Regulation - LGIC
Amendments to Simplify the Rent-Geared-to-Income Calculation in Social Housing
Regulation Number(s):
Ontario Regulation 298/01
Ontario Regulation 367/11
Ontario Regulation 367/11
Instrument Type:
Regulation - LGIC
Bill or Act:
Housing Services Act, 2011
Summary of Decision:
Ontario Regulation 367/11 (General) and Ontario Regulation 298/01 (DETERMINATION OF GEARED-TO-INCOME RENT UNDER SECTION 50 OF THE ACT) under the Housing Services Act, 2011, has been amended by Ontario Regulation 316/11, filed September 23, 2019.
Analysis of Regulatory Impact:
Analysis of Regulatory Impact is on separate page. See link below.
Further Information:
Housing Services Act, 2011
Ontario Regulation 367/11
Ontario Regulation 298/01
Community Housing Renewal Strategy
Analysis of Regulatory Impact
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Summary of Proposal
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Proposal Number:
19-MMAH005
Posting Date:
April 17, 2019
Summary of Proposal:
The Housing Services Act, 2011 establishes the legislative framework for social housing in Ontario. Rent-geared-to-income assistance is administered locally by 47 Service Managers (municipalities and district social services administration boards) designated under the Housing Services Act, 2011 to manage social housing programs across the province.
Rent-geared-to-income refers to rental units where the tenant pays rent based on their income - typically 30 per cent of gross income less exclusions and deductions.
Ontario's Housing Services Act, 2011 regulations establish broad provincial eligibility rules for rent-geared-to-income assistance (O Reg 367/11), in addition to prescribing the method for calculating monthly rent (O Reg 298/01).
The Ministry has heard from a wide-range of stakeholders that the current rent-geared-to-income calculation is outdated and complex, making it difficult for tenants to understand and for staff to administer. These rules require tenants to report each time their income changes, creating disincentives for households to work and become economically self-sufficient. There is also evidence that these complex rules are applied differently across the province, leading to unequal treatment of tenants.
Ontario's Auditor General also recommended the province simplify the rent-geared-to-income calculation in its 2017 Value for Money report.
In response to these concerns, the Ministry is seeking feedback on a proposed suite of changes to the rules that govern the calculation of rent-geared-to-income assistance to make it more fair and easier for tenants to understand and simpler for staff to administer.
These proposed amendments are part of a larger Community Housing Renewal initiative.
Proposed Amendments:
O Reg 298/01
Rent Calculation:
-Moving to a simplified calculation of rent based on 30 per cent of Adjusted Family Net Income as determined (where possible) using the tenants' most recent income tax return information.
-Rent for a family unit would now be calculated by taking 30 per cent of Adjusted Family Net Income, dividing by 12 months, and adjusting for utility charges or allowances (if applicable).
-Adjusted Family Net Income would be calculated in a manner generally consistent with the portable housing benefit framework in Schedule 4.1 of O Reg 367/11 and would include the net income of each tenant in the family unit, other than those who are in full-time studies.
-All tenants in full-time studies at a recognized educational institution would now have their income exempt from the rent calculation, removing the existing conditions attached to this exemption.
-Net income would be verified by a tenant's most recent notice of assessment or proof of income statement issued by the Canada Revenue Agency, or if not available, by other methods determined by the Service Manager.
-On an in-year review, a tenant's net income would be the amount that best approximates the tenant's projected net income for the 12-month period beginning on the month following the month in which the application is considered.
-For tenants who work, exempt $1,800 per year of family unit employment income from Adjusted Family Net Income, matching or exceeding the current employment deduction offered to tenants.
-Remove imputed income from the rent calculation for non-interest bearing assets (eg, real estate, art, certain bank accounts).
Summary of Proposal continued on separate page. See link below.
Rent-geared-to-income refers to rental units where the tenant pays rent based on their income - typically 30 per cent of gross income less exclusions and deductions.
Ontario's Housing Services Act, 2011 regulations establish broad provincial eligibility rules for rent-geared-to-income assistance (O Reg 367/11), in addition to prescribing the method for calculating monthly rent (O Reg 298/01).
The Ministry has heard from a wide-range of stakeholders that the current rent-geared-to-income calculation is outdated and complex, making it difficult for tenants to understand and for staff to administer. These rules require tenants to report each time their income changes, creating disincentives for households to work and become economically self-sufficient. There is also evidence that these complex rules are applied differently across the province, leading to unequal treatment of tenants.
Ontario's Auditor General also recommended the province simplify the rent-geared-to-income calculation in its 2017 Value for Money report.
In response to these concerns, the Ministry is seeking feedback on a proposed suite of changes to the rules that govern the calculation of rent-geared-to-income assistance to make it more fair and easier for tenants to understand and simpler for staff to administer.
These proposed amendments are part of a larger Community Housing Renewal initiative.
Proposed Amendments:
O Reg 298/01
Rent Calculation:
-Moving to a simplified calculation of rent based on 30 per cent of Adjusted Family Net Income as determined (where possible) using the tenants' most recent income tax return information.
-Rent for a family unit would now be calculated by taking 30 per cent of Adjusted Family Net Income, dividing by 12 months, and adjusting for utility charges or allowances (if applicable).
-Adjusted Family Net Income would be calculated in a manner generally consistent with the portable housing benefit framework in Schedule 4.1 of O Reg 367/11 and would include the net income of each tenant in the family unit, other than those who are in full-time studies.
-All tenants in full-time studies at a recognized educational institution would now have their income exempt from the rent calculation, removing the existing conditions attached to this exemption.
-Net income would be verified by a tenant's most recent notice of assessment or proof of income statement issued by the Canada Revenue Agency, or if not available, by other methods determined by the Service Manager.
-On an in-year review, a tenant's net income would be the amount that best approximates the tenant's projected net income for the 12-month period beginning on the month following the month in which the application is considered.
-For tenants who work, exempt $1,800 per year of family unit employment income from Adjusted Family Net Income, matching or exceeding the current employment deduction offered to tenants.
-Remove imputed income from the rent calculation for non-interest bearing assets (eg, real estate, art, certain bank accounts).
Summary of Proposal continued on separate page. See link below.
Contact Address:
Ravi Bhusia, Manager
Ministry of Municipal Affairs and Housing
Housing Programs Branch
777 Bay Street, 14th Floor
Toronto Ontario
M5G 2E5
Ministry of Municipal Affairs and Housing
Housing Programs Branch
777 Bay Street, 14th Floor
Toronto Ontario
M5G 2E5
Effective Date:
September 23, 2019
Decision:
Approved