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UBC Theses and Dissertations

Yukon's housing industry and community economic development Hedmann, David G.C. 1989

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Y U K O N ' S H O U S I N G I N D U S T R Y A N D C O M M U N I T Y E C O N O M I C D E V E L O P M E N T B y D A V I D G . C . H E D M A N N B . A . C o n c o r d i a Univers i ty , 1978 A T H E S I S S U B M I T T E D IN P A R T I A L F U L F I L M E N T O F T H E R E Q U I R E M E N T S F O R T H E D E G R E E O F M A S T E R O F A R T S i n T H E F A C U L T Y O F A R T S S C H O O L O F C O M M U N I T Y A N D R E G I O N A L P L A N N I N G We accept th is thesis as conforming to the required s t anda rd T H E U N I V E R S I T Y O F B R I T I S H C O L U M B I A A u g u s t , 1989 © Copyright David G.C. Hedmann, 1989 In presenting this thesis in partial fulfilment of the requirements for an advanced degree at the University of British Columbia, I agree that the Library shall make it freely available for reference and study. 1 further agree that permission for extensive copying of this thesis for scholarly purposes may be granted by the head of my department or by his or her representatives. It is understood that copying or publication of this thesis for financial gain shall not be allowed without my written permission. Department of The University of British Columbia Vancouver, Canada DE-6 (2/88) ABSTRACT In 1986, dur ing Yukon 's worst recession in twenty years, the territorial government began a two-year process to develop an economic development strategy. The result was Yukon 2000, a p lan for communi ty economic development (CED). Concurrent ly , but not as part of Yukon 2000, the 1986 Yukon Housing Needs Study reported the percentage of people in core housing need in Y u k o n highest in Canada . Th i s thesis identifies new policy initiatives to meet hous ing needs and help achieve the communi ty economic development goals of Yukon 2000. The Yukon 2000 process overlooked the hous ing industry for several reasons. These include the industry 's low visibility dur ing the recession in the early 1980's. A lso, decision makers and planners knew very little about the industry because the data base for the Y u k o n hous ing industry is extremely weak. Most C M H C statistical reports either meld data on Y u k o n with data on another jur isdict ion or do not report on Yukon . The goals of Yukon 2000 are to provide options for people to earn a living in Y u k o n , to control their future, to protect the environment and to create an equitable society. These goals apply to the Yukon communi ty and to each communi ty within the territory. Crit ical to achieving these goals is diversifying the narrow base of the isolated economy, in part, through import replacement, meeting social needs, devolving decision mak ing and distr ibuting resources more equitably. The Market and Non-Market sectors of the Y u k o n hous ing industry are unstable and there is strong evidence the Market Rental sector is not working. Throughout the 1980's, the Y u k o n and C a n a d a hous ing corporations have consistently failed to meet p lanning targets for new social hous ing. Th i s thesis defines policy options for the Y u k o n government to stabilize the industry, meet p lanning targets and increase federal spending i n Y u k o n . Housing is a unique industry because of what housing means to individuals, groups and communities. The right to adequate, affordable and suitable shelter is a fundamental one not available to about one third of people in Yukon. On a per household basis, the housing corporation in the Northwest Territories has ten times more social housing than the housing corporation in Yukon. Yukon Housing Corporation and Canada Mortgage and Housing Corporation have funding for about 130 new social housing units each year. Increases in the Yukon population will generate demand for an additional 300 new units each year through the 1990's. New construction and housing renovations are an important part of the small Yukon economy. This thesis developed sixteen criteria to measure the impact of fourteen housing programs on CED. These criteria were developed from the goals and objectives of Yukon 2000 and the literature on CED. This thesis compares the relative impact of each program on CED. Based on this analysis, modifications to program delivery are suggested. The Yukon economy is particularly susceptible to boom and bust cycles. These cycles and other characteristics of the economy inhibit investment in the housing industry despite generous government incentives to businesses. This thesis proposes ways to increase this investment. The Yukon government has the resources to meet housing needs and stabilize the housing industry. That Yukon government can use the industry to diversify the economy and help achieve the four Yukon 2000 goals. It can create a win-win environment, meet housing needs, create employment and business opportunities and develop new leadership. This thesis describes the important roles of governments, the private sector, communities and non-governmental organizations in the housing industry. It describes the possible roles of each in a CED strategy to respond to housing needs and problems with the housing industry. ii i Table of Contents ABSTRACT i i 1. Introduction 1 1.1. Thesis Statement 2 1.2. Rationale for this Thesis 3 1.3. Thesis Scope 8 1.4. Research Questions 10 1.5. Methodology 12 2. Yukon 2000 and Community Economic Development 15 2.1. Yukon 2000 18 2.2. New Perspectives on Economic Development 21 2.3. Import Substitution 23 2.4. Summary 26 3. Yukon's Housing Industry 28 3.1. The Yukon Housing Industry Defined 28 3.2. The Role of the Federal Government 35 A. Social Housing Programs 36 B. Federal Staff Housing 41 3.3. The Role or the Territorial Government 43 A. Social Housing Programs 43 B. Territorial Government Staff Housing 48 C. Community and Transportation Services 49 3.4. Band Governments 50 3.5. Municipal Governments 51 iv 3.6. The Private Sector 53 3.7. The Demand for New Housing in the 1990's 54 A. Population Growth 54 B. Government Response to Core Housing Needs 57 C. The Aging Housing Stock 63 D. Economic Conditions 65 4. Existing Housing Programs 70 4.1. Cooperative Housing Program 72 4.2. DIAND Housing Program 74 4.3. Non-Profit Housing Programs 76 A. Urban Native Housing Program 78 B. On Reserve Housing Program 79 C. Rural and Native Housing Program 80 D. Private Non-Profit Housing Program 81 E. Public Non-Profit Housing Program 81 4.4. Rural and Native Demonstration Program 83 4.5. Lease Purchase Program 84 4.6. Renovation Programs 86 A. CMHC Renovation Programs 87 B. YHC Renovation Programs 88 C. Saving Energy Action Loan (SEAL) 88 D. DIAND Renovation Program 90 4.7. Summary 90 5. Conclusions and New Policy Initiatives 95 5.1. Impact of the Housing Industry on CED 96 5.2. New Policy Initiatives for YTG 99 v 5.3. Conc lus ions 105 5.4. Implications for P lanning Practice 107 Appendix 1. S u m m a r y of New Policy Initiatives 110 6. Notes 113 7. B ibl iography 125 vi List of Figures Figure 1 NHA Loan Approvals: New Units 1968-1988 9 Figure 2 A Model of the Yukon Housing Industry 29 Figure 3 Profile of the Yukon Market Rental Stock by Age 31 Figure 4 Market and Social Housing Starts in Whitehorse: 1986-1988 33 Figure 5 Annual CMHC Social Housing Delivery: 1980-1990 38 Figure 6 Subsidized Federal Staff Housing: The Aging Stock 42 Figure 7 Core Housing Need by Type of Problem 58 Figure 8 Social Housing in Yukon: New and Existing Properties 62 Figure 9 Profile of the Yukon Housing Stock by Age 64 Figure 10 The Effect of Recession 1982-1986 67 vii List of Tables Table 1 Employment in Yukon by Industry: 1987 and 1988 24 Table 2 Ownership of Occupied Private Dwellings in Yukon: 1988 31 Table 3 New Housing Starts in Whitehorse: 1980-1988 32 Table 4 Value of Residential Building Permits: 1978-1988 32 Table 5 CMHC Social Housing Programs i n Yukon: 1980-1990 37 Table 6 CMHC Program Delivery: 1988 39 Table 7 Subsidized Federal Staff Housing 41 Table 8 YHC Portfolio at December 31, 1988 44 Table 9 YHC Social Housing Unit Delivery: 1986-1988 45 Table 10 C&TS and the Housing Industry: Fiscal Year 1988/89 48 Table 11 The On Reserve Housing Program: Band Portfolios 49 Table 12 Population and New Housing Demand Projections: 1990-1999 55 Table 13 Canada and Yukon: Households and Housing 1986 57 Table 14 Yukon Core Need Income Thresholds: 1986 and 1988 59 Table 15 Portfolios of the NWT and Yukon Housing Corporations: A Comparison ... 60 Table 16 UIC Claimants and Employable Social Assistance Recipients 68 Table 17 Urban Native Housing in Yukon: Society Portfolios 79 Table 18 The On Reserve Housing Program: Band Portfolios 80 Table 19 Home Renovation and Repair Programs 86 Table 20 The Impact of Housing Programs on CED: A Summary 93 viii 1. Introduction In 1986, during Yukon's worst recession in twenty years, the territorial government began a two-year process to develop an economic development strategy. The result was Yukon 2000, a plan for community economic development (CED).1 The four goals of Yukon 2000 are: • THE OPTION TO STAY m THE YUKON: Yukoners see our territory as a place to live, work, learn, and raise a family. We want it to stay that way, but we also want to be able to earn a living in our chosen place. Development must offer us a chance to support ourselves and our families, within the territory and within our communities. • CONTROL OF THE FUTURE: Yukoners want more control over the economic future of the territory. The keys to greater control are more regional and local decision-making, increased authority for communities, and a higher level of Yukon ownership. • AN ACCEPTABLE QUALITY OF LIFE: Yukoners want development to preserve and enhance the quality of Yukon life. We want wages, business opportunities, and public services comparable with the rest of Canada. But we are not prepared to sacrifice either the potential for living off the land or the unspoiled natural environment that surrounds us. • EQUALITY: Development should ensure an equal economic chance for all Yukoners, including those who do not currently have equal opportunity. (Yukon 2000, page 3) (emphasis added). These goals clearly distinguish between the Yukon community and individual communities within the territory. The community in community economic development in Yukon can mean two different things. 1 Concurrent ly , but not as part of the Yukon 2000 process, the 1986 Yukon Housing Needs Study reported that hous ing needs are m u c h greater in Y u k o n than anywhere else in Canada . Approximately one third of Yukoners are in core housing need.2 Core housing need is a definition used i n all the provinces and both territories. It means a need for better hous ing by households who: • occupy crowded or inadequate dwellings and pay less than 3 0 % of their income for shelter but for w h o m basic shelter costs for an adequate and uncrowded dwelling would consume 3 0 % or more of their income; or • pay more than 3 0 % of their income for shelter, and for w h o m an adequate and uncrowded dwelling would consume 3 0 % or more of their income; and , 3 • have incomes below a level or threshold set annual ly for each area in Canada . The high incidence of core housing need in Y u k o n and the precipitous decline in market rental starts in the 1980's are both strong indications the Y u k o n Market Housing and Social Sectors are not meeting hous ing needs. It is timely that a review and analysis of the hous ing industry occur. It is also timely to conduct a study which identifies ways the industry can work better, specifically to meet hous ing needs and the four Yukon 2000 communi ty economic development goals. 1.1. Thes is Statement The purpose of this thesis is to identify ways the Y u k o n government can assist Yukoners and Y u k o n communi t ies meet hous ing needs and help achieve the four Yukon 2000 C E D goals. Th i s thesis explains why the Yukon government mus t play a formal leadership role in 2 the housing industry to meet these goals. This thesis shows that the purpose of this leadership role should be to: a) increase production of Yukon harvested and manufactured building products and use of these products in the Yukon housing industry; b) stabilize the level of new housing starts from year to year; c) stabilize employment and investment in plant, equipment and professional development; d) provide greater certainty for housing industry workers, investors, and businesses; e) meet housing needs not met by the housing market; f) identify a mix of social housing programs designed to optimize the community economic development benefits of these programs; g) optimize the community economic development benefits of government spending in the housing industry. 1.2. Rationale for this Thesis The Yukon 2000 Strategy overlooked the housing industry for several reasons. The most important of these was the low visibility of the industry during the recession which motivated the Yukon government to develop Yukon 2000. In their Annual Report for the BC/Yukon Region in 1982, CMHC reported, "By mid-year, the housing markets across the Region were nearly dormant (CMHC: 1983 p.l)." The industry remained depressed for several years. In their 1984 Annual Report, CMHC reported "the lowest level of new housing starts [across the Region] 3 in more than two decades (CMHC: 1985 p.l)." In Whitehorse, the Yukon capital, there were only 11 new housing starts in 1983, 21 in 1984, and 27 i n 1985." By 1986, there was some recovery with 119 starts. Based upon the performance of the housing industry i n the early 1980's and the dearth of information about it, it is indeed understandable how planners and participants all but eliminated housing from the Yukon 2000 deliberations. However, this thesis shows that the housing industry can help achieve the four Yukon 2000 CED goals. Using existing resources and available, for-the-asking federal funding, the housing industry can create new businesses, new jobs, new leadership, new community organizations, and thus revitalize communities. The housing industry involves people, needs, human rights, homes, personal investment, ownership, privacy, security of tenure, employment, business, and communities. It also involves issues of community planning, neighbourhood revitalization, Not In My Back Yard (NIMBY), and the image of the community (how residents and others perceive it). The housing industry is not simply construction in the same way that houses are not just buildings. The housing stock i n a community is an indication of it's wealth, character, and capacity to support members acquire shelter, a fundamental human right. 5 Housing in this sense means neither fee simple ownership nor occupancy of a single detached dwelling, the Canadian and Yukon housing norms.6 Rather, it means that suitable, affordable, and adequate shelter is a right of every Canadian. This thesis shows the housing stock to be an essential part of a community because of its social, psychological, cultural and economic importance. Housing alternatives and opportunities and the existing housing stock are part of a community's amenity factor. This factor affects the locational decision of firms and workers. Because housing is an essential part of a community and its economy, so too the housing industry must be part of a CED strategy. 4 The characteristics of the housing industry make it a unique industry. It differs in fundamental ways from farming, tourism or mining. Government and community responses to housing needs and housing programs depend on many variables. Most people in Yukon would welcome a new business that would create hundreds of jobs throughout the territory and not have a negative impact on the ecosystem. Governments would offer such a business an array of incentives to locate in Yukon. However, people i n Yukon have not extended that same welcome to the housing industry or social housing programs. The Yukon government has the resources to respond to divergent housing needs and demands. That government exercised its mandate and committed resources to initiate and implement processes to define community economic development goals and objectives. Experience with mine, railway and business closures also exemplifies that expenditures by governments are much more reliable over the long term than expenditures by international corporations. This thesis shows government spending is a base on which to restructure the housing industry so it is better able to meet housing needs and the goals of Yukon 2000. CED is a new concept and one which will be difficult to implement. This is particularly true in the housing industry in Yukon where there are certain anachronisms and contradictions about the role of government. Some people in Yukon participate in debates on housing policy that took place in the rest of the country in the 1920's.7 Many long-time Yukon residents, particularly those in the rural areas, grew up poor. Their poor housing conditions were, and for many remain, an indication of this poverty. In many Yukon communities, poor housing conditions remain the norm. Planners do not receive a very hospitable reception when they meet with people in the communities to discuss and report on housing programs and conditions. Many people have strong resistance to improving the housing stock, part of a communities wealth and economic base, with social 5 housing programs. A frontier philosophy about housing, a basic human need and human right, persists in Yukon. This frontier philosophy is that individuals are responsible for meeting their own housing needs. In this philosophy, housing is something unique. Most frontier philosiphers do not suggest, for example, that education or health care be left to the individual. Rather, they support a role for government in these important areas. Part of the frontier philosophy is the belief people choose to live in inadequate housing without running water because of some romantic attachment to the "cabin lifestyle." Perhaps some do, but for most people living in these conditions, their harsh poverty is no romance. The contradiction inherent in this frontier philosophy is that while opposing government response to core housing need, frontier philosophers support government aid to homeowners and assisted home ownership. They also support government subsidized land development for housing middle and upper income earners. In addition to opposition by frontier philosophers and partisan politics, there will be at least two causes for resistance. First, people who benefit, or perceive they benefit, from the unequal distribution of wealth and housing, will resist CED. This is because CED, as defined by the Social Planning and Review Council of BC and in the final Yukon 2000 report, causes a more equal distribution of resources and the empowerment of new people and communities. The second source of resistance will come from people i n institutions, particularly government, who do not yet have the requisite systems and personnel, in numbers or i n qualifications, to plan and develop CED. Excessive bureaucratic resistance...will not only hold back the new way of life and retard the new stability, it can damage us by holding onto a yesterday that no longer fits while weakening the appropriate responses 6 now striving to survive in our industrial societies (Nicholls and Dyson, 1983, p. 182). The Yukon government is on record as saying that Yukon 2000 is the yardstick by which it will measure future decisions. 8 This thesis shows that measured against this yardstick, the government continues to fall short i n the housing area. This thesis shows a more proactive approach by the Yukon government is essential for the housing industry to function within the Yukon 2000 framework. The role of the Yukon government in the housing industry is especially critical in Yukon for four reasons. First, there is a high incidence of core housing need in Yukon; in fact, it's the highest in Canada. Second, the Yukon non-governmental organization (NGO), non-profit sector has a limited capacity to increase the supply of affordable housing. There are no housing co-operatives, housing resource groups, or anti-poverty and other such pressure groups. Third, the number of new private sector rental housing starts has fallen off in the 1980's. That sector is not responding to housing needs. Fourth, the Yukon government began the consultative process to develop the Yukon 2000 strategy and now is implementing ways to achieve the goals the process identified. The scope of recommendations in this thesis covers how to begin to achieve these goals in one industry, housing. The Yukon government adopted an import substitution policy as part of the Yukon 2000 strategy.9 This thesis identifies some of the ways that government could work with the housing industry to achieve the import substitution objectives. Building new housing is neither necessary nor sufficient to cause community, economic, or community economic development. Building new housing could cause underdevelopment and unemployment. The urban renewal schemes in North America in the 1960's proved building new housing can even destroy communities and reduce the stock of affordable 7 hous ing. Some hous ing programs such as co-operative, private non-profit or publ ic non-profit programs require communi ty institutions to make them work. A s d iscussed in Chapter 4, these communi ty institutions facilitate and support the process to develop the leadership necessary for communi ty development. In the broader Canad i an experience, there are communi ty based co-operatives and non -profit societies in localities with both high and low levels of polit ical efficacy. Commun i t y control of broader communi ty p lanning processes is not essential for a communi ty or communi t y group to control the supply of social housing. However, the development of communi ty leadership and organizations is an integral part of communi ty economic development. Some hous ing programs, like the Co-op and Private Non-Profit, can create communi ty leadership and organizations. Th i s increases the wealth and strength of communit ies . Leadership and organizations are resources communi t ies need to take control of communi ty economic development. 1.3. Thes is Scope The scope of this thesis is the communi ty economic development (CED) opportunities created by one industry, housing. Data presented in this paper shows hous ing is an integral part of C E D . It will also reveal that social hous ing programs are an important part of the hous ing industry and the way to meet m a n y hous ing needs. Th i s thesis shows that, despite great hous ing need, the supply of social hous ing in Yukon by hous ing corporations has always been at levels less than governments f inanced them to provide. The two hous ing corporations in Yukon , Canada Mortgage and Hous ing Corporat ion (CMHC) and Y u k o n Hous ing Corporat ion (YHC), have never met p lanning targets for the 8 supply of social housing. Th i s thesis will also show that for the few units the hous ing corporations manage to deliver, they use a social hous ing program mix which has a low propensity to cause C E D . Y u k o n communit ies , the economy, and Yukoners in core housing need, all benefit from bui ld ing social housing. However, in the 1980's, there were far fewer social hous ing starts than were possible with available resources. The result: the benefits of this new home construct ion for Y u k o n communit ies , the economy, and people in core housing need were very l imited. Opportunit ies for C E D were missed. Figure 1 N H A Loan Approvals: New Units 1968-1988 A l l Yukon N H A S e c t i o n s E . 5 8 a n d 5 9 L o a n s "1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 ' 6 8 5 9 ' 7 0 ' 7 1 ' 7 2 ' 7 3 ' 7 4 ' 7 5 ' 7 6 ' 7 7 ' 7 H ' 7 S ' 8 0 ' 8 1 B 2 ' S 3 ' 8 4 ' 8 5 ' 8 6 ' 8 7 • S i n g I e O w e I I i n g s + A l l O w e I I i n g T y p e s Data shows that in the hous ing industry, both the market and social hous ing sectors are unstable. A s shown in Figure 1, a very consistent feature of the Y u k o n hous ing industry is its instabil i ty. 1 0 Th i s instability is not good for C E D , people in core hous ing need, the housing 9 industry, or the economy. This thesis shows that the causes for the instability i n the market and social housing sectors are fundamentally different. It also discusses the warning signals that the market housing rental sector is failing or indeed, has already failed. Chapter 4 provides an analysis of the menu of social housing programs. Chapter 5 presents a strategy to cause some stability in the industry and in Yukon communities. This strategy advocates increasing community control of the housing industry, increasing employment in it, sharing the economic benefits more equally among Yukon communities, and adopting an integrated approach to developing the industry. This thesis describes and analyzes opportunities for CED created by the Yukon housing industry and by the role of governments in that industry. This thesis also offers some policy options for one of these governments, the Yukon Government, to support CED initiatives in the housing industry. It also describes ways to increase the use of federal funds to build affordable housing. 1.4 Research Questions This thesis answers some important questions about the Yukon housing industry and the role of government in it. These questions are: 1. How is the Yukon housing industry working? a) what is the historical performance of the industry? b) what are the roles of governments, the private sector and community groups? c) is the industry meeting housing needs and if so, which ones? d) what linkages does the industry have to other industries? Are these linkages 10 important? 2. What is the relationship between the hous ing industry and Commun i t y Economic Development (CED)? a) can the Y u k o n government apply a C E D strategy to the hous ing industry? b) have the Yukon Government, the bus iness communi ty , and/or hous ing agencies expressed a commitment to C E D ? c) is the provision of affordable adequate hous ing an important part of C E D ? 3. How could the Y u k o n government apply a C E D strategy to the hous ing industry? a) what institutions and agencies could play a role in this strategy? b) of the social hous ing programs that are available, what are the relative C E D benefits of each? The data base for the Yukon hous ing industry is extremely weak. Most reports meld statistical information for Y u k o n with information on Brit ish Co lumb ia or the Northwest Territories. For example, each year, Canada Mortgage and Hous ing Corporat ion (CMHC) prepares Housing Statistics." Of the 88 tables in the 1988 report, only 12 provide information on Yukon . Most C M H C reports are for the Br it ish Co lumb ia/Yukon Region in which B C activity dwarfs activity i n Y u k o n . The monthly C M H C report Housing Statistics, prepared by the C M H C Br i t ish Co lumb ia and Y u k o n Regional Office, does not report on Y u k o n . 1 2 Other reports available from the C M H C Whitehorse B ranch office include data on the part of Northern B C serviced by that office. For example, before data was compiled for this thesis, data was not available on annua l hous ing starts in Whitehorse or on social hous ing program activity throughout the Territory. 11 There was no accurate data base for decision makers in the private sector, in government or in housing agencies.13 The Yukon government prepared a Yukon 2000 progress report Construction and Housing Strategy i n April, 1987. This report contained ten recommendations to "guide the development of this sector (p. 1)." Indicative of the absence of a data base for the housing industry is the following quote from the report. Information about the housing market would enable builders to make more informed decisions.. .The size of the market is unknown across Yukon (p. 5). However, even more revealing about the level of understanding about the housing industry is the length of the report itself — five pages for the entire construction industry including housing. In 1987, there was little grasp of the significant impact that the housing industry can have on community economic development. This thesis compiles data and information on the Yukon market (rental and ownership) and non-market (social and employee) housing sectors together in one comprehensive report for the first time. During this study, it was usual for data collected from one source to be different from the same data from a second source. For example, there were differences in the data supplied by the CMHC Whitehorse office and the CMHC BC /Yukon Region office. 