A public hearing has been set for June 13 on a proposal to significantly boost Banff Housing Corporation fees to cover the cost of administering the existing housing portfolio.
The board estimates that, not including an annual increase for inflation, the total cost to administer the existing BHC portfolio is around $45,000.
Given the BHC currently has 183 units within its homeownership portfolio, the current estimated cost per unit is around $246. They are currently paying $80.
“We’re seeing a substantial jump in fees because the board feels the fees have been kept too low for too long,” said Councillor Paul Baxter, chairman of the BHC’s board of directors.
“We hope we do get feedback from all the homeowners who have a stake in the organization. We encourage any and all feedback.”
The BHC board is recommending that an increase to the annual administration fee – which is allowed under the sublease agreement – be phased in over two years.
The current annual administration fee is $80 per unit, but the proposed 2011 fee would be $165 plus GST and the 2012 fee would jump to $250 plus GST.
An increase to the administration fee was a recommendation of the BHC’s controversial 2008 mandate review. It was part of a move to increase its long-term cash flow position.
The BHC has a home ownership portfolio of 183 units and each homeowner has a leasehold interest in the property through a sublease agreement.
The sublease agreement indicates that, if required, BHC can charge an annual administration fee in “an amount determined by the corporation from time to time”.
The fee is not to exceed 25 cents per square foot of gross floor area. The sublease for the 10 Peyto Place units states 25 cents per square foot of floor area, or $250, whichever is greater.
The increased fee intends to cover the level of service of the existing BHC portfolio.
Among many functions, administrative work includes working with homeowners, writing reports and attending meetings, preparing agendas and minutes, advising the board on policies and activities of BHC, developing financial plans, knowing sublease agreements, organizing public meetings and financial monitoring.
It should be noted that the Town’s lawyers advised three board members – Paul Baxter, Ladd Snowsell and Francis Hopkins -– they had a potential conflict of interest given they are BHC homeowners.
All excused themselves from the board’s vote. Baxter also excused himself when the issue was discussed last week by council, who was acting as the shareholder of the corporation.
