Mr. Chairperson (Ben Sveinson): Order, please. Will the Committee of Supply please come to order. When the committee last sat we were considering the Estimates of the Depart-ment of Housing. I believe we were on 30.1. Housing Executive (b) Executive Support (1) Salaries and Employee Benefits $391,100. Shall the item pass?

Ms. Marianne Cerilli (Radisson): I am just looking at the documents that the minister has provided me with based on my request and both that and the folder he gave me in the House. This is quite a bit different from what I have received in the past when I have asked for this information. Maybe the way that Manitoba Housing Authority and the department keep track of vacancies has changed in the way that they set up their database, so I am just going to do some comparison now. In the past there was this format that showed the applications, the waiting lists, the vacancies and the arrears, and sort of what was called turnovers all on one page. This time I have just gotten the vacancies, and it is not clear to me if these are the vacancies for the whole portfolio which you now manage, including the new CMHC ones. It does not seem like it because there are not enough.

Hon. Jack Reimer (Minister of Housing): No, they are not. The ones that I just gave her recently were just the direct managed ones.

Ms. Cerilli: In the past I have gotten separate sheets for Winnipeg-sponsored housing, the private nonprofits and co-ops, the direct managed, and I am interested in seeing the same stats for the CMHC portfolio that you have taken over. So that part of it is kind of incomplete.

Mr. Reimer: I am told that the federal government does not do that type of monitoring and tracking. We do it in our department, but I guess we do not have the figures available on the federal side of it.

As I mentioned, or just been told, that the feds have never had that monitoring or tracking system.

Ms. Cerilli: I remember that, when we were in discussion in Estimates before, that was one of the sticking points with the negotiations with the federal government as you were wanting them to fill vacancies and report vacancies and deal with this whole area prior to the signing of the agreement, so this is kind of a surprise to me. I want you to respond to that if that issue did not get resolved because I thought you were requiring that they would give you some kind of a report on vacancies in the federal portfolio before you signed the agreement.

My other question then is: are you going to start requiring a report from the nonprofits that you have inherited from the federal government on the status of their vacancies in arrears?

Mr. Reimer: In dealing with the federal portfolio, there are various components of arrangements and agreements that the federal government was involved with. Where this government had no cost-sharing arrangements, it was totally managed and controlled by the federal government. As I mentioned earlier, the reporting mechanism was not there for vacancies or vacancy management of sorts.

Where there was also unilateral funding by the federal government, there, again, there was no recordkeeping or stats on vacancies or vacancy management in the federal portfolio. Where there became an analysis on our part as a provincial government in looking at the federal portfolio was where there were projects that were in difficulties. This is where there was an availability of the history of the project, the vacancies, the units that were occupied. Those we had were made available so that we could analyze the difficulties and the costs involved with those, but as I mentioned before, where the federal government had a unilateral arrangement with the private nonprofits or where there was no cost-sharing involved of the provincial government with the federal government, those types of statistics were not available.

Ms. Cerilli: Well, the minister really did not address my question which is are you going to start doing this now, considering that you now have management responsibility for all of these units? You must get that information now in their reports to you.

Mr. Reimer: I think that is something that, as was just pointed out, the department is still looking at, the qualities and the quantities of information that could be used and to what degree. There has not been any directive to be on top totally of monitoring every unit, because if units are managed properly, there are no problems. The vacancy rates in a lot of these private nonprofits are very, very minimal. There is very little turnover. There is a fair amount of consistency in these units. Unless they get into difficulty, that is when there is a need to monitor them. They are reportable naturally with their year-end statements and their accountability and the transparency of funds and how they are managed, and that would be a very strong indicator of the management capabilities where and if there are problems coming up in regard to those units.

So a lot of them are very, very well managed. They are very well subscribed to for residents. The vacancy rates are very, very low. We seem to always deal as a department where the difficult ones are, and that is where there is close monitoring set in, and that is where there is a different type of approach for possibly marketing the units. That is what the department seems to concentrate on. The good ones, they manage themselves. The accountability me-chanisms are set in. The reporting mechanisms are set in, and I guess if they do a good job, we work with them.

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Ms. Cerilli: My question is in the reporting mechanisms that they have, they have to report their vacancies on an annual basis, month by month, is that correct?

Mr. Reimer: On an annual basis.

Ms. Cerilli: I understand you are not going to be managing how they deal with their vacancies, but do you not think that it is in the interests of your government to know, even if they are nonprofits, what their vacancy rates are?

Mr. Reimer: Yes, I think what it comes down to is the yearly monitoring of the situations at the various locations and the reporting mechanisms and the accountability that they do have to subscribe to. If in the reporting mechanism at that time, there is a problem that is recognized, well, that is when there should be closer scrutiny and possible remedial action set up at that time. But to do it on a monthly basis for the manpower and the time involved, I think is something that we have not looked at in a serious manner.

Ms. Cerilli: Mr. Chairperson, I am not suggesting that Manitoba Housing should be getting a report from these nonprofits on a monthly basis. I understand there is a process where they have their budgets approved and they have to report to you at least annually. In that annual report, there would be a monthly indication or a month-by-month indication of their vacancies, and that is not occurring.

Mr. Reimer: No. It has been pointed out that when the report is given to us on that yearly basis, that is when the stats are made available to us at that time. I believe the report does not have a–[interjection] Yes, a snapshot at year-end, but it does not have the month-to-month occupancies.

Ms. Cerilli: The minister had mentioned that there were some properties, though, that were identified as having some difficulties in the portfolio that you got from CMHC. Can you give me some sense of the number of those properties, the number of units involved, where they are, that kind of thing?

Mr. Reimer: I have been advised that it was less than ten projects that were identified in difficulty. We do not have the exact names and locations, but that can be supplied to the member.

Ms. Cerilli: That would include co-ops, I am assuming?

Mr. Reimer: Yes, it would.

Ms. Cerilli: I want to ask questions then again about the other information that you gave me. The repair maintenance expenditures are, I would think, probably just information that is in the Estimates material. This is pretty different from what I received in 1995, and I think I have it from 1997 as well. I can show you. It is The Criteria for Priorizing Capital Expenditures for a three- to five-year period, and then it lists each of the regions and each of the projects, the amount that was going to be spent on both modernization and improvement. Then there is a similar schedule that was for maintenance and ongoing repairs. Also, with that, I had been given a listing of all the properties in the different communities and regions that were going to be declared surplus and sold. I am wondering if I can have the same kind of information. This is what I wanted to have prior to starting the Estimates process so that we could have a more thorough discussion about what is happening with the management of the stock throughout the province. Hope to get that.

Mr. Reimer: I do not know whether that is the same. I realize that what we have given the member is quite a bit different than that. Maybe what we can do is go back into our file, and then we can try to duplicate it for the member.

Ms. Cerilli: Just to clarify that, that is much more extensive and detailed, and that is the kind of thing that I am looking for that will really make this a much more meaningful discussion.

Mr. Reimer: We can work this into the same type of format, you bet.

Ms. Cerilli: Okay, well, we have to wait to deal with all those maintenance and budget issues then until next week. I guess I will go back to some of the issues we were discussing before the lunch break in terms of how the government is dealing with some of the changing demographics and this report that I have been referring to.

I received back a copy you made of the one that CMHC did, but this report, Elderly Persons Housing Vacancy Study, was done by your own department. I was wanting to get some explanation of how far this report was taken in terms of implementing some of the recommen-dations or following up on some of the analysis. I will get into more specific questions about it in a minute, but just sort of generally, was this a report that was sort of implemented and taken seriously or was it a report that just sort of was done and has not really gone anywhere?

