A local affordable housing complex for seniors is seeking city assistance to ensure the facility can continue to operate.
Since 2008, Hillcrest Lodge has provided geared-to-income rental units, daily meals, and other services for the 31 residents at its Matchedash Street building.
Hillcrest Lodge president Michael Jones wrote a letter to council this week noting the facility has remained financially viable since opening thanks to the strength of agreements with property owner Toronto United Church Council in addition to provincial and federal grants.
“It certainly is pretty unique as a facility in Canada,” Jones told OrilliaMatters. “It's really an apartment building, which helps vulnerable seniors to live as much as possible out of care situations and hospitals for as long as they can live … and we do that by giving them very, very affordable housing and meals.”
The church signed a 50-year lease with Hillcrest Lodge in 2005 for $1 annually, and the project received a lump sum grant from the federal government, along with monthly mortgage subsidies from the provincial government, which allowed the organization to remain otherwise “completely self-sufficient” over the years.
Additionally, the City of Orillia has never collected property taxes for the building, following a ten-year agreement in 2009.
With these supports, Jones said Hillcrest Lodge has been able to entirely cover its operating costs since opening, arguing that it's a good example of how affordable housing could work in Canada.
“Since we created it, we've had no operating monies from anybody at all. We've had a few donations, and that's about it,” Jones said.
However, in 2019, a Municipal Property Assessment Corporation (MPAC) assessment deemed Hillcrest Lodge ineligible for its tax exempt status moving forward as it does not own the property.
The council of the day suggested Hillcrest acquire the property for a nominal sum, a process which is underway, but in his letter to council Jones said it is taking far longer than expected.
Recently, The First National Bank, who is working with the church and Hillcrest on the property sale, froze Hillcrest’s access to its escrow fund and increased its monthly mortgage payment due to what it considers unpaid back taxes under the MPAC assessment.
The initial impact of the MPAC assessment could raise rent by $150 per month, with the recent addition of back taxes threatening rent hikes of $930 per month, Jones explained, which would make the units unattainable for virtually all of Hillcrest’s residents.
Some residents are living on as little as $12,000 per year, he said.
In his letter, Jones requested the city retroactively reinstate Hillcrest’s tax exemption to allow ample time to complete the property transfer and ensure its residents can safely remain and the organization does not go bankrupt.
If Hillcrest absorbed these additional costs through its operating budget, it would likely go bankrupt by the spring, Jones warned.
At Monday’s council meeting, city staff recommended preparing a report with the Affordable Housing Committee to assess the feasibility of retroactively reinstating its tax exemption, to allow sufficient time for the property transfer, which council ultimately agreed to.
Coun. Jay Fallis, however, questioned whether council could move forward with the tax exemption immediately.
“My immediate thought, reading this, was the clock is ticking, and I personally believe it's a really important institution within Orillia,” he said. “Is there not something we can do right now. as opposed to having the report come from affordable housing? My worry being that (it takes) two months and then it comes back to council and (it’s) already March or April.”
Coun. Janet-Lynne Durnford asked whether Hillcrest’s request was still as time-sensitive as when the letter was drafted.
“My understanding is that there has been some progress made by Hillcrest with regard to this issue,” she said. “Are they still under the same time pressure that they were when this correspondence was written?”
Jackson said the situation changed slightly, as of last Friday, and that Hillcrest is fine with the proposed timeline for a report.
“I did share the timeframe (with Hillcrest) to get a report back to council, and that timeframe seemed to be an appropriate timeframe,” responded CAO Gayle Jackson. “They weren't concerned about reporting back to the March 20 agenda.”
Both Durnford and Mayor Don McIsaac argued to wait for updated information through the report, including the impacts of Hillcrest’s request, the organization’s current financial situation, and information on potential County of Simcoe assistance.
Council supported waiting for the report prior to making a decision.