Homeless action requires money; climate change requires behaviour change

CREDIT: Steve Bosch, Vancouver Sun Files A homeless man, his cup out for change, sleeps on the street in dowtown Vancouver near Hastings and Hornby.

CREDIT: Glenn Baglo, Vancouver Sun Files Homeless man in North Vancouver has been up all night checking blue boxes for bottles and cans.

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Mike Harcourt has a dream about how to solve homelessness in this region by 2015. His dream is not that federal and provincial governments will reverse 20 years of policy and start pouring money into housing the way they used to.

Instead, he thinks it can be done by tapping into the willingness of many people with "deep pockets" in the community -- people who are aghast at what they see in Vancouver and are willing to do something about it.

"There are lots of people in town who are disgusted and upset by the homelessness on the street," said the former premier. "They are people with deep pockets and big hearts and they want very concrete projects they can give to."

If Harcourt and those who have been working with him on the still-evolving project can pull off harnessing the energy of "civil society" to help solve homelessness, they will have achieved something that no one else has in North America.

But he believes it can be done.

By his calculations, the province needs about 1,000 new units of housing a year for its poorest residents over the next seven years. The province is already on board to provide about half of that, with more than 3,000 units bought or on the drawing board.

Now, says Harcourt, that substantive investment needs to be accelerated by finding ways to pull together the big dollars he believes local citizens are waiting to give, the energy of non-profits, the willingness of cities to help, and other layers of financing that are needed to cover the high costs associated with housing people who are homeless.

He is working with others on three pilot projects -- two in Vancouver, one in Surrey -- that he didn't want to give the details on yet, saying they won't be solid until the fall.

If those pilots work, Vancouver would provide a revolutionary new model for building housing for the homeless.

Ever since senior governments started withdrawing from new investments in social housing in the 1980s, people have been trying to figure out a way to replace the billions that were lost.

There are really only two sources besides government money. One is developers, who can be asked to build social-housing units in exchange for extra density on their sites. Vancouver has had a few small successes in that area, thanks to developers' intense desire here to get extra space.

The other source is private money -- either as donations or low-interest loans.

A Holy Grail

The dream of being able to tap into donations from private citizens to help solve housing and homelessness problems is a Holy Grail that housing advocates and governments in the industrialized world have been pursuing for years, without much success.

In Vancouver, Mayor Sam Sullivan's council hired Ken Dobell, a former city manager and deputy minister to Premier Gordon Campbell, to come up with a way to attract private money for housing projects. Sullivan said there are people waiting to give, including one person who has talked about giving as much as $10 million.

But that plan depends on the federal government making changes to tax laws that are not visible on the horizon yet. So at the moment, the Vancouver idea of a homeless foundation that invests donor dollars in social housing remains just an idea.

In Surrey, Mayor Dianne Watts is trying to kick-start a new era of investing in social housing through a new homelessness and housing fund. But that foundation only has $9 million in it -- not enough to kick off even a small project.

Surrey announced this week that the society that runs the foundation is offering $1 million to the group that comes up with the most innovative way to reduce homelessness in Surrey.

"We really don't know what will be proposed," said program manager Vera LeFranc. "We've hoping for some great, innovative ideas and we're excited about what will be coming across the desk."

But the fund's most involved councillor, Judy Villeneuve, acknowledges that the foundation will need much more money if it's going to make a real leap in providing housing. The city is hoping to get that through private donations and bonus densities for developers.

But those who have been in the housing and city planning field for decades say trying to build housing for people at the very lowest income levels is extraordinarily difficult.

"I've never seen anywhere that's been able to house those folks without heavy state subsidies," says Ann McAfee, Vancouver's former co-director of planning, who is now teaching and working internationally as a consultant.

McAfee says it's not too difficult to find mechanisms to create affordable housing for people who fall just below the level of being able to operate in the housing market.

But for the poorest, who have so little income and frequently so many needs, mnor adjustments to the usual market mechanisms don't work.

Steve Pomeroy agrees with her. Pomeroy, an Ottawa consultant who has been advising federal, provincial and municipal governments, along with housing associations, for three decades on this subject, says no one has been able to figure out how to close the large gap between what the poorest have to spend on housing -- typically the $300 to $400 a month that's the housing portion of a welfare cheque -- and the high cost of housing plus services.

"The reality is that if you're taking someone off the streets and putting them in a self-contained building, the minimum investment you'd need from private money per suite is $85,000."

