GN embraces free market staff housing scheme

Happy New Year — because if you live in subsidized GN staff housing, your rent’s going up.

That’s only the first of a series of changes that the Government of Nunavut’s staff housing tenants will have to adapt to starting this January, as the GN attempts to liberalize Nunavut’s housing market to encourage more home ownership and more ownership choices, such as condominiums and co-operative housing.

The GN announced this week that it will withdraw from the provision of staff housing in Nunavut’s three largest communities by 2015, while imposing a market-based rent scheme that will see staff housing tenants in all communities pay annual step-by-step increases until their rents reach market levels.

The policy makes it clear that for the Government of Nunavut, staff housing will never again become an automatic entitlement available on demand.

“The GN considers staff accommodations a privilege, and not a right or benefit of employment,” the policy says.

At the same time, a new rental assistance program will protect lower-income GN workers, especially those with dependents, from the full impact of the new policy.

The GN pays $34 million a year to supply staff housing to eligible employees, but gets back only $10.8 million a year in rent payments and other charges.

But GN officials say the new scheme is likely to be revenue-neutral in its early years, because of the cost of implementing it.

The actual purpose of the new rent system is “to support and stimulate the emergence of private affordable rental and home ownership markets in Nunavut communities,” the policy states.

“Once viable and sustainable markets are established, it will no longer be necessary for the GN to provide subsidized staff rental housing. In order to assist that transition, the GN will continue to make limited amounts of staff housing available to staff.”

The plan affects roughly half of the GN’s work force, living in the 1,150 staff housing units that government assigns to workers deemed eligible for staff housing. The GN now leases most of those units from private companies.

The plan does not affect public housing tenants or GN workers who do not live in employer-supplied staff housing.

It’s all part of a new staff housing policy approved earlier this year by cabinet, and unveiled this week by Olayuk Akesuk, the minister responsible for the Nunavut Housing Corp.

In Iqaluit, the new policy will move all GN workers into the private housing market within five years. The GN will do that by transferring landlord responsibilities to building owners, and then getting out of the staff housing business.

The same thing will happen in Rankin Inlet and Cambridge Bay, but more gradually — by 2015.

In all three communities, GN staff housing tenants will soon pay more for their units: a 15 per cent base-rent hike kicks in on January of 2006, followed by another 15 per cent increase in January of 2007, and 20-per-cent-a-year increases from 2008 until 2010, or until rents reach market levels.

Outside of the three big regional centres, base rents for GN staff housing tenants will increase at a rate of 10 per cent a year until 2010, and by 5 per cent until 2015, or until rents reach market levels.

And that’s not all. To complement the new scheme, the GN will develop a program to help more employees become home owners. GN officials say that program is likely to be announced this fall.

The new staff housing policy also spells out a system for figuring out which eligible employees should get first crack at staff housing units.

“Category 1” employees, who hold jobs deemed “necessary for the continuous health and safety of the citizens of Nunavut,” get the first priority. That includes doctors, nurses, fire safety employees, airport workers, correctional workers and emergency measures people.

“Category 2” employees, holding jobs “necessary for the delivery of programs and services” are next. That includes teachers, adult educators, directors, managers, and officer-level workers.

“Category 3” employees, which takes in most low-level administration jobs, are last. That category includes secretaries, data entry clerks, and so on.

The Nunavut Housing Corp. will continue to manage the GN’s staff housing system.