1.5 Methodology This research explains the social and economic circumstances which caused the Yukon government to develop Yukon 2000, a community economic development strategy. It also explains the process which produced Yukon 2000 and its four goals. 12 This thesis describes the housing industry i n Yukon and provides a model of how it functions. It assesses the impact of the industry on CED and identifies four factors which contribute to the demand for housing. This thesis explains the characteristics of the Yukon economy and its impact on housing conditions, housing needs and the housing industry. It reports the roles of different governments, agencies and the private sector i n the industry. Ways in which these roles could be better coordinated to achieve the four Yukon 2000 goals and other CED objectives are identified. Particularly, ways in which the Yukon government could apply an import substitution strategy to the industry to diversify the economy are explained. There are many different housing programs in Yukon; this thesis reviews fourteen. Sixteen criteria, derived from the literature on CED and the four Yukon 2000 goals were developed to measure the impact of these programs on CED. This process provides an analysis of the comparative impact on CED of each program. Each community has limited opportunities for CED. These opportunities are particularly limited i n Yukon because of its geographic isolation, narrow economic base and small population. This thesis identifies policies and programs the Yukon government could implement to take advantage of the CED opportunities the housing industry creates. This thesis consists of five chapters. Chapter 2 introduces the Yukon Government's economic strategy, Yukon 2000. It also defines the terms community economic development and others pertinent to this paper and reports on the theory of CED. Chapter 3 describes the Yukon housing industry and the housing activity expected in the 1990's. This chapter also examines the characteristics of the Yukon economy and opportunities for using the housing industry as part of a CED strategy. It presents a model which describes the structure of the Yukon housing industry. This description and analysis 13 shows that governments (federal, territorial, band , and municipal) dominate the industry in Yukon . New Y u k o n Government initiatives to improve and instal l mun ic ipa l infrastructure and its potential impact on C E D are reported. Chapter 3 concludes by defining the demand for new hous ing caused by changes in the populat ion, hous ing needs, an aging hous ing stock and the economy. Chapter 4 reviews the m e n u of hous ing programs which governments and communit ies c a n use to make C E D happen. It introduces the institutions that work with existing housing programs (co-operatives, non-profit societies, hous ing associations, for profit companies and Crown hous ing corporations) and their respective roles. Th i s chapter also crit iques and measures the impact of fourteen hous ing programs on C E D . Chapter 5 presents 20 policy and program options for the territorial government which can help achieve the Y u k o n 2000 C E D objectives. It also presents some policy options to mitigate the impacts of the failing Whitehorse rental market and the aging redundant federal employee hous ing stock. Th i s final chapter also describes the impact on p lanning practice and the lessons we can learn from an analysis of C E D and the hous ing industry in Yukon . Th i s thesis demonstrates that the hous ing industry c a n create numerous opportunities for C E D . The question is, will the Y u k o n Government, the Y u k o n Hous ing Corporat ion (YHC) and the other institutions involved in the hous ing industry seize these opportunit ies, take a proactive approach, and work with communit ies and the industry to make C E D happen? 14 2. Yukon 2000 a n d C o m m u n i t y E c o n o m i c D e v e l o p m e n t Commun i t y economic development is a process of communi ty change. The Social P lanning and Review Counc i l of Br i t ish Co lumb ia (SPARC of BC) has defined C E D as being: . . .concerned with fostering the social, economic and environmental well-being of communi t ies and regions through initiatives taken by institutions, communi ty agencies, or other organizations that strengthen local decision-making and self-reliance, co-operative endeavour and broad participation in communi ty affairs (SPARC, 1987). A communi ty can mean a group separated by geography but l inked by interests members perceive as common, like the Y u k o n Order of Pioneers or the Y u k o n Indian Women's Associat ion. Commun i t y c a n also mean a smal l or large geographic area, the members of which define their own boundar ies. These could be for neighbourhoods or Y u k o n . What l inks indiv iduals into a communi ty is one or more shared social or economic or political interest. "Communi t ies manifest their presence (and limits) by common cause and action (Douglas, 1989, p. 30)." There is no one definition of communi ty and no one definition of development. Commun i t y economic development theoreticians usual ly scramble for the exits when asked to define the topic. "It's not up to us," they say. "It's up to communit ies (whatever they are)." In this thesis "economic" means m u c h more than the activities measured in dollars in the gross territorial product. It includes informal economic activities in wh ich the home plays an important, often central role. The home is one of the means of product ion for many economic activities. "Economic" also includes the work of volunteers, the non-profit sector, and activities for which cash may or may not be the med ium of exchange. Th i s inc ludes the underground economy and activities which occur in every community , between friends, neighbours and 15 acquaintances but are not reported to Revenue Canada (Douglas, 1989; Nicholls and Dyson , 1983). The early non-Native economic and communi ty growth and development in Y u k o n had as its bas is exploitation of minera l resources by individuals and corporations. It was the search for gold which caused the first economic boom in Yukon . The gold r u sh lured prospectors and miners to the North in the late 1800's. It was a period of free enterprise and unbr idled capital ism. The only government interventions were to mainta in law and order and the requirement that each person entering Y u k o n carry one ton of provisions, the amount deemed necessary to prevent at least imminent starvation. (Tryck, 1980) Fortunately, the Y u k o n economy and society has changed since those early days. There is good co-operation between local resident entrepreneurs and the few international companies that extract minera l resources. (Stabler, 1984) However, Y u k o n society and the economy on which it is based, are fragile. 1 4 The isolated economy has a very narrow base, depends heavily on exports and experiences severe boom and bust cycles. It was the desire to reduce the negative effects of these boom and bust cycles dur ing a particularly bad recession in the early 1980's that sparked interest in C E D in Yukon . Economic growth is concerned with increasing employment and bus iness opportunities first and quality of life issues second, if at all. In the past, the goal of government, bus iness and un ion leaders was to increase the value of the local domestic product. Th i s was usual ly done through market ing a region or communi ty as "open for bus iness, " without concern for the negative externalities new businesses may br ing. The goal was more; more jobs, more businesses, and more tax revenue. The economic aspect of C E D also is concerned with increasing employment, bus iness and creating wealth, about quantitative change. However, there are new issues, values and 16 concerns, su ch as how the existing and new economic activities impact the quality of life, equality, the environment and employment aspirations. P lanners and decis ion makers have new goals which include economic, environmental , and social issues. However, for a communi ty to coalesce a round these new goals, as occurred when Yukon 2000 was developed, it mus t at least perceive a need to be involved in p lanning communi t y economic development. C E D is the proverbial chi ld of bad t imes. 1 5 When an economy is strong and employment and profits are high, people are less likely to support changes to the economy. However, when unemployment is high, the profits of entrepreneurs are down and the old institutions, systems a n d corporations don't work as well as in the past, people are more wil l ing to try something new and different. S u c h was the case in Y u k o n when, in 1985-86, the newly elected New Democrat ic Party Government proposed a bold new communi ty economic development initiative - Yukon 2000. The largest mine closed, the only rai lroad suspended operations and unemployment was 1 5 % . Fresh in the m inds of Y u k o n Territorial Government employees was their recent, across-the-board 1 0 % pay cut. Everyone knew that at the Canada Employment Centre, the latest employment support, unemployment and regional development programs were in big demand. Everyone had friends leave Y u k o n to secure employment somewhere else. 1 6 Yukoners watched the economy fail dur ing the recession in the early 1980's. When the Cypress Anv i l Mine, which directly employed about three quarters of the work force in Faro closed i n 1984, so did the town. Other than the empty bui ldings, the sense of communi ty that people in Faro created was all that remained. The recession confronted people throughout Y u k o n with the fragile, isolated and narrow base of the Y u k o n economy. Yukoners were receptive to new ideas on how to diversify the economy. 1 7 Because of the poor economic outlook, there really wasn't m u c h to lose by trying a new approach. Y u k o n Government Leader Tony Penikett called Yukon 2000 Yukonomics . 17 2.1. Yukon 2000 Between 1986 and 1988, the territorial government led a consultative process. The objective was to determine the kind of society people in the territory and in each community wanted and how to develop the economy to create it. The result was Yukon 2000, a strategy for community economic development. This strategy represents a change from the resource based export approach to economic development and signals the willingness of people in Yukon to define development to include environmental, community and fairness issues. Through the '86 to '88 period, there were a series of workshops and community meetings. Experts prepared more than forty reports on virtually every aspect of economic and social life in the territory. In September 1987, The Yukon government released the interim Yukon 2000 report, The Things That Matter: A Report of Yukoners Views on the Future of Their Economy and Their Society. The report contains the concerns and recommendations of the hundreds of Yukoners who participated in the Yukon 2000 process in the 1986-87 period. It discussed housing under the heading "Infrastructure" together with transportation networks, leisure and recreation facilities, communication systems, energy, and municipal services. The report indicates a view of housing as a basic part of communities, "an essential link in the process of economic development (which) creates jobs, provides business opportunities, and generates income for Yukon residents (page 8-1)." Viewed from this perspective, community development and economic development are separate, though linked processes. In the view of the Yukon 2000 participants, the poor housing conditions in Yukon, "and the need for additional housing [are] an opportunity, rather than only a problem. A well thought-out and carefully implemented housing strategy presents an opportunity to contribute to economic development, improve the quality of life, and achieve greater economic equality 18 (p. 8-8). The three goals for housing in the interim report are: 1. That all Yukoners have access to good quality, appropriate and affordable housing. 2. That government devolve and decentralize responsibility for administration and delivery of housing programs. 3. That government and the industry use housing development to promote local training, employment and business development, and enhance the quality of life. (p. 8-8, 8-9) The Report also contained 10 recommendations for housing. While the Yukon Housing Corporation and other agencies have made modest responses to these recommendations, fundamental problems with the housing industry in Yukon remain. " The public consultation process continued and in 1988, the government released the final report, Yukon Economic Strategy Yukon 2000: Building the Future. The Strategy's four goals were developed from community forums, Yukon 2000 workshops and research reports. The consensus was that economic development "is for and about people; it should serve human goals, not just an abstraction labelled "the bottom line" (p. 3)." The four goals "form the foundation of [Yukon 2000] and will be the guide for future government decisions." • THE OPTION TO STAY IN THE YUKON: Yukoners see our territory as a place to live, work, learn, and raise a family. We want it to stay that way, but we also want to be able to earn a living in our chosen place. Development must offer us a chance to support ourselves and our families, within the territory and within our communities. 19 • CONTROL OF THE FUTURE: Yukoners want more control over the economic future of the territory. The keys to greater control are more regional and local decision-mak ing , increased authority for communit ies, and a higher level of Y u k o n ownership. • AN ACCEPTABLE QUALITY OF LIFE: Yukoners want development to preserve and enhance the quality of Y u k o n life. We want wages, bus iness opportunit ies, and public services comparable with the rest of Canada . Bu t we are not prepared to sacrifice either the potential for living off the land or the unspoi led natura l environment that su r rounds us. • EQUALITY: Development should ensure an equal economic chance for all Yukoners , inc luding those who do not currently have equal opportunity [Yukon 2000, p. 3) Accord ing to S P A R C of B C , C E D has the following elements. The Yukon 2000 goals listed above contains all these elements. • local control and ownership of resources • the creation of permanent local employment • maximizat ion of local resources • reduct ion of economic leakages • environmental ly and socially conscious bus iness • communi t y awareness that bui ld ing organizations and contr ibut ing to the social well-being of its members contributes to its weal th 1 8 The Yukon 2000 process and goals also meet the C E D criteria descr ibed by Douglas (1989). Th i s is because in Yukon 2000: 20 • people i n the Yukon community and in the individual geographic communities are seen as the subject, beneficiary and decision-makers; • the goals link social and economic objectives, emphasize equality, fairness and sharing benefits throughout the Yukon community; • the goals and objectives were established as the criteria against which to measure government policy and program initiatives. The participants made accountability part of strategy; • the process involved a broad spectrum of participants in an interactive process; • the goals and objectives are about reducing the vulnerability of both the Yukon economy and the economy of individual communities; and • economic initiatives and objectives are viewed as "means to various ends, not as the primary ends in themselves (Douglas, 1989, p. 29)." 2.2 New Perspectives on Economic Development The ideas that local people should direct and control development and own the resources in their area are radical. They represent a fundamental change from the free market economy. They also affect issues of ownership and private property. That this idea is radical is proven by the stormy debates around the world over nationalization of private corporations and the privatization of public ones. It is also proven by the fact that in Canada, the state arrests aboriginal people who try and assert their ownership over resources they have used, as owners, for centuries. 21 Local control and ownership of resources is not the no rm in the mixed market capitalist Canad i an economy. In fact, in Canada , we are moving towards less, not more, local control with the implementat ion of free trade with the United States. Companies , foreign to local communi t ies and often foreign to Canada , own m u c h of this country 's resources. Concepts like the globalization of capital and industry are now relatively common ones. We drive cars f rom Korea, fuel them with gas from Kuwait, work for companies owned by Amer icans , dr ink Co lumb ian coffee, wear clothes from Hong Kong, eat fruit from Chile and meat f rom New Zealand, dr ink water from France and use computers from J apan . Issues and concerns about the denigration of the ecosphere are rais ing questions about the paradigm of cont inuous economic growth (Rees, 1989 and Wor ld Commiss ion on Env i ronment and Development, 1987). Ideas like sustainable economic development and local resource management are gaining some acceptance in Canada . We are learning from Th i rd Wor ld countries. There, C E D planners try to identify unused , underused and undiscovered resources and place them under local control to create development and new wealth. 1 9 The m a i n objective of economic development in the past was economic growth. Accepted methods inc luded trying to attract new investment, businesses and industries. There was not m u c h regard for the negative externalities f irms can produce. Communi t i es once considered the smell of a pulp mi l l , a chemical company 's toxic waste, or a smelter's su lphur emissions, the price of progress. In fact, it was the very smoke stacks that people trying to create economic growth were chasing. Y u k o n is not unique in its decision to develop and implement communi t y economic development. At the University of Br i t ish Co lumbia , the School of Commun i t y and Regional P lanning is teaching a course in communi ty economic development to satisfy the demand by regional districts and municipal i t ies for communi ty economic development planners. There is 22 growing realization that attracting new industry to increase exports is not the only way to create employment. There is a growing realization too that communi t ies do not have to sacrifice things which contribute to the quality of life to achieve economic development. It is not an either or d i lemma (Ross and Usher, 1986). Commun i t y economic development "by design and convict ion sees the communi ty s imultaneously as both subject and object, in sharp contrast to most external economic development initiatives (Douglas 1989 p. 29)." The C E D definition of resources inc ludes natural and h u m a n resources in both the formal and informal economy. It also includes the infrastructure, organizations, institutions and the volunteer corps that make a communi ty a quality place to live. If the hous ing industry c an create, support and develop these resources, it c an cause C E D . In its recent report on the hous ing industry, C M H C estimates that every house construct ion site job in Canada creates 2.3 jobs in other industr ies. However, according to the C M H C report, about 2 5 % of these other industry jobs are in Ontar io . 2 0 For the hous ing industry to achieve the Yukon 2000 goals, it would have to develop local industr ies to create more of the "other industry" jobs in Yukon . Entrepreneurs would have to establish new and expand existing companies to replace goods and services currently imported by the hous ing industry. 2.3. Import Subst i tut ion Import subst i tut ion means replacing imported goods and services with local ones. Import subst i tut ion is at least as good for a local economy as increasing exports (Davis, 1989). By diversifying the economy, import replacement makes the local economy less vulnerable to sectoral downturns in the export market . 2 1 23 In Y u k o n , exports generate most employment. Therefore, p lann ing and implementing economic diversity is essential for economic and social stability. Table 1 il lustrates the Yukon 's Table 1 Employment i n Y u k o n by Industry: 1988 1987 and dependence on export markets . 2 2 Governments employ thirty-five Industry 1987 1988 percent of the work force and Government 4,212 4,300 Retail and Wholesale Trade 1,616 1,725 government spending indirectly Accommodation and Food Services 1,341 1,400 creates addit ional employment. Mining and Exploration Business and Personal Services 986 728 1,100 770 Sixty-nine percent of Y u k o n Transportation 634 680 Communications and Utilities 568 610 government revenue is a transfer Construction 403 550 f rom the federal government Manufacturing Finance and Real Estate 386 370 400 390 which is like an export. Education and Health Services 255 275 Agriculture, Logging and Fishing 48 50 The retail and wholesale trade, Total 11,547 12,250 accommodat ion and food services, Source: Derived from YTG Bureau of Statistics; Economic mining and exploration sectors Development: Mines and Small Business Yukon Economic Review are the number two, three, and and Outlook 1987 - 1988 Table 2-2 four employment industries. A l l are heavily dependant on the export tour ism and world mineral markets . 2 3 One estimate is that the min ing industry accounts for "30-40% of all goods and services produced in the economy (YTG, Assessment of Import Subst i tut ion Opportunit ies, p. 1)." There are many benefits to diversifying an economy. These include mak ing it more l predictable, more creative, more resilient, fairer, more responsive, more productive, more independent, and able to offer more occupat ional choice (Boothroyd and Davis, 1986). If the hous ing industry is to assist people in Y u k o n achieve the four Yukon 2000 goals, then it must 24 diversify. Yukon ' s remote location does place export based bus inesses at a cost disadvantage over localities in Southern Canada because of shipping costs. Bus inesses incur sh ipping costs both when they import raw materials inputs and when they export f inished products. However, there are possibilities for back-haul ing, the term for us ing transportat ion systems returning empty to the South, particularly Vancouver and Edmonton . It is possible for a Y u k o n bui ld ing products bus iness to compete successful ly in southern markets . 2 4 However, because of transportat ion costs, bus inesses which could be viable operating on a scale to replace imports would likely have the greatest chance at success. Import replacement, not the export market, shou ld be the pr imary objective of diversification in the hous ing industry. While it may be technical ly feasible to manufacture some hous ing industry products in Yukon , it may not be economical ly viable to do so. However, in addit ion to financial and social costs, all cost benefit analyses shou ld also consider the four Yukon 2000 goals. Th i s thesis will not identify and cost part icular bus iness opportunities. Th i s is an area for further research by governments and the hous ing industry. Private sector representatives did identify some bus iness ideas when interviewed for this thesis. In addit ion to expanding existing bus inesses to capture a larger share of the local market, these include businesses to manufacture the following: • finger joint s tuds • interior and exterior doors • wood siding • dimensional lumber • k i tchen cabinets • var ious f inished wood products • concrete • gypsum board 25 The manufactured products listed above were the same or s imi lar to the products identified in the 1986 Assessment of Import Substitution Opportunities report (YTG, 1986). That report identified products the hous ing industry uses which Y u k o n bus inesses cou ld manufacture or process. These products are: construct ion lumber, wooden k i tchen cabinets, wood products (veneer, plywood, and particle board), concrete, cement, pipe and tube mil ls, i ron works, fibreglass, metal fabricating and glass products. The products d iscussed above are some of the opportunit ies for import replacement in the Y u k o n hous ing industry. Governments, particularly the territorial government, cou ld use their purchas ing power and lead an import replacement strategy i n the hous ing industry. Governments could use this purchas ing power to change the current situation f rom one in which f irms import more hous ing construct ion materials than the entire local industry produces. The Y u k o n government can use the hous ing industry to achieve C E D objectives and Yukon 2000 goals. 2.4. S u m m a r y Th i s chapter explained how people in Y u k o n and elsewhere define C E D . It established the linkage between the hous ing industry and communi ty economic development. It also identified some of the things the hous ing industry mus t do if it is to help people in Y u k o n achieve their stated C E D goals and objectives. More specifically, the next three chapters identify ways the hous ing industry can achieve the following C E D goals and objectives: • create more affordable, adequate and suitable hous ing opportunit ies and options in Y u k o n communit ies ; • create more total employment and employment choices in construct ion and manufactur ing; • create more skilled jobs in communit ies ; 26 • give more control for hous ing and communi ty p lann ing to communi t ies and communi ty groups; • create new community organizations (non-governmental organizations - NGO's) which operate together with yet apart f rom government in the hous ing industry; • replace imported construct ion products with products manufactured in Yukon ; • increase the amenity factor and quality of life in Y u k o n communit ies ; • introduce co-operative ways for communit ies , communi ty groups, government, and the private sector to work together to achieve shared goals and objectives; • assist and develop the informal economy; • diversify the economy; • create more economic equality throughout Y u k o n and between Whitehorse and the other communit ies ; • create more regional and communi ty decision mak ing in the hous ing industry; • increase the use of communi ty h u m a n and physical resources; • increase the use and local control of external f inancial resources; and • replace imports through the use of alternate technology. The Y u k o n hous ing industry is an important part of the Y u k o n economy and hous ing is an important part of each community . The next chapter discusses the nature of the industry and the communi ty economic development opportunities it creates. 27 3. Y u k o n ' s H o u s i n g I n d u s t r y This chapter describes the sectors which make-up the Yukon housing industry and explains the dynamics of the industry. The description includes ownership patterns, type of tenure, the age of the existing stock, and new housing starts in the Market and Non-Market sectors in the 1980's. The lead roles of the federal, territorial, municipal and band governments in the industry are documented and explained. The history of government involvement in the industry and the strength of demand by the private sector in the 1980's are reported and critiqued. This chapter concludes with an analysis of the effects of social housing programs, core housing need, the aging housing stock, the economy and population growth on the industry. The federal, territorial, band and municipal governments dominate the housing industry in Yukon. Combined, governments are the largest land owners and land developers.25 The federal government is the biggest landlord; the territorial government is the second largest. 