Mr. Reimer: I can assure the member that the report has been utilitized in the sense of analysis and direction of some of the ways that the department is moving. I think that it has been pointed out that one of the things that we have moved along in utilizing that report is moving towards some of our support of housing projects that we have initiated on a trial basis on Arlington Street, 880 Arlington. I have had an opportunity to tour that facility, and the condition and residents there and the people that are involved with that are very, very optimistic and quite enthusiastic about that approach with support of Housing on the way. I believe part of the basis came out of analysis of that report that the member is referring to.

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Ms. Cerilli: That is somewhat disappointing, 880 Arlington is only one complex, and this has recommendations that would really to the full extent utilize Manitoba Housing properties that are vacant. So in talking to some people, I am not sure if the vacancy picture has changed that much in the last year or so with your properties. I know just from the material you provided me in the House that I did some quick arithmetic and it looks like the vacancies in total are still over 1,100 units, and there are 331 bachelor units that are vacant, that are still just in the portfolio that is managed by Manitoba Housing.

So how does the department characterize the vacancy picture at this time? Is it still seen as necessary to try to utilize units in another way? This report recommends turning units into long-term care facilities, into hostels, into student housing. There are recommendations here for housing for victims of elder abuse. Are all those things still being considered? Do you see the picture of vacancies in the portfolio to have changed and that this is not warranted anymore?

Mr. Reimer: One of the biggest advantages and one of the deciding factors that came into consideration when the provincial government looked at taking over the management of the federal portfolio was our ability to make decisions on a local basis. The report that the member is referring to has some excellent suggestions and some excellent areas of utilizing Manitoba public housing stock in its various components and various directions, and those are all very, very valid ways to look at the best utilization of Manitoba housing.

One of the things that restricted a lot of those types of new endeavours was the fact that, because we were in funding arrangements with the federal government and the federal government had to be part of any decision that was made in regard to reconfiguration or redirection or an innovative new program that we felt we wanted to carry out in Manitoba Housing, we had to have the federal government's concurrence. That usually was a very onerous burden to try to get the changes and to try to convince them of changes and to try to still retain the funding for changes that we felt were needed. A lot of the suggestions in that report are excellent suggestions that we still feel that we should be moving towards. We have the ability now, with the signing of the federal government's devolution agreement; as I mentioned, one of the biggest advantages was the fact that local decision making can be made now in regard to what is best for Manitobans.

I think that what has been very exciting for the department is to look at some of these challenges and some of these new directions that they can take Manitoba Housing because it gives us an opportunity to be creative. It gives us an opportunity to look at the best utilization of our stock. It gives us a best way to make different types of arrangements or partnerships with private, nonprofit organizations. It opens up an awful lot of opportunities to look for the best way to utilize Manitoba housing stock.

Another strong point that goes along with the devolution offer is the fact that any savings that are incurred by the provincial government in its undertakings of new directions stay within the province and stay within the department for the redirection into possibly brand-new programs or brand-new subsidies or brand-new arrangements that we can make with organizations or components of housing so that we can turn that money back into a better way of dealing with the housing problems here in Manitoba.

The report is a very, very good blueprint to start looking at how we can manage our vacancies in our portfolio. It has always been a very, very big problem with us, especially with the configuration of some of our buildings that have an awful lot of the bachelor units which pose a big problem in trying to fill those. What we have done in some of our locations, and it is something we look at as possibly a partial solution to some of the problems is looking at converting some of the bachelor units into one-bedroom units, if it is feasible and possible. Sometimes it is just as easy to put a hole through the wall and join the two units. It is not always possible in some units because of the architectural structure and the configuration of some of the buildings where it looks easy but cannot be done once you get an engineer's report in there. But in some of the locations we can do that. We can eliminate some of our bachelor units that way. It gives the opportunity for people to enjoy a more spacious area, and, in all likelihood, they do get occupied, whereas before where we had two bachelor units sitting vacant maybe for months and months, we now get one unit drawing a resident in there. It gets utilized, and it becomes a home for some person.

Those are some of the things we are looking at on an individual basis. We have approached and we have initiated what we call a marketing strategy also to market some of these units in areas, and what we have assigned as a team of two people to get involved in a marketing strategy in some of these complexes. A good example is the unit on 601 Osborne, where there was a high vacancy rate in there, and the marketing team went into the community . They did community drops; they went around and talked to some seniors groups, telling them about the availability of these units in this project. We had, as I say, some information pamphlets made up. We had some signing put on the building, and I believe right now the vacancy rate in there is down significantly. There is a fair amount of activity in that unit.

We have looked at various ways of trying to accommodate more utilization of these units. As I mentioned earlier, with the ability to make decisions locally now, a lot of new programs can come about, because, as I say, we do not have to be in concurrence all the time with the federal government, who were very reluctant to do any type of change, other than cut back in the funding, which they unilaterally did to the Housing department back in 19–[interjection] Yes, the federal Liberal Party–the federal Liberal government, pardon me–cut back in 1994, I believe it was. Then, in 1995-1996, they capped it. So we have risen to the challenge of still meeting the needs of the Manitoba government, even at the expense of the federal Liberal government cutting back.

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Ms. Cerilli: May I remind the minister about my opening statement in terms of dealing with the specific questions that I ask, because we have been going through this a few years now, hey, Mr. Minister? I have been asking these questions for a few years in terms of your vacancy rates and your plans for your vacancy rates. You have had 11 years to deal with this. Eleven years. One specific question, because every year you have talked about converting bachelor units into one-bedrooms and joining them together. I am wondering how many of them you have converted. In 11 years, how many conversions have taken place of bachelor units into one-bedrooms? Let us start there.

Mr. Reimer: As mentioned, the conversion on a lot of these units, because of the bearing walls and the architectural design and things like that, as much as there are units available, sometimes you have to make sure too that they are right next to each other because of the configuration of the buildings. Here in Winnipeg, and I will just mention the places anyway, in Columbus Courts we converted 12 units; at Oak Lake Manitoba we converted four units; at Rapid City we converted four units; at Plum Coulee we converted four units; and in Flin Flon we converted a whole building actually over to a PCH.

Flin Flon was a conversion of nine units, and two units at Teulon.

Ms. Cerilli: So in 11 years we have converted in Manitoba Housing Authority 35 units, bachelor units into one bedrooms. So I guess you have also done the cost comparison, the cost that it was costing you by having these vacant, the amount of money invested in terms of the renovations and conversion costs. What did you come up with? What is the picture for these 33 units in terms of the bottom line for the department?

Mr. Reimer: Conversion costs are actually not that expensive. In fact, in a lot of the units it can be done for less than $2,000. I think that some of them are even around a thousand dollars. In the frame buildings, it is very, very economical to convert them, because I have seen some of them. It is just a matter of literally putting a doorway through a wall and framing it up. It is very, very economical, so the costs are not very high.

They then become rentable and rented out as one-bedroom units. I guess we would have to do a calculation as to the prior when they were vacant and how long they were vacant before we converted and the history from then on. But I would think that it would be on the positive side with the occupancy rate of these now compared to what they were before.

Ms. Cerilli: So it is a good investment; 35 times two, that is $70,000.

Mr. Reimer: It would be less than that.

Ms. Cerilli: Less than $70,000. So I am certain you are getting more than that from the rent, right?

Mr. Reimer: Unless we had the figures for it, but I would think that the return is substantial, yes.

