we have to find either the money internally or do an assessment on the programs and services we do deliver and we may have to cut out certain programs that we just cannot afford to deliver anymore. So has that review taken place or have we considered looking at that as an option, that we may have to cut back on the delivery side, and more importantly, how do we replace $7 million on a program that has $16 million in it? That’s a major loss of revenues and I think we know that there’s high demand in regard to these programs and services, especially from the maintenance side and from the seniors program preparedness side. I think, if anything, it’s going to have a direct affect on the residents of the Northwest Territories. So has there been a strategy or an idea of how we deal with this going forward?

Thank you, Mr. Krutko. Minister McLeod.

Thank you, Mr. Chair. The Member raises a good point because there is quite a decrease in the funding that we have been receiving from Ottawa, but we’ve taken the necessary steps. Obviously, because of the lack of funding, we’ve had to cut back on the dollar amounts. So on the number of programs we offer... We’re doing an evaluation of all our housing programs right now, housing choices programs. So until we see that, it’s going to be awfully difficult to determine which programs we may have to cut because of the loss of revenue. Our preference is not to cut any, because the ones we have we feel are serving a lot of the folks across the Northwest Territories.

So having said that, though, we do need to go back and have a look and do an evaluation of the programs that we do offer. I mean, I do know because we had such an aggressive construction plan for the last four or five years with the federal investment, that right now we’re having to deal with some of the after effects of that and I did give a Minister’s statement and an update to committee as to what we’re doing with all the vacant units we have and we’ve cut back on the number of HELP units that we’re doing in ‘11-12 just because we’ve got so many units that are out there. Then adding into our public housing stock as we’re doing now, then that may relieve some of the pressure of having to come forward with money for more public housing. So with the 37 we’re proposing through the Vacant Unit Housing Strategy and the 12, so we’ve got 49 units that should be into our public housing stock this year. So that should alleviate a lot of the pressure going forward. Thank you.

Again, I think that we have to be realistic here that we as government probably can’t cover off that $7 million. We are going to have to look for that internally. There are other things that

have been requested in regard to shelter policies, looking at the possibility of other programs that people are requiring. I think also with the number of vacant housing units that we have on the ground, regardless if we’re trying to get them occupied, there’s still an ongoing cost to operate and maintain those units. You can’t walk away from that. I think that we have to be realistic that we have to sometimes make tough decisions and that that may mean doing away with a certain program or having, in some cases, to lay off program staff because you’re spending more money on delivering the program than they actually have program dollars to deliver it. So for me, that’s the issue.

We geared our programs and the amount of dollars that were allocated to each program. A lot of that was based on the money we were getting from the federal government and because that money is not there, then obviously we’ll have to pull back a bit and go back to our historical figures. We use the CARE, the home repair, for example. Because of the investment the federal government has made, we’ve been able to add resource into that particular program. Now that the investment is done, it’s sunsetted, then we go back to our historical figures and we feel that we’ve been able to make some gains in the last few years with the amount of money that we’ve been putting into a lot of these programs. Our programs were geared to the amount of money we received and now that all that’s sunsetted, we’re back to our historical levels. We still feel that we’ll be able to provide programs not on the scale that we’ve seen in the last few years but we’ll still be able to provide programs.

In the past one of the ideas was to start selling off some of the government housing units regardless if they were surplus housing or they were considered that come to in the life retrofits, it basically might be cheaper to just dispose of those units than trying to put any more money into them. I think we have to realize we have less money and we need to find ways to bring in new revenues or quit throwing good money after bad, knowing that we have to dispose of those assets, get rid of them, get them off our books, and take the O and M money or maintenance money and reinvest it into new construction or programs. I’d like to know where we’re going with that notion of divesting ourselves of old housing assets and getting them off our books.

Last count we have 51 units across the Northwest Territories that we’re looking to remove from our stock. We’re trying to find ways to get rid of these units. We’ve been working with some community governments to try and turn the units over because they’ve expressed an interest in them. We do have 51 that are slated for disposal one way or another and we’re hoping to have a fairly aggressive disposal plan. We hear

from a lot of the communities, we have a lot of units in the community that are boarded up and aren’t really any good to anybody. We’re figuring out how we can deal with that. We’re looking to see some results to that.

As far as selling off some of our older units, that’s not a very good point, because everything’s for sale. Mostly everything’s for sale. What we want to make sure is if we’re selling our units, we want people to be able to maintain the units and look after them. We don’t want to be setting anybody up that takes over a unit and finds that their maintenance costs are a lot higher than expected. It’s not a policy, but we do say that most of our units are for sale as long as we have people there that are qualified to buy them. Not only buy them, but more importantly they have to be able to maintain them.

Can we have some order in the House? It’s kind of hard to hear the Minister’s good answers.

Okay. No question. Mr. Krutko.

Thank you, Mr. Chairman. I just thought you were going to...