2 0 The federal government owns ninety-five percent of the land i n Yukon. 2 7 Governments plan and develop all subdivisions. 2 8 3.1. The Yukon Housing Industry Defined A model of the Yukon housing industry is shown in Figure 2. Industry Support includes all firms that harvest, manufacture and sell building materials. It also includes all the government agencies that provide support services, professional service firms, real estate companies, regulators, and equipment and product support companies. Land and Services includes all activities to plan, design, install and maintain residential subdivisions, roads and services. Market Housing includes all privately owned and occupied dwellings and dwellings available for rent on at least a month-to-month basis. It also includes 28 the f i rms which own and manage the Market Housing stock. Non-Market Housing includes the accommodat ion that employers rent to their employees o n at least a month-to-month basis. It also inc ludes all social hous ing and social hous ing agencies. Rent supplemented units are part of the Rental Sector. Figure 2 A Model of the Y u k o n Hous ing Industry INDUSTRY SUPPORT LAND AND SERVICES MARKET HOUSING NON-MARKET HOUSING OWNERSHIP SECTOR RENTAL SECTOR SOCIAL SECTOR EMPLOYER SECTOR Th i s model of the industry describes the hous ing industry quite broadly. Statistics Canada defines the industry as residential construct ion, a sub-section of construct ion. Accord ing to that definition, in 1986 the construct ion industries employed 970 people, about 7 % of the 13,865 person Y u k o n workforce. 2 9 The model of the industry in Figure 2 is a better representation of the industry for two reasons. First, many of the jobs in the hous ing industry in Y u k o n are in government and Statistics C a n a d a reports them in that sector, not housing. A s explained in Chapter 3, 29 government workers and consultants to government plan all subdivisions and municipal infrastructure. There are also many people employed by governments in their respective housing corporations, departments and agencies and governments are also the largest landlord. Recording this employment as government understates the size of the housing industry. Second, this broader definition includes employment and businesses i n sectors like finance and insurance, real estate, transportation and manufacturing where employment, in varying amounts up to 100%, is dependant on housing activity. This thesis focuses on the Market Housing and Non-Market Housing parts of the industry. As discussed below, it is new housing starts in these sectors that creates the most opportunities for CED. This thesis also presents information on home renovations and the role government home renovation programs have in a CED strategy for the housing industry. This thesis defines the housing industry to include all activities to plan, design, construct, modernize, renovate, regulate, buy, sell, and manage the following: • residential subdivisions • residential lots • new permanent dwellings • the existing housing stock • residential water supply • residential liquid waste disposal • residential electrical service • residential roads • residential liquid waste treatment About 5 ,800 units, 7 5 % of the existing housing stock, are in the Market Housing sector (defined above). Of the units in this sector, about 825 (14%) are rental units i n buildings with four or more suites. Of these, most, about 70%, are in three storey walkups. There are no apartment buildings more than four storeys in Yukon. Most, 94%, multiple dwelling rental units in the market sector are in Whitehorse. There is no record or estimate of other units in the rental sector, whether legal or illegal. Of the remaining occupied private dwellings, (about 3 0 Table 2 Ownership of Occup ied Private 5,000 units) most are detached dwellings. Dwell ings i n Yukon : 1988 duplexes or mobile homes. The Whitehorse market rental sector is aging and dominated by five owners who combined have title to about half of the 797 un i ts . 3 1 Figure 3 shows the Whitehorse market rental stock by age. Note that only 6 . 9 % of the stock is less than ten years old. If the rental market was working, it would have responded to populat ion growth, a strong economy and the low vacancy rate over the past five years by bui ld ing more rental hous ing. However, there was only one apartment bu i ld ing start since 1981. Th i s 10 unit Figure 3 Profile of the Y u k o n Market Rental Stock by Age Bui I d i n g s w i t h 4 o r more R e n t a l U n i t s 750 of 737 Reported + 30 Years CB 1*0 11 to 20 Years C62 .7%3 Owner Number Percent Band Housing 914 10.9 Government of Canada (staff) 522 6.3 YHC Social Housing 353 4.2 Other Social Housing 118 1.4 United Keno Hil l Mine 100 1.3 Government of Yukon (staff) 94 1.2 Other Owners 5774 74.3 Total 8350 100 Sources: Compiled from interviews and from Yukon Executive Council, Bureau of Statistics, Information Sheet No. 2-87.12. Some numbers are approximate. Percents are rounded to one decimal point and do not sum to 100% 31 project represents just over 1% of Table 3 New Housing Starts in Whitehorse: 1980-1988 the existing rental stock. While it may be too early to be certain, this could be an indication that the rental market in Whitehorse is failing or has already failed. Single Year Detached Multiple Total 1980 37 0 37 1981 74 32 106 1982 21 0 21 1983 11 0 11 1984 15 6 21 1985 27 0 27 1986 109 10 119 1987 125 4 129 1988 154 4 158 Total 573 56 629 Source: City of Whitehorse Building Permit Department. Notes : 1. There is no record of building starts for the rest of Yukon. 2. The numbers to 1987 are gross units. The 1988 numbers are net. The recession in the first half of the 1980's had a severe negative impact on the industry, particularly for firms and workers i n v o l v e d i n new home construction. Data is only available for new starts in Whitehorse. As shown in Table 3, new starts fell by 80%, from 106 in 1981 to 21 in 1982 and then again by 50%, to 11 new starts in 1983. The industry remained depressed until 1986, when new starts had climbed to 119. Similarly, the total dollar value of residential building permits declined precipitously in the early 1980's. (see Table 4) The decline of the housing industry began in 1980 and by 1982, it reached its low for the decade. In 1982, the value of residential permits was 3 6 % of the 1979 value. In 1981, social housing starts were the lowest of the decade to date, only one unit. Total new starts reached the highest level of the Table 4 Value of Residential Building Permits: 1978-1988 Year Residential Permits($000) A s a % B u i l d i n g o f A l l P e r m i t s 1979 $16,333 53% 1980 $10,886 35% 1981 $ 8,194 22% 1982 $ 4,781 27% 1983 S 5,475 36% 1984 S 5,665 24%+ 1985 $ 8,354 27% 1986 $11,344 20%+ 1987 $23,218 45% 1988(p) $19,197 42% Source: Statistics Canada, Building Permits, Cat. 64-203 and YTG Statistical Review, Fourth Quarter, 1988. (p) partial year +major non-residential government project 32 d e c a d e i n 1 9 8 8 w i t h 1 5 8 t o t a l u n i t s . O f these units , 26 or 1 6 % were social hous ing starts. 3 2 Y H C lapsed 45 units in 1988, inc luding a p lanned 12 uni t project in Whitehorse (see Sect ion 3.3. A below). H a d this latter project proceeded, social hous ing starts would have been 2 2 % of total starts in Whitehorse. Figure 4 Market and Social Housing Starts in Whitehorse: 1986-1988 [771 Market Housing | \ \ | Social Housing \X//A r H C Lapsed Units Another indicator of the boom and bust cycle of the hous ing industry is the number of N H A loan approvals for new units. O n average, the number of these loans represents about half the number of new units constructed each year. 3 3 Data was available on these loans for the 1968 to 1987 period (see Figure 1) and so provides a good history of new hous ing starts. C M H C approved 84 N H A loans for new starts i n 1974. In the next bu i ld ing season, it approved 299, a 3 5 5 % increase. Three years later, i n 1978, there were 65 loans, a decline of 33 almost 7 8 % . In 1981, there were only 12 loans approved, a further decline of 2 1 % . The history of the Y u k o n hous ing industry is not an experience for the faint-hearted. Compared to investing in plant and equipment in the Y u k o n hous ing industry, stocks on the Vancouver Exchange are safe investments. Figure 4 shows the number of Market Sector starts and the numbe r of Social Sector starts in Whitehorse for the 1986-88 period. Th i s Figure illustrates the importance of social hous ing starts to the industry. In 1987, almost half the starts were social hous ing. Note that Y H C lapsed 83 units dur ing this period. Had half these uni ts been constructed in Whitehorse, social hous ing would have been 3 1 % of total starts in Whitehorse. Despite the current buoyancy of the industry, activity and employment in the industry could have been higher in 1988. The 1987 forecast for 1988 was for a rapid increase in the number of private residential starts. Th i s forecast inc luded 48 units i n two apartment projects. Neither of these apartment projects proceeded, though construct ion on a 30 unit condomin ium project d id start in the first quarter of 1989. The anticipated Y H C social hous ing activity never material ized. In fact, in 1988 Y H C made commitments to construct only two social hous ing units. A l l but two of the thirteen Y H C 1988 social hous ing starts were 1987 commitments. Had it not been for 16 Rent Supplement Program commitments made in late December, 1988 would have been a dismal committment year indeed. 3 4 Eight of the uni ts rent supplemented are in a bui ld ing owned by Y H C which it converted from staff to social housing. There is always concern in Y u k o n that the next recession in the hous ing industry , if not for the whole economy, is about to occur. Caut ious investors in two condomin ium projects, the first in more than fifteen years, have opted to delay construct ion, pending the results of pre-construction sales. A n industry representative reports these sales as s luggish. 3 5 34 It is difficult to market condomin iums in Whitehorse. One crit ical cause for this difficulty is that the cost for a newly constructed condomin ium is about the same as for an existing house. In fact, two condomin ium projects are p lanning to come on stream in the plus $100,000 range. In 1988, the average price for a detached house in Whitehorse was $80,000. The average cost for a n existing three bedroom condomin ium is about $56 ,400 . 3 6 C M H C is investigating the market in Spr ing 1989 to evaluate the exposure of the Mortgage Insurance F u n d (MIF) in Yukon , with part icular attention to condomin iums . 3 7 There are few speculative house bui lders in Yukon . Accord ing to an official with C M H C in Whitehorse, "spec" homes represented between 1 0 % and 1 5 % of new starts over the past five years. Most new starts are owner built or cus tom designed or pre-sold by the bui lder/developer. 3 8 However, past experience i n Y u k o n is that, as confidence in the economy and the populat ion increase, the number of "spec" homes shou ld also increase. A s d iscussed above, all governments combined dominate activity in the industry. O n average, for the 1980-1988 period, governments were the consumers for about a third of the new homes constructed each year. 3 9 However, other consumers combined likely out-spend all governments in the renovation sector, a smal l but vital part of the industry. The Sections 3.2 through 3.4 below outline the roles of the federal, territorial, band , and munic ipa l governments. 3.2. The Role of the Federal Government The federal government plays an important role in the Y u k o n hous ing industry. The focus here is its funding and delivery of social hous ing programs and its role in employee housing. 35 A. Social Hous ing Programs C a n a d a Mortgage and Hous ing Corporat ion (CMHC) is the federal government's hous ing agency. The National Hous ing Act (NHA) provides legislative authority for C M H C . C M H C has defined its corporate mandate which is, in part, to promote the construct ion of new houses, the repair and modernizat ion of existing houses, and the improvement of hous ing and living condit ions. 4 0 Unt i l 1986, C M H C defined its social hous ing budget in numbers of hous ing units. In 1985, C M H C had a budget for about 20,000 un i ts . 4 1 Th i s represented the federal contr ibut ion to all social hous ing programs. 4 2 The Y u k o n allocation was about 110 or . 0 5 5 % of the 20,000 units in 1986. Most C M H C social hous ing units are cost shared with the provinces and territories and the effect is additive. For example, if the 20,000 units were cost shared 50:50, there would be 40,000 units. However, not all units are cost shared and the ratio is usual ly less than 50:50. In Br i t ish Co lumbia , the ratio is 67:33 and i n Yukon , it is 75:25. The federal government pays the majority share in both jur isdict ions. In addit ion to the cost shared units, some jur isdict ions have their own social hous ing programs. There was no data available for this thesis on the total number of new social hous ing units i n C a n a d a each year. C M H C is the most important agency in the Social Sector, quite s imply, because it has the largest budget . 4 3 The Y u k o n Government, through Y H C , does cost share four social hous ing programs with the federal government, as d iscussed in section 3.3. A below. 36 Table 5 C M H C Social Hous ing Programs in Yukon : 1980-1990 NHA Section and Program Name '80 '81 '82 '83 '84 '85 •86 •87 •88 '89 '90 Total Section 40 Rural and Remote 5 1 0 0 0 0 -1 0 0 0 0 5 Section 55 Rural and Native 0 0 0 0 0 3 6 6 7 10 10 42 Section 56.1 On Reserve 0 0 21 19 27 59 44 46 34 30 20 300 Section 56.1 Non-Profit Urban Native 0 0 0 0 22 12 7 7 7 12 12 79 Section 56.1 Non-Profit 18 0 4 0 -10 10 NA NA NA NA NA 22 Section 37(1)(1) Rural and Native Demonstration 0 0 0 0 0 0 13 5 -1 7 7 31 Total 23 1 25 19 39 84 69 64 47 59 49 479 Source: Compiled from Interviews with C M H C Whitehorse Branch and B C / Y u k o n Region staff and C M H C Whitehorse Branch annual reports Table 5 il lustrates C M H C ' s role in the social hous ing sector. Except for the N H A Section 34.15 program the Counc i l for Y u k o n Indians delivers for C M H C under contract, C M H C delivers all programs shown in Table 5.4 4 Y H C assumed delivery of the Section 56.1 Non-Profit program in 1986. Commitments in this program since and inc luding 1986 are shown as Y H C units (see Table 9). Table 5 shows a negative value in 1984 and 1986. These are units which were deleted from the social hous ing inventory. The Rura l and Remote Hous ing Program unit was repossessed by C M H C . The mortgages for the ten Non-Profit Program uni ts were paid out in 1984 and refinanced i n the program by a new sponsor in 1985. A s shown in Figure 5, C M H C activity was not consistent in the 1980's. Delivery ranged f rom one unit in 1981 to 84 units in 1985. Six factors explain most of this erratic delivery pattern: 37 1. A special increase in the allocation for the Kwanl in D u n B a n d Relocation Project. 2. The emergence of u rban native non-profit groups. 3. The acceptance level of Y u k o n Indian Bands for the 56.1 O n Reserve Program. 4. Increased promotion of the Rura l and Remote Hous ing Program. 5. The increase in the status Indian populat ion caused by Bi l l C-31. 6. The sociopolitical climate in Yukon . Figure 5 A n n u a l C M H C Social Hous ing Delivery: 1980-1990 Net T o t a l U n i t s 4 79 Fur ther to point 6 above, C M H C reports that it could deliver more uni ts if the sociopolitical cl imate in Yukon was more receptive to their hous ing programs. 4 5 However, the level of acceptance of the programs is more dependant on program design and C M H C ' s organizational structure. Delivery is very centralized in Whitehorse. Once the projects are complete, C M H C manages the portfolio from Vancouver. Th i s means all contact between C M H C in Whitehorse 38 and non-profit sponsors terminates; staff in C M H C ' s Vancouver office are responsible for ongoing adminstrat ion matters. The result is that C M H C has difficulty providing follow-up to sponsors, many of which have limited resources and experience high staff turnover. The general sentiment among sponsors, particularly Indian bands , is that the C M H C Vancouver office does not understand hous ing condit ions i n Y u k o n or that there is no housing market i n the smaller communit ies . Th is caused some problems for the O n Reserve Program in 1988 when bands received notice of rental increases of as m u c h as 3 0 0 % . 4 6 The average price of units delivered by C M H C in 1988 was about $ 1 0 5 , 0 0 0 . " Table 6 shows program delivery in 1988 (excluding seven units of the Rura l and Native Demonstrat ion Program in O ld Crow). Officials report C M H C will continue to deliver social hous ing programs in Y u k o n indefinitely. Current and anticipated funding levels will permit delivery of between 45 and 60 units per year. Table 6 C M H C Program Delivery: 1988 The numbe r of units C M H C Program Units Total Cost Average Cost delivers in Y u k o n each year 56.1 On Reserve 34 $3,565,343 $104,683 shows a general increase. The 56.1 Urban Native (UNH) 7 $ 777,000 $111,000 average uni ts delivered per year for the decade is 4 4 units. Rural and Native (RNH) 7 $ 687,275 $ 98,182 Total 48 $5,029,618 $104,784 However, the average number of units delivered per year in the Source: Compiled from interviews with C M H C Whitehorse Branch and B C / Y u k o n Region staff last five years is about 6 1 . 4 8 In fact, the C M H C budget for all social hous ing programs in Y u k o n increased by 3 1 % in 1988 over 1987, f rom $20 .6m to $ 2 7 m . 4 9 For the 1990's then, the expectation is C M H C will unilateral ly fund at least 4 4 new units each year, excluding the Co-operative and Demonstrat ion programs. 5 0 39 The federal government now makes its annua l social hous ing allocation in a dollar amount rather than a specific number of un i ts . 5 1 Whether its units or dollars, the Y u k o n share of the nat ional al location is about half of 1%. In fact, the 1987 Y u k o n allocation for new uni ts was $ 2 0 . 6 m , 5 2 less than the amount of the national social hous ing budget wh ich lapsed, $21 .5m. 5 3 The point is that because Yukon 's share of the nat ional hous ing budget is so smal l , the impact of federal f iscal restraint will also be smal l . The federal contr ibut ion for the Rura l and Native Demonstrat ion Program is for materials and professional labour only. Individuals or communit ies are responsible for all non -professional labour to bu i ld the houses. Th i s program is d iscussed in Chapter 4, section 3.D. In addit ion to programs to bui ld new houses and acquire existing ones are C M H C home renovation and rehabilitation assistance programs. These are the Residential Rehabil itation Ass istance Program (RRAP), and the Emergency Repair Program (ERP). In 1988, RRAP and ERP funding was about $250,000 and $150,000, respectively. A s explained above, there is every reason to believe these expenditures will continue, even when there are program changes. A l l uni lateral federal social hous ing programs represent an annua l capital expenditure of about $6 .5M (1988 dollars). Office administrat ion expenses also contribute to the economy. In 1988, salary and personnel expenses alone were $525,000 . 5 4 A s Table 6 shows, C M H C has yet to deliver a single co-operative hous ing unit in Yukon . Y u k o n is the only jur isdict ion in the country without a hous ing co-op. C M H C does report that it expects to deliver 12 co-op units in 1989. Fur ther demand and supp ly of co-op units is unknown. Use of the co-op hous ing program in a C E D strategy is d iscussed in Section 4.1. 40 B . Federal Staff H o u s i n g The federal government owns more res ident ia l ren ta l un i t s , 522 i n 14 communi t i e s , t h a n any other l and lo rd i n Y u k o n . T h r o u g h the Depar tment of P u b l i c W o r k s , the federal government owns a n d manages 357 un i t s for i ts employees i n Whi tehorse . In addi t ion , five other depar tments a n d agencies own and manage 195 un i t s . The federal government p lanned , designed a n d cons t ruc ted subd iv i s ions i n m a n y Y u k o n c o m m u n i t i e s i n the forties and fifties. The technology used in some of these subdiv i s ions was not appropriate for Y u k o n . In others, the infras t ructure requires upgrad ing a n d repair. In fact, the water a n d sewer sys tem for one s u b d i v i s i o n i n Whi tehorse w i t h 172 un i t s w i l l require replacement to m a i n t a i n the area for hous ing . More t h a n 7 0 % of the s tock of federal staff h o u s i n g is at least 30 years o ld as s h o w n i n F igure 7. T h i s aging s tock houses a w o r k force that is decreasing i n number . Three factors cause th i s down-s iz ing ; devolut ion of author i ty a n d person years to the terr i tor ia l government, technological change and cont rac t ing out w o r k formerly done by employees. The federal government has more staff un i t s t h a n it needs i n some communi t i e s , bu t is b u i l d i n g new h o u s i n g i n others. The impact of staff hous ing requi rements o n the indus t ry is difficult to predict . B u i l d i n g new h o u s i n g depends on decis ions made i n Ot tawa. S imi la r ly , Table 7 Subs id i zed Federa l Staff H o u s i n g Department Units Public Works 357 RCMP 49 Health and Welfare 47 Parks 37 Revenue 19 Transport 13 Total 522 Source: Compiled from interviews with staff in each department 41 decisions to dispose of property rests with bureaucracies outside the territory and reflect changing federal government policy on the provision of this employee benefit. Figure 6 Subsid ized Federal Staff Hous ing: The Aging Stock Under 10 Y e a r s CS G*D It is certain that the government will dispose of properties in some communit ies and bui ld in others. In some communit ies , federal houses are vacant and have been vacant for some time. The federal government is exploring options to reduce its surp lus employee hous ing inc luding sales to the public. The federal government's staff hous ing portfolio has a n impact on C E D . The federal government may try to sell some of its aging redundant stock to agencies and individuals in Yukon . If the federal government made the vacant units available to Yukoners , this would increase the supply of housing. However, it also has the potential to h a r m the Y u k o n economy in two ways. First, it would reduce the demand for new housing. Second, buy ing the houses is essentially an import; the money paid for the houses leaves Yukon . While the federal 42 government is sensitive about the impact on the market and industry, it is not clear what will happen with the surp lus units. The federal government has more subsidized hous ing for its employees (522 units) than the Y u k o n government has in its social hous ing portfolio (353 units). Th i s is some indication of the hous ing policy and program priorities of the federal a n d territorial governments. 3.3. The Role of the Territorial Government The territorial government is involved in m a n y sectors of the hous ing industry. It owns and manages social and staff hous ing, plans, designs and bui lds subdivis ions, sells lots, regulates and enforces the industry, plans, designs, installs, operates and funds waste disposal systems and delivers social hous ing programs. It has the most direct impact on Y u k o n communit ies and therefore, its activity creates the most opportunity for C E D . A . Social Hous ing Programs The Y u k o n government's hous ing agency, Y u k o n Hous ing Corporat ion (YHC) derives its authority f rom five acts. These are the Hous ing Corporat ion, Hous ing , Hous ing Development, Rental Purchase Hous ing and Government Employee Hous ing P lan Acts. A s shown in Table 8, Y H C owns and manages 447 social and staff hous ing units in 15 communit ies . Y H C involvement in the hous ing industry has depended on political priorities, the political climate and the state of the economy. In the early 1980's, the territorial government directed Y H C to sell its portfolio of detached social hous ing units. Y H C sold about 30 units, 10% of its social hous ing inventory at the t ime. 5 5 43 Prices in the real estate Table 8 YHC Portfolio at December 31, 1988 market throughout Yukon were already down because of the recession. These sales further depressed the soft market. While the federal government was trying to stimulate the economy with programs to assist new rental starts and home ownership, the Yukon government acted quite contrarily. Its actions further reduced demand for new housing. In 1984, the Yukon Conservative Community Social* Staff Total* Beaver Creek - 2 2 Carcross 6 3 9 Carmacks 12 8 20 Dawson City 46 16 62 Destruction Bay - 1 1 Elsa - 2 2 Faro - 16 16 Haines Junction 13 4 17 Mayo 26 7 33 Old Crow - 3 3 Pelly Crossing - 4 4 Ross River 15 8 23 Teslin 12 11 23 Watson Lake 27 9 36 Whitehorse 196 - 196 Total 353 94 447 * Excludes Rent Supplement Program units Source: Compiled from YHC records government merged YHC into the Department of Community and Transportation Services and made YHC a line department like Property Assessments. When the current NDP Government was first elected in 1985, it began restructuring of YHC, a process which continues. The government plans to introduce new legislation for YHC during its current term in office.56 However, based on the unit commitment pattern of YHC since 1985, neither the government nor YHC have acted like social housing was a priority. YHC has lapsed almost as many units as it committed in the 1986-1988 period. To date, there has been only minor change in housing policy brought about by the change in the political party in office. In 1986, the Yukon government joined with the other 11 major jurisdictions and signed Global Agreements on housing with the Government of Canada in 1986. Under this agreement, YHC cost shares four social housing programs with CMHC. It could cost share other programs, such as the Urban Native and Rural and Native Programs as is done in some other 44 jur isdict ions. Delivery targets and actual units delivered for 1986-1988 are provided in Table 9 below. Y H C only delivered about Table 9 Y H C Social Hous ing Unit Delivery: 1986-1988 5 3 % of the units available to it in the partnership in the 1986 to 1988 period. Th i s record creates some uncertainty whether Y H C will deliver the 80 new units available to it in 1989. 5 7 E ighty units would likely be available to Y H C each year for an indefinite period if it cou ld deliver them. Year Planning Target New/ Acquired Rent Supp Total Take-Up 1986 57 5 19 24 42% 1987 57 52 0 52 91% 1988 63 2 16 18 29% Total 177 59 35 94 53% Source: YHC records and interviews with C M H C Whitehorse Branch and B C / Y u k o n Region staff Y H C caused a substantial loss to the Y u k o n economy by not delivering all the units for which funding was available. 5 8 The units not delivered in the 1986-88 period represents a loss to the Y u k o n economy of about $9 .3M (1988 dollars). 5 9 Th i s is in addit ion to the hous ing years lost, about 3000 years. Y H C borrows the money for new social hous ing commitments f rom private lenders (banks). 6 0 C M H C and Y H C cost share the net operating deficit for each project on a 75:25 ratio for up to 35 years. Th i s means the loss to the Y u k o n economy caused by not bu i ld ing the uni ts is more t han just the capital spending. After subtract ing the estimated pr incipal and interest expenses, payments for other operating expenses (properly taxes, maintenance, heat, vacancy loss etcetera) for the 83 units represents a loss of an addit ional $ 1 2 m to the economy. Of this amount , C M H C contributions would have been $ 9 m . 