At a meeting on Tuesday, Feb. 21, 2023, Kingston City Council will vote on whether or not to apply for funding to the federal government’s Rapid Housing Initiative on behalf of an affordable housing project at 484 Albert Street and 620 Princess Street. The project, led by Home Base Housing, aims to build 48 new affordable, transitional, and supportive housing units for youth, as part of a new Youth Services Hub at the site of the former Princess Street United Church.
The Rapid Housing Initiative (RHI) is a program administered by the Canadian Mortgage Housing Corporation (CMHC), which seeks to provide funding for new long-term affordable housing units. The RHI includes two different program streams: the Cities Stream, which provides funding to municipalities, and the Projects Stream, which funds community projects across the country using an applications-based process.
The RHI is currently in its third round, which will provide a total of $1.5 billion in funding to projects throughout Canada. While the City of Kingston is already set to receive over $6 million in funding through the program’s Cities Stream, the Home Base Housing project provides an opportunity for the municipality to secure additional funds through the Projects Stream.
According to a staff report, Home Base Housing has obtained the necessary zoning by-law amendments, heritage approvals, and site place control approvals for the project. The organization is now looking to finalize the details of its capital budget requirements in order to fund the units to completion. In its previous term, Kingston City Council helped secure a total of $8.9 million for the project, including $4.8 million through the provincial government’s Home for Good Social Services Relief Fund (SSRF). The previous City Council also provided Home Base Housing with $4.1 million in direct capital funding.
With the SSRF set to expire this March, Home Base Housing has put in a request for the City to submit an application to the RHI Project Stream in order to secure over $13 million for the project. The report notes that “municipally led applications receive preferential evaluation within the program’s competitive application process,” which is why the organization has requested the CIty’s assistance in securing the additional funding.
Staff are now calling on City Council to provide direction on whether or not to proceed with the application to the RHI on behalf of Home Base Housing, with a report providing two different options for councillors to consider. The first option would see staff “apply to and take responsibility for” an application to the RHI Projects Stream.
If successful, the RHI Projects Stream would provide the single biggest source of funding for the project, with the City hoping to secure $13,907,062 for Home Base Housing. However, RHI-eligible projects must be “competed and occupied” within 18 months of funding, which the report notes could be difficult. “The nature and complexity of the project make an 18-month construction period challenging.”
Despite some potential difficulties, Home Base Housing has prepared a construction schedule with an estimated project completion date of December 2024, in order to comply with RHI expectations.
Should Council opt to proceed with an RHI Project Stream application, the report notes the added responsibilities this would place on City staff. “The Municipal Funding Agreement with Home Base Housing will require that city staff be fully involved in the construction process, such as being part of the tender review process, attending construction update meetings, reviewing all project update notes documented at those meetings to ensure that the project is progressing on time and on budget.
“Should Home Base Housing be in default of any requirements under the Agreement, including failure to meet any construction milestones set out in the agreement, the City will have the right to cure the default, including carrying out the required work to achieve compliance with the construction milestones,” the report adds.
Home Base Housing’s contractors have estimated a total capital cost for the project at around $36.9 million, up from the $23.7 million which was budgeted back in 2021. “The increase in cost is attributed to unprecedented cost escalation and inflationary pressures occurring over the past few years and includes labour market cost increases, an approximate 30 per cent increase in material costs and a cost premium to give allowance for supply chain issues commonly noted in recent experience,” adds the report.
If approved, the first option would also see City staff submit a request to the provincial government for an extension of the SSRF project completion schedule. The extension would give Home Base Housing another two years to complete the project before funding expires. Option One also includes $9.9 million in the form of a “forgivable loan” to Home Base Housing from the City, as well as $420,000 per year in operating funding and rent subsidies.
Home Base Housing’s project aims to create a number of different units for youth aged 16 to 24. “The supportive, transitional housing component of the project will include 48 units targeted towards homeless and vulnerably housed youth,” notes the report. “The 48 units will include 44 bachelor units and four one-bedroom units. 12 of the units are proposed to be accessible.”
On top of the 48 units, the Youth Services Hub will also include a youth cultural centre, as well as space for additional services and support. The site is also expected to include a Social Enterprise Cafe as part of a future development phase
According to the report, applications for Projects Stream funding must be submitted to CMHC by Wednesday, Mar. 15, 2023, which means staff will have to move quickly to prepare the application should Council approve one on Tuesday evening.
Option Two meanwhile would see the City not proceed with an application to the RHI’s Project Stream, as staff instead focus solely on an extension of the SSRF funding. Should Councillors vote in favour of the second option, staff would also work with Home Base Housing to “redefine the scope of its project and reduce the overall cost and report back with other capital and operating funding options.”
Both options will come before Council at a meeting on Feb. 21, which is scheduled for 7 p.m. in the Council Chamber at Kingston City Hall (216 Ontario Street).
It should be noted that the RHI funding being requested by Home Base Housing is separate from the $6,669,918 in funding the City of Kingston is set to receive as part of Phase Three of the program’s Cities Stream. Staff are expected to report back to Council in March with information on the projects being submitted to CMHC for funding as part of Cities Stream.