Ms. Cerilli: So this would be a good management practice in terms of–

Mr. Reimer: As Martha Stewart would say, it is a good thing.

Ms. Cerilli: Again, the minister and I have been having this discussion for a few years now in terms of your approach to dealing with these vacant units. This is I think the most sort of concrete numbers that I have had in these conversions over the years, but I want to go back to the whole question then of the cost that it is costing the department for having units vacant. And I want to refer to this report that I have been talking about, the Elderly Persons Housing Vacancy Study that was done in 1990. On page 8, under the 4.3, Maintenance and Design Problems, it talks about how given the current market situation and natural turnover rates, officials from the Department of Housing feel a vacancy rate of 5 percent is acceptable. Presently bottom-line budgeting is being practised with the allowance for a 3 percent vacancy rate. If a project carries a vacancy rate higher than 3 percent, funds available for maintenance and upgrading are sacrificed in order to afford the higher vacancy rates.

That is a pretty strong statement. Then this is the scenario. Coupled with the existing port-folio of housing units approaching 20 years of age continue to contribute to a cycle of increased vacancy rates and sacrificed maintenance. Not good management, not a good story outlined in this department report.

I have heard different figures of what the vacancies are costing Manitoba Housing. Now the staff are also talking about the savings that you make in paying for the conversions and then collecting the rent does not account for the subsidy that you have to pay, but I would think that the calculations have been done in your department. So what I want to know is: what is the bottom line in terms of what the vacancies are right now, and what they are costing the department?

Mr. Reimer: I think one of the things that has to be taken into consideration when we talk about vacancies and we put a number on it, that we will always have a certain percentage of vacancies. One of the reasons why there will always be a certain amount of vacancies is because of turnover. Turnover happens very, very frequently in public housing. What happens with turnover, units have to be usually refurnished or repainted or cleaned up after an occupancy turnover, so that unit then becomes a vacant unit while it is getting ready for some sort of clean-up process or maintenance, or that it has to go into before it can come back for occupancy.

So occupancy, turnover and vacancies are actually three components of a vacancy percentage number. We will never come down to a zero vacancy or 100 percent occupancy because just by the nature of public housing there is a tremendous amount of turnover. With that turnover, it creates usually a vacancy of a couple of months or more, maybe two to three months by the time the place is recleaned or fixed up and put back into a position where people can see it, visit it, and we can try to rent it out again. That is a constant factor.

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I think generally what we talk about is a vacancy rate overall of about 10 percent within all our properties as a general number, but that can fluctuate from various portions of the city from almost right down to zero right up to 15 percent or 20 percent depending on the complex. So vacancy rates we will always have. I guess the biggest challenge on our part is to get those units back into the marketable position so that someone can rent them again as quickly as possible. A lot of times, because of the size of the unit or the location of the unit and the sudden vacancy of the unit, because people just move out on us, the management of the vacancies is a fairly complicated part of our costs. It does cost, as the member says, to have vacancies. We try to minimize it, but the circumstances some-times take a life of their own.

Ms. Cerilli: Well, the minister did not answer my question. I am not sure if you are saying that right now you think you have 10 percent vacancy. Can you tell me how many units that is, and what that number is costing you? Maybe that will include some of the units that are just being in that two- or three-month transition or turnover period. But I think what we are talking about is there is a chronic vacancy problem, and 10 percent is higher than what is recommended in your own report here that says 3 to 5 percent is what is allowable, so that you are not having to sacrifice money for maintenance to pick up the costs. Now, is that true, and can you tell us what the costs are?

Mr. Reimer: The overall vacancy right now as of April 30 is 9.3 percent. For elderly housing, it is 7.67 percent. In just doing a rough calculation –staff are just doing a rough calculation–if 3 percent was acceptable, that would mean a cost to our government of about $383,000 per year based on those figures in the elderly housing component which comprises about 5,500 units here in Winnipeg.

Ms. Cerilli: I just want to clarify this to make sure I am understanding what the minister is saying then. You are telling me that the elderly persons' housing has a vacancy of 7.6 percent and that the cost for those vacancies is $383,000.

Mr. Reimer: What I am saying is that if we take the figure of 3 percent as being reasonable, and that is the industry standard, then subtracting that from the 7.6 and prorating it on a cost basis, that would be our total expense, if you want to call it that, to maintain that vacancy rate here for elderly housing in Winnipeg.

Ms. Cerilli: To clarify further then, what you are telling me then is the $383,000 for the elderly persons' housing vacancies is really only for a vacancy rate of 4.67 percent, because you are subtracting the 3 percent that is kind of a given, and that fits in with what you said earlier, that there is never going to be a zero percent vacancy. So there is this sort of 3 percent cushion.

So we would be able to extrapolate that because you told me that overall the vacancy rate is 9.3 percent as of April 30, '99. So it sounds to me like it is probably–and this is annually, that $383,000 is an annual cost?

Mr. Reimer: Yes, that would be sort of on an annual basis, taking those figures.

Ms. Cerilli: Is that taking into account the fact that then you are not paying the subsidy on those units?

Mr. Reimer: Yes, the subsidy cost still is there if it is a vacant unit.

Ms. Cerilli: So then that $383,000 on 4.6 percent is really then the loss of the rent plus paying the subsidy and that is how you are arriving at that figure.

Mr. Reimer: Loss of the rent, yes.

Ms. Cerilli: So you are not counting this as a subsidy at all. That makes sense. Okay. So if we actually looked at this then for the whole portfolio, it would be for sure more than half a million dollars a year.

Mr. Reimer: That is a reasonable estimate, yes.

Ms. Cerilli: I am wondering if the department has a more accurate figure.

Mr. Reimer: What we were trying to do there was just sort of get a bit of a general number as to the approximate cost, as the member is referring to, based on the snapshot that was done on April 30 and taking into account that sometimes the figures can move around. Extrapolating that out, it comes to about, on a province-wide basis, about $890,000.

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Ms. Cerilli: Well, there are a number of questions that flow from this then. If you are losing $890,000–let me go back up for a minute then. I want to just clarify the question I was asking earlier; it had to do with, generally, is the vacancy rate improving. I have heard that a lot of the apartments are filling up, that this sounds like a bit of an improvement. I remember the total figure used a while back was 1,300 vacancies. I think that was the total from the last time I had one of these update reports, that there were over 1,300 units that were vacant. Do you have that total now, and can you show that there has been an improvement in the vacancy rate this year over, say, a couple of years back?

Mr. Reimer: Yes, the member is right. The vacancy rate is going down. For example, in April of 1998, the vacancy was, as she mentioned, almost 1,400, and now in April of 1999 it is 1,201. So it is going down.

Ms. Cerilli: So if we look then at this report from the department that talked about what ends up happening is that maintenance and upgrades are sacrificed because you are not increasing the budget to deal with the vacancies, what is the accumulated impact on the maintenance budget of having carried over a 10 percent vacancy rate for so many years?

Mr. Reimer: I am going to ask the member to ask that question again, I am sorry.

Ms. Cerilli: Mr. Chairperson, it is fairly logical. Your report says that if projects carry a vacancy rate higher than 3 percent, the funds available for maintenance and upgrading are sacrificed in order to afford the higher vacancy rates. To me that means your maintenance budget would have been higher over the years if you had not been carrying a 10 percent or more vacancy rate. So what I am asking is: what has been the impact on the budget totally over the years? I mean, we are talking millions of dollars less that has gone into maintaining the investment of the asset of all this housing because it has had a vacancy rate of more than 10 percent.