That's a conservative estimate, based on a total cost of $100,000 per suite. In Vancouver, planners usually calculate the cost of a minimal apartment in social housing at $200,000.

The amount most low-income people can pay in rent is only enough to pay the basic costs of running a large building -- heat, light, enough staff to keep control at the front door, taxes and simple maintenance.

More than minimal staff

That means someone has to come up with the cost of land and construction of a building.

As well, if the people you're trying to house are mentally ill, drug users or both, as many of Vancouver's homeless are, that means each building needs more than minimal staff. So realistically, the cost of extra staff -- nurses, social workers, just extra people around the building -- has to be factored in.

That means a lot of money, year after year, 24 hours a day, 365 days a year.

But that wouldn't be such a problem if people were willing to give to housing projects.

Statistics show that, in the past, they haven't been.

Data gathered in the 2003 National Survey of Nonprofit and Voluntary Organizations showed that non-profits in B.C. generated $11 billion in revenue. About half of that came from government funding; approximately 15 per cent -- $1.6 billion -- came from charitable donations. But the development and housing sector, although it represented almost one-tenth of the total number of organizations, accounted for only four per cent of the revenue.

The survey didn't provide a breakdown by sector, but if the general averages held true for the housing sector, the amount of money that should have come to housing groups through charitable donations was about $66 million.

That's not a billion, but it's a respectable amount.

However, a closer look at what people donate to real housing groups that are trying to house the homeless indicates that is not likely a realistic figure.

A check of the figures supplied to the Canada Revenue Agency by some of the largest housing providers in the Downtown Eastside shows that a minuscule proportion of the revenue they need to run their residences and shelters is donated through charity.

Groups like Lookout Emergency, the St. James Community Service Society and the Portland Hotel Society get about $250,000 to $500,000 a year in registered charitable donations and non-charitable gifts for their housing, shelters, and services to the sick.

Their total expenditures for their organizations, which are largely devoted to paying for building and staff costs, range from $10 million to $14 million.

A smaller organization, Raintree (which just changed its name from Triage), whose operations are dedicated exclusively to housing the mentally ill and addicted, got about $300,000 in charitable donations in a total budget of $6 million.

In spite of those low numbers, Harcourt said he believes people will be willing to give when they feel they can contribute to a tangible project where there is evidence that it will make a difference. That's what he and others are trying to produce.

His major collaborators so far are Milton Wong, one of B.C.'s most successful businessmen and philanthropists, and Michael Clague, the former director of the Carnegie Centre, who is spending a big part of his retirement on volunteer work in his old neighbourhood. The two men are at the core of a group trying to come up with a plan for responsible development in the Downtown Eastside.

Part of that plan is developing pilot projects with innovative mechanisms to pay for social housing.

Clague acknowledges that those projects will still require government investment. And he says he and Wong are dubious about trying to provide too much of the money for social housing through giving developers extra space.

The problem with that, says Clague, is that the price for even that is high.

"You need eight or nine or 10 market units to generate one non-market unit through density bonusing," says Clague. That would mean, if people in Vancouver wanted to create 1,000 new units of housing for the homeless in the Downtown Eastside -- a very low number relative to what's needed -- having to pack 8,000 to 10,000 market units into that small area.

Government money needed

Clague and Wong think that would be a mistake for the precariously balanced and historic neighbourhood.

Instead, they're looking at how to create small social housing projects that are financed through a combination of sources with less impact. Yes, some government money will be required. But that could be supplemented through some private donations or low-interest investments. It could also be supplemented through retail operations on the bottom floors.

After all, the cheap hotels of the Downtown Eastside traditionally have been able to offer the lowest-cost housing in the city because they had business operations on their ground floors. But most of those were bars, which is not what anyone wants to rush into building. Nor do Clague and Wong want to see a rash of Starbucks or Blenz outlets in the Downtown Eastside.

But they do believe there are retail operations that could work for the neighbourhood, providing revenue to the buildings they're in while also serving the people who live there.

Everyone involved in these projects is both excited and cautious about them.

They're excited because they're trying to develop something new and a lot of heavy hitters in the community are pitching in with ideas and help. They are cautious because they know how many ships have gone on the rocks before them.

"It's all an experiment right now," Harcourt says. But if it works, he and the others want to go all out to clone their success as quickly and as often as possible. "There's 3,500 more units to go, so let's get at it."

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