6 1 The total loss to the economy of not bui ld ing the 83 units is about $21m. 45 The four programs Y H C delivers create opportunities for C E D , but not equally so. (The relative C E D benefits of all programs are d iscussed in Chapter 4.) O f the social hous ing programs Y H C delivers, the Private Non-Profit Program creates the greatest opportunity for C E D , in part because it requires a private non-profit sponsor. Typical ly, sponsors are existing or new communi ty organizations like the L ions C lub , cul tura l groups, chu r ch groups, women's groups, and unions. However, Y H C has never delivered the Private Non-Profit Program. It does plans to deliver two projects totalling 18 units in 1989. Better promot ion of the program could increase demand and opportunities for C E D . Y H C could also deliver the Private Non-Profit to a hous ing cooperative. In this program variation, all households mus t be i n core housing need. Th i s would make it possible for a hous ing co-operative to get the same subsidy as any other non-profit sponsor. As C M H C will not deliver their Co-op Hous ing Program in non-market communit ies , this is an alternative for non-market communit ies . For a full explanation of the programs d iscussed in this thesis, please refer to the respective program guidelines. The Y H C Board of Directors and management did not support the Non-Profit Hous ing Program unti l early 1988. In fact, Y H C kept the m a x i m u m unit prices lower than it could bu i ld for itself. 6 2 Th i s made it virtually impossible for sponsors to make the Co-op and Private Non-Profit Programs work. In 1989, Y H C support for Private Non-Profit is min ima l . Y H C has never dedicated staff to this program and never promoted it. YHC ' s priority over the past three years was to deliver the Publ ic Non-Profit Hous ing Program. A s d iscussed in Chapter 4, this program does very little for C E D . 46 One c o m m o n perception of Public Non-Profit hous ing projects is that they don't belong to the communi ty . Many people equate this program with their unders tand ing of the public hous ing projects built in the 1970's. People, even those in core housing need, view Publ ic Non-Profit projects as just another form of publ ic government hous ing and not desirable places to live. One indicat ion of this is that in the early 1980's, there were vacancies in the publ ic hous ing projects managed by the Greater Vancouver Regional Distr ict Hous ing Department. At the same time, hous ing co-ops and Private Non-Profit projects h a d waiting lists. Part of this communi ty versus government ownership perception may contribute to speculat ion at C M H C that Private Non-Profit projects costs less to mainta in than Publ ic Non-Profit projects. Some C M H C officials believe tenants i n Private Non-Profit projects take better care of their accommodat ion than tenants in Public Non-Profit projects. Th i s means that in of the two programs, Private Non-Profit could be more cost-efficient. 6 3 The other two programs Y H C delivers and cost shares with C M H C are rent supplement programs. Co-operative Rent Supplement causes new construct ion because it makes C M H C Co-op projects economically viable. It also helps the project mainta in economic viability over its life cycle. Hous ing co-ops are d iscussed in Chapter 4. P r i v a t e R e n t S u p p l e m e n t d o e s n o t c a u s e n e w h o u s i n g s t a r t s o r c o n t r i b u t e to C E D . 6 4 Its use in Y u k o n is questionable, because of the dynamics of the hous ing market , particularly the decline of the rental sector. The reason it is popular with Y H C may be because it is the easiest program to deliver. However, based on C E D criteria d iscussed in Chapter 4, it's a poor program choice. It also uses the same budget for other programs which cause new construct ion. 47 B. Territorial Government Staff Hous ing A s d iscussed in Section A above, Y H C owns and manages about one hundred staff hous ing units i n 14 communit ies for Y T G staff. In fiscal year 1983/84, the last year for which figures are available, occupancy months by department was about 5 8 % Educat ion , 3 0 % Highways, with the remainder by Renewable Resources, H u m a n Resources B r anch , the L iquor Corporat ion, and Just ice . 6 5 Y H C derives its authority to provide staff hous ing f rom the Employee Hous ing Act. However, the discretion to provide it and the rental rate to charge, rests with the Hous ing Minister and the Y H C Board of Directors he/she appoints. A n example of this discretion was the 1984 decision by the Board to dispose of its staff hous ing properties in Whitehorse. 6 6 The purpose of staff hous ing is to facilitate hir ing new staff, part icularly teachers, in communi t ies where there is no hous ing market. In Yukon , Whitehorse is the only communi ty with a hous ing market. Staff hous ing is good for C E D . It facilitates the hir ing process which makes it possible for the government to hire people with skil ls either not available in a communi ty , or available in sufficient numbers to meet economic and social needs. Bu i ld ing staff hous ing creates employment in the construct ion process and in on-going maintenance and operations. It also generates new property tax revenue for the host area and creates new jobs in property management. The way the Y H C manages and plans the staff hous ing portfolio, l imits its contr ibut ion to C E D . Program management is centralized in Whitehorse. People in Whitehorse decide where 48 and what to bu i ld , which units to modernize and improve, w h o m to house and the rent to charge. These decisions are l inked to hir ing priorities which are also set in Whitehorse. Y H C cou ld devolve the responsibil ity for this program to communit ies . C. Commun i t y and Transportat ion Services The Department of Commun i t y and Transportat ion Services (C&TS) is the government's land development agency. Table 10 shows this department's spending in the hous ing industry . 6 7 Table 10 C & T S and the Hous ing Industry: F isca l Year 1988/89 Person (OOO's) Capital Section Years Salaries Budget (000's) Total (OOO's) Lands Branch 12 $ 800 $ 4,500 $ 5,300 Community Services 15 $ 679 $ 6,725 $ 7,404 Total 27 $1,479 $11,225 $12,704 Source: interviews with Department Directors C & T S plans, develops, services and sells lots in new subdiv is ions, bu i lds and mainta ins the physica l infrastructure and makes capital and operating grants to municipal i t ies. It also provides advice and direction for the many unincorporated settlements in Yukon . Th i s department is a major player in the hous ing industry. Its 1989 spending in the hous ing industry will exceed spending by Y H C for new construct ion and renovation programs. 6 8 The Y u k o n government announced a new initiative to install mun ic ipa l water and sewer services in several communit ies in the January , 1989 Throne Speech. 6 9 These capital projects will create opportunit ies for C E D in several ways. First, Y T G will have to establish and support 49 communi ty p lanning processes. The key issues i n these p lanning processes are physical p lanning (the location and type of system), the method of treatment and the disposal/discharge problem. Second, the installation of munic ipa l services will create jobs and bus iness opportunit ies in the communit ies . Th i rd , the new mun ic ipa l services will improve the physical infrastructure in communit ies. However, these opportunit ies for C E D will depend on the technology and materials decision makers select and the level of communi t y involvement in the projects. 3.4. B a n d Governments Table 11 The O n Reserve Hous ing Program: B a n d Portfolios B ands governments p lan and develop At December 31 , 1988 subdiv is ions, own and develop businesses, bui ld Band U n i t s houses, t ra in workers and own and manage Kwanlin Dun Little Salmon/Carmacks 106 24 about nine hundred hous ing units. Included in Champagne/Ashihik 30 Teslin 18 this total are 250 O n Reserve Program units and Dawson City 19 about 650 units built with hous ing subsidies Liard O l d Crow 17 15 from the Department of Indian affairs (without Selkirk 13 Ross River 8 a subs idy from C M H C ) . 7 0 Some bands , like Total 250 Champagne-Aish ih ik and Kwanl in D u n , have Source: compiled from interviews with CMHC Whitehorse Branch staff their own construct ion companies or act as companies themselves. C M H C considers band governments non-profit societies eligible to sponsor O n Reserve Hous ing Program projects. Table 11 shows band take up of this program since 1980. Three of the twelve Y u k o n bands . Mayo, Carcross and the K luane Tr iba l Counc i l , have never sponsored an O n Reserve Hous ing Program project. The Kwanl in D u n Band (KDB) experience is a good example of how to use the housing 50 industry for C E D . Located in Whitehorse, the K D B owns Tag ish Kwan, an economic development corporation. It started as a prefabricated home bus iness with its own factory in 1985. Since 1985, the company has manufactured and constructed about 100 homes. Tag ish Kwan has expanded its operations and now manufactures non-residential bui ldings. The company is also an owner or partner in other businesses, has a 30 unit condomin ium project under construct ion, and plans to bu i ld a $ 2 0 M industr ia l park. Most projects and bus inesses are in the Whitehorse area. Tag ish Kwan has a permanent full-time staff of twelve and employs another twenty-two people seasonally. About two-thirds of its employees are B a n d members . The B a n d Chief and Counc i l appoints the company Board of Directors. 7 1 The K D B is in the final phase of a five year relocation project. The project involved moving the village site to a new location, the existing but unoccupied Mclntyre Subdiv is ion. Us ing the N H A Sect ion 56.1 O n Reserve Hous ing Program, the project involves construct ing about 120 new homes. The Kwanl in D u n B a n d is us ing Tag ish Kwan to tra in and provide employment for Band members . However, though the band is a non-profit entity, Tag ish Kwan is a for profit bus iness . It is not a co-operative or a collective which cou ld do more for C E D (Ross and Usher , 1986). 3.5. Mun ic ipa l Governments Municipal i t ies in Y u k o n perform about the same funct ions as municipal i t ies elsewhere in the country. However, no Y u k o n munic ipal i ty owns or manages a social hous ing project. Municipal i t ies, or associations of municipal it ies, could sponsor Private Non-Profit Hous ing 51 Program projects. The City of Whitehorse is a funding partner (12.5%) in a 43 unit social hous ing project built in the early 1970's. However, Y H C manages the project and the partnership is strictly a f inancial one. Y H C did not consult with the City about major improvements to the project in 1987. One result is that the City's share of 1987 operating losses remain u n p a i d . 7 2 The City finally responded to a 1988 invitation from the Y H C President to place a representative on the Whitehorse Hous ing Author i ty Boa rd of Directors. Counc i l lor Ga l lup is the representative. Dawson City developed about 15 residential lots in 1986-87. The lots are on the market at development costs. Dawson City is unique because most other municipal i t ies rely on Y T G to p lan and develop new subdivis ions. Dawson City also provides hous ing for two of its senior staff. Other municipal i t ies may also provide staff hous ing but the total number of units is smal l . The Minister Responsible for Y H C invited the Associat ion of Y u k o n Municipal i t ies to recommend appointments to the Y H C Board of Directors in 1988. A lso in 1988, the Minister invited municipal i t ies to make similar recommendat ions for the communi ty hous ing associations. However, the municipal i t ies did not respond. There is however, some communi ty representation on the Y H C Board of Directors. Y H C has made an effort to involve municipal i t ies in identifying hous ing needs. Th i s consultat ion process is for both existing and new projects. However, the process is consultative; it is not power shar ing or empowerment. It is c o m m o n for Y H C to change or cancel projects without consult ing with the same communi ty leaders they consulted in the project p lanning phase. 52 3.6. The Private Sector While the federal, band and territorial governments dominate the hous ing industry, most dwellings are privately owned, and, in most years, built by private companies. Of the estimated 8,350 occupied private dwellings, approximately 5,800, about 7 0 % , are privately owned, fee simple properties. The importance of the Market Housing Rental Sector is decl ining as d iscussed i n Chapter 2. Since 1982, the private sector added only ten new apartment rental uni ts to the rental stock in Whitehorse. There are only 47 apartment (four or more units) rental units in the private sector in all the other communit ies outside the capital combined . 7 3 There are about 100 companies involved in the construct ion sector of the hous ing industry. Most have less than 12 employees. 7 4 A Y u k o n government directed C E D strategy in the hous ing industry would directly affect these firms. These f irms would also benefit most from a government commitment to stabilize the hous ing industry. The Y u k o n hous ing industry mirrors the boom and bust character of the economy. It will be difficult for government to succeed with efforts to develop and diversify the housing industry because of these cycles. Smal l private f irms will have difficulty getting f inancing for major investment in new plant and equipment i n such a n unstable market . 7 5 Government programs which assist f inancing will likely have only l imited success. There is so m u c h uncertainty that f irms will remain unwil l ing to invest, even with the generous f inancial incentives government programs provide. The private sector is doing a good job of meeting the hous ing needs of upper middle and upper income earners, particularly in Whitehorse. It is also doing a good job of bui ld ing 53 government staff hous ing throughout Yukon . However, the private sector is not doing a good job of meeting the needs of low and middle income Yukoners except with market choices like mobile homes. Mobile homes are an import and as such , represent a leakage to the economy. Th i s leakage is compounded because most mobile homes are energy inefficient. For the Y u k o n government to be successful in its implementat ion of Yukon 2000, it mus t have the support of the private sector. In the hous ing industry, this means the support of both producers and consumers . Some means to get this support are d iscussed in Chapter 5. 3.7. The D e m a n d for New Hous ing in the 1990's The demand for new hous ing depends on the combinat ion of several factors. Four are d iscussed below. These are: • populat ion growth; • government response to core housing needs; • age and condit ion of the existing stock; and • economic condit ions. A. Populat ion Growth There is a lot of uncertainty about the export industr ies on which the Y u k o n economy and hence workforce is based. A s a result, mak ing populat ion projections is not m u c h more than informed guesswork. Changes in the export base, which i n Y u k o n is government, tour ism, and min ing , c a n cause unpredictable and wide swings in populat ion. However, despite the severe recession in the first half of the decade, the Y u k o n populat ion cont inues to grow. Major populat ion changes in one industry communit ies like Faro and E l s a will occur when 54 the mines close either temporari ly of permanently. However, viewed over several years, there is some stability to overall populat ion growth. The strength of the government and tour ism sectors and the large (20%) resident native populat ion, are factors which contribute to this growth. Table 12 Populat ion and New Hous ing Demand Projections: 1990-1999 (The Actual 1989 population is 29.1. Population is in OOO's. New housing is in units) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Total Scenario 1 30.1 31.1 32.1 33.3 34.2 35.4 36.5 37.6 38.8 40.0 New Housing 356 369 359 371 383 395 408 405 418 431 3895 Scenario 2 29.9 30.8 31.6 32.4 33.3 34.2 35.1 35.9 36.8 37.7 New Housing 300 309 288 296 304 312 320 306 313 321 3067 Scenario 3 29.9 30.8 31.6 32.4 33.2 34.1 35.0 35.8 36.7 37.7 New Housing 299 308 284 291 299 306 314 300 307 314 3023 Scenario 4 29.8 30.5 31.1 31.7 32.3 33.0 33.5 34.2 34.7 35.3 New Housing 252 258 211 216 220 224 228 202 205 208 2224 Averages Population 29.9 30.8 31.6 32.4 33.3 34.1 35.0 35.9 36.8 37.6 New Housing 302 311 286 293 301 309 318 303 311 319 3052 Source: Derived from StatsCan Catalogue #91-517. Population is rounded to one decimal place. New housing projections are based on the increase in population divided by 2.8 persons per household (1986 census average), and is rounded. Note. The Yukon Government does not do population projections for the territory. Statistics C a n a d a developed different growth rate scenarios for Y u k o n in 1976. Table 12 shows populat ion predictions based the actual 1989 populat ion and the growth rates in these scenarios. The Y T G Bureau of Statistics does not make populat ion projections and no other projections were available for this thesis. Compound ing problems with populat ion projections is the populat ion data base. For 1984 and 1985, no populat ion figures are available from Y T G . 7 6 Based on Statistics Canada projections, the Y u k o n populat ion will increase through the 55 1990's. A s s u m i n g the average household size in 1986 of 2.8 (see Table 12 below) remains constant, demand for hous ing caused by the increasing populat ion will be about three hundred new units every year in the next decade. A s s u m i n g an average cost of between $110,000 and $130,000 (1989 dollars) per unit, each year new construct ion cou ld generate between $ 3 3 M and $ 3 9 M in direct economic activity and about 612 years of employment. 7 7 The C E D benefits of new hous ing continue over the life cycle of the properties. These benefits include spending on operations and maintenance and the employment that results, increased tax revenue for governments, and jobs in property management . If the incidence of core housing need persists because of problems like chronic unemployment and underemployment (see Table 16 in Section D below), then about one third of this new demand will be by households in core need. Th i s means that about two thirds of this new demand will be effective market demand likely to result in new construct ion. The private sector will have to produce about 200 units per year and the government 100 or the current hous ing crisis would worsen. Of course, this would do nothing to address the needs of about 3500 households already in core housing need. Employer suppl ied hous ing will meet some of this new demand. However, this should not be a significant number of units. The mine in Faro recently privatized hous ing for its employees and the mine in E l sa may also divest itself of its staff hous ing portfolio, about 100 units. The new Canamax mine near Ross River provides hous ing for employees only while they are at the mine site on shift. Most Canamax employees require permanent accommodat ion elsewhere in Yukon . As d iscussed in section 3.2. B above, the Federal Government will divest itself of most of its staff hous ing portfolio sometime in the future. The pressure on Y T G to do likewise may also increase. Th i s will mean the private sector will have to respond to the hous ing needs of the 56 employees w i t h stable, h igher incomes. The governments m a y s t i l l have to provide h o u s i n g i n the smal le r communi t i e s to recrui t staff. Table 13 compares total private Table 13 C a n a d a a n d Y u k o n : Househo lds a n d H o u s i n g 1986 househo lds for Y u k o n and for C a n a d a . The table shows the ownersh ip rate i s about the same for C a n a d a a n d Y u k o n . However, there is a s ignif icant difference i n the percentage of detached dwell ings. Single detached dwel l ings are the p redominan t b u i l d i n g form i n Y u k o n . Soc ia l and marke t h o u s i n g p lanners s h o u l d heed th is difference. Average incomes i n Y u k o n are d ramat ica l ly h igher t h a n the C a n a d i a n average, about 34% more. However, the m e d i a n income is m u c h closer, only 13% higher, suggest ing that income d i s t r i bu t ion i n Y u k o n is more skewed. S u p p o r t i n g th i s hypothes is are two facts. F i r s t , is the h igher percent of Y u k o n households earn ing more t h a n $50,000 a year. T h i s is 26% compared w i t h 20% for C a n a d a . Second, is the h i g h n u m b e r of ch ron ica l ly unemployed and underemployed people, especial ly i n the smal le r c o m m u n i t i e s (see Table 16). B . Government Response to Core Housing Needs The 1986 Yukon Housing Needs Study reported what m a n y people already knew. Hous ing Characteristic Canada Yukon Type of Dwelling Single Detached 56% 71% Households Persons Per Household 2.7 2.8 Average Household Income $35,665 $47,853 Median Household Income $29,462 $33,273 Households with Incomes Greater than $50000 20% 26% Tenure Home Ownership Rate 63% 64% Sources: Derived from J .D . and Housing Policy, UBC Plan #2-87.12 Hulchanski, Canada's Housing ning Papers and YTG Info Sheet 57 needs i n Y u k o n are m u c h greater t h a n i n any of the twelve major j u r i s d i c t i o n i n C a n a d a . The 1986 s tudy found that a lmost 3 0 % of households were i n core housing need.78 Figure 7 i l lus t ra tes the k i n d s a n d levels of h o u s i n g need i n Y u k o n . W h a t i s s t r ik ing is about 3 0 % of househo lds i n core housing need have more t h a n one k i n d of h o u s i n g problem. It i s c o m m o n for people i n Y u k o n to pay more t h a n the i r income c a n suppor t for inadequate or c rowded hous ing . F igure 7 Core Housing Need by Type of P rob lem AFFORDABILITY BASIC FACILIT IES CONDITION COMBINATION CROWDED One cr i te r ia for identifying core housing need is i f households pay, or w o u l d have to pay, more t h a n th i r ty percent of thei r income for sui table a n d adequate shelter. Whi tehorse is the only loca t ion i n Y u k o n wi th a h o u s i n g market . There, the Core Need Income Thresho lds or CNITs , are derived from average marke t rents for ful ly serviced accomodat ion . F o r the rest of Y u k o n , CNITs are derived from the cost of a R u r a l a n d Native D e m o n s t r a t i o n Program-type 58 house (This program is d iscussed i n Chapter 4). Households i n core need mus t have a hous ing problem and an income less than the threshold applicable to their household size and composit ion. Y H C has not updated the 1986 Yukon Housing Needs Study to reflect the major increases in the core need income thresholds for Yukon . Increases are part icular ly significant for the rura l areas. However, the estimate used i n this thesis is that about one th i rd of households are in core housing need.79 Table 14 shows the increase in the core need income thresholds since 1986. Table 14 Y u k o n Core Need Income Thresholds: 1986 and 1988 Income Threshold by Region Bedrooms Whitehorse (City) Rural Areas Special Access Areas Required 1986 1988 1986 1988 1986 1988 One $22,600 $21,000 $21,800 $38,000 $13,000 $34,000 Two $27,200 $25,000 $24,100 $38,000 $17,000 $34,000 Three $29,200 $28,000 $26,600 $42,500 $19,600 $48,000 Four $30,600 $34,000 $28,100 $48,000 $21,600 $60,000 Sources: Yukon Housing Needs Study, page 6 and YHC records. Notes: 1. New National Occupancy Standards in 1987 changed the way of calculating thresholds. 2. The Thresholds in for the rural areas in the Needs Study were averaged for this table. People in Y u k o n identified the k ind of responses to hous ing problems they want from the Y u k o n government in two Yukon 2000 reports. 8 0 These include: • increased availability and affordability of all types of hous ing by creating new programs to support home ownership; • access for all Yukoners to good quality, appropriate and affordable hous ing; and 59 • devolved responsibil ity for runn ing hous ing programs. There is no "best" way to respond to respond to the approximately 3500 Y u k o n households in core housing need.81 The definition of the appropriate and cost-effective program response to hous ing needs is political and highly subjective. 8 2 However, because of the extent of core housing need and the low level of rental starts i n the 1980's, Y H C and C M H C shou ld have no shortage of occupants for new units p r o v i d e d t h e y m e e t c o m m u n i t y n e e d s . The annua l number of new hous ing starts i n Y u k o n is quite erratic as il lustrated in Figure 5 and Table 9. C M H C and Y H C have always had the f inancial resources to bu i ld more units than either ever did. Neither agency ever fully committed its social hous ing budget for new units. Unfortunately, this failure is not only a contemporary one; it has persisted since the early seventies. It is not only a failure by politicians, but by bureaucrats and communi ty organizations. Table 15 Portfolios of the NWT and Y u k o n Hous ing Corporat ions: A Compar i son Estimated Number of Households Social Housing Units+ Ratio Yukon 10714 353 1:30.3 NWT 13514 4100 1:3.3 Source: Compiled from interview with NWT Housing Corporation Yellowknife staff and YHC records. The average number of persons per household in Yukon is 2.8; in NWT, 3.7 (1986 Census, Table 1 19-104) + includes units owned or managed by the two territorial housing corporations Table 15 compares the social hous ing portfolio of the Y u k o n and Northwest Territories Hous ing Corporat ions. A s shown in this table, the N W T Hous ing Corporat ion has been m u c h more active than Y H C in responding to hous ing needs. While condit ions in the two territories are different because of geography and number of remote communit ies , the response by the 60 territorial government in the NWT to hous ing needs is m u c h greater than its counterpart in Yukon . On a per household basis, the NWT Housing Corporation has ten times as many social housing units as Y H C . There are no hous ing cooperatives and only three fledgling non-government non-profit hous ing societies. These are Native non-profit societies which receive fund ing only f rom the federal government. The Y u k o n government has never funded a private non-profit hous ing project, though it has had funding to do so for the past three years. In fact, dur ing that same period, Y H C lapsed federal funding for about 83 units. A past president of one non-profit hous ing society in Y u k o n reports that if Y H C had contacted her society, that organization would have used at least some of these un i ts . 