Mr. Reimer: I think what should be pointed out is our maintenance is not based upon our revenues; our maintenance is based upon the needs and the requirements for keeping our stock in a manner that is safe for the people and for occupancy. The revenue naturally is important, but that would not dictate our responsibility to keep the stock in a proper manner. So our maintenance budget in fact has increased. It has stayed strong. In fact this year I think we are up to just over $11 million in our maintenance budget. Last year it was over $10 million. So that has remained fairly constant, but we do not tie it in with our revenue stream.

Ms. Cerilli: So is what the minister saying then that if you had been getting more from rents over the years because you had maybe 3 percent or 4 percent vacancy, that you would have not then been spending as much from general revenue on your Housing budget line because you would have just traded the money from the revenue for general revenue monies instead of having that revenue from rent. I mean it is logical that if you would have been getting more money from your properties, and that is what this report suggests, there would have been more monies available to be turned around and invested back into those assets.

Mr. Reimer: It has to be pointed out that it is not as if we are the sole funder of the stock of Manitoba Housing. There are the various arrangements with the federal government and in some cases even municipal government in regard to the expenditures and also would apply to the revenue stream, so it is not as if that money is totally coming into the provincial coffers. Because of the arrangements with the various, like I say, the federal government and some municipal governments, there is a sharing of the costs as there is a sharing of the revenues so we have to look in the picture of the situations of what controls those individual units.

Ms. Cerilli: So what the minister is saying to me is that because of some of the federal responsibilities and cutbacks there, that necessarily would not have meant that there would have been increases in the budget if there had have been more revenue from the increased tenures or less vacancies.

Mr. Reimer: The member is right because, in fact, what the federal government has done is it has literally capped our funding in I believe it was '95-96.

Ms. Cerilli: Well, how do you explain this report that was done in 1990, a couple of years into your government's tenure, that says if a project carries a vacancy rate higher than 3 percent, funds available for maintenance and upgrading are sacrificed in order to afford the higher vacancy rate? How do you explain that?

Mr. Reimer: I do not know how that–whether the explanation is in the interpretation or whether–you know, I think that it is a report that was done–it is an excellent source of report. It is a report that has a lot of good recommendations in it. It is something that can be worked with. It is a document that I think has a lot of merit to still include in a lot of decision making.

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Ms. Cerilli: Well, this report is not done by one specific person. It is done by the department, by your Planning branch. I am sure, because it is done up, that it is approved by your department. Actually, I did not notice this before but in the introduction it talks about how the current EPH units in Winnipeg, with close to a vacancy rate of 10 percent, some projects as high as 25 percent, and this level of vacancy translates to an annual loss of approximately $927,000 in revenue and represents approximately 6 percent of the total possible revenues. Given existing federal-provincial cost-shared arrangements, currency vacancy rates translate to a direct revenue loss to the Manitoba Housing and Renewal Corporation of approximately $464,000 annually. So this report is very clear in suggesting that the vacancy rates are costing the department money, and this cost has to be borne somewhere. How has the department dealt with the reduced amounts from rents because of the high vacancy rate?

Mr. Reimer: I think that one of the ways we have tried to manage costs and expenses in regard to the expenses of units is, looking at what we have done, we have looked at the utilities, the hydro, conversions of hydro to gas. We have looked at water conversions. We have looked at energy efficiencies in the upgrades to buildings and things of that nature, insulations and things like that. I think all those things they may seem sometimes very small but in the overall picture they all add up to fairly significant savings that can be realized through just efficiencies of the maintenance dollars that are available. This is done on a very con-scientious manner by the department and I think it is something that we look at very seriously to try to cut back on the expenses.

I know the member is referring to the loss of revenue because of vacancies, but as I mentioned earlier, that is something we continually work at and try to bring down. It is an ongoing situation that I do not know whether there is an instant panacea for correction on it because it, to a degree, is just part of public housing that there is going to be a vacancy rate there.

Ms. Cerilli: Well, the minister said that they are dealing with the loss of almost $1 million a year in revenue because of high vacancy rates by doing conversions and efficiencies in gas and water. Would you not do those anyway, even if you were not having a high vacancy problem?

Mr. Reimer: It is an ongoing program naturally. When we are looking at the costs of units, the expenses on units, we look at all ways of trying to bring in some sort of efficiencies into that unit. I know that we have done windows, a lot of replacement of windows in a lot of units. We have a fairly aggressive program this year in a lot of our units in maintenance replacement of windows. I know that we are, I think we are even looking at cladding a couple of buildings that we are replacing. These things, like I say, our main-tenance budget alone is over $11 million this year. Morden Legion is another example, so these are some areas where we are trying to look very closely at how we can make these buildings efficient.

Where was I at the other day? [interjection] Oh, yes, Portage la Prairie, where we just put in a new water system with the member for Portage la Prairie (Mr. Faurschou). We were out there on the weekend and they converted water or gas there, too, did they not? Yes. The people are quite pleased with the operation there. We put some esthetic changes in there, some carpeting, a little bit of furniture and some partitions in there, and it came in way under budget.

I should take time right now to give credit to some of the department heads and the managers, because I was very, very impressed with what they have done in, like I say, Portage la Prairie. The district manager out there was very, very ingenious in looking at ways to try to help the residents in a couple of complexes out there. The place looks very, very good. A lot of it was done, like the member for Portage la Prairie (Mr. Faurschou) said, under budget, and esthetically very, very pleasing. It usually is because the department is quite frugal and quite astute in trying to get the best buy for their buck. So I give the department a lot of credit for a lot of the things that they have come up with. It is not just a matter of going out and spending money. They are being very, very prudent in their management of the taxpayers' dollars.

Ms. Cerilli: But the point here, Mr. Chairman, through you to the minister: is it not the case that you would look for these efficiencies, whether they be energy conservation or water conservation or conversions of utilities, even if you were not losing almost a million dollars on your revenue side by having high vacancy rates? Would you not be doing that anyway?

Mr. Reimer: We would do that normally in our normal process. We would do that anyway, yes.

Ms. Cerilli: So the other part of your previous answer, you were saying that there was no sort of solution or panacea, but earlier we had just been talking about your rate of conversions and the fact that for as little as $2,000 a unit, you were converting units and then they were rented. So why are you not moving more quickly or aggressively on these kinds of conversions? I will let you answer that first.

Mr. Reimer: One of the things that has to be considered when you look at some of these conversions is working with the group that is either the sponsor or the tenant of that particular building. One of the things that we try to work very, very closely with is the tenants and the tenants association in trying to not be disruptive. For example, we may have a complex that has 20 units in it, and it may have maybe six or eight vacancies in it, but some of those units may not be interconnected. What happens then is that the person does not want to move, even though there is a vacant bachelor unit right next to this person. So we have to be very careful in trying to accommodate the individual's needs. We try to work with them in saying that we would like to convert this and make it into a different unit but it means moving you, and some of the people feel that they do not want to move. So we do not forcefully move them out because we want to interconnect the two rooms, so that is one of the things that we have to be very, very careful of.

The other one is, as I mentioned before, sometimes some of these structures cannot be converted because of the configuration or the architectural design of these buildings. So that eliminates some of these places that have high vacancy rates of bachelor units. So we have to eliminate those, but usually, if there is a willingness and we have a request to look at a unit in a town or in the city here that has a high vacancy rate and there is the possibility of converting it, we will look at it very, very seriously to convert and to try to accommodate that particular request because it is an easy way, like the member mentioned, to rent out a unit. But it is not an automatic, just because there are so many vacancies in a particular building, that they all can be converted, because some of them may be on one floor and some on the next floor and we have not looked at going through the floor yet.

