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Subject:  2007 Minimum Market Rent for Municipal Non-Profit (Section 95)

This item is NOT selected / Cette item n'est pas selectéLegislation/Regulation                                Release 06-08

This item is selected / cette item est selectéOperational

Starting with the 1997 fiscal year, the ministry developed an annual Rent Inflation Factor, which is to be used in the calculation of subsidy for projects subsidized under the Municipal Non-Profit Program (1978-1985).

The Rent Inflation Factor is used to determine the Minimum Market Rent that is expected to be charged. If a non-profit housing provider does not increase market rents by this rent inflation factor, it will be subject to a reduction in subsidy.

PROCEDURE

The applicable Rent Inflation Factor, from the attached 2007 list, is inserted on Line 441, page 3A, of the Municipal NP Operating Budget Form 819(01/95). When used in the budget, the factor is expressed as 1 plus a decimal number (e.g. 2.1% would be expressed as 1.021). The Rent Inflation Factor is then multiplied by the actual market rents charged in 2006 to determine the Minimum Market Rent for 2007.

If a provider feels that it cannot charge market rents at this Minimum Market Rent level, an application may be made to the Service Manager for an exemption when the 2007 budget is submitted.  The application must include supporting evidence to clearly demonstrate the inability to charge the Minimum Market Rent.

ACTION REQUIRED

  • Municipal Non-Profit Housing Providers (1978 - 1985) are to use the attached 2007 Rent Inflation Factors to determine the Minimum Market Rent level for the 2007 market rents.
  • If an exemption from the Minimum Market Rent level is required, an application must be submitted along with the 2007 budget. The application must include evidence to clearly support the inability to charge the Minimum Market Rent.

PLEASE NOTE:        This notification applies to Municipal Non-Profits and will be used to create a minimum market rent level for Municipal Non Profit housing providers whose project are now under administration by local Service Managers. 

If you have any questions, please contact your respective Service Manager.

For additional information, please contact Terry Pearce at MAH, (416) 585-7349.

Randy Hodge
Director
Facilitation Branch

Attachment:  2007 Rent Inflation FactorsAttachment (56.5 KB)

November 15, 2006