8 3 Y H C did give project development funding to three private non-profit groups in 1988. Y H C expects that two of the groups may proceed with projects in 1989. The total take-up could be about 18 units. There are problems with program delivery d iscussed above. However, this thesis uses the number of units that C M H C and Y H C could bu i ld as the number, of social hous ing uni ts these agencies will bui ld . This number, about 130 units, is manageable. For comparison, the NWT Housing Corporation delivered 291 units in 54 communities in 1988 and plans 300 units in 52 communities in 1989. Not all "new" social hous ing units are "new" to the hous ing market. Project sponsors have the option of buy ing existing or bui ld ing new hous ing units. In fact, program guidelines are clear; project sponsors should evaluate their "best buy" option. Th is means that when the market value of existing properties is less than the market value of bui ld ing new, project sponsors shou ld buy the existing property. The effect is that when the economy is in recession and cou ld benefit f rom the st imulat ion bui ld ing new hous ing creates, program guidelines mean 61 sponsors shou ld buy existing units. Figure 8 Social Hous ing in Yukon : New and Exist ing Properties 1990 - 1988 83.6% New E x i s t i n g 16.4% Rat io New:Exist ing 4.1:1 100 _, 80 81 82 83 BA 85 '86 87 '88 Year • New + E x i s t i n g There are other reasons project sponsors may decide to purchase existing properties. First, buy ing existing property is easier than bui lding. A project sponsor with limited resources may select to buy rather to bu i ld , particularly if they are under a tight time constraint. Second, buy ing existing may be the only way a sponsor c an get their units integrated into an existing stable ne ighbourhood which is already built-up. Th i rd , in some markets, the best buy value of existing properties is so m u c h greater than bui ld ing new that project sponsors would all but refuse to bu i ld . Th i s is particularly true in the smaller Y u k o n communit ies , where the gap between the cost of new and existing hous ing is greatest. Four th , for some sponsors, buy ing existing and converting or renovating may be the only way they can get their project to cost less than the applicable m a x i m u m unit pr ice. 8 4 62 A s shown in Figure 8, about eighty-four percent of social hous ing commitments so far this decade were new units. Some programs have a greater propensity to cause new construct ion as d iscussed in the next chapter. C. The Aging Hous ing Stock The 1986 C a n a d a Census reports 7975 occupied private dwelling uni ts in Y u k o n in June of that year. The age of the Y u k o n hous ing stock reflects the bui ld ing boom which occurred in the mid-1970's (see Figure 1). A s shown in Figure 9, about 6 0 % of the stock less than twenty years o ld . 8 5 Th i s is a m u c h newer stock compared to the stock in the rest of Canada. Nationally, only about 4 0 % of the stock is less than 20 years old. However, overall, the condit ion of the stock in Y u k o n is m u c h worse than in Canada . The Housing Needs Study reported that about hal f the hous ing stock i n Y u k o n was in inadequate condit ion; 2 4 % lacked basic facilities; 2 3 % was in poor interior condit ion; and 1 6 % was in poor exterior condit ion. There is some overlap, but clearly, the stock is not in good condit ion. For the older stock, particularly in the communit ies outside Whitehorse, homes in inadequate condit ion are common. Even in Whitehorse, about 1 4 % of the stock is in inadequate condit ion. It is not possible to predict how m u c h of the hous ing stock which is more than 30 years old will be replaced in the next ten or twenty years. Th i s replacement will depend on many variables inc luding the spending decisions of the property owners. However, if only 2% of this stock is replaced i n each of the next ten years, this would create demand for about 35 new units each year. Th i s is a modest replacement cycle as some of the stock which is now less than 30 years old will also be replaced over the decade. 63 Figure 9 Profile of the Y u k o n Hous ing Stock by Age Canada Census 1986 AiI DweIii ng Types yyyyy/yyyy97>^ +so Years c.21.990 15 to 19 Years Q20. 9SQ Renovation programs are good for C E D as discussed in Chapter 3 and 4. Rehabil itating the best of the existing stock provides continuity and l inks with the heritage of each community . C M H C reports the renovation sector is a rapidly growing part of the hous ing industry in which the trend is specialization of labour. According to the Summary Report, The Changing Housing Industry in Canada, "Significantly less opportunity for growth [in the renovation sector] is expected for indiv idual firms attempting to be "jacks of all trades"...[and] The highly qualified skil led labour required for renovation work is in short supply (p. 41)." For Y u k o n , this means to salvage the older hous ing stock, vocational tra ining and firms in the hous ing industry need 64 to recognize the special requirements of the renovation sector. Renovation programs can meet some core housing need. For m a n y others however, their house is beyond economic repair. For many people, their house mus t be replaced or they will remain in core housing need. D. Economic Condit ions The strength of the economy, interest rates, people's expectations about cont inued employment (or underemployment), and household income are some of the factors which contribute to their hous ing spending decisions. Entrepreneurs also base their investment decisions on economic conditions. The saying among entrepreneurs and investors in Y u k o n is that if you can't recover an investment within five years, don't make it. Because the economy is export based, f irms can not predict what the economy will be like six months or even six weeks in the future. A shift in the price of silver on the London futures market can mean one industry towns, like E lsa and Faro in Y u k o n , are closed down. E conomy uncertainty means that demand for market hous ing is highly uncerta in; so is supply. Investors and bui lders are very hesitant to invest i n the hous ing industry which can be buoyant at the beginning of the bui ld ing season and in deep recession at the end. Figure 10 shows the effect of the boom and bust cycle in the 1980's on the Gross Territorial Product and corporate profits. 8 6 The effects are dramatic and of real concern to f inancial institutions and the bus iness ventures they get asked to finance. The Y u k o n government has more flexibility to spend its way out of a recession than some of the provinces. Th i s is because the Y u k o n government it is not as dependant on locally 65 generated taxes for revenue. About two thirds of the Y u k o n government's revenue is a transfer f rom the federal treasury. 8 7 Many Y u k o n government expenditures are i n program areas, like hous ing, the C a n a d a Assistance P lan and the Economic Development Agreement in which it shares the costs with the federal government. A s shown in Figure 10, for the corporate sector, the recession has a major impact. In the 1983-85 period, corporate profits were off more than $75m. However, dur ing the same period, Y T G spending was up more than $ 1 1 4 m . 8 8 There are several things the Y u k o n government can do to ease legitimate concerns about the hous ing industry which is so susceptible to economic downturns. These are d iscussed in Chapter 5. Government spending in Y u k o n has a dramatic affect on the composit ion of the work force. Governments employ almost 2 1 % of Y u k o n workers. Th i s compares with 7 .6% for C a n a d a (McArthur, 1987). A s reported above, the source of revenue for government spending only depends in a smal l though significant way on the strength of the Y u k o n economy. When that economy is in recession, more than one in five workers have jobs which are m u c h more secure than jobs in the private sector. Without government spending and government employment, the recession of the early 1980's would have been a depression. Figure 10 shows that it wasn't the private sector which led the economy from the recession in the early to mid-1980's. It was government spending that turned the economy around and the private sector wh ich depended on that lead. C M H C and Y H C cou ld have further assisted the economic up tu rn by spending the money they had to bu i ld new hous ing. Employment and underemployment are systemic in many communi t ies as shown in Table 16. M a n y employment opportunities that do exist are seasonal or not full-time. Note that for the same month reported in Table 15 above, the official unadjusted unemployment rate for Y u k o n was 1 0 % for Y u k o n and 8 . 1 % for Canada . 66 Figure 10 The Effect of Recession 1982-1986 67 Table 16 is also an indication of the poverty in many of the smaller Y u k o n communit ies . A n industry, like housing, which can create a jobs in every communi t y every year on a sustainable basis would help many of these communit ies . Bu i ld ing many houses in one year would help ease hous ing problems. However, it would do little to relieve chronic unemployment and the hous ing problems it creates. In fact, the Yukon 2000 report on hous ing recommended Table 16 UIC Cla imants and Employable Social Assistance Recipients J une , 1987 Community UIC Claimants S.A. Recipients Population +15 Years (D+(2) (1) (2) (3) as % of (3) Carcross 35 13 243 19.8 Carmacks 32 46 276 28.3 Dawson City 209 31 1211 19.7 Faro 39 3 1010 4.2 Haines Junction 72 18 564 16.0 Mayo 64 39 803 12.8 Old Crow 7 8 191 7.9 Ross River 24 31 273 20.1 Teslin 63 11 418 17.7 Watson Lake 86 76 1 136 14.3 Whitehorse 1515 236 14219 12.3 Total 2145 512 20344 13.1 Source: Yukon Territorial Government, Yukon Economic Review and Outlook 1987-1988 Table 4-3 page 20 that the Y u k o n government: use the construct ion industry to stabilize economic activity by spreading larger projects over time, for example by bui ld ing a numbe r of social hous ing units a year for five years rather than all the required units for five years. Th i s would maximize the longer term employment and bus iness opportunit ies and reduce the need to import tradespeople and other workers f rom out of the Y u k o n (Yukon Development Strategy: Construction and Housing, p. 2). The shortage of employment opportunities in many of the communi t ies means people 68 there have l imited resources for new housing. A s a result, effective demand for new hous ing will cont inue to represent only a port ion of total hous ing need. 69 4. E x i s t i n g H o u s i n g P r o g r a m s Th i s chapter reviews fourteen hous ing programs and assesses the impact of each on C E D . The fourteen programs are: • Co-operative Hous ing • U rban Native • O n Reserve 8 3 • Lease Purchase • Emergency Repair • DIAND Renovation Program • Private Non-Profit • DIAND Hous ing Subs idy • Rura l and Native • Rura l and Remote Demonstrat ion • Residential Rehabil i tat ion Ass istance • Home Improvement Initiative • Saving Energy Ac t ion Loan • Public Non-Profit Sixteen criteria were developed against which to measure the impact of each program on C E D . These criteria are based on the goals and objectives for hous ing in Yukon 2000 reports and the literature on C E D . A s d iscussed in Chapter 2, the "community" in this thesis can m e a n either the Y u k o n communi ty (all Yukon) or a part icular geographic community , like Whitehorse or O ld Crow. So there is Y u k o n C E D and community-based economic development. Nine criteria differentiate between the impact on Y u k o n C E D and impact on C E D in a part icular c o m m u n i t y . The sixteen criteria measure the impact the programs have on C E D as each delivery agent delivers each program. Th i s is not an empirical test or evaluation a n d the criteria are not weighted. Rather, the purpose is to measure the relative C E D benefits of the programs based u p o n the criteria. Table 20 at the end of this section summar izes the relative impact of each program on each C E D criteria and gives each program a total score. About 6 5 % of the Y u k o n populat ion lives i n Whitehorse. If the distr ibut ion of C E D 70 occur red o n a popu la t i on basis , t hen 6 5 % of the C E D benefits of the h o u s i n g i ndus t ry w o u l d be i n the capi ta l . However, to redress the cur ren t u n e q u a l d i s t r i bu t ion of income a n d C E D i n Y u k o n , necessitates that a percentage of benefits greater t h a n 3 5 % accrue to communi t i e s other t h a n Whi tehorse . Indicative of this unequal income distribution is that 37% of households outside Whitehorse earn less than $20,000 per year compared with only 22% in Whitehorse; 30% of households in Whitehorse earn more than $50,000 per year compared to only 19% outside Whitehorse.90 A l s o , h o u s i n g condi t ions are m u c h better i n Whi tehorse . 9 1 In the cr i ter ia , "communi ty" means the either the loca l geographic c o m m u n i t y i n w h i c h a n agency delivers a h o u s i n g p rogram or a loca l com m un i ty - ba s ed non-profi t , elected or appoin ted group. In the cr i ter ia , "requires" means by p rogram des ign or necessi ty. "Control" means the au thor i ty to direct and manage the project w i t h i n p rog ram guidel ines . "Tenant /owner" means the occupant or in tended occupant of the h o u s i n g un i t i n each program, not the holder of the title. "Affordable hous ing" m e a n s occupan ts do not pay more t h a n 3 0 % of the i r income to shelter costs. "Adequate hous ing" means the proper ty a) meets na t iona l occupancy s tandards , b) meets the specials needs of people w i th a d isabi l i ty , c) conforms w i t h the Na t iona l B u i l d i n g Code, and d) has indoor p l u m b i n g a n d l i q u i d waste d isposa l . "Imports" refers p r imar i ly to impor ted fossi l fuels bu t also to other impor ts . The cr i ter ia are: • requires the use of Y u k o n harvested and manufac tu red b u i l d i n g mater ia l s • requires the use of c o m m u n i t y harvested a n d manufac tu red b u i l d i n g mater ia l s • requires the use of Y u k o n l abour and professional services • requires the use of loca l c o m m u n i t y l abour and professional services • uses a fund ing source external to Y u k o n • c o m m u n i t y cont ro l of the process to identify h o u s i n g needs 71 • project sponsorship by a new or existing communi ty group • communi ty control of the project p lanning process • communi t y control of project implementat ion • communi ty control of ongoing project operations • tenant/owner control of the project p lanning process • tenant/owner control of project implementat ion • tenant/owner control of ongoing project operations • increases the supply of affordable hous ing • increases the supply of adequate hous ing • replaces imports through the use of alternate technology 4.1. Cooperative Hous ing Program The purpose of the new (1986) Co-op Hous ing Program is to increase the supply of affordable hous ing. People living i n co-ops funded under this new program do not have to be in core housing need. Hous ing co-operatives are groups of people who have jo ined together to provide their own hous ing through joint ownership...people from all income brackets have turned to hous ing co-ops as a way to enjoy a secure, affordable home designed to suit their needs in a strong communi ty environment... Co-ops are member controlled organizations...each member has one vote in the operation of the co-op. Every year, the members elect, f rom among themselves, a Board of Directors to manage the bus iness and affairs of the co-op. Membersh ip means joint ownership and control of one's hous ing (CHF, 1988). 9 2 72 Co-op owners may have some or all of the following responsibil it ies: • incorporating a new non-profit cooperative hous ing society • complet ing a needs study • hir ing consultants as required • selecting a bui ld ing site or a bui ld ing to acquire • hir ing an architect • preparing capital and operating cost estimates • preparing bui ld ing plans • tendering the project • arranging f inancing for 1 0 0 % of the capital cost • supervis ing and managing construct ion • selecting tenants • all responsibil it ies as project owners and landlords C M H C funds and delivers one national co-operative hous ing program which it introduced in 1986. There are also three provincial co-operative programs, in Ontar io, Quebec and Mani toba (Fact Sheet #3 CHF:1988) . It is u sua l for hous ing co-ops to start other co-operative agencies and activities (CMHC, Information for New Co-ops, N H A 6078). The program requires that a not-for-profit hous ing co-operative society incorporate for each co-op project. The hous ing co-op members are owners and tenants. Many co-operatives jo in the Co-operative Hous ing Foundat ion of Canada , an important hous ing resource group founded in 1968 by the Canad ian Labour Congress, the Co-operative Un ion of Canada and the Canad ian Un ion of Students (Fact Sheet #2 CHF:1988) . There are more t han 54,000 co-operative hous ing uni ts in Canada (CHF:1988). However, as reported 73 above, Y u k o n is the only jur isdict ion in Canada without a hous ing co-operative. C M H C reserved funding for a Y u k o n co-op i n 1987, 1988 and again i n 1989. The group incorporated in 1987 and secured a bui ld ing site i n Whitehorse i n 1988. In 1987 and 1988, C M H C loaned the group Project Development Funds . However, the amount of the m a x i m u m unit price which C M H C imposed on the project caused delays in 1988. The consensus of the group was they cou ld not bu i ld the project for less than the m a x i m u m unit price. The latest report is that the co-op will not be able to construct a town house project within the m a x i m u m unit price for that bui ld ing form. The group can however, purchase new three bedroom detached dwellings as that cost is below the applicable m a x i m u m unit price for detached dwell ings. 9 3 The 12 unit project will mean an injection of about $1 .2M into the Y u k o n hous ing industry. However, the group may have to import some of the professional labour and most of the materials. Th i s project will create about 6 person years employment in on site construct ion work and a n unknown number of off-site jobs in Y u k o n . 9 4 4.2. D IAND Hous ing Program The federal Department of Indian Affairs and Northern Development (DIAND) provides a capital subs idy directly to bands for the construct ion or acquisit ion of hous ing units. The D IAND Indian and Inuit Program Whitehorse Office administers this program for the 12 Y u k o n and 3 Northern B C bands . The federal government funds this program. The intent of this program is to assist bands meet the hous ing needs of band members living on land set aside. D IAND pays a subs idy to band governments in the form of a condit ional capital grant. In 1988, the approximately 40 DIAND condit ional grants to Yukon 74 bands totalled $ 1.48m. The amount of the hous ing subsidy varies from $27,583 to $45,590, depending on whether D IAND designates a band u rban , rura l , remote, or special access. U r b a n bands receive the lowest subs idy and special access the highest. The subsidy amount only covers part of the cost of bui ld ing or buy ing a house that meets the National Bu i ld ing Code. Bands may contribute additional capital funding to hous ing projects, but only to cover the cost of mun i c ipa l services outside the house. Whether by design or default, the result of these program guidel ines is that about 5 3 % of units built with it in the 1986-88 period also used the C M H C Private Non-Profit O n Reserve Program. 9 5 In some communit ies , the DIAND subsidy is sufficient to bu i ld a home to current National Bu i ld ing Code standards. However, it is not always sufficient to bu i ld a home to meet C M H C adequacy standards and with indoor p lumbing and l iquid waste disposal . It is also not always sufficient to bu i ld a home with enough bedrooms to meet nat ional occupancy standards (number of persons per bedroom by age and sex, not co-habitating). In some communit ies , indiv idual band members mobilize sweat equity and use their own savings to complete houses with the subs idy and the other capital contribution. It is however, more common for the houses bands bui ld with the DIAND subsidy to be effectively completed over several years. It is c ommon for bands and the occupant to complete the house us ing several renovation programs. Some bands can bu i ld a house to the m i n i m u m standard required by DIAND with only the subsidy. In subsequent years, bands use other programs to make additions, install munic ipa l services, increase thermal efficiency or install electric service. After several years, the result may be a complete adequate dwelling. However, this innovative use of renovation programs produces a house which is likely inferior to what bands cou ld bu i ld if they had all the funds at the beginning of the construct ion process. 75 E a c h band chief and counci l allocate the hous ing subsidies and all b and housing. Some bands use hous ing committees to try and de-politicize the allocation of hous ing resources and involve communi ty members i n the process. However these committees funct ion with vague terms of reference and intermittency. If there is no loan on the property, the occupants do not pay rent to the b a n d . 9 6 Some other programs, like the now defunct Homeowners Grant in B C and RRAP, recognize the occupants of band hous ing as owners though they do not have title. However, once a band allocates a house to a part icular household, it is the cus tom for that household to retain quiet enjoyment indefinitely. In some cases, bands bu i ld log houses with trees harvested in Yukon . In most instances where bands completed houses only with the DIAND subsidy, through necessity they used at least some local bui ld ing materials and products . 9 7 4.3. Non-Profit Hous ing Programs C M H C and Y H C deliver 7 non-profit programs in Yukon . The two rent supplement programs are not reviewed in this section. The other five programs are: • U r b a n Native (CMHC) • Rura l and Native (CMHC) • O n Reserve (CMHC) • Private Non-Profit (YHC) • Publ ic Non-Profit (YHC) The purpose of these programs is to increase the supply of affordable and adequate hous ing for households i n core housing need. In these programs, people assisted are tenants and they pay 2 5 % of their income to rent. 9 8 In 1987, Y H C set the m a x i m u m rent for units it manages at $600 per month . For units completed before 1986, program guidel ines permitted 76 program sponsors to set a m a x i m u m rent. For uni ts completed after 1985, program guidelines do not permit project sponsors to set a m a x i m u m rent. C M H C delivers the U rban Native, On-Reserve and Rura l and Native programs. Y H C delivers the Private Non-Profit and the Public Non-Profit programs. C M H C funds all programs it delivers 100% . The non-profit programs Y H C delivers are cost shared with C M H C on a C M H C 75 :YHC 25 basis. Non-Profit Program project sponsors may have some or all of the following responsibil it ies: • incorporating a new non-profit hous ing society • complet ing a needs study • hir ing consultants as required • selecting a site • hir ing an architect • preparing capital and operating cost estimates • preparing bui ld ing plans • tendering the project • arranging f inancing for 1 0 0 % of the capital cost • supervis ing and managing construct ion • selecting tenants • all responsibil it ies as project owners and landlords Program sponsors may be Indian bands , groups which previously sponsored a C M H C hous ing project, a new communi ty group or Y H C . These programs c a n empowers communi ty groups by giving them authority and responsibil ity to meet hous ing needs in their respective communit ies . 77 Some new communi ty groups are formed to sponsor hous ing projects us ing these programs. Other groups, like Entre Nous Femmes Hous ing Society in Vancouver , sponsor more than one project. That group sponsored one project in each 1985, 1987 and 1988. G roups like Entre Nous Femmes are also an important resource for other groups which want to sponsor their own projects. " The five non-profit programs use newly created or established benevolent societies or governments as the means to meet hous ing needs. There are important differences between these programs and the co-op program discussed above. The legal owners of the properties funded with non-profit programs are the benevolent societies or governments, not the tenants. These benevolent organizations p lan, develop, bu i ld , select tenants and assume all management and landlord responsibilities. Tenants are not members of the non-profit society. In fact, program guidel ines prohibit tenants f rom becoming members. Th is is because the const i tut ion of societies us ing these programs mus t state that members can not profit or otherwise receive benefits from the society. C M H C considers being a tenant a benefit . 1 0 0 Similarly, the constitut ion of the society mus t prohibit members of the society from entering contracts with the society. Accord ing to the program guidelines, this means that if a member of a society was an accountant, the society could not pay them for keeping the accounts of the society. While conflict of interest guidelines have merit, some societies f ind these program guidel ines reduce program effectiveness and the capacity of groups to meet hous ing needs. A . U rban Native Hous ing Program The purpose this program is to provide affordable and adequate hous ing to Native people in core housing need living in u rban areas. The means is through a Native non-profit housing society. There are 3 such societies in Yukon . Thei r property holdings are shown in Table 17. 78 Though by definition, the program is for Table 17 U r b a n Native Hous ing in Yukon : Society Portfolios u rban areas (more than 2500 people), C M H C d i d deliver this program in Watson Lake and Tes l in , which had 1988 populat ions of 1,737 and 452 respectively. C M H C reports that will continue to deliver this program in these communi t ies . 1 0 1 Th i s program has the lowest units constructed to units committed ratio. In Yukon , t h i s p r o g r a m h a s n o t d i r e c t l y c a u s e d t h e c o n s t r u c t i o n o f a s i n g l e h o u s e . 1 0 2 B. O n Reserve Hous ing Program The purpose of this program is to increase the supply of affordable and adequate hous ing to band members living on land set aside. Across Canada , C M H C recognizes Indian Bands as eligible sponsors for this Non-Profit Program. There is a m a x i m u m subsidy for this program and it is not as deep as other programs. 1 0 3 Th is fund ing arrangement means that bands must use the D IAND Hous ing Subs idy Program to make each project f inancial ly v iable. 