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Ms. Cerilli: I am wondering if there has been any kind of report or feasibility study done in your department that would indicate how many units could be converted in this way, if you have any kind of assessment of which areas would be suitable to convert into more long-term care facilities. This is something that I have not been able to understand. When you have, in some cases when I look at this list, in certain communities, especially out of the city, it seems like there is almost an entire block or certainly a floor in a block that could be converted to some kind of long-term care facility, and we know that in rural areas that is what is needed. We need to have more personal care homes or supportive housing or certainly not just the bachelor unit without any supports there. So that is one question, how have you dealt with this in doing an assessment in your department to look at the number of units that could possibly be converted or the number of buildings or floors. I look at 185 Smith or some of the other blocks that have had high vacancy rates and their location is good for having more supported housing or long-term care facilities. So how are you dealing with that?

The other thing, just before you answer, you were mentioning the fact that you do not want to disrupt people. So I am wondering how many, really, have you approached and they have said no. I mean when you have only done 35 units, I am not sure how many people that you have approached have said no. I mean when you have vacancies in elderly persons housing as high as there are.

Mr. Reimer: One of the things that is happening is we have established a dialogue with the Winnipeg Long Term Care society, committee, pardon me, committee on long term care with Marion Suski, I believe and her group. This was an initiative that we felt we wanted to be on top of because, as the member mentioned, there is an awful lot of public housing out there that possibly can be utilized in some way, either with a floor or two floors of PCH, personal care home, or assisted living. So we initiated a dialogue with them shortly after we took over control of the total portfolio, because we now had the opportunity to enter into discussions of this nature that we can make some decisions on a local basis. I believe what we have done is we are actually doing an assessment of some of our locations to look at them in a way that they possibly could be utilized and upgraded or converted to some sort of long-term care or assisted living or something like that.

One of the things that was pointed out right off the top was the fact that we are dealing with an older stock of buildings, as I mentioned previously, that were built in the '60s, '70s and '80s and under codes that were applicable at that particular time for a particular segment of the market and the requirements at that time. When you try to look at the requirements for, whether it is PCHs or assisted living or any type of programming that is expected now under the building codes and the fire codes and the various regulations in regard to the care and concern with people, some of these buildings, unfortunately, the upgrades cannot be done, because it is just way too costly and the structures and the design just will not make it available. But that does not mean that we may not have some buildings that can be utilized this way. So it is a matter of doing the assessment.

I know that there is a fair amount of meetings with the Long Term Care committee. In fact, if I am not mistaken, the meetings are fairly regular in trying to assess our stock and how it can best be utilized. I am optimistic that there is possibly some complexes or some units that can be utilized that way or portions of them or maybe a renovation of sorts that can be utilized, but here again, what we are doing is looking at trying to utilize some of the Health budget into the Housing budget and the co-ordination between the two in trying to get the best utilization of the dollars. That was one of the things that we did with 880 Arlington. We expect, and we would hope that we can do that in other areas too.

The one building that the member mentioned, 185 Smith Street; 185 Smith Street is in an excellent location, but it has been pointed out to me that the architectural design on that building and the bearing walls and the configuration within that building make it very, very hard even to convert two units into one. I know we have had engineers in there, in fact, because that was one of my first queries. I said: why do we not just utilize that building there? The engineering report says that I think it is only about the top two floors, top four floors that could be possibly utilized that way. After that, it becomes a problem of structure and the design of the building. So we have a building there that is in a good location but because of the engineering design on it, it does not fit into anything that we feel–pardon me, not necessarily that we feel, but what the codes will not let us do. So we have to live with that building the way it is.

Ms. Cerilli: I want to see if I am understanding what the minister is saying here. Is he saying that because of the codes for long-term care facilities being what they are, that the existing older stock could not be, as easily as we might think, transferred to becoming a long-term care facility? So it is the codes that apply to the requirements for long-term care facilities. I see the minister is nodding yes.

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Mr. Reimer: Yes.

Ms. Cerilli: Just then to finish off on this, can the minister tell me when this assessment and report are going to be completed by this committee?

Mr. Reimer: I have some good news for the member. I have to tell her that. 185 Smith, the one that we have been talking about a lot, I have just been informed that we only have three vacant units in there–[interjection] Five. I thought it was three. Five vacant units, so that is a tremendous improvement from what it was before.

In regard to the assessment, it has been pointed out that Health identifies certain areas and certain needs, and this is where the assessment is going on. It is not as if it can be done on a total basis, in a sense, because their budget restrictions can only allow them to spend so much, I guess. So it is looked at on an individual basis. It is looked at on an individual location basis as to where there possibly are needs, and those are the types of analyses that are undertaken right now with Manitoba Health, or Long Term Care, I should say.

Ms. Cerilli: So is what the minister saying is that Health is the one that is actually doing the assessing of the Manitoba Housing units and that they are only looking at it as sort of depending on where they need more long-term care facilities? I am not clear on this. I mean, you have the existing Manitoba Housing properties, you have identified where the high vacancy areas are, or the ones that have a number of elderly bachelor unit suites. To me it should be fairly straightforward in having someone, an engineer or others, go in there and assess which ones could be converted and in what kind of way. Maybe they should not all be converted to some kind of formal long-term care like a personal care home facility, but is there not a way of converting them. It may or may not be so much structural, but what we were talking about earlier today is just providing the necessary staff or resource support so that seniors or others who have those kinds of long-term health requirements would be accom-modated, and we would get people out of hall-ways and get people out of hospital beds that could then be freed up for other folks.

Mr. Reimer: Mr. Chairperson, it is not just a one-sided analysis. Health and Housing work very closely in looking at the needs. I guess it is like putting an overlay over not only on existing stock but looking at where there is the availability of buildings that would possibly fit in certain types of reconfigurations. It is the locations that Health would identify where they feel that they would like to be located ideally and then working back from there and looking at where our particular buildings are to see whether they configure to what they are looking for. There area a fair amount of parameters that come into place. Like I mentioned, it is working with Health in a way of looking at where there is the best utilization of our housing stock and whether it can be utilized. The analysis goes on, you know, it is one that long-term care and Housing work closely with.

Ms. Cerilli: Let me try another approach with this. I am looking at this vacancy list you provided me with. I look at the one for the Parklands where I can see that Ethelbert has a 20-unit project that has 11 vacancies. Have you checked out Ethelbert? Do we know if that one is feasible for converting it into some kind of personal care home, long-term care, assisted–living kind of facility for the good folks of Ethelbert?

Mr. Reimer: I have been informed that in Ethelbert there have been overtures made to the town in regard to whether they would be interested in this type of conversion to some sort of long-term care facility or conversion to a better utilization. Not only that, I guess it is working with the local RHA, the regional health authority, in trying to also identify that they would have to be part of the decision making. I have been informed that there has not been that kind of overture by the town of Ethelbert to pursue that. So they would have to be part of the decision making.

Ms. Cerilli: Getting back to sort of–you are looking at where your vacancies are highest. I remember from last year when we were dealing with the same issue, you were explaining that a lot of these rural portfolios are being offered to municipalities. So then it is up to the municipality to follow up and do the legwork with the RHA or the Long Term Care Authority.

Mr. Reimer: Yes, they would have to be on side; they would have to be part of the decision making and working with the RHA to come to us and say, yes, we feel that we can utilize this or that unit, and we would try to work with them and try to accommodate them.

