Subsidies in the Post-operating Agreement World June 20, 2012.
-
Upload
homer-tate -
Category
Documents
-
view
213 -
download
0
Transcript of Subsidies in the Post-operating Agreement World June 20, 2012.
![Page 1: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/1.jpg)
Subsidies in the Post-operating Agreement
WorldJune 20, 2012
![Page 2: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/2.jpg)
![Page 3: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/3.jpg)
![Page 4: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/4.jpg)
4
![Page 5: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/5.jpg)
5
Workshop Objectives
Understand what the post-operating agreement environment looks like
Identify and discuss options for continuing to house lower-income members
![Page 6: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/6.jpg)
6
Some Terms
![Page 7: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/7.jpg)
7
Outline
Introduction, objectives
The post-operating agreement environment
The Challenge sound operations, affordable homes
The Choice rely on ourselves, rely on government
How will it work?
Going forward
![Page 8: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/8.jpg)
88
Our future…
![Page 9: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/9.jpg)
9
Profile of a Post-OA Co-op
No more subsidy for low-income members
Low-income members still in place
First mortgage fully paid out
Operating costs increasing
Reserve contributions needed
New debt service?
No government safety net
![Page 10: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/10.jpg)
![Page 11: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/11.jpg)
11
![Page 12: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/12.jpg)
12
Looking Ahead
If nothing changes other than the end of your operating agreement, after 5 years what kind of shape will your co-op be in:
physically?
Financially?
as a community?
![Page 13: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/13.jpg)
13
Life in the Post-OA Environment
We want our co-ops to be:
Well governed membership associations
Soundly managed, viable businesses
Well maintained real estate assets
Healthy, inclusive, mixed-income, cooperative communities
![Page 14: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/14.jpg)
14
Co-op Mission Statements
In a safe, inclusive, and accessible community, we will provide affordable, well maintained, sustainable
co-operative housing.
Working together to provide well-maintained, affordable homes in a safe, respectful and diverse community.
We provide affordable, sustainable housing within a safe, self-governing community open to diverse membership.
![Page 15: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/15.jpg)
15
Co-op Mission Statements
Safe
Affordable
Sustainable
Diverse
![Page 16: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/16.jpg)
16
The Challenge
How can we meet the requirements for sound operation and still offer reduced housing charges to low-income households after our government assistance ends?
![Page 17: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/17.jpg)
EOA Financial Scenario 1 S95 co-op 10 units
Full housing charge: $825 / month Now Post-OA
Occupancy charges: member payments 78,000 78,000
Housing Charge subsidy applied 24,000
Operating subsidy - -
Other revenue - -
Total revenue 102,000 78,000
Operating expenses 45,000 45,000
Reserve contributions 8,000 8,000
Debt Service 49,000 -
Total operating expense 102,000 53,000
Net surplus (deficit) 0 25,000
![Page 18: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/18.jpg)
EOA Financial Scenario 2 S95 co-op 10 units
Full housing charge: $825 / month Now Post-OA
Occupancy charges: members 78,000 78,000
Housing Charge subsidy applied 24,000 -
Operating Subsidy - -
Other revenue -
Total revenue 102,000 78,000
Operating expenses 45,000 45,000
Reserve contributions 8,000 8,000
Debt Service 49,000 30,000
Total operating expense 102,000 83,000
Net surplus (deficit) 0 (5,000)
New mortgage loan (20-year loan, 5%, close to $40,000 per unit, repairs, renovations)
![Page 19: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/19.jpg)
EOA Financial Scenario 3 S95 co-op 10 units
Full housing charge: $925 / month Now Post-OA
Occupancy charges: members 78,000 83,000
Housing Charge subsidy applied 24,000 -
Operating Subsidy - -
Other revenue -
Total revenue 102,000 83,000
Operating expenses 45,000 45,000
Reserve contributions 8,000 8,000
Debt Service 49,000 30,000
Total operating expense 102,000 83,000
Net surplus (deficit) 0 0
Full housing charge increase: 12%, and 33% above the per-unit break even
![Page 20: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/20.jpg)
20
The Choice
To maintain the income mix we have now and the value of our homes:
1.Most members will have to pay more than the real break-even housing charge so that some members can pay less
OR
2.We have to persuade government to provide assistance to our lower-income members
![Page 21: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/21.jpg)
21
Your Task
Make the case for and against option 1
Make the case for and against option 2
![Page 22: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/22.jpg)
22
Going forward
Having the discussion
Any advice for the CHFT and CHF Canada boards?
![Page 23: Subsidies in the Post-operating Agreement World June 20, 2012.](https://reader035.fdocuments.in/reader035/viewer/2022062720/56649f0e5503460f94c22c7c/html5/thumbnails/23.jpg)
23
Wrapping up
Thank you !