1 0 4 The m i n i m u m DIAND capital grant varies from project to project depending on location, but is about 4 0 % of the total per unit capital cost. Table 18 reports the take up of this program in Y u k o n since 1980. Most bands use hous ing as a communi ty economic development program to create training and employment for b a n d members and to offer improved hous ing alternatives to band At December 31, 1988 Unit Type Society SDD' Other Total Grey Mountain 23 10 33 Teslin 3 0 3 Tintina 19 0 19 Total 45 10 55 Source: CMHC Whitehorse Office staff 1 Single Detached Dwelling 79 Table 18 O n Reserve Hous ing members . By mak ing improved hous ing alternatives Program: B a n d Portfolios available, bands can keep some members in the communi t y that would otherwise leave. Other band members return to their home communi ty get the affordable hous ing this program makes possible. Some bands , like Kwanl in D u n in Whitehorse and Champagne Ash ih i k which has several settlements in the Haines J unc t i on area, also use the program to start and develop businesses. Most bands use the program for the physica l development of their communit ies as part of a communi ty p lanning process. Some bands even use the program to integrate their communi ty into the non-Native communi ty in their area by purchas ing non-reserve property with program funding. However, most Bands manage the property as a cross between a private home ownership program and a private rental program. About 9 5 % of the properties funded in this program are single detached dwellings. At December 31,1988 Band U n i t s Kwanlin Dun 106 Little Salmon/Carmacks 24 Champagne/Ashihik 30 Teslin 18 Dawson City 19 Liard 17 Old Crow 15 Selkirk 13 Ross River 8 Total 250 Source: compiled from interviews with C M H C Whitehorse Branch staff There are no tenant associations and no hous ing co-operatives on land set aside in Yukon . C. Rura l and Native Hous ing (RNH) Program The purpose of this program is to increase the supply of supply of affordable and adequate hous ing for households in core housing need in rural areas (this means all Y u k o n except Whitehorse) not on land set aside. There are three options for people in this program; ownership, lease-to-purchase or rental (CMHC, N H A 5901-7 09/88). C M H C committed 21 R N H units in Y u k o n since it first delivered the program in 1985. C M H C p lans to commit 10 uni ts in each of the next two years. Th i s program is targeted to both native and non-native people on a percentage basis C H M C sets each year in the Yukon 80 Three Year Plan. The Counc i l for Y u k o n Indians delivers this program under contract with C M H C . This program has the second lowest units constructed to units committed ratio. Of the 22 units committed between 1985 and 1988, only 9 were new units. Th i s program does not involve communi ty groups or require a non-profit sponsor. Communi t i es and communi ty groups do not have any control over who receives the program benefits. CYI u sua l method is to advertise its representatives will be in a communi ty to explain the program and receive applications. D. Private Non-Profit Hous ing Program Y H C is the agency responsible for delivering the national Private Non-Profit Program which it cost shares with C M H C on a 25:75 (YHC:CMHC) basis. The purpose of the program is to increase the supply of affordable and adequate hous ing for people in core housing need. Th is program requires a non-profit sponsor. Unl ike C M H C , Y H C does not target a percentage of the new hous ing it delivers to Native people in the territory. While it may be a good thing not to deliver hous ing programs on the basis of race, Y H C has not delivered the Private Non-Profit Program to a Native sponsor. Y H C has not made the existing u rban native hous ing societies aware that they can use this Y H C program. Indeed, Y H C has never delivered this program, though it contracted with C M H C to do so in 1986. E. Publ ic Non-Profit Hous ing Program Of the hous ing programs assessed, the Public Non-Profit Program creates the least 81 opportunit ies for C E D . In Yukon , Public Non-Profit projects involve communi ty based but Y T G appointed hous ing associations and authorities. The role of these appointed groups is essentially twofold; to advise Y H C on all communi ty hous ing matters and to make hous ing allocations based u p o n criteria developed by Y H C and C M H C . 1 0 5 Y H C and C M H C cost share this non-profit program. In it, Y H C is the owner and landlord. It may contract out some or all property management responsibil it ies and does in one communi ty only, to the Whitehorse Hous ing Authority. In this program, Y H C is the project p lanner and owner. A t different times in recent years, Y H C sought advice f rom communi ty hous ing associations, bands , mun ic ipa l counci ls , area residents and the local Member of the Legislative Assembly (MLA). The purpose of this consultat ion was to identify hous ing needs and in assist in project p lanning and implementat ion. However, as project owner, Y H C holds all decision mak ing power; the decision to consult is discretionary and the recommendations of those consulted are not b inding on Y H C . Y H C delivered 71 Publ ic Non-Profit units in 4 communit ies in the 1986-88 period, in addit ion to manag ing these units, Y H C manages 282 units in 9 communi t ies built prior to 1986 with programs C M H C discont inued. Th i s thesis considers these units the same as Public Non-Profit units. Under the terms of the program, Y H C has no responsibil ity to consult with the local communi ty before it deliver the program. In practice, the consultat ion process varies from communi ty to community . Even within the same community , the consultat ion process varies from project to project at the discretion of Y H C . Y H C does not use the program to empower communit ies or communi ty groups, for training, 82 or to create local employment. Except for one seniors' project in Whitehorse, it does not support tenant associations, though the program does permit Y H C to fund them. Y H C cou ld tu rn over program delivery to the communi ty hous ing associations. With Y H C technical support , these associations could design, deliver and manage projects. Commun i t y groups may perceive this to be an advantage over the Private Non-Profit Program because Y H C would act as a k ind of safety net. Th is is particularly important because there is no non -profit network or resource groups in Y u k o n from which a communi t y group could get help if it there was a problem with program delivery. O f the 59 units Y H C delivered in this program in the 1986-1988 period, most, 8 6 % , were new units. Th i s program has a high units constructed to units committed ratio. 4.4. Rura l and Native Demonstrat ion Program C M H C announced in 1986 that it would fund 500 units in this new demonstrat ion program over the 1986-90 five year period. The target group is people in core housing need in rura l areas who "demonstrate a wil l ingness and capability to provide the volunteer labour required to bu i ld (their) own home," and are able to afford the on-going costs of homeownership excluding a mortgage payment ( C M H C program Information N H A 5901-12)." Households selected into the program choose a design which, in the opinion of C M H C , the household can bu i ld within the $45,000 m a x i m u m per unit cost (materials and freight only). C M H C expedites the materials, provides some technical support and electrical, mechanica l and other specialized labour at critical points in the house construct ion. The household is responsible for mobil izing the labour to bu i ld the house. Th i s labour usual ly includes the household , family and friends. 83 Commun i t y groups can not be project sponsors in this program. It is worth noting that communi ty groups can sponsor the NWT Hous ing Corporat ion Homeowner Ass istance Program on which the federal government based their Demonstrat ion Program. In the NWT, this means that indiv iduals who do not themselves have the resources to bu i ld a house (for example, female-led families or the elderly) can receive the benefits of the program. The School of Communi t y and Regional P lanning at the University of Br i t ish Co lumbia is researching the C E D opportunities created by the Homeowner Ass istance Program in Fort Good Hope, NWT. The prel iminary f indings are that HAP does creates C E D . 1 0 6 The NWT Hous ing Corporat ion completed an evaluation of HAP 1987. A m o n g the findings pertinent to this thesis is that there are limited economic development opportunit ies created by of HAP. Th i s is because the hous ing corporation there imports so m u c h of the materials (NWT Hous ing Corporat ion, 1987). However, the evaluation also found that the program did cause communi ty development "by engendering responsibil ity for long term operation and maintenance of their homes (p. 10)." Y H C delivered the Demonstrat ion Program in O ld Crow, Carmacks , and Carcross in 1986. Commun i t y opposit ion in Carmacks was particularly fierce and bitter. The way Y H C delivered the program fuelled the perception that it was a free home program which would reduce property values. Y H C has not delivered the program since 1986 and C M H C will only deliver the program in O ld Crow. 4.5. Lease Purchase Program Y H C developed and introduced this program in 1988 and funds it 100% . It was developed in response to the Yukon 2000 recommendat ion that Y H C develop an assisted home ownership program. The purpose of the program is to increase the home ownership rate of people with 84 low and moderate incomes. The program provides assistance to people who can afford, or almost afford the costs of home ownership but who don't have the downpayment and who demonstrate good management of their personal f inancial affairs. It provides an opportunity for a l imited number of renters, 20 and 30 in 1988 and 1989 respectively, to become owners. Th i s program does not impact directly on communi ty groups or on communi t y planning processes. People i n the program may select, within cost constraints determined by their income and debt load, to bu i ld or purchase a n existing home. None selected to bu i ld and one household selected to import a mobile home, an option i n the program. In 1988, four of twenty people (20%) i n the program were social hous ing tenants in Publ ic Non-Profit Program projects. There are benefits that accrue to a communi ty when a household has a f inancial stake in it. Some people may argue that owners have a greater f inancial stake in a communi ty than renters and are more likely to become involved in communi ty affairs as a result. However, it is not the purpose of this thesis to define the relative impact of ownership and rental programs on C E D . The impact of programs on C E D has more to do with program design and delivery than whether people in the programs become owners or renters. Home ownership has at least a perceived stream of benefits that renting does not. These include equity bui ld-up, security of tenure, control of the property and , if income is rising, relatively lower downstream costs. These are some of the same reasons that motivate about 6 5 % of Canad ians to become owners. Part icipants in home ownership programs may at least perceive they are better off, even if they are not. Some people may also have the perception that owners are better than renters and more entitled to government assistance. Still others may support assisted ownership while opposing social hous ing because they th ink the former means single detached dwellings while 85 the latter means apartments. The impact on hous ing programs is that some communi t ies may-support assisted ownership programs while opposing rental social hous ing. Hous ing and C E D planners shou ld be sensitive to communi ty perceptions about hous ing programs in program design, market ing and implementation. 4.6. Renovation Programs A s d iscussed in section 3.2 B, about half the homes i n Y u k o n are in inadequate condit ion. Many of these homes and others are also energy inefficient. Th i s energy inefficiency causes high costs to the occupants and leakages to the economy as all fossil fuels are imported. To meet hous ing needs, four government agencies f und home renovation programs. Table 19 reports the value of these programs in the 1980's. The federal government terminated the C M H C Landlord Residential Rehabil itation Assistance Program (RRAP) in the Apr i l , 1989 federal budget. That program is not reported in Table 19 Home Renovation and Repair Programs Actua l dollars in $000's Year C M H C YHC YTG DIAND' Total '80 NA NA NA 174 174 '81 28 NA NA 181 209 '82 242 NA NA 189 431 '83 435 NA NA 197 632 '84 594 NA 3 205 802 '85 803 NA 320 214 1337 '86 630 NA 500 223 1353 '87 475 231 539 232 1477 '88 503 898 550 242 2193 '89 503 898 550 252 2203 Total 4213 2027 2462 2109 10811 Sources: C M H C Annual Reports and interviews with YHC, YTG, DIAND and C M H C staff. 1 DIAND was able to provide estimates only. this thesis. The impact of the seven cont inuing programs on C E D is d iscussed below. 86 A. C M H C Renovation Programs C a n a d a Mortgage and Hous ing Corporat ion (CMHC) established a b ranch office in Whitehorse in 1979. It has funded renovation programs in Y u k o n since 1981. C M H C could have delivered the Residential Rehabil itation Assistance Programs beginning in about 1973 when it introduced these national programs, or beginning in 1979 when it opened a Whitehorse office. However, C M H C reports it was unable to f ind an agency to deliver the programs. 1 0 7 C M H C funds two types of renovation programs. The first, the Residential Rehabil itation Assistance Programs (RRAP), are delivered on behalf of C M H C by delivery agents across Canada . C M H C designed these programs to increase the longevity, adequacy and accessibility of existing hous ing owned by people with low and moderate incomes. To be eligible, a property mus t be inadequate and, after renovation, mus t be adequate and i n a state of repair to last a m i n i m u m of 15 more years. To be eligible, households mus t be i n core housing need. Under the terms and condit ions of the programs, C M H C makes loans, up to $8,250 in Yukon , to eligible homeowners. The purpose of the loans is to repair heating, p lumbing, structural , electrical and fire safety deficiencies or to make the property more accessible to a person with a disability. C M H C forgives the loans over a five year period provided the recipient cont inues to own and occupy the property. The second k ind of C M H C program is for the emergency repair of properties not eligible for RRAP because the condit ion is too poor. The Emergency Repair Program (ERP), provides assistance to homeowners on an emergency basis as the program name implies. Homes eligible for this program mus t be in such poor condit ion that the program delivery agent, after inspect ion, believes will not last more than a few years. 87 For areas outside Whitehorse, the CYI delivers these programs for C M H C . In Whitehorse, Y H C delivers the RRAPs. The ERP is not delivered in Whitehorse. It is possible for municipal i t ies and bands to be program delivery agents; i n Y u k o n , none are. 1 0 8 The C M H C renovation programs contr ibuted about $4 .2m to the economy in the 1980's. The programs are under review and C M H C expects to announce changes in 1990. In 1987 and 1988, Y H C and C M H C discussed the possibility of cost shar ing a renovation program but there is no progress to report. B. Y H C Renovation Programs Y H C developed and implemented the Home Improvement Initiative (HII) in 1987 in response to the 1986 Yukon Housing Needs Study. There are three programs in the HII targeted to homeowners in core housing need. The RRAP E "tops up" the RRAP forgivable loan f rom C M H C by up to $2,750. The Mun ic ipa l Services Assistance Program (MSAP) provides up to $7,500 for the improvement or instal lation of water and l iquid waste disposal systems. The Renovation Program for Persons with a Disabil ity (RPPD) provides up to $5,000 to assist people improve accessibil ity for household members with a disabi l i ty. 1 0 9 A l l funding to homeowners is a loan which Y H C forgives over five years. Total funding for the HII in the 1987-1989 period is about $2m. The Counc i l for Y u k o n Indians (CYI) delivers the programs in the communit ies and areas outside Whitehorse. In Whitehorse, Y H C delivers the programs. C. Saving Energy Act ion Loan (SEAL) The Y u k o n government funds this program which the Energy B ranch in the Mines and 88 Smal l Bus iness Section in the Economic Development Department delivers. That department developed and implemented the program in 1984. Th i s program is part of the territorial government's strategy to reduce energy imports and energy consumpt ion . The strategy has three parts; first, it promotes a n awareness about energy use, consumpt ion and conservation; second, it promotes replacing imported oil with local wood as a heat source and so represents import subst i tut ion; and third, it promotes the use of non-electric domestic and hot water heat. The reason for this is the high capital cost of increasing hydroelectric output, about three to four thousand dollars per ki lowatt. 1 1 0 Most of this expenditure represents imported capital equipment and thereby a leakage to the Y u k o n economy. 1 1 1 The form of the assistance is an interest free, repayable loan up to $3,000. The purpose of the program is to reduce energy consumpt ion, particularly imported oil, by landlords and homeowners. Loans are available to complete energy saving improvements. Most program appl icants are homeowners. Property owners who make applicat ion for program loan funds must commiss ion an energy audit on their property. Th i s evaluates the energy efficiency of the property and recommends the energy saving improvements, in priority order, the owner should complete. The department advances the loans funds to the owner as a re imbursement for their spending on eligible improvements. Th i s program has contr ibuted approximately $1 .9m in loan funds to the economy since 1984. In addit ion, this program has leveraged about $650,000 i n addit ional private spend ing . 1 1 2 The direct impacts of the program are spending on energy saving improvements of about $3 .1m in the 1984-1989 period and reduced energy imports and consumpt ion . 89 D. D IAND Renovation Program Th i s program is 1 0 0 % funded by the federal department of Indian and Northern Affairs. A s part of its capital funding to bands , D IAND makes capital grants for home renovations. Bands allocate these funds in their capital p lans within program guidel ines which have a spending target of $6,000 per unit. In their capital p lanning exercise, each band reviews hous ing needs and decides which homes to renovate. D IAND officials and the band chiefs allocate the Y u k o n budget. Total funding for this program in the 1980-89 period is about $2 .2m. 4.7. S u m m a r y A l l hous ing programs have the potential to cause C E D . Programs that fund new construct ion have the greatest potential for C E D because the economic value and overall impact on communit ies is greater than other programs. Programs which fund renovations also have a n impact on C E D . W h e n used to purchase existing homes, social hous ing programs have less impact on C E D . However, purchas ing existing homes can integrate low and moderate income into existing neighbourhoods. It also is less intrusive and less likely to cause division in the communi ty as a result. Of the programs which can cause new construct ion, the Co-op, D IAND Hous ing Subs idy and Private Non-Profit have the greatest impact on C E D ; the Rura l and Native Hous ing , Lease Purchase, and Publ ic Non-Profit Programs cause the least. O f the renovation programs, the D IAND Renovation Program and RRAP cause have the greatest impact on C E D ; the HII, ERP and S E A L cause the least (see Table 20). 90 The DIAND Housing Subsidy Program scored high against the CED criteria. However, this is by default rather than program design. The program requires the use of Yukon harvested and manufactured products only because the subsidy does not cover the full cost of building a complete house. Individual band members must improvise to complete the house as best they can and typically use whatever local materials they can find. The program funding levels also mean that some of the units do not have indoor plumbing and a septic system certified by Health and Welfare Canada. While the band or occupant can make the improvements to make the property adequate using DIAND, YHC, CMHC or some combination of programs, the program can perpetuate core housing need. Programs which cause the greatest impact on CED require the creation or existence of a not-for-profit community-based society and involve a community or community group. All programs discussed above could better contribute to CED if they required the use of Yukon and community materials and labour. Other programs which have not involved community groups in the past could do so in the future. Both YHC and CMHC could devolve program delivery and operations of the housing programs to communities and community organizations. The more the housing corporations devolve responsibility and authority to community based organizations, the more impact the programs will have on CED. One of the Yukon 2000 goals is "control of the future." It is what people in the communities said they wanted at the Yukon 2000 community meetings. Therefore, more control over social housing programs in itself causes CED. The more communities control social housing programs, the greater likelihood communities can use the housing industry to achieve other goals and objectives of Yukon 2000. A l l social housing programs contribute in some way to CED. Table 20 shows the relative 91 benefits to C E D based u p o n the criteria stated at the beginning of this chapter. However, some hous ing programs cause divisions in communit ies because of the Not In M y Backyard Syndrome (NIMBY), the frontier phi losophy discussed i n Chapter 1, and the perception that Y H C and C M H C don't deliver the programs in a fair way. Th i s fairness issue applies to the broader economic benefits of the hous ing industry. Neither C M H C or Y H C delivers programs in a way deigned to maximize the use of local (Yukon and community) labour and materials. Processes which involved, indeed gave control to communi t ies and communi ty groups in program design and delivery cou ld facilitate greater communi ty acceptance and more communi ty economic development. Th rough their respective governments, Y H C and C M H C have the money to pay for approximately 130 new hous ing units ( Y H C - 80, C M H C - 50) each year for an indefinite period. Th i s would contribute about $15 .6M into the economy for capital work each year. Also each year, the hous ing corporations would spend money to subsidize the operating costs of these new units. Exc lud ing principal and interest, this subs idy would be about $4,148 per unit per year. Th i s subs idy usual ly decreases over time. Renovat ion programs also contribute to the economy, almost $ 1 1 M in the 1980-89 period. A s shown in Table 19, the total annua l renovation programs budget is increasing. Not discounted, the 1989 total budget will be the highest of the decade. The record of social hous ing program delivery has not been good, part icularly for Y H C . Th i s creates uncertainty for the industry, communi ty groups and for people in core housing need. The Y u k o n Government could help resolve social hous ing program delivery problems by ensur ing Y H C has the necessary resources, organizational p lan and political direction to bui ld new hous ing and assuming delivery of programs currently funded by C M H C unilaterally. 92 Table 20 The Impact of Housing Programs on CED: A Summary Criteria A B C D E F G H I J K L M N •requires the use of Yukon harvested and manufactured building materials O © O o o O o o o o o o o o •requires the use of community harvested and manufactured building materials 0 © 0 o o o o o o 0 0 o o o •requires the use of Yukon labour and professional services o o o o o o o 0 0 0 o o o o •requires the use of local community labour and professional services 0 0 0 0 o o o o 0 o 0 0 0 0 •uses funding source external to Yukon • • © • 0 • • o © • • • 0 0 •community control of the process to identify housing needs • • • © o o 0 • © 0 0 o •project sponsorship by a new or existing community group • • • • • ,0 0 o 0 • © 0 0 o •community control of the project planning process • • • • • o o 0 © • © o o •community control of project implementation • • • • • 0 e 0 © • © o o •community control of ongoing project operations • • • • o o o o • © © o •tenant/owner control of the project planning process • e • © © • © • o • © © • • •tenant/owner control of project implementation • © © © © • © • o • © © • • •tenant/owner control of ongoing project operations • • © © o • • • o • • • • •increases the supply of affordable housing • • • • • • • © • © © © o e •increases the supply of adequate housing • 0 • • • © • • • © © © © © •replaces imports through the use of alternate technology o O 0 0 0 0 o 0 0 0 0 o 0 o Score out of 100% 76 A 76 B 64 c 60 D 60 E 42 F 40 G 33 H 29 I 67 J 44 K 38 L 31 M 27 N Legend O No Impact (no points) © Medium Impact (2 points) © • Low Impact (1 point) High Impact (3 point 3) A C M H C Co-op Housing B DIAND Housing Subsidy c YHC Private Non-Profit D C M H C On Reserve E C M H C Urban Native F C M H C Demonstration G C M H C RNH H YHC Lease Purchase I YHC Public Non-Profit J DIAND Renovation K C M H C RRAP M YTG S E A L N YHC HII L C M H C ERP 93 By improving the delivery of social hous ing programs, the Y u k o n government can strengthen and revitalize the Y u k o n hous ing industry, the economy and communit ies . The government c an also reduce the incidence of core housing need which is the highest in Canada . The Y u k o n government has adopted Yukon 2000 and stated that the Yukon 2000 goals are the yardst ick by which it will measure future policy initiatives. It is regrettable that the Y u k o n cont inues to miss ing out on the stream of C E D benefits and opportunit ies social hous ing programs offer the territory. Home renovations c an also play a vital role in C E D . There are several programs which can change the situat ion f rom one i n which about half the homes in Y u k o n are in inadequate condit ion. The economic contr ibut ion of these programs, $2 .2m in 1989, is significant. Attaching condit ions to all social hous ing programs regarding the use of harvested and made in Y u k o n bui ld ing materials by recipients could contribute to import replacement and the development of the Y u k o n bui ld ing products industry. A l l the programs scored relatively low when their impact on C E D was measured us ing the 16 criteria. The pr incipal reasons for this is that the programs do not require the use of Y u k o n or communi ty labour and materials or the use of alternative technology, like wood chip boilers, solar energy, or energy efficient design. M inor program improvements could dramatical ly increase the impact of these programs on C E D . These improvements are d iscussed i n Chapter Five. 94 5. Conclusions and New Policy Initiatives The Y u k o n government adopted Yukon 2000, a C E D strategy, as government policy in 1988. That policy is the guide for future government decisions.. .When reviewing new policy or program proposals, the Y u k o n government and the Y u k o n people will have to continual ly ask whether they help u s meet our goals (Yukon 2000, p. 3). However, as d iscussed above, the government has not yet implemented hous ing policies to help achieve the Yukon 2000 goals. The Y u k o n government has not integrated the hous ing industry into its Yukon 2000 strategy. There are a number of indicators of this hous ing policy vacuum. First, the government and Y H C stopped work in progress i n 1987 to develop a White Paper on social hous ing policy. Th is work has not been restarted or even re-scheduled. Second, Y H C cont inues to develop and implement programs which have a low impact on C E D . Th i rd , Y H C has not devolved program delivery at the communi ty level. Four th , Y H C continues to give high priority to the Publ ic Non-Profit Program. O f the social hous ing programs that c an cause hous ing starts, this program has the lowest impact on C E D . Fifth, the government has done nothing to stabilize the industry or to use it to diversify the economy. Chapters 2, 3 and 4 discussed many of the ways the Y u k o n government and others can use the hous ing industry as part of the C E D process in Yukon . The description and analysis of social and other hous ing programs also indicates that these programs can , because of program design and requirements, cause C E D . Chapter 4 showed that while all programs have some impact on C E D , certain programs have a m u c h higher impact than others. Th i s Chapter 95 presents alternative policies and programs that the Y u k o n government cou ld apply to one industry, hous ing, to help it achieve its C E D goals and objectives. 