---Interjection

Again the question I have is we’ve had a report not that long ago where there were 137 units sitting vacant. I think that we have to realize there is a cost to operate and maintain those units. We have to realize that that is an ongoing cost that we’ll have to pay, whether people are in those units or not. We have to find a way to invest the resources we have while realizing we may have to shut down certain units and say, sorry, we cannot operate uneconomic units because it’s just not viable. I know people don’t like to see boarded-up units, but at the end of the day you have to make a decision on how to find ways to get these units occupied, operational, and either disposing of them through the homeownership programs or finding ways, like you say, to turn them into social or public housing. We need to require them to take the cost savings from the operation of those newer units that we just built throughout the Northwest Territories. We have 2,400 units to operate. That may mean re-profiling those units and disposing or liquidating the older units. That is something that we have to be aware of. It is an issue. I know you’re trying different things regarding professional housing and getting more people into homeownership, but we have to find a way to work around that.

Thank you, Mr. Krutko. Mr. McLeod.

Thank you, Mr. Chairman. The 135 to 137 units that the Member spoke of, we’re looking at August 31

st

by having all

those off our hands. A lot of them will be approved HELP clients, which wouldn’t be really a burden on the NWT Housing Corporation.

The Member is right; a lot of these units have been empty for the last few years. We’ve had to maintain the units and look after the operational costs of the units, because we’ve been putting them down so quick and we’re having trouble finding approved clients for it. We’re quite confident this year that we have 82 clients, we think, are just in the stages of being approved. We think we can get those in. I’m not sure if the 20 that we’re looking at under the gap analysis that I’ve asked the Housing Corporation to do, I’m not sure if they’re in the 82 or if… They’re in 82? So they are within the 82. So we’re thinking 82 will be given to homeowners or signed over to homeowners. Then, as I pointed out, we do plan on converting some over to public housing. Then, doing that, we may have to, as the Member said, start selling off some of our older units that we continue to pay the O and M on. We just take them down, sell them, do what we can with them, but we do need to relieve ourselves of a lot of these older units.

Thank you, Mr. McLeod. We’re on page 5-53, NWT Housing Corporation, information item, programs and district operations, operations expenditure summary.

Page 5-54, NWT Housing Corporation, information item, programs and district operations, grants and contributions.

Page 5-57. Mr. Bromley.

Thank you, Mr. Chairman. I want to bring this up. I know the Minister is aware of this. Some of the concerns that I have about the current budgeting of local housing organizations seem to fail to recognize the realities under which they provide social housing. This practice is leading to untenable financial situations and could ultimately mean the end of some LHOs and their bankruptcy. The reality and the dilemma that we face here is that you can’t get blood from a stone. What can the Minister do to prevent this service delivery failure, outright bankruptcy that seems inevitable if we stick to the current budgeting practices? I know the Minister’s been wrestling with this, so I’m looking forward to hearing what can be done. If there simply is not the capacity amongst our tenants to pay the rent collections that the Housing Corporation deems should be paid, then we need to be able to fund LHOs recognizing that fact.

Thank you, Mr. Bromley. Mr. McLeod.

Thank you, Mr. Chairman. We are working with some of the LHOs that have found themselves facing some financial difficulties. We have a stabilization fund we’re hoping will help them stabilize a bit.

The Member speaks of the rent collection. We ask LHOs to collect 90 percent of the assessments. We’ve had a lot of people across the Northwest Territories...and the Member talks about the capacity of tenants to pay. A lot of them have realized now that they have to start working on their arrears, they have to start paying their rent. I think we’re starting to see a bit of a shift in attitude. I do know and I see the numbers of people that are coming in that are in arrears that are working out repayment plans. It’s very encouraging to see that. Having said that, we still recognize that there is a need to continue to work with the LHOs, and the tenants need to do their part to ensure that their LHOs are running smoothly, are fairly stable.

During the transfer of assessments we found that we had a few LHOs running into some financial difficulties and we’re dealing with that right now. I think since June 1

st

, when LHOs took over the

responsibility for assessments, I think we’ve seen an improvement. In all areas of housing we’ve seen improvements. In the repayment plans we’ve seen improvements. In the rent collection we’ve seen improvements. In the assessments and reassessments we’ve seen improvements. I think that goes a long way to helping the LHOs. In the short term we’re working with the LHOs. We have a bit of a stabilization fund that we’re hoping to help them offset and maybe get back on track. The rest of it will then kick in and I think we’ll see that once they’re over this crisis, they’ll all start operating pretty smoothly.

I’m afraid I swallowed that reassurance line for a couple of years on this and I wish I could be with the Minister on this, but it ain’t happening out there. I’m not saying that there aren’t some improvements in some areas, and perhaps in some communities there have been vast improvements. The situation is not like that with the communities that I work with and others that I know about. We’re not just talking a minor adjustment or a little adjustment here. I’m not sure what stabilization funds. I’d like to know how much we’re talking about in stabilization funds. We’re talking about 100 percent difference between what is being collected and what the Minister is asking to be collected. Like they say, you can’t get blood from a stone. I’m looking for some real action here, a reality check of the department, because the march continues very much towards bankruptcy here. That’s just the plain facts. The rates are an escalating thing, an exponential thing. It starts low and doubles each year. It doesn’t take many doublings before we’re at 100 percent in the hole here. I’d like to be reassured. The Minister speaks

in a very reassuring way. Again, I haven’t seen any mechanism here that is actually going to deal with this.