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High-income wage earners cashing in on public housing

Rents raised after review finds scores of undercharged tenants

Canadian Taxpayers Federation Prairie director Colin Craig says high-income earners shouldn't live in public housing.

MIKE DEAL / WINNIPEG FREE PRESS FILES Enlarge Image

Canadian Taxpayers Federation Prairie director Colin Craig says high-income earners shouldn't live in public housing.

High-income earners who live in subsidized public housing in Manitoba are now paying more rent.

The increase came quietly in January after Manitoba Housing was pressured into a review after the Canadian Taxpayers Federation (CTF) released documents in September 2013 that showed there were more than 30 Manitoba Housing and Renewal Corporation (MHRC) housing units with residents that earned more than $70,000 annually, including 10 who earned between $90,000 and $153,000.

The documents were obtained through a freedom-of-information request by the CTF.

"We're pleased that the government took our concerns seriously," CTF Prairie director Colin Craig said Monday. "They investigated it and they're now acting on their decision. They shouldn't be in the business of providing housing to high-income people."

Craig said Manitoba Housing's later internal review found the numbers were higher.

There were 63 tenants whose income exceeded the limit for the province's affordable-housing rental program, and who were not paying the rent they should be charged under the rules. (The 2013-14 income limit is $64,829 for a family and $48,622 for an individual.) MHRC also found 161 tenants in public housing throughout the province, including 43 living in Churchill, who earned an annual income of more than $50,000.

The findings of MHRC's internal review were obtained by the CTF though a second, recently approved freedom-of-information request.

The documents, available on the CTF's website, say MHRC notified affected tenants in January their rent would increase, giving them the minimum three months' notice.

Craig said the documents say MHRC calculated that by increasing rates on higher-income families, it could raise up to $316,975 more per year in rent, almost doubling what it collected before under the affordable-housing rental program. The top rent charged will be 10 per cent greater than the posted market rent as set each year by MHRC.

Craig said the benefit is that some tenants may choose to move out of public housing.

"As a result (MHRC) is going to save some money and they're going to free up spaces for true low-income people to get into social housing and give them a hand up," he said. "If people are earning tons of money, they should be phased out. The government should push them out."

MHRC says the new policy is in no way intended to evict or cause a household to involuntarily leave public housing because of the rent hike. Manitoba Housing can only increase rent upon renewal of a lease and can only impose one rent increase in a 12-month period.

"This would be in contravention of the Residential Tenancies Act," MHRC said. "High-income tenants will have security of tenure at a reasonable rent level."

MHRC is to conduct an audit of its new rent policy in January 2015 to make sure all tenants are being charged posted rents.

The issue can be traced back more than a decade ago when MHRC brought in a ceiling rent policy to reduce vacancies and increase revenue. In 2003, the average rent in the private rental market was $514 and the average ceiling rent was $426. Rents were supposed to be reviewed annually and change with the market.

There are about 5,200 income-earning tenants who live in public housing in Manitoba, with about half in Winnipeg.

bruce.owen@freepress.mb.ca

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Updated on Tuesday, July 22, 2014 at 8:47 AM CDT:
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