5.1. Impact of the Hous ing Industry on C E D Chapters 3 and 4 reviewed and analyzed the market and social hous ing sectors. The demand for new hous ing caused by the increase in the populat ion is about 300 units each year. The poor condit ion and age of the existing stock will mean that about 35 new units per year will have to be built to replace existing units. In addit ion, demand for renovations will create more demand for labour and bui ld ing materials. Bu i ld ing and renovating these units could create about 700 direct, indirect and induced jobs. However, some of these jobs will not be in Yukon . Most bui ld ing products are manufac tured elsewhere and imported into Yukon . Some labour is also imported. A s a result, construct ing new homes and renovating existing ones in Y u k o n will create many jobs elsewhere. A s reported in Chapter 3, not all demand caused by the increase i n the populat ion will be effective i n the marketplace. Some households do not have sufficient income to effectively express their hous ing needs in the hous ing market, either as renters or as owners. In 1989, about one th i rd of Yukoners are in core housing need. Based on this percentage, about one third of new hous ing demand will come from households in core hous ing need. Non-profit sponsors, communi t ies and governments can use social hous ing programs to meet m u c h of the demand for suitable, adequate and affordable hous ing. Spending on social hous ing could cause the construct ion of about 130 uni ts each year for an indefinite period. Th is construct ion would create about 265 construct ion jobs years each year in Yukon . A commitment to bu i ld these units would provide some certainty that housing 96 condit ions in Y u k o n will improve. It would also create certainty for a n industry particularly vulnerable to the effects of economic uncertainty and the cyclical boom and bust Y u k o n economy. T h e Y H C - C M H C p a r t n e r s h i p c o u l d e n s u r e t h a t s o m e m i n i m u m n u m b e r o f s o c i a l h o u s i n g u n i t s were b u i l t e a c h y e a r . T h e y c o u l d p r o v i d e t h i s c e r t a i n t y t o t h e i n d u s t r y e v e n t h r o u g h p e r i o d s o f r e c e s s i o n . A Y u k o n government commitment to social hous ing and a proactive, cooperative approach with the industry c an facilitate diversification of the economy. It would also allow more communi ty groups to become involved in the hous ing industry. The boom and bust nature of the Y u k o n economy and the inconsistent delivery of social hous ing programs should make the industry wary of over-supply. Indeed, in a Whitehorse newspaper story on Apr i l 12, 1989, Dave Penner, President of the Y u k o n Home Bui lders ' Assoc iat ion observed that "there may have been some overbuilding last summer and now bui lders who aren't seeing their houses sell quickly are holding back, part icular ly the ones who just got into the bus iness last year (Yukon News, Apr i l 12, 1989 p. 8)." Prudent investors and entrepreneurs are understandably hesitant to overbuild in such an uncerta in market. Overbui lding or overproducing bui ld ing products could cause f inancial ru in for the f irms in the industry. The bui ld ing pattern in Y u k o n is one of intense activity and a high number of new starts for a year or two followed by several years in which the industry is almost dormant. For example, new hous ing starts in Whitehorse were down 6 0 % i n Apr i l , 1989 over Apr i l , 1988. Th i s pattern reinforces the boom and bust economic cycle in Y u k o n and acts like a self-fulfill ing prophesy. One result is undercapital izat ion in the industry, particularly in manufactur ing, research and development. 97 Co-operation between the publ ic and private sectors i n the hous ing industry cou ld greatly improve the industry 's performance and its impact on C E D . Th i s co-operation cou ld create a win-win environment in which the performance of the industry was more stable. Th i s would mean more jobs and profits, less uncertainty, and a m u c h greater impact on C E D . New hous ing construct ion does more than create new jobs and new bus iness . It can revitalize communi t ies and support both the informal and formal economies. Some social hous ing programs support existing communi ty groups. Others cause the creation of new community-based organizations. Th i s creates new leadership opportunit ies and opportunities for communi t ies to control an important part of the bui l t environment. It also provides a means to revitalize communit ies and to improve the hous ing stock, an important part of a commmuni ty ' s amenity factor. Th i s is important not only for the benefits that accrue to residents, bu t to businesses and workers deciding where to locate (or re-locate). Some programs, like U rban Native, Lease Purchase, and Rura l and Native, do not directly cause many new hous ing starts. Program modifications would increase the impact of these programs on C E D . For example, the funding agency cou ld require that some percentage of commitments in these programs be new hous ing starts. The impact of all programs on C E D could be improved by requir ing that sponsors or appl icants use some m i n i m u m percentage of Y u k o n and communi ty materials and labour. As the government is contr ibut ing tax revenue to these programs, it cou ld do what the taxpayers involved in Yukon 2000 want: that is to design and deliver programs which help meet the Yukon 2000 goals. There are no policies and programs in place designed to cause import subst i tut ion in the hous ing industry or to give more control over hous ing to communi t ies and communi t y groups. Employment , profits, training, and the future of the hous ing industry is as uncerta in now as 98 dur ing the recession in the early 1980's. 5.2. New Policy Initiatives for Y T G The most important thing the Y u k o n government cou ld do to improve hous ing condit ions and develop the economy is to start us ing the federal funding that is available for social hous ing. No amount of import subst i tut ion will likely generate as m u c h new investment as the value of federal funding for social hous ing which leaks from the economy each year. As discussed in Chapter 3, the loss to the Y u k o n economy caused by lapsed units just in the 1986-88 period was about $9 .3M in capital spending. In addit ion to this loss, is about $9m in federal subsidies (excluding and interest payments) over the 35 year life cycle of the projects. The Yukon Government should direct Y H C to maximize the benefits of the Y H C - C M H C partnership and not let budgets for social housing lapse. Y H C does not make it a practice to advertise its social hous ing programs and dedicates no staff to publicity and promotion activities. Though other Y T G social service departments and agencies regularly advertise on radio and in newspapers, Y H C does not. The programs Y H C cost shares with C M H C all have their own program and project promot ion budgets. However, Y H C has only used these budgets to advertise and ho ld events which m a r k all too infrquent official openings. Advert is ing and promotion can also increase the level of acceptance of social hous ing programs. By informing communit ies and communi ty groups, Y H C would also cause increased participation in hous ing programs. Y H C should adopt a corporate and program communications policy that includes a strategy to increase awareness of housing programs generally, and the Private Non-Profit Program specifically. Y H C mus t devolve authority and responsibil ity to communit ies and commun i t y groups to 99 meet the goals and objectives of Yukon 2000. One way to do this is to promote and deliver the Private Non-Profit Hous ing Program, inc luding the co-op option. Y H C could assist and support project sponsors in tangible ways and could dedicate staff to the program. Y H C s h o u l d a d o p t a p o l i c y t o p r o m o t e t h e P r i v a t e N o n - P r o f i t P r o g r a m a n d w h i c h d e d i c a t e s at l e a s t h a l f t h e a n n u a l a l l o c a t i o n t o t h a t p r o g r a m . Y H C funds several programs which permit options to b u y existing hous ing , to construct hous ing or to purchase mobile homes. E a c h option creates more or less opportunit ies for C E D but bu i ld ing has the greatest impact on the economy. Y H C s h o u l d a d o p t a p o l i c y w h i c h d e d i c a t e s s o m e p e r c e n t a g e o f t h e u n i t s i n e a c h p r o g r a m t o n e w c o n s t r u c t i o n a n d t h a t t h e p u r c h a s e o f m o b i l e h o m e s be t h e o p t i o n o f last r e s o r t . The government and Y H C need to create a consultatative p lanning process. They need to identify ways to maximize the benefits of spending in the hous ing industry for the Yukon economy and the economy of each Y u k o n community . Th i s process shou ld involve bus iness and labour, communit ies and government departments. T h e Y u k o n G o v e r n m e n t s h o u l d a d o p t a p o l i c y t h a t a l l Y T G d e p a r t m e n t s i n v o l v e d i n t h e h o u s i n g i n d u s t r y h i r e l o c a l a n d b u y l o c a l . Of the programs reviewed, the Cooperative Hous ing Program creates the most opportunit ies for C E D . However, there are major problems with the current program which make its delivery, even in Whitehorse, problematic. Because C M H C considers co-ops funded with the new program 'market housing' , C M H C will not deliver the program in areas it considers non-market. In Y u k o n , non-market is everywhere except Whitehorse. A lso , there are enough problems with hous ing programs in Yukon without trying to explain the intricacies of indexed l inked mortgages. Many people will have difficulty understanding how and why the co-op program needs another program, rent supplement, to make it work. 100 The Y u k o n Government should consider enriching the existing program, designing its own program or us ing the Private Non-Profit Program co-op option. Quebec, Ontar io and Manitoba all developed their own co-op programs to meet local needs. Made i n Y u k o n programs are necessary to meet local needs in Yukon . Yukoners shou ld have low expectations that a new, nat ional program, like the co-op program, designed to work in large u r b a n centres, will work in Whitehorse. Y H C should adopt a policy to investigate program modifications and innovations whenever national programs can not meet housing needs in all Yukon communities. The Y u k o n government could cost share the U rban Native, Rura l and Native and O n Reserve Hous ing Programs. Th i s would affect the industry and C E D in four ways. First, it would increase the supply of affordable housing. Cost shar ing on the same 75:25 ratio as for other programs means that the number of units increases from about 46 to 61 (However, the cost shar ing ratio could be less). Second, it would make one agency responsible for all hous ing programs in Y u k o n creating more certainty for businesses, communi t ies and sponsors. Communi t i es would only have to make representations to and p l an with one agency. Th i rd , if the Y u k o n government controlled the specifications for all new social housing, it would have more control to achieve its import subst i tut ion objectives. Four th , the government could better use the industry in its strategy to achieve the four Yukon 2000 goals. The Yukon Government should adopt a policy to cost share the Urban Native, Rural and Native and On Reserve Housing Programs with the Government of Canada and direct Y H C to assume delivery of these programs. Program planners should be aware of the relative impact different social hous ing programs have on C E D . Whether us ing the C E D criteria in this thesis or some others, p lanners should undertake a social hous ing delivery programme as the government directed in the Yukon 2000 final report. Y H C should adopt a policy to plan annual program delivery to meet both housing needs and Yukon 2000 (CED) objectives. The plan should also explicitly report 101 on how well it helps meet the Yukon 2000 goals. The government and Y H C shou ld let the hous ing industry and non-profit sponsors know of the fund ing Y H C has to bu i ld about 200 social hous ing uni ts over the next three years. YHC should adopt a policy to work with the private and non-profit sectors to plan and build the annual unit allocation. There is a problem with data for the hous ing industry in Yukon . C M H C , Statistics Canada , the Y u k o n Bu reau of Statistics, the City of Whitehorse and Y T G Protective Services all record data. However, no agency publ ishes it in a form that is useful for private, non-profit or public sector p lanning. The Yukon Government should adopt a policy directing the Yukon Bureau of Statistics as responsible for collecting and publishing reports on the Yukon housing industry. Representatives of the Bu reau should meet with representatives from Y H C , C M H C , Statistics Canada , Indian Bands , Y T G Protective Services, the City of Whitehorse, and Health and Welfare Canada at the earliest possible time to coordinate this important activity. Bu i ld ing about 130 new units each year will have a major impact on p lanning and instal l ing new subdivis ions. YHC should adopt a policy to work with communities and YTG Lands Branch both to insure that sufficient building lots are available and that social housing is integrated into new subdivisions. The federal government will dispose of its aging, redundant staff hous ing portfolio in the future. The Yukon Government should adopt a policy to negotiate with the federal government to mitigate the negative impact the disposal of the aging and redundant federal staff housing stock will have on the Yukon housing industry. The Y u k o n government and the Yukon 2000 process have identified import substitut ion and support for local f irms as priorities. Y H C and other agencies involved in the industry 102 could work with the private sector to implement an import substitution strategy. Y H C should adopt a policy to lead the initiative to identify and develop opportunities for import substitution. Import substitution program options for YTG are listed below. • sponsorship of a reverse trade show for the industry • application of a surcharge to aU. the residential building lots YTG sells. This could be up to 100% refundable provided the builder used some percentage of Yukon harvested and manufactured building materials • sponsorship of a design competition for homes designed in and for Yukon and using a high percentage of Yukon harvested and manufactured materials • sponsorship of research to identify opportunities for developing Yukon harvested and manufactured construction products • sponsorship of a hire local buy Yukon campaign • working with the industry to develop industry promotion programs like the use of industry dollars (like Canadian Tire dollars) • entering multi-year contracts for the supply of Yukon harvested and manufactured building materials and products • providing direction to all departments and YHC to hire local, buy Yukon 103 • working with the industry, particularly Tagish Kwan, to develop a product to compete with the mobile homes that are imported into Yukon Y H C c o u l d es tabl i sh l inkages w i t h other groups to identify ways to s t rengthen the h o u s i n g indus t ry . The other groups c o u l d be Ind ian bands . Native non-profi t groups , C a n a d i a n Home B u i l d e r s A s s o c i a t i o n a n d the Y u k o n Cont rac tors Assoc i a t i on . Y H C should adopt a policy to work with others in the industry and establish an industry working group to identify ways to strengthen and develop the Yukon housing industry. There are oppor tuni t ies for research i n the h o u s i n g indus t ry . These inc lude import subs t i tu t ion , energy efficient house design, the use of alternative technology a n d mater ia ls , a n d t r a in ing modu le s for s m a l l communi t i e s . Y H C should adopt a policy to allocate 1% of its capital budget to research and development and that this work occur in Yukon. Y u k o n government depar tments and agencies create prob lems w h e n they in t roduce new or select exis t ing technology that displaces Y u k o n l abour a n d mater ia ls . It is recognized that supp l ie r s w i l l a lways in t roduce new technology into the indus t ry . However, government agencies s h o u l d a lways cons ider the impac t of the i r projects o n Y u k o n l ab o u r a n d mater ia ls . The Yukon Government should adopt a policy that requires all Yukon government agencies planning projects in the housing industry for which there are alternate technologies to study and report on the impact on Yukon labour and materials in the project planning phase. Some government h o u s i n g indus t ry projects cause very li t t le economic act ivi ty i n the c o m m u n i t y i n w h i c h the projects occur . Typica l ly , projects i n the smal le r c o m m u n i t i e s resul t i n the government impor t ing l abour a n d mater ia ls . The Yukon Government should adopt a policy which requires respondents to its tenders to report the local community labour and materials they will use in the work. 104 The Y u k o n government has adopted northern preference and local hire policies but has no way of knowing if departments are following these policies. The Yukon Government should adopt a policy that its departments and agencies record and report on the following at the end of each fiscal year: a) the total value of contracts awarded b) the community in which each project occurred c) the value of work awarded to firms in each community by project d) the value of materials purchased from suppliers in each community by project Expendi tures in the hous ing industry in all communit ies will continue indefinitely. While some labour and materials and labour will always be imported into Y u k o n and into the smaller communi t ies , Y H C shou ld make every effort to increase training and employment for local labour and the use of local materials. Y H C should adopt a policy on the use of local materials and labour and work with Yukon College, bands, city councils and others to identify ways to achieve these targets. To undertake new initiatives in the hous ing industry, Y H C will require staff and other resources. However, in June , 1989, permanent staff filled only two of five management positions. Compound ing staffing problems caused by the Yukon 's location are min ima l career and training opportunities with Y H C . There is no corporate training p lan i n place and the last promot ion of staff within the corporation occurred in 1981. Y H C should adopt a staffing policy which includes provisions for timely responses to staff vacancies and a corporate training plan. 5.3. Conc lus ions Successive Y u k o n governments neglected the hous ing industry. Th i s neglect has 105 contr ibuted to the high incidence of core housing need, the failing Whitehorse rental market, the undercapital izat ion of f irms in the industry and the industry 's l imited diversification. Though the current government has adopted Yukon 2000, a C E D strategy, as its policy, it has not appl ied this policy to the hous ing industry. The hous ing industry is the same as most others in Yukon . It experiences wide swings in activity because of the boom and bust nature of the narrowly based export economy. Government involvement in the industry c an create some certainty and stability in the industry for bus iness , communit ies and indiv idual consumers . A diversified economy is stronger, more resilient and better able to offer employment and bus iness opportunities. Th is in tu rn creates new wealth and reduces both unemployment and social problems. Hous ing condit ions in Y u k o n are the worst i n the country. These condit ions create problems for the one third of Yukoners who are in core housing need. These condit ions also create barr iers to economic development. By developing the industry, the Y u k o n government will be better able to meet hous ing needs. By developing the industry and creating new wealth, employment and business opportunities the government would also be reducing the level of future core housing need. Hous ing is an important part of a community , part of its social and economic infrastructure. The poor condit ion of this infrastructure impedes C E D . There are other barriers to C E D in Y u k o n about which the government c an do little. The government c a n however, do m u c h about improving hous ing condit ions and increasing the C E D benefits of the housing industry. The government has a commitment to C E D as expressed in Yukon 2000 and because of its partnership with the federal government, ample resources to use the hous ing industry to help achieve it. The C E D opportunities in every region are limited. They are part icularly l imited in Y u k o n 106 because i t is isola ted and the economy is based u p o n the export of a few non-renewable n a t u r a l resources. The h o u s i n g indus t ry c a n create oppor tuni t ies for C E D w h i c h the Y u k o n government s h o u l d not mi s s . There are s t rong s ignals that the private marke t i s fai l ing. There is a sharp decline i n new starts w i t h only one apar tment b u i l d i n g (10 units) cons t ruc ted s ince 1981 . O the r res ident ia l s tar ts are up sharp ly , the economy i s s trong, there is a low vacancy rate, the popu la t ion is increas ing , a n d there are m a n y households i n core housing need. T h i s l a c k of response by the private ren ta l marke t , pa r t i cu la r ly i n the smal le r communi t i e s , ra ises ser ious quest ions about the future of the private renta l marke t i n Y u k o n . 5.4. Impl ica t ions for P l a n n i n g Practice C E D is someth ing relatively new to the p l a n n i n g profession a n d new i n C a n a d a . It is especial ly difficult to implement something new w h e n the economy is s t rong. However, the economic changes i n regions a n d communi t i e s caused by the g loba l iza t ion of capi ta l , free trade a n d envi ronmenta l d i sas te r s /concerns , m a y create more oppor tuni t ies for C E D . P lanners w i l l have to become more sk i l l ed i n ways to w o r k w i t h c o m m u n i t i e s to identify C E D goals and objectives a n d ways to achieve them. The h o u s i n g indus t ry has character is t ics w h i c h m a k e it different f rom other indus t r ies . Whi l e governments and communi t i e s t ry and attract new bus inesses to the i r areas, a sma l l m ino r i t y i n Y u k o n oppose government meet ing core housing need. P l anne r s need to be aware of the d y n a m i c s of the hous ing indus t ry when p l a n n i n g and promot ing soc ia l hous ing . There are several areas i n the coun t ry w i t h charac ter i s t ics w h i c h m a y m a k e t h em at least appear s i m i l a r i n some respects to Y u k o n . The N W T a n d the no r the rn and inter ior of B.C., Albe r t a , M a n i t o b a , Onta r io and Quebec are examples. P lanners i n these areas s h o u l d identify 107 ways to increase the use of local resources and external funding sources to meet communi ty economic development goals and objectives. There are obstacles to C E D , found perhaps with greater frequency than opportunities for it. There are political, bureaucrat ic and communi ty barriers to implementing a C E D strategy. In Canada , where the marketplace and grand political design (like Northeast coal and the Montreal Olympics) drive the economy and planning, C E D planners face formidable, though not impossible, odds. P lanners will need to reduce these obstacles and create a win-win situat ion for communit ies , businesses, workers and interest groups. The hous ing industry has a strong economic mult ipl ier effect because of its important economic l inkages. The industry also causes great leakages for economies like Y u k o n which have a very narrow base. Governments have the means to stop some leakages and to use a strategy of import replacement to diversify the economy. Planners have a role to play to help communi t ies structure and implement import replacement strategies. There are problems with the private rental market across the country. There is a shortage of new supply and the existing stock is getting smaller in numbers due to conversions to condomin iums and demolitions. Increasingly, social hous ing will be the only way many households can secure affordable, adequate and suitable shelter. P lanners will have to identify the ways and means of meeting hous ing needs and integrating social hous ing into new and existing communit ies . Different social hous ing programs work more or less well in different communi t ies and neighbourhoods. Planners need to be aware of program options. When existing programs are not suitable or able to meet needs, p lanners will have to design new programs to meet hous ing and communi ty needs. 108 The government's role in the housing industry, the importance of the industry to the economy, and the importance of housing to communities, all combine to create CED opportunities. If housing needs, available government funding, consultant and other reports, and a government committed to CED were combined, how could CED fail in Yukon? 109 Appendix 1. Summary of New Policy Initiatives 1. The Yukon Government should direct YHC to maximize the benefits of the YHC-CMHC partnership and not let budgets for social housing lapse. 2. YHC should adopt a corporate and program communications policy that includes a strategy to increase awareness of housing programs generally, and the Private Non-Profit Program specifically. 3. YHC should adopt a policy to promote the Private Non-Profit Program and which dedicates at least half the annual allocation to that program. 4. YHC should adopt a policy which dedicates some percentage of the units in each program to new construction and that the purchase of mobile homes be the option of last resort. 5. The Yukon Government should adopt a policy that all YTG departments involved in the housing industry hire local and buy local. 6. YHC should adopt a policy to investigate program modifications and innovations whenever national programs can not meet housing needs in all Yukon communities. 7. The Yukon Government should adopt a policy to cost share the Urban Native, Rural and Native and On Reserve Housing Programs with the Government of Canada and direct YHC to assume delivery of these programs. 8. YHC should adopt a policy to plan annual program delivery to meet both housing needs 110 and Y u k o n 2000 (CED) objectives. The p lan shou ld also explicitly report on how well it helps meet the Yukon 2000 goals. 9. Y H C shou ld adopt a policy to work with the private and non-profit sectors to p lan and bu i ld the annua l unit allocation. 10. The Y u k o n Government should adopt a policy directing the Y u k o n Bu reau of Statistics as responsible for collecting and publ ish ing reports on the Y u k o n hous ing industry. 11. Y H C shou ld adopt a policy to work with communit ies and Y T G Lands B r anch both to insure that sufficient bui ld ing lots are available and that social hous ing is integrated into new subdivis ions. 12. The Y u k o n Government should adopt a policy to negotiate with the federal government to mitigate the negative impact the disposal of the aging and redundant federal staff hous ing stock will have on the Y u k o n hous ing industry. 13. Y H C shou ld adopt a policy to lead the initiative to identify and develop opportunit ies for import subst i tut ion. 14. Y H C shou ld adopt a policy to work with others in the industry and establish an industry working group to identify ways to strengthen and develop the Y u k o n hous ing industry. 15. Y H C shou ld adopt a policy to allocate 1% of its capital budget to research and development and that this work occur in Yukon . 16. The Y u k o n Government shou ld adopt a policy that requires all Y u k o n government agencies p lanning projects in the hous ing industry for which there are alternate technologies to 111 study and report on the impact on Yukon labour and materials in the project planning phase. 17. The Yukon Government should adopt a policy which requires respondents to its tenders to report the local community labour and materials they will use in the work. 18. The Yukon Government should adopt a policy that its departments and agencies record and report on the following at the end of each fiscal year: a) the total value of contracts awarded b) the community in which each project occurred c) the value of work awarded to firms in each community by project d) the value of materials purchased from suppliers in each community by project 19. YHC should adopt a policy on the use of local materials and labour and work with Yukon College, bands, city councils and others to identify ways to achieve these targets. 