Ms. Cerilli: I do not understand why Housing would not play more of a leadership role. It is in your interest as well; it is in the interests of the community, the whole province. Are com-mittees struck in this case in Ethelbert? I was looking at the list, Bowsman, for example, a small community, has a project that has nine units, and five of them are vacant. Are there committees being struck to try and get this moving, or is the offer made and it has sort of not gone anywhere?

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Mr. Reimer: We try to work very closely with the local authorities and the local municipalities or towns in trying to encourage, you know, the occupancy and the residency for the unit, for the residents in any particular town or municipality and the RHAs in the area. We can provide the physical structure, but the maintenance, the ongoing care, the ongoing commitment to the residents in there have to be taken up by the local authorities for it to maintain itself. So we have no problem in going to the local authorities and making these overtures, and then it becomes a decision by those officials or those elected officials in that particular town or area or RHA to then say yes or no. We just cannot drop it on them and say it is now going to be yours. But we will make those types of overtures to the local, like I say, authorities and the decision makers in those particular areas. It is up to them to yea or nay it.

Ms. Cerilli: Going back then to some of the questions I had been asking about vacancies as it relates to the federal portfolio. One of the things that has come to my attention from calls from some of the managers of this portfolio is there is going to be a change in policy in how money is given to these projects to deal with vacancies. Is it the understanding of the minister and his department that in the past under CMHC, if there were vacancies in these nonprofit corporations, CMHC would then have some kind of a supplement for them to cover their vacancy costs?

Mr. Reimer: One of the things that is very prevalent and very evident in dealing with Housing, whether it is the federal portfolio or the provincial portfolio, is there is a myriad of arrangements regarding the funding of the housing complexes and with the private nonprofits and the PCHs and a lot of those other ones. It would be interesting to know what the numbers are, because I would think that there are dozens. Yes, there are a dozen or more anyway. Each one of them brings with it its own baggage and its own arrangement of funding and formulas. So it is hard to say in a blanket state-ment whether the subsidies are interrupted or changed because of the taking of the federal portfolio. What was the question?

Ms. Cerilli: I will clarify my question for the minister. Can you confirm then that there are some housing complexes under a given program with CMHC where the vacancies were covered in terms of costs that would come from CMHC to the not-for-profit corporation? Is that true? Is that the case for a program?

Mr. Reimer: We are not aware of that type of arrangement.

Ms. Cerilli: I think it is best in this case that what I would do then is get more detailed information about the program and the specifics for the case that was brought forward to me. I thought I had that here but I do not, so I will come back to that issue another time.

The other thing though before we leave this whole issue in terms of the conversions and vacancies and all that is to deal with 880 Arlington. I know that this is one of the Manitoba Housing properties that has been transferred over in co-operation with the Long Term Care Authority into supportive housing, and I have a number of questions about that. First of all, how long did that process take, and how many units are involved there?

Mr. Reimer: The negotiations and conversions took approximately a year. What we have there is we have 22 units, 11 units of supportive housing and 11 units of assisted-living housing.

Ms. Cerilli: Well, my next question then has to do with the kinds of supports that are in place for that situation, both for supportive housing and assisted living, the kind of agreement you have with Manitoba Health for the services that they are providing and the cost for Manitoba Health that has been associated with that. I know that under that whole program in Manitoba Health it was $2.1 million, but I am not sure how much of that is going into 880 Arlington.

Mr. Reimer: I should point out that 880 Arlington is a 10-floor building. There are 121 units in it. Two floors have been designated as what we were talking about. The manager of that complex is Bethania. They manage not only the other units in the other eight floors, but they also have a contract with Manitoba Health in regards to the supportive housing units that are under their purview.

Ms. Cerilli: A point of clarification, then. Is 880 Arlington then a not-for-profit?

Mr. Reimer: No, we own it. They manage it, yes. The dollars, I do not know whether we have access to the dollars that flow through there, from Manitoba Health to Bethania, but they are the ones that, like I say, not only manage the whole complex for us but they also do the management for the supportive housing and assisted living housing too.

Ms. Cerilli: Well, I would be interested in knowing how much money is being spent on health under this contract. This must be a formal contract agreement then, and Housing is still involved even if it is supportive housing, and you do own that property and they manage it. It seems though that that is a fairly reasonable amount of time to set something like this up, one year. So I am just comparing that to the fact that in 11 years, you have only done 35 conversions on your own of the bachelor units into the single bedrooms. I am just wanting to then wrap this up with maybe a clarification of any other long-term care conversions or assisted living conversions that have taken place.

Mr. Reimer: I think, as I mentioned previously to the member, we have converted Flin Flon, and then we are in the process of doing some conversion at the deaf centre on Pembina Highway.

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Mr. David Faurschou (Portage la Prairie): Mr. Chairman, a little earlier this afternoon the minister made comments pertaining to facilities in Portage la Prairie. I just want to add for the record that the minister came to Portage la Prairie last Friday, May 14, to help me or I assist him in a rededication of two Manitoba Housing Authority facilities, Oak Tree Towers and the Stephen's Apartments. The minister mentioned that the Manitoba Housing Authority personnel, and specifically Donna Whyte and Marion Sutherland, how engineering and ingenious and persevering they were in facilitating the esthetics and mechanical improvements to those facilities. In fact, they were able to accomplish the changes significantly below budget.

I might just give the example that they, once hearing of the closure of the Brandon Mental Health institution, attended and secured more than a trailerload of furniture from that facility, brought it to Portage la Prairie for renovation through ARC industries, and then coupled then with a local upholstering firm, were able to put virtually new furniture in both those facilities of which the residents are very, very appreciative. I might say that their appreciation was shown just hours prior to the minister's arrival. There were more than 30 people out on the grounds attending to any litter or any flowerbeds that were on the premise, and I must say that both facilities were looking extremely appealing when the minister arrived last Friday.

So with those few remarks, Mr. Chairman, I really appreciate the minister taking the time from his busy schedule to come to Portage la Prairie and recognize the residents and certainly his staff within Manitoba Housing, their dedication and commitment to making the housing facilities a very pleasant place in which to live. Thank you.

Mr. Kevin Lamoureux (Inkster): Mr. Chairperson, I did have a few questions in a couple of different areas that I was wanting to explore with the minister. The first one is the government in the past has entered into private, public contracts in terms of the development of land. The two larger ones over the last decade have been the Ladco, MHRC, and then there was Qualico and MHRC in opposite ends of the city, Qualico being in the north end. Virtually all of the area is inside the area which I represent with respect to the Qualico, so I guess I will start there.

There was quite a bit of expectation that was built up a number of years ago when the government signed the agreement. Individuals felt fairly confident that we were going to see other things starting to develop in that northwest corner of the city. I am wondering if the minister can give some sort of indication to us today in terms of what the current status is with Qualico and that plot of land just north of Old Commonwealth saddling Keewatin Street.

Mr. Reimer: Mr. Chairperson, the member is right. It is an agreement between MHRC and Qualico. It was entered into in July of 1993, and there are approximately 750 residential building lots. It is just almost 163 acres of land. The portion contributed by MHRC was around 124 acres, the remainder by Qualico. It was a 15-year agreement. The agreement expires in July of 2008 or until such time as all the building lots and other properties have been developed and sold, whichever occurs earlier.

From what I have been told, there have been no overtures by Qualico to start development on it. We are still of the opinion that we are willing to participate in the joint venture and that the sharing of the revenues is by agreement between ourselves and Qualico, but to date there have been no overtures by Qualico to start to develop that property. The contract is current, the intent is still there but until Qualico decides to move on it, it is still vacant.

