But, as federal funding dries up, those co-ops fear they may be facing heart-wrenching decisions. Members feel they have to choose between two equally terrible options. One is to charge their only slightly better-off residents higher rates in order to maintain affordable rents for low-income families. The other is to raise rents on subsidized units to the point where those low-income families will likely have to leave.
Residents at Marpole’s eight co-ops are hoping there are other solutions, including lobbying the provincial government for more funding. In the meantime, many of them are debating which is the lesser of two evils.
Increasing rent for unsubsidized residents strikes at the heart of the mandate behind co-operative living, which is to provide affordable housing to individuals and families with a range of incomes.
Marine Court Co-op is considering this option, but, for Larry Birckhead, chair of the membership committee and resident at Marine Court Co-op, that means making life less affordable for a different group of people, the tenants who are slightly better off than their subsidized neighbours.
“Some members that are currently ‘market’ may not be able to afford another $100 a month themselves. If they had to pay another $100 a month, they might have to go on subsidy,” says Birckhead.
Elsewhere, Wits’ End Co-op is looking at an alternative solution: raising rent for its subsidized members even if this means some may have to leave their homes. That’s equally problematic.
“It’s really those on the low income: it’s the pensioners and those who are on social assistance or making minimum wage. It breaks your heart. You wish you could help them and I go over the figures back and forth just to see how I can structure the rents but the reality is I have got to cover the bills,” says Cathy Maxwell, office coordinator at Wits’ End Co-op, the third-largest co-op in Marpole.
As the agreements near their end dates, Maxwell is concerned that the co-op’s most vulnerable members may face the greatest risk in the transition.
The federal government’s operating agreements for co-ops, put in place 30 to 35 years ago, created a system where the government would pay the co-ops approximately the equivalent of the mortgage payments for the building every year. Co-op committees then decided how much to subsidize each family, depending on their income.
The premise was simple: once the mortgage was paid out, the subsidy would end. The federal government assumed that once the mortgage payments were finished, the co-ops would only need to cover operating costs. This way, they would be able to continue providing affordable rents to low-income families.
But the federal funders did not foresee that by the time the original mortgage was paid off, these buildings, many of which were poorly built, would need to be repaired and refurbished, forcing co-ops to take out a second or even a third mortgage.
“It was a great idea when they first started, but I don’t think the government really [thought] further ahead. They should never have ended the subsidy – I mean people need affordable housing. The co-ops are never gonna be able to be self-sufficient,” says Maxwell, who has worked in an administrative capacity with co-ops for more than three decades.
Both Wits’ End and Marine Court Co-ops have already taken out second mortgages to stay afloat. Wits’ End Co-op is currently paying $311,000 a year on its two mortgages.
“When [the government] steps out, we have to take out another mortgage. We have to re-pipe. We have more building-envelope issues. All the suites need major upgrading, so we have no choice. We are going to have to take out a mortgage of a million-and-some-odd dollars. So we cannot self-subsidize,” says Maxwell.
Push for more support
Making the lives of people in co-ops even more difficult, the federal government transferred the responsibility in 1996 for social and co-op housing to the provinces. As a result, residents find themselves having to lobby for money from a level of government that was only handed the portfolio recently.
Both the provincial and the national co-op housing federations are pressuring the government for more support. The Co-op Housing Federation of B.C. has already launched its You Hold the Key campaign to ask the province to consider offering subsidies under a new rent-assistance program.
“We’re saying, ‘We’ll help the co-ops take care of the buildings, you need to take care of the vulnerable people’,” says Fiona Jackson, media coordinator at the federation.
Another campaign is 2020 Vision, created by the national Co-op Housing Federation, aimed at helping co-ops better prepare for the end of their operating agreements.
But those in co-ops are not optimistic that they will get anything more than enough to scrape by. That means the current generation of co-op residents may be okay — but there isn’t much hope for any newcomers. That will change the face of co-op housing forever.
“Some people see ‘co-op’ and say, ‘that’s affordable housing’ and they’re hoping to get in. You feel bad for them. You know you have to turn them away. I hate to say that to them – to give up hope. But there is no hope. They’re never gonna get a subsidy here.”