20. YHC should adopt a staffing policy which includes provisions for timely responses to staff vacancies and a corporate training plan. 112 6. Notes 1. Community meetings and a public consultation process culminated in the release of the Yukon Economic Strategy Report Yukon 2000: Building the Future in 1988 by the Yukon Territorial Government. In this thesis, the strategy and the report are both referred to as Yukon 2000. 2. See the 1986 "Yukon Housing Needs Study." Since that study, the income thresholds used to define core housing need have substantially increased as discussed in Chapter 3. The effect of this major change is households with housing problems previously excluded by the definition of core housing need are now captured in it. While the study has not been updated to reflect the new income criteria, one estimate is that increase in households in core housing need is to about 33%, up from 29% as reported in the "Yukon Housing Needs Study." 3. See the Global Agreement on Social Housing reached between the federal government, the provinces and the territories in 1986 for this definition. At least 90% of new social housing units in each jurisdiction must be targeted to households in core housing need CMHC developed this criteria in response to federal government direction to target social housing programs to people in greatest need. 4. City of Whitehorse Building Activity Reports, 1980 - 1988 5. Section 25(1) of the United Nations Declaration of Human Rights is "Everyone has the right to a standard of living adequate for the health and well-being of himself and his family, including food, clothing, housing medical care and necessary social services." (emphasis added) 6. See McAfee, Ann, in '7s Government Home Ownership Assistance the Way to Go," Proceedings from a Symposium held in Calgary, September 18-20, 1980, Canada Council on Social Development, Ottawa, 1081, pp.157-161. 113 7. See C M H C , Housing Policy in Canada Lecture Series: Number 1. "Programs in Search of a Corporat ion: The Origins of the Canad ian Hous ing Policy 1917-1946." A lecture delivered at the Centre for H u m a n Settlements by George Anderson , November 5, 1987. C M H C , 1987. 8. See the Yukon Economic Strategy, page 3. 9. See the Y u k o n Bus iness Incentive Policy (POLICY 3/20). The latest revision available is 87/07/23 . 10. C M H C , Housing Statistics, Table B-21 (14/04/89). Figure 1 shows gross loan commitments for 1968 through 1987. Gross loan commitments refers to the number of loans which were approved. Net loan commitments refers to the loans which were actually made. The number for 1988 is net commitments, projects that were constructed in that year. Da ta was not available which showed new starts for all Yukon by unit type after 1985. 11. See Canada Mortgage and Hous ing Corporat ion, Canad ian Hous ing Statistics, an annua l report publ ished since 1955. 12. See C M H C , Housing Statistics, January , 1989. C M H C B C / Y u k o n Regional Office 13. Examples of this are the C M H C Canadian Housing Statistics and the C M H C Annual Reports on social hous ing starts. These reports record gross commitments and never correct to show net commitments. Th is means that housing starts and social hous ing units are overstated as some N H A insured loans are never made because the hous ing unit(s) are never built. Similarly, not all social hous ing commitments are actually built. Th i s is particularly problematic in Y u k o n because the number of new units i n any one year is smal l . 14. Th i s point is reported in the literature on informal Native economies in Canada . For a discuss ion, see Weaver, Clyde and A la in M. Cunn ingham, "Social Impact Assessment in Native Communities," Berkeley Planning Journa l , Vol . 2, Nos. 1 and 2, 1985, D. McAr thur , Structure 114 and Change in the Yukon Economy, a report prepared for Yukon 2000, 1987, or Hugh Brody, Maps and Dreams, 1981. 15. See J . Lotz, "Communi ty Development: A Short history," in the Jou rna l of Communi ty  Development, May/ June 1987 16. See the Yukon Statistical Review, Th i rd Quarter 1988. 17. For an analysis of the Yukon economy, see the Yukon 2000 background reports and Stabler, J ack , C , "Interindustry Relations in a Frontier Economy," in The Canad ian Journa l  of Regional Science, VII:1 (1984) pp. 115-123. In 1988, Yukon Government Leader Anthony Penikett described the Yukon economy as "...weak, narrow, colonial...". See the Yukon Economic Strategy, p. iii 18. Kemp, L., "Is There a Difference Between Communi t y Economic Development and Local Economic Development? A Review of "Initiatives for Communi ty Economic Development" Conference, SPARC News, V : l Fall 1988 19. Hainsworth, G.B., "Local Resource Management, for Livelihood Security and Livelihood Enhancement , " Introductory remarks to P lan 503, February, 1989. 20. C M H C . Summary Report. The Changing Housing Industry in Canada, 1946-2001, NHA 6120 02/89 , 1988. p.49. The full multi-volume report is not yet in print. 21. See Davis, H.C. "Buy Local Program: Import Subst i tut ion at the Regional Level", in Plan  C a n a d a 1989 (forthcoming) 22. See J a c k Stabler, "Interindustry Relations i n a Frontier Economy," in The Canad ian  J ou rna l of Regional Science, VII: 1 (1984) pp. 115-123 for a discuss ion on federal government transfers as an export. 115 23. Y u k o n Department of Economic Development: Mines and Smal l Bus iness , "Yukon Economic Review and Outlook 1987 - 1988," Y T G , May, 1988 24. Whitehorse based Northerm Industries is Yukon's only manufacturer of vinyl windows. It received government support to get established. It has had modest success competing in southern markets. 25. The Federal Government holds title to approximately 9 5 % of the land in Yukon. In the past 30 years, only the federal, territorial and band governments developed subdivisions. These three governments account for approximately half of new home construct ion since 1985. 26. The federal government owns and manages approximately 520 units. The Yukon government owns and manages approximately 459 hous ing units. The Kwanl in D u n Band owns and manages approximately 110 units. The largest private owner is an employer. United Keno Hil ls Mine which owns and manages approximately 100 units for its employees in E lsa . The second largest private sector owner is a group of lawyers which owns and manages 90 units in Whitehorse. 27. Interview with the (Yukon) Director of Lands, Department of Indian Affairs and Northern Development February 21, 1989 28. Y T G and the City of Whitehorse experimented with private sector subdiv is ion development in 1989. There was one country residential development. Pine Ridge Estates, with 40 2.5 acre (approximate) lots, within the City limits. However, neither Y T G or the City have development guidel ines and regulations in place. There is a history-of small private subdivisions of parcels into residential lots. These do not represent major subdivis ion development according to Y T G Lands B ranch . 29. Y u k o n Executive Counc i l Office, Bureau of Statistics, Information Sheet #8-88.09. 116 30. See The Y u k o n Government Bureau of Statistics, "Yukon Statistical Review, Fourth Quarter, 1988," page 45 and Information Sheet No. 2-87.12. The June , 1986 census reported 7,975 total occupied private dwellings. Since then, approximately 165 new market sector ownership units. 220 non-market social housing units (170 delivered by C M H C and 50 by YHC) and 10 non-market staff units were constructed. There is no accurate record of demolitions and other losses to the stock which are assumed at 10 units. The 1988 total occupied dwellings is approximately 8,350 units. 31. Y T G Bureau of Statistics 32. Interview with C M H C BC/Yukon Region staff. There were 19 O n Reserve starts (all Kwanl in D u n Band) and seven Y H C starts (four on Bamboo Crescent, one on Redwood and two on Green Crescent). The Y H C units were all 1987 commitments. 33. Interview with C M H C Whitehorse staff. Get second source. 34. Y H C did make commitments to C M H C for about 40 new units. However, problems with the projects prevented any construction of these units in 1988. There is some possibility that the commitments for 2 units may be salvaged. Only the Rent Supplement Program commitments are secure at this time. 35. Interview in Apr i l , 1989 with a representative of the real estate sector. 36. Yukon Economic Review: Fourth Quarter 1988, page 53 37. Interview with C M H C B C / Y u k o n Region staff. 38. Telephone interview with Dave Penner, President of the Y u k o n Canad ian Home Builders' Associat ion. 39. There is no record of total starts in Y u k o n so exact percentages are unknown. However, total o n reserve starts exceed all other starts combined in communit ies outside Whitehorse. 117 40. Canada Mortgage and Hous ing Corporat ion, Whitehorse Office 1986 Year-End Review, C a n a d a Mortgage and Housing Corporation, Whitehorse, Yukon , 1987. p. 1 41. Canad ian Bui lding, June 1988, pg. 31. Th i s includes the units for all the program targeted to aboriginal people. These units are divided up across the country on the basis of per capita Aboriginal people per jur isdict ion. The balance, somewhere around 16,000, are divided up based upon the Regina Accord . The Accord does guarantee a number of units, only that the number available will be split according to a formula. 42. The C M H C social housing budget excludes the new (1986) co-operative hous ing program because C M H C considers it a market hous ing program. It relies on a mortgage instrument for economic viability. For a description of the program see the program guidelines. 43. National Housing Act (NHA) Section 6 Mortgage Insurance is outside the scope of this paper. It does not impact on C E D . C M H C claims that all areas in Y u k o n are eligible for mortgage insurance. At the national level, C M H C is negotiating with the twelve junior jur isdict ions on cost sharing losses to the Mortgage Insurance Fund(MIF) in one industry towns. However, for the purposes of this paper, it is assumed that N H A Section 6 is not a constraint on C E D . 44. Y H C delivered the Demonstrat ion Program in 1986 only. 45. Telephone interview with C M H C Whitehorse B ranch staff 5.4.89 46. Source forthcoming from C M H C Whitehorse Office 47. Telephone interview with C M H C B C Yukon Region official 7.4.89 48. Two C M H C officials reported on 12.6.89 that the C M H C may ask its Whitehorse office to deliver 90 units in 1989. C M H C originally p lanned to deliver 35 units. While this would increase the housing stock, band planning processes may not be able to accommodate this 257% increase. The 1987 interim Yukon 2000 report on hous ing specifically opposed this k ind 118 of program delivery. The report recommended that program planners deliver an even number of units each year, rather than the k ind of delivery C M H C and DIAND are considering for the 1989 O n Reserve Program. Th is report was qualified by the Regional Director for the Indian and Inuit Program in Yukon on 19.6.89. He said that the total D IAND housing subsidies in i989/90 would be about 270 unit, triple the number for the previous fiscal year. 49. Interview with C M H C B C / Y u k o n Region Office staff 50. What is more likely, is that Y H C will offer to cost share some or all of the programs C M H C currently funds unilaterally. The effect of cost shar ing is to increase the number of units. 51. For the purposes of this paper, all budgets will be expressed in estimated number of units. 52. Th i s exclude the Non-Profit O n Reserve Program, (34 new units in 1988) which are funded separately and renovation programs. 53. Th i s information is contained in a C M H C report Background to the Determination of the Financial Caps, J anuary 23, 1989. In 1987, four regions returned surp luses to C M H C National Offices which totalled $39.7M. Of this, $18.2M was reallocated, leaving an unallocated surplus of $21 .5M. The total allocation for Yukon was approximately $23.4 in 1988. 54. Interview with C H M C Whitehorse Branch staff February 21, 1989 55. See Yukon Hous ing Corporat ion, The Future Mandate of the Yukon Housing Corporation, Y H C , 1986 or D. Hu lchansk i , A History of the Yukon Housing Corporation, (unpublished) for a review of the turbulent history of Y H C . 56. Hedmann , David. "Interview with Yukon's Hous ing Minister," Canad ian Housing, forthcoming. 119 57. See Y u k o n Housing Corporation, "The Future Mandate of the Yukon Housing Corporation," a 1986 report prepared by Bairstow and Associates for a brief history of Y H C . 58. E a c h year, Y H C and C M H C agree on the cost shared budget for Yukon . This agreement guarantees the availability of federal funds should Y H C marshal l the resources to deliver them. 59. The average capital cost in the 1988 Yukon social hous ing costing model was $112,300. 60. Y H C has the option of borrowing additional funds on a separate mortgage or paying cash for all costs which exceed the max imum unit price. 61. The other operating expenses were estimated in the 1988 social hous ing costing model at $4,148 per unit. So the loss is 83 units x $4,148 x 35 years = $12,049,940. Th i s operating loss is cost shared 75:25. The federal funds lost are .75 x $9,037,455. 62. In 1987 and 1988, the Y H C Construct ion and Maintenance Department was responsible for negotiating the max imum unit price (MUP) with C M H C . The Construct ion and Maintenance Department insisted it and non-profit sponsors could at or below the applicable MUP. However, Y H C records tell a different story. Of the 47 units Y H C constructed in 1986, 1987 and 1988. only 2 units cost less than the applicable MUP . 63. Reported by C M H C officials at a Joint P lanning and Monitor ing Committee meeting in Whitehorse in 1987. 64. See J . D . Hu l chansk i (1983) "Private Rent Supplement Programs: The Canad ian and Amer i can Experience," paper presented to the Vancouver City P lanning Commiss ion , October 1985, D. Hedmann , Whitehorse Star, March 22, 1989 and D. Hedmann , A Review of Cost Effective and Appropriate Program Choice, (unpublished) March 1989. 65. Th i s is from a Y H C draft cabinet submiss ion, undated, 1984. 66. Interview with former Y H C staff 4.89 120 67. Information, on C & T S expenditures was obtained in interviews with branch directors in Apr i l 1989. 68. Y H C could spend up to $6 .3M on new construct ion, $ 1 M on renovation programs, $0 .5M on new staff hous ing and $2 .5M improving its existing portfolio for a total of $10.3M. Numbers are approximate. 69. See Speech from the Throne, Sixth Session, Twenty-sixth Legislative Assembly, Yukon Government, J anua ry 10, 1989. 70. In addit ion to the 234 N H A Section 56.1 units managed by bands are the approximately 700 homes built prior to the non-profit program and/or us ing only the DIAND housing subsidy. 71. Interview with Tagish Kwan staff, Apri l , 1989 72. Telephone interview with Y H C staff 6.4.89. The c la im included expenses for capital improvements which were planned and undertaken without any involvement by the City. 73.. Y T G , Statistical Review, Fourth Quarter 1988, Table 4-7, page 45. Th i s table reports all rental units in bui ld ings with four or more rental units. 74. See Y T G , Assessment of Import Substitution Opportunit ies page G E T S O U R C E 75. Get source from industry representative, bank and F B D B . 76. The Y T G Bu reau of Statistics reports in their Economic Review that "due to administrative changes to the Y u k o n Health Care records, Apr i l 1984 to May 1985 populat ion figures are not available." 77. C M H C Planning Division, "Housing and the Economy" , J anuary , 1985, pg. 14. The findings of that report are that about 2.04 person years are created i n bui ld ing and infrastructure 121 instal lat ion for each new dwelling start. $110,000 was also the average cost of C M H C delivered social hous ing units in 1988. 78. Y u k o n Hous ing Corporation, Yukon Housing Needs Study, Y H C , 1986 79. Approximately 3 5 % of Yukon households live in rura l and special access communit ies. Hous ing conditions in these areas are documented i n the Housing Needs Study. Approximately 6 8 % , 3,750 households, in these areas have incomes below the applicable CNIT. 80. See Construction and Housing Strategy: A Progress Report, Apr i l , 1987 and Yukon Economic Strategy, 1988. 81. The 1986 Yukon Housing Needs Study reported that approximately 3 0 % of the 8233 household in Y u k o n were in core housing need. Th i s works out to 2470 households. Appl icat ion of a more realistic methodology for determining income thresholds and application to the populat ion increases the number in core need to about 3 3 % . Th i s is about 2700 households in 1988. 82. See C M H C , Cost Effective and Appropriate Program Choice: A Planning Framework, C M H C . 1988 and D. Hedmann , A Review of Cost Effective and Appropriate Program Choice, 1989 (unpublished) 83. Telephone interview 84. E a c h year, C M H C and the active party in the Global Agreement come to terms on m a x i m u m unit prices for each planning area and each k ind of unit by number of bedrooms. The schedule of m a x i m u m unit prices is signed by the senior official for C M H C and the active party. Prior to 1986, the max imum unit price or M U P was the pr imary way C M H C controlled project costs and ensured that social hous ing was modest. Since signing of the Global Agreements, C M H C established another cost control mechan ism. 122 85. The 1986 census reported the age of units to 1986. The units constructed since the census were not added to the census total units. The age of the 1986 stock shown in this thesis is as of 1990. 86. Y T G Bureau of Statistics 87. Interview with Y T G Department of Finance official and the Yukon Economic Review and Outlook 1987 -1988, page 51 88. Interview with Y T G Department of Finance official and the Yukon Economic Review and Outlook 1987 -1988, page 51 89. The land set aside in Yukon is considered as Reserves by C M H C . 90. 1986 Census Table 94-122 91. See the Yukon Housing Needs Study. . 92. Co-operative Hous ing Federation of Canada, 275 B a n k Street, Ottawa, Ontario. K2P 2L6. There are six double-sided fact sheets. 93. Telephone interview May, 1989 94. C M H C . "Housing and the Economy," Planning Div is ion, C M H C , J anuary , 1985 pg. 14 95. The Regional Director for the Indian and Inuit Program for the Y u k o n Region reports there were 270 hous ing subsidies in the 1986-88 period. Du r i ng that same period, these subsidies were used to bui ld 143 units with the O n Reserve Hous ing Program. The Regional Director also reported a dramatic increase in hous ing subsidies in fiscal year 1989/90. Subs id ies will be about $ l l m up from $3.45m in the previous fiscal year. Telephone interview 19.6.89 123 96. B ands use loans guaranteed by the DIAND Minister, not mortgages, to finance O n Reserve Hous ing Program units. 97. Interview with Department of Public Works, Architecture and Engineering, Whitehorse office staff. Th i s office approves all house plans and completes all inspections on houses built with this program. Formerly, this office was the DIAND Engineering and Architecture section. It was recently reorganized into the Department of Public Works. 98. There are three options in this program; rental, lease to purchase and ownership. In this thesis, this program is treated as a rental non-profit program. 99. Ent re Nous Femmes Housing Society started organizing in 1985. It completed its first hous ing project, the 46 unit A lma Blackwell bui ld ing in 1986. Subsequent to that success, the 18 unit Beatrice Terrace Bui lding and the 21 unit Antkiw Bui ld ing were completed i n 1988 and 1989 respectively. 100. Interview with Entre Nous Femme Hous ing Society representatives and C M H C B C /Yukon Regional Office 04.89. See also the program guidelines especially the guidelines regarding incorporation. 101. Telephone interview with C M H C Whitehorse B ranch staff 10.4.89 102. C M H C Whitehorse Branch Office Staff 103. The m a x i m u m subsidy for this program is calculated based u p o n a mortgage interest rate write down to 2 % based upon the total cost of the project. The other non-profit programs contribute a subs idy equal to the difference between approved operating expenses and rental revenue. 104. It possible that bands could finance 1 0 0 % of the cost of a project and have rental revenue exceed total expenses. However, all projects in Y u k o n used the DIAND subsidy. 124 105. See for example Commiss ioner 's Order 1976/237, a Hous ing Corporat ion Ordinance, stating the role of the Dawson City Hous ing Associat ion 106. Rees, W. E. and J . D. Hu l chansk i , "Housing as Commun i t y Development," work in progress, 1989 107. See C M H C A n n u a l Reports for 1980, 1981, and 1982 108. The City of Whitehorse has been the RRAP delivery agent since about 1984. However, the city has never delivered the program. It sub-contracts delivery to Y H C . 109. A s defined in the Y u k o n H u m a n Rights Act . 110. Interview with S E A L Program staff 111. Interview with S E A L Program staff 31.5.89 112. Interview with S E A L Program staff 125 7. Bibliography B u c h a n a n Consu l t ing Services, "Small Bus iness and the Yukon : A Linkage Report", Draft D i s cuss ion Paper Prepared for the Y u k o n Economic Strategy Fal l Conference, Y T G , 1986. C M H C Planning Divis ion, "Hous ing and the Economy" , C M H C , J anuary , 1985. C M H C , Housing Policy in Canada Lecture Series. Numbers 1 and 2, "Programs i n Search of a Corporat ion: The Origins of Canad ian Hous ing Policy, 1917-1946 and 1944-1967," Speeches given by C M H C President George Anderson at the University of Br i t ish Co lumbia . C M H C 1988 C M H C , The Chang ing Hous ing Industry in Canada , 1946-2001, C M H C , 1988, N H A 6120 02/89 . C M H C , "Background to the Determinat ion of the F inanc ia l Caps" , C M H C , 1988. Davis, H.C. , "Buy Local Program: Import Subst i tut ion at the Regional Level", P lan Canada 1989 (forthcoming). Centre for H u m a n Settlements, Smal l Scale Product ion of Bu i ld ing Materials in the Context  of Appropriate Technology, Proceedings of a Seminar of Experts convened in Vancouver , Canada , November 20, 1985. Centre for H u m a n Settlements, 1986. Douglas, Dav id J .A . , Community Economic Development in Rural Canada: A critical Review, Plan Canada , 29:2, March , 1989 Fr iedmann, J ohn . , P lanning in the Publ ic Doma in : F rom Knowledge to Act ion Princeton University Press 1987. H L A Consul tants , "Yukon Based Furni ture Manufactur ing" , Y T G , 1986. Hainsworth, G.B., "Local Resource Management for Livelihood Security and Livelihood Enhancement " , Introductory Remarks to P lan 503, February, 1989. H e d m a n n , D., "A Review of Cost Effective and Appropriate Program Choice" , March , 1 9 8 9 . (unpublished). Hu l chansk i , J . D . , "Private Rent Supplement Programs: The Canad i an Amer i can Experience", 126 Paper presented to the Vancouver City P lanning Commiss ion October, 1985. Hu l chansk i , J . D . , Canada 's Hous ing and Hous ing Policy: A n Introduction, U B C P lanning Paper, CPI #27, J une , 1988. Hu l chansk i , J . D . , "A History of the Y u k o n Hous ing Corporat ion", J anuary , 1989 (unpublished). Kemp, L., "Is There a Difference Between Commun i t y Economic Development and Local Economic Development?", S PARC News, V : l Fal l . Lotz, J . , "Commun i t y Development: A Short History," J ou rna l of Commun i t y Development, May/ June 1987. McAr thur , Doug . "Government as an Economic Force", draft d iscuss ion paper prepared for the Y u k o n Economic Development Strategy Fal l Conference, Y T G 1986. McC la in , Janet., Editor, "Is Government Home Ownership Ass istance the Way to Go?" Proceedings from a Sympos ium held in Calgary, S e p t e m b e r 18-20, 1980. C a n a d a Counc i l on Social Development, Ottawa, 1981. MacPherson , C.B., The Rise and Fal l of Economic Just ice and other Essays , Oxford University Press, 1987. Marcuse , P., "Hous ing Policy and the Myth of the Benevolent State" and "Afterward: The Myth of the Meddl ing State," Chapter 14 of R.G. Bratt, C. Ha r tman and A . Meyerson, editors., Crit ical Perspectives on Hous ing, Phi ladelphia, Temple U. Press, pp 284-263. Novacorp Consul t ing , Y u k o n Bus iness Opportunity Identification Study: Bus iness Sector  Reports, Y T G , 1986 Patterson, J . , "Hous ing and Communi t y Development Policies," Hous ing Progress in Canada , C M H C , (forthcoming). Rees, W.E. , and J . David Hu lchansk i , "Hous ing as Northern Commun i t y Development: A Case Study of the Home Ownership Assistance Program in Fort Good Hope, NWT., School of Commun i t y and Regional P lanning, U B C , (work in progress). Resource Interlude Ltd. , "Report on Import Subst i tut ion/Market ing Workshop" , Y T G , 1987. 127 Ross, Dav id P. and Peter J . Ross, F rom the Roots Up : Economic Development as if  Commun i t y Mattered, Van ier Institute of the Family, Ottawa, 1986 Sundog Resource Consul t ing, "Low Capital Technologies for Economic Development in Yukon" , Y T G , 1987. Thompson , A.R., Harriet Rueggeberg, and Fraser Gifford, "Resource Management in the Yukon" , Draft D i scuss ion Paper prepared for the Y u k o n Economic Development Strategy Fall Conference, Y T G 1986. Townsend , C , "A Theory of Poverty and the Role of Social Policy," in M. Loney et al. editors, Social Policy and Social Welfare, Mi l ton Keynes: Open University Press, 1983. Tryak, Keith. Y u k o n Passage, Henrt and whiteside, Toronto, Ontario, 1980 Treeline P lanning Services Ltd. and RoofRaisers Hous ing Consul tants , "Yukon 2000: Hous ing Infrastructure," a draft d iscuss ion paper prepared for the Y u k o n Development Strategy Fall Conference, October, 1986. Y T G , 1986. Weale, A. , "Issues of Va lue and Principal in Social Policy," in M. Loney et. al., ibid. , pp. 104-116. Weaver, Clyde., Regional Development and the Local Communi ty : P lanning, Politics and Social  Change, J o h n Wiley and Sons, 1984. Westcoast Commun i t y Development, Foundat ions for Growth: How to make Economic  Development Work for Your Communi ty , Westcoast Commun i t y Development, Br i t ish Co lumb ia , Canada , 1987. Widmeyer, Scott. "Munic ipa l Infrastructure Study", Draft d iscuss ion paper prepared for the Y u k o n Economic Development Strategy Fal l Conference, Y T G , 1986. Wismer, S. and D. Pell, 1981. Communi ty Profit: Communi ty-Based Economic Development  in Canada , Is Five Press, 1981. Y u k o n Chambe r of Commerce and Y T G , 1988 Y u k o n Bus iness Directory, Y T G , 1988. 128 Y u k o n Conservat ion Society, "Sustainable Development in the Yukon " , a submiss ion to Yukon 2000, Y u k o n Conservat ion Society, June , 1987. Y u k o n Hous ing Corporat ion, The Future Mandate of the Y u k o n Hous ing Corporat ion, report prepared by Bairstow and Associates, Y H C , 1986. Y u k o n Hous ing Corporat ion, The Yukon Housing Needs Studu, report prepared by The Institute of U r b a n Studies, Y H C , 1986. Y u k o n Territorial Government, Assessment of Import Subst i tut ion Opportunit ies, a report prepared for Economic Policy, P lanning and Research, Department of E conomic Development, Department of Economic Development, Mines and Smal l Bus iness , Y T G , M a r c h 1986. Y u k o n Territorial Government, "Report of the Proceedings of the Women in the Economy Workshop" , Y T G , 1987. Y u k o n Territorial Government, Indian and Canada Northern Affairs Program, Yukon Economic  Development Perspective Update 1986-87, Y T G , 1988. Y u k o n Territorial Government, Y u k o n Economic Forecast, J anuary , 1989. Y T G , 1989. Y u k o n Territorial Government, Y u k o n Economic Review and Outlook: 1987-1988, Y T G , May, 1988 Y u k o n Territorial Government, Y u k o n Economic Strategy, Y T G , 1988 129 

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