Options For Independence is asking for an exemption that would otherwise require the organization to repay more than $65,000 in City of Whitehorse grants applied to property taxes.
The request came forward to Whitehorse city council at its Jan. 4 meeting.
As Pat Ross, the city’s manager of land and building services, explained, Yukon Housing is set to take over ownership of OFI’s supportive housing residence on Fourth Avenue with the non-profit organization continuing to operate the facility.
The organization’s 14-unit development opened in 2014 with the city approving a development incentive that provided a grant for a portion of property taxes based on the improvements to the property. Under the terms of the agreement, the building was to remain under the ownership of the non-profit for at least 10 years or the organization would be required to pay back the annual grant amounts the city had provided towards property taxes.
“To date, the value of the incentive has been approximately $9,300 annually, for a total of $65,672,” Ross said.
He went on to note that in 2019, OFI and the Yukon government’s Department of Health and Social Services began discussing the impact mortgage payments were having on the organization’s operations.
“It was decided the best solution to ongoing issues was that ownership of the building be transferred to Yukon Housing Corporation, but that OFI continue to operate the building as supportive housing.”
With the building’s ownership to transfer, the society would be required to repay any grants doled out under the incentive policy.
“The pending transfer of ownership to YHC will trigger (a clause in) the development agreement between the city and OFI, which would require all of the grants issued from the city to OFI to be repaid,” OFI manager Sam Mutiwekuziwa wrote in a Nov. 13, 2020, letter to the city.
He went on to request the exemption, noting OFI is a non-profit that is continuing to provide supportive housing, which remains consistent with what was outlined in the development agreement.
It was also noted OFI has been able to provide services to more clients and the units have remained at full capacity with all clients stable in their placements and eight of those clients being employed.
“None has been negatively involved with the criminal justice system, but rather are contributing to the safety and well-being of city citizens in general,” he wrote. “Due to assistance with systems navigation from our staff, unnecessary use of the emergency medical services has been eliminated and our clients’ health and social outcomes have been positive. This is particularly important in light of the COVID-19 pandemic.”
Mutiwekuziwa emphasized again in the letter that while Yukon Housing will be taking over ownership of the property, OFI will “continue to use the property to manage and support adults with FASD; consistent with the terms of the Memorandum of Understanding between YHC and the Department of Health and Social Services.
“The only reason OFI has decided to relinquish ownership of the property is due to financial hardship associated with mortgage payments. Repaying the grants will only make our already financially precarious position worse.”
Presented with the recommendation that council exempt OFI from the repayment requirement, council members voiced their support for the organization and its services, at the same time wondering the impacts to the city’s budget and asking for further information on the financial situation being faced by OFI.
Coun. Laura Cabott said it seems like an unfortunate situation OFI is in and while she’s not opposed to the request, the city owes it to taxpayers to get more information on the financial situation.
Ross noted city staff can request that information from OFI.
“It is unfortunate,” Coun. Samson Hartland said, adding the organization provides a quality service. He then asked about the implications on the city budget with staff noting the transfer will result in the city gaining more than it would otherwise as the incentive program will cease.
“The incentive will end with the change of title,” Mike Gau, the city’s director of development services, said noting that the issue for council is whether to clawback taxes that are foregone from the incentive in previous years.
“That’s the question before council,” he said.
It will be Jan. 11 before council votes on it, but members largely appeared to favour the exemption, pointing out the intent of the development to provide support when the incentive was approved is still in place.
Coun. Steve Roddick said if the units were being sold for condos it would be a different question.
As Ross stated in his report before making the recommendation for the exemption: “An intent of the policy was to ensure that grants provided for supportive housing would benefit local groups providing the services. OFI has provided supportive housing for 14 adults with Fetal Alcohol Spectrum Disorder during the eight-year time frame since the development incentives agreement took effect.”
Yukon Housing spokesperson Sarah Murray stated in an email it’s anticipated the property will be transferred by the end of the fiscal year on March 31.
“The Government of Yukon is pleased to work in partnership with Options for Independence to ensure they can continue to run their supportive housing program which supports housing action plan objectives to provide a range of housing options to meet the needs of all Yukoners,” she wrote.
Murray noted Yukon Housing is waiting to see what Whitehorse city council decides on the grant exemption and will manage the facility within its 2021/2022 budget as it monitors expenses on the facility.
OFI did not have a spokesperson available to speak to the News.
Contact Stephanie Waddell at stephanie.waddell@yukon-news.com