Mr. Lamoureux: Every year there would be annual servicing costs just for having that lot there. Who would be picking up the cost for that?

Mr. Reimer: The only costs that are associated with it would be our costs for weed control. We do not pay tax on vacant land, no property tax, so our cost would be in doing weed control on that.

Mr. Lamoureux: Is there anywhere in the contract that would stipulate that they have to take action by such–you know, we will go into some discussion on the deal in the south end. My understanding of that one, because I did actually get a copy of the deal but that was a number of years ago, back I think it was in '89. It gave a detailed plan as to what expectations, how many houses need to be met by X year. Was there anything of that nature in this particular agreement?

Mr. Reimer: It has been pointed out that there is no commitment to a certain amount of homes by a certain amount of time. It is a land development agreement for the development of the land with the principal player being the developer himself, which is Qualico. But there is no time frame saying that there has to be a certain amount of development or lots are sold or completions within a certain time frame other than the agreement itself which expires, like I mentioned before, in July of 2008.

Mr. Lamoureux: So there would be no penalty at all for Qualico if it decides that it is not going to build anything on the property?

Mr. Reimer: That is true.

Mr. Lamoureux: Is the government then honoured to keep up the contract with Qualico for the full duration of the 15 years, or can it opt out if it wanted to go with someone else that might want to come forward with an idea, because I understood that it was actually tendered, and if it was tendered one would think that there might have been others that put in to develop the area? So, because we have one developer who enters into a contract and there is nothing obligating him to develop the land, it seems that the people, in particular in Meadows West and other areas because it has such a dramatic impact on the overall development whether it is in The Maples or Tyndall Park, that if Qualico is not obligated to build anything, does the government have the ability to get out with no penalty?

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Mr. Reimer: I do not know whether that has been looked at as an option. We would have to look at it and see whether there was a way of doing it if it was warranted, but I should point out that the land that is owned by Qualico itself also has not been developed, so the whole parcel is sitting vacant. I guess it is a matter of which areas of the city are developing and where the demand is. I guess it is like anything, the market will dictate where people want to move or live or develop, and I guess this piece of property, at this particular time, does not have the demand that maybe other areas have.

Mr. Lamoureux: I think that we have to at least acknowledge or note that we have a bit of a situation in the northwest end of the city if you are going to expand. You really cannot go further west because of the airport. You do not want to go building under the runway type thing, or under the flight path, so that means further construction. There are many people who would like to move into that area just north of Inkster Boulevard or see that expansion occur in Meadows West. Because I think that it is worthy of the government at the very least sitting down with Qualico, and I will come up with some other suggestions right away, but I would think that there is benefit in terms of sitting down with Qualico.

Well, first, before even sitting down with Qualico, finding out whether or not there were, because I thought that there were others that put in for that particular tender. I could be wrong on that, but I think it is worthwhile finding that out. If not, I still believe that there might be just cause to look at reopening that whole process, and it is because of limitations of individuals that want to remain or build in that community that are being restricted. If Qualico, for example, has a number of sites throughout the city and you cannot build in that area because there is no land available, Qualico is the only one who has the land but they choose not to develop that, well, it does have an impact on the market because we have allowed that to take place. So I think that there is a need for the government to look at that contract and possibly sit down with Qualico because it has been somewhat stagnant over the last number of years. I would look for just the minister's observations on the comments.

Mr. Reimer: The member brings up some interesting points. You know, it is a fairly big piece of property up there in northwest Winnipeg. It has been pointed out to me that there has been development, I believe, north of this property, northeast of this property, and it is sitting there. It would be interesting to know, and I guess I would ask the department to look into whether we have had any other types of overtures in this particular area and look at what our options are as to the agreements, pardon me, the agreement with Qualico, and get a further update on it and the situations around the development of this piece of property. But, again, I guess, as I mentioned before, even with the acreage that is indicated, Qualico has not even moved on their own piece of property.

Mr. Lamoureux: I guess that in itself is somewhat discouraging because on the onset one might speculate that they do not have any intentions of developing that property, at least in the short term, but they have already had rights to develop that entire area for the past six years. What I would be interested in seeing happen, as I say, is that we look into the contract. If it is possible to be given a copy of the contract in confidence, I would honour any requests from the minister in keeping the confidentiality aspect of it in confidence. But I would very much like to be able to see some sort of movement in that area because it is a concern, I say not only for the people that I currently represent in Meadows West but also in The Maples.

I am wondering how receptive the minister might be if I were to attempt to arrange some form of a public meeting and invite Qualico and someone from the department to come just to listen to the concerns of the residents in terms of the development or potential development of that quadrant of the city. It is something that I know would likely mean a lot to a lot of the residents in the area. I think that MHRC and Qualico would both benefit by an event of this nature. I would be more than happy to provide and ensure that the facilities and the local residents are, on both sides, on The Maples side and the Inkster side, made aware of it, at least those homes that are right adjacent to the property. Would he be open to that?

Mr. Reimer: I certainly cannot discourage the member for trying to represent his constituency in the best manner that he feels proper and in looking at the best utilization of properties in that area and the responsibilities for develop-ment of that particular area. I cannot really yea or nay whether there should be a meeting. If the member is of the opinion that is something he was wanting to pursue with the residents in that area, I could not say do not do it or do it. I think any type of information meeting that the public wants to have in regard to any type of aspect of their community, we as elected officials have an obligation to try to hear the sides of all concerned citizens. I can only say that if the member feels there is a concern shown by some of his constituents, and he feels that this is one of the ways to try to get some sort of resolve to the problem or direction on the problem, that is a decision that, as a member and a representative of that constituency, that he feels that he should do, well, then I cannot give him that type of direction.

As the landlord of that particular piece of property, in co-operation with Qualico, I imagine that if there was a meeting to discuss this particular piece of property, naturally, we would have a representative from Manitoba Housing there as an observer or someone to listen to the concerns of the citizens. But as to giving direction, we would not be in a position to give any type of direction as to what should or should not transpire there.

I think, if anything, it would be viewed as a public meeting to address a concern, so we would be there as an observer, because it would pertain to us, as a landowner, I should say, in that particular area.

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Mr. Lamoureux: I think that the request is more so trying to provide the joint partners with what the general feelings are of the area, the type of development, for example, that they would like to see. I think it just assists in the invitation of the MHRC and Qualico, if in fact the minister sees no problem in terms of accommodating an informational type of meeting at which both MHRC, Manitoba Housing, the local residents, can just give some feedback.

I can recall when it was first announced, for example, I extended an invitation and Qualico did show up, and they talked about the plan. It was a fairly impressive plan. Well, obviously that has likely changed, or maybe it has not. I do not know. Just to at least give the minister and his staff notice that this is a meeting that will likely occur, we will be appealing to MHRC to send a representative along with Qualico so that the residents can be better informed as to what the future is. In the interim, as I indicated, if it is possible to get an actual copy of the contract, I would be interested in that, as local representative, and I would ask the minister to look into the original tendering process. Were there others that had made application? Because if Qualico and MHRC jointly feel that they do not want to proceed, maybe there is someone else or another organization or another private company that is prepared to move ahead, especially if you have the local residents wanting to see the development.

Unfortunately, I do not have a map with me, but if the minister saw the map, he will see how critical of a link this particular piece is to The Maples, Meadows West and Tyndall Park. It is in essence the hook-up. The traffic patterns would change tremendously by an extension of Keewatin, for example, Keewatin Street to Adsum.

