Memorandum of understanding, 2016
Memorandum of understanding, 2016
The Memorandum of Understanding, 2016 (MOU) between the Minister and the Ontario Mortgage and Housing Corporation was an administrative agreement that promoted mutual understanding of the roles and responsibilities of the agency, the Minister, the Board, and its officers and support staff.
OMHC’s mandate responsibilities were listed in an MOU with the Ministry. Responsibilities were primarily financial in nature and included:
- administration of public housing debt to Canada Mortgage and Housing Corporation (CMHC) and the Province;
- managing OMHC’s contingent liability to CMHC with respect to certain social housing mortgages for non-profit housing programs in accordance with OMHC’s loan insurance agreements with CMHC;
- managing any environmental liabilities under the Environmental Protection Act (EPA) on public housing properties formerly owned by OMHC that were transferred to Local Housing Corporations;
- managing and administering Affordable Home Ownership Program legacy mortgages transferred to it by Minister’s Order in accordance with the OMHCA;
- using the monies in the Affordable Home Ownership Revolving Loan Fund and the monies received under the transferred Affordable Home Ownership Program mortgages, including interest earned on the monies, only for housing purposes in accordance with a Minister approved by-law;
- administering marketable and forgivable loans and mortgages related to former housing programs, including loans and mortgages that were owned by OMC and transferred to OMHC on April 1, 2015;
- administration of loans to colleges and universities under the Ontario Student Housing program for the development of on-campus student housing;
- administration of housing programs, or parts of housing programs, as may be prescribed under the OMHCA, including making grants and loans related to such prescribed programs and taking security for such loans;
- making housing related loans, grants, guarantees or advances in accordance with the OMHCA and the HDA;
- carrying out building developments as defined under the HDA in accordance with the OMHCA and HDA;
- coordinating and arranging all borrowing, financing, short-term investment of funds and financial risk management activities through the Ontario Financing Authority, unless the Minister of Finance approved otherwise; and
- subject to applicable legislation, such other matters which are within OMHC’s statutory mandate as may have been assigned to OMHC by the Minister.
Affordable home ownership mortgages and revolving loan fund
OMHC administered the repayment of mortgages issued under the Affordable Home Ownership Program (AHP). This federal-provincial program was established in 2005 to provide down payment assistance in the form of second mortgages. The AHP loans are forgivable after 20 years. However, if a mortgagor wishes to sell the property prior to that time, the loan must be repaid. Loan repayments were deposited in an account called the Affordable Home Ownership Revolving Loan Fund (AHP Revolving Loan Fund). The AHP Revolving Loan Fund was vested in OMHC through amendments to the OMHCA which came into force on April 1, 2015. The AHP Revolving Loan Fund was held outside of the Consolidated Revenue Fund.
The OMHCA required that monies held in the AHP Revolving Loan Fund be used only for housing purposes in accordance with an OMHC by-law approved by the Minister: OMHC By-law No. 2, Affordable Home Ownership Mortgages and Revolving Loan Fund (By-law No. 2).
By-law No. 2 specifies that the Corporation was authorized to use the money in the Fund and the money it received under the AHP Mortgages, including any interest earned, for housing purposes, as requested by the Minister and approved by the Board of Directors.
Upon OMHC dissolution, any repayment of mortgages issued under the Affordable Home Ownership Program (AHP) will be directed to the Ministry.
In 2019-2020 and 2020-2021, in compliance with By-Law No. 2, the Corporation entered into transfer payments agreements which were funded primarily by the AHP Revolving Loan Fund.
In 2019-2020, District of Sault Ste. Marie Service Administration Board (SSMSAB) made a request to the Minister of Municipal Affairs and Housing to provide $600,000 in funding for an affordable housing ownership program. The proposal from SSMSAB represented a unique opportunity for the Ministry/OMHC to make a targeted investment in an area experiencing stagnant or declining property assessment values and spur growth in available affordable homeownership units. The resulting arrangement drew upon the AHP Revolving Loan Fund.
The Minister directed the OMHC Board of Directors to provide funding for this specific housing initiative. The OMHC Board passed a resolution approving up to $600,000 in funding for this initiative. A transfer payment agreement was executed between OMHC and SSMSAB. The funding from the AHP Revolving Loan Fund was transferred to SSMSAB in 2020-21.
Additionally, consistent with provincial priorities, the Minister requested the Corporation to use $200,000 from the AHP Revolving Loan Fund to support the Homes for Heroes Foundation (HFH) to conduct planning studies related to the creation of transitional affordable housing units in 2020-2021. The OMHC Board passed a resolution approving $200,000 in funding for this initiative. A transfer payment agreement was executed between OMHC and HFH. The funding from the AHP Revolving Loan Fund was transferred to HFH in 2020-2021.
Finally, in 2020-2021, the Minister directed the Corporation to fund $1,174,000 ($545,320 from the AHP Revolving Loan Fund and $628,680 from unrestricted cash) for the creation of 23 affordable rental housing units for low-income individuals and families in Aylmer, Elgin County. The OMHC Board passed a resolution approving $1,174,000 in funding for this initiative. The OMHC entered into an agreement with the Corporation of the City of St. Thomas (as service manager for Elgin County) and funding was transferred in 2020-2021.