June 15, 2018 6:52 pm
Updated: June 15, 2018 6:57 pm

Edmonton audit finds problems with affordable housing strategies

The Sakaw Terrace is an affordable seniors building that is scheduled to open in Edmonton in 2018.

GEF Seniors Housing, Credit
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A new audit at City Hall says money isn’t being tracked as well is could be in the city’s affordable housing strategy. The report, which will be reviewed by council’s audit committee next Friday, also cited badly outdated policies and has proven to be not very effective when working with developers.

The audit reviewed the second phase of the city’s affordable housing strategy.

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“Cornerstones II included an evaluation matrix with 10 measures with targets,” the report said. “We assessed the City’s achievement of these targets and found it had achieved four of them and did not achieve three of them. We were unable to determine if the remaining three were achieved as the required targets were not set.”

Included in that set of targets was the goal of creating 2,500 units, yet only 776 were committed to.

The report goes on to acknowledge that anticipated federal and provincial funding didn’t materialize.

READ MORE: Big city mayors meet in Halifax, discuss wish list for affordable housing and climate change

The city’s housing strategy is also way behind on implementation actions. The report identified 3 actions that have been carried out, nine that are behind schedule, while six are not yet due.

The report also identified a failure to properly track funding, saying “[a]t the end of 2017 there was $31.3 million in the reserve fund.” Some of that reserve fund was left over from Cornerstones I, yet there was no clear indication over a five year period which program was being used between 2012 and 2017.

Roles and responsibilities of city finance staff aren’t clearly defined.

“There is a lot of knowledge regarding past decisions that resides with a small group of people. If any of these people were to leave the City, it would be difficult for someone new to understand the current financial information.”

READ MORE: Edmonton city council has no appetite to reverse added borrowing recommendation

The report also identified shortcomings in dealing with the development industry.

The plan was to have five percent of the units in a development offered at a discount, with developers charging 85 percent of the value. Yet the audit said the city has barely touched that portion of the affordable housing program.

It said five units were created at a cost of $866,000, for an average cost of $173,000. Yet three other programs fared much better.

Habitat for Humanity used $4 million to create 75 units at an average cost of $53,333, $4.2 million was used on surplus school sites for 112 units at an average cost of $37,500 and new secondary suite grants worth $3.2 million were converted into 162 units for an average cost of $19,815.

READ MORE: Alberta Budget 2017: $49.5M to fund affordable housing project in north Edmonton

“The outputs are very disappointing,” said Councillor Mike Nickel. “We’re going to have to take a solid step back and say, ‘Are we actually meeting the outcomes?'”

The audit also points out there are five policy initiatives in the affordable housing program, yet four of them are decades out of date and need revisiting.

In an accompanying report which gives the response from management, it said programs are already under review and performance measures will be in place by the end of the year.

© 2018 Global News, a division of Corus Entertainment Inc.

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