So there are all sorts of things that could result in some positive, maybe a little bit of negative also, but generally speaking I think there could be a lot of good things, good ideas that could be discussed at this particular meeting.

So the minister can give a comment on that if he so chooses, or I am going to move on to the next area.

Mr. Reimer: Just a short comment. Like I mentioned, if there is going to be a meeting called, we certainly would want to be invited as part land owner in that particular area. We would have someone from our department be there.

Mr. Lamoureux: I thank the minister. Moving on to the Ladco, MHRC deal. I think that one was a little bit better defined. I know I do have the contract for it. I am just trying to get a bit of an update from the minister in terms of I understood that–and again, I am going by memory, and this is a decade ago–I thought it was close to a 10-year agreement in which there were some time frames where they expected development to occur. If the minister can just give an update on that.

Mr. Reimer: It was a 15-year agreement that began in 1989. It was for a joint venture to develop 1,900 lots on approximately 476 acres, which was 180 acres with MHRC and 296 with Ladco. The current status as of February 28, 1999, is there are 305 lots being developed in phases one, two and three, 241 lots are sold, 64 are remaining in inventory. The cost of servicing the sites and selling of the lots was just over $7 million. The total value of the sales was just over $10 million. Our share of the profits was almost a million dollars on that.

Mr. Lamoureux: Does the minister anticipate that they will continue to receive more money or more profit? I was under the impression, and I would have to go back to the original press release, that it was closer to somewhere around $10 million that they were anticipating. Was that just an overly optimistic price back then. I realize the current minister was not even around at the time, I believe, when that actually was signed, so obviously he is not responsible for it, but I believe it was an original $10-million profit that they were hoping to achieve.

Mr. Reimer: I think the number was based on the selling of the original 1,900 lots. I guess you have to do some arithmetic. When you look at, if there has been 305 lots developed with MHRC's share of almost a million dollars, I guess you have to–[interjection] Yes. If it was totally developed, maybe that is where the $10 million would come in, you know, totally. But it is being developed as one of the areas of growth in the city.

Mr. Lamoureux: So at this point, the government is optimistic that that particular area will in fact be fully developed over the next five years.

Mr. Reimer: Well, that is a good area of town, you know. That is represented by a good MLA too. I guess it all depends on market demand and the growth area. I know there is still a fair amount of growth in southeast Winnipeg. There seems to be a fair amount of homes still going up. As to whether it will develop the full 1,900 building lots, the development seems to be still moving in that particular area and I guess you always live with the optimism, if they continue to grow it may possibly fully develop. I do not know whether that will be in the next few years or when it will happen but with 305 lots developed already since 1989, I guess that is 10 years, and you never know how the market is going to move.

Mr. Lamoureux: Actually when the minister talked about that side of the town type thing, one of the things I should mention, today I posed a question about property tax, and that side of the town even a house of the same value does not pay as much property tax because on the north side of town we happen to be in Winnipeg School Division No. 1 which is the heaviest taxed property-wise in the whole province, so it is a little bit tougher to sell in terms of the amount of property tax, but the quality of life is by far worth the venture to moving into the north end of Winnipeg. I can assure the minister of that, and that is part of the reason why I am suggesting we need to look at reopening or having more dialogue with Qualico because I believe that there is a demand for it.

An Honourable Member: Nothing to do with the MLA, then.

* (1650)

Mr. Lamoureux: With all modesty, I do not think it has too much to do with me, even though my ego might like to think so at times. Anyway, I wanted to move on to another area.

It is an area which I respect the minister is doing a considerable amount of effort in terms of making it happen and that is the whole area of tenant management. We have had a great deal of discussion in the past in regard to it. I really believe that the future is fairly bright with respect to tenant management. The biggest concern I have is more of consistency than anything else, and education. The minister and I are quite familiar with the Gilbert Park tenants' group and association, both their good times and their little bit rough times at times, but I think that the general feeling is that tenant manage-ment is a very positive thing. I guess I would look first for just some insight from the minister on how he sees tenant management proceeding in the future.

As I have indicated, an important component to tenant management has got to be education. It is an area in which the department –and I know Ron has been wonderful in terms of trying to make tenant management work. Even though Ron cannot speak at the table, I think it should be noted that it is very much appreciated the efforts that the department puts in, in terms of trying to enable, empower individuals to take a little bit more pride in the areas in which they live and a little bit more pride than you would normally see, let us say, in someone that owns a home or in a housing co-op. It is not an easy task. It would be very easy just to let things dwindle down on a vine. I think there is a responsibility for the Department of Housing to be aggressive at promoting and educating. The reason for that is that I do not think that in many areas that you can just sit back and believe that it is going to happen, and if you have a more proactive approach at facilitating in some areas, initiating, that the long-term benefits are just overwhelming.

I know the minister has seen that first-hand. I have seen that first-hand. As I indicated, there have been some bumps up and down here and there, but, all in all, I think that, at least in my experience with respect to Gilbert Park, it has been relatively smooth as we see people move ahead, as we see programs that have been initiated that might not have been initiated had the local tenants not had the interest level that they did have. It is not to say that there have not been some mistakes. There have been, and there will likely be mistakes in the future, but I think that what is important is that we do not lose focus on the need to develop.

The more specific question that I would have for the minister on this particular point is that of education. I have often talked to members of the Gilbert Park Tenants Association of things such as having a video, that when you are a new resident, you are provided a video in which the video, in essence, talks about the tenants association, the benefits of a management-tenant. Just to make people more aware, there was the trip that was made to Washington, and I understand that there is a chance that the lady who was in charge out there might even be coming up to Manitoba sometime during the summer. I think it is just inspiring, the video that I had seen in regard to how people have really made a difference. I would like to believe that if we provide the educational tools and are supportive, we can, in fact, make a difference. It is not trying to run the lives of individuals. That is not what we are trying to do. What we are trying to do is enable and empower people who would under normal circumstances not have that sense of pride that is only given through a tenant-management.

I could talk about when I was first elected, and there were many more sad faces in Gilbert Park back in '88 when I was elected. I can recall having a press conference where there was broken glass all over the place; there was no infrastructure or anything of that nature. You know, one would think that the Tories might be kind of cruel in the area of public housing, and I think that if you ever require an example where you have demonstrated good will in terms of social development at the housing level, that Gilbert Park can be an excellent example of that. I would challenge anyone to say otherwise because of what I have seen first-hand occur.

My concern is that that sense of commitment needs to continue and to expand. I have seen it. I believe the minister and the Minister of Housing prior had seen that. So I am just interested in his comments on it.

Mr. Reimer: I think that the member's point hit at some very, very excellent points regarding tenant- managed association projects because we have both recognized some significant changes not only in the area that he represents, but I work very closely with the member for Burrows (Mr. Martindale) and the member for Point Douglas (Mr. Hickes) in trying to turn around some of the housing projects in their areas, and I think that we have seen some fairly pleasant surprises in the way that things can change.

It is usually just by the manner of delegating the authority and giving the ability to the people on-sight to make decisions and to make changes and to be part of the decision making and taking sense of community and some pride in their complexes. It is a very satisfying endeavour to see these types of changes and the enthusiasm that these people bring forth because they definitely do make a difference, tenants associations.

My commitment is 100 percent and 110 percent to tenants associations. I think they are excellent, and I encourage them wholeheartedly in any complex, not only in the ones that we have talked about but in all areas, and if they want to form a tenants association, they can.

Mr. Chairperson: Order, please. As previously agreed, the hour being five o'clock, committee rise.