Saint John and the mission of housing

Public Housing in Vienna, Austria

By Brent Harris & Joanna Killen
October 11, 2022
Published in the Times Globe on Oct 15, 2022
https://tj.news/greater-saint-john/101986580?ref=rss

Saint John is in a housing crisis. With a multitude of jobs that our expanding industries are seeking to fill and a growing lack of housing availability to our people, the time is now to act. We agree with other qualified voices on the matter that the private sector will not be able to solve the housing crisis. The time has come to re-engage the non-profit development sector and public sector. We did it with healthcare half a century ago and we need to take steps to do it with housing now. But is a centralized entity that funnels through Fredericton the right solution? We say no. The answer lies with restoring a type of municipal housing entity within the city boundaries of Saint John. 

One successful ‘in-house’ example of municipal leadership in Saint John would be Saint John Energy (SJE). SJE is a municipally owned corporation but independent from City operations and has one council-appointed board member. 100 years ago, this council founded Saint John Energy. The results over those 100 years have been positive for the city and the citizens it serves, bringing more reliable service, consistent return on investment, and affordable energy rates. Given their citizen-first approach, we are seeking a similar approach to addressing the housing crises in Saint John. We are seeking the creation of a Municipal Housing Entity (MHE) to drive best practice urban housing development. 

Like any entrepreneurial endeavor we must start with clearly identifying the problem. Saint John has an affordable housing waitlist of 1200+ that has been increasing since 2019. We have fewer housing starts than Fredericton & Moncton despite high demand and numerous job opportunities with one of Canada’s fastest growing ports. We also have a pipeline of over 1000 approved units waiting to be built that are not coming back to get permits in a timely manner, unlike Moncton and Fredericton. Of course, developers point to increasing costs and labor shortages, but those are similar everywhere, and we are the ones lagging. New solutions and players are clearly needed in this sector. 

Finally, affordability. At the 8 Cities conference in Fredericton on September 24 there was a panel of leaders, developers, and economists that spoke about the rising costs of development and how it affects the types of buildings being built. One developer, Willy Scholten, mentioned that the higher costs associated with construction now mean that a finished new product is already priced near the more high-end price point, even when using more basic materials. That means developers might as well build a proper high-end unit and compete on the high end market for those high-end profits. In other words, it doesn’t make sense to build more affordable units because the price gap isn’t wide enough. Private developers building for profit can’t get us where we need to go. 

Let’s review.  We’ve got good examples of municipal crown corporation leadership in Saint John that we can model off of (SJ Energy), we have a myriad of problems to solve, and we have more money available from the province and federal government to develop affordable housing solutions than ever before. The soil is fertile for Saint John to once again stand-up a municipal housing entity that can drive major changes. But what might those changes be? 

In Vienna, Austria there has been a municipal housing entity coordinating construction, design, and overall approach to housing for over 100 years. Their result has been that it is more difficult to be a private owner/developer than it is to be a public or non-profit. This has earned them the title as one of the most affordable cities in the world to live in with their housing stock in excellent condition. The fears some have of municipally owned housing leading to ghettos is not only overblown, but it is diametrically untrue with an MHE leading the charge like this. Even in Canada, The OMHM has a housing stock valued in January 2018 at more than $3 billion. From 2008 to 2017, more than $828 million was invested in replacement, improvement and modernization of buildings by the Société d’habitation du Québec (SHQ), the Canadian Mortgage and Housing Corporation (CMHC) and the Communauté métropolitaine de Montréal. 

The Telegraph Journal editorials board gave stern warnings about the duplication of red tape, government overreach, and other classic scare tactics to sling shade at the proposed MHE. They did this without any review of what other MHE’s have done and accomplished. Our Affordable Housing Action Plan comes with 39 recommendations and could cost $3-6 million per year to resource properly. It only makes sense with a workload like this to establish an organization with a clear mandate, focus, and capacity to attack these recommendations head on. We also know that when we stand up arms-length organizations it has the unique ability to escape the political realm and leverage money that municipalities struggle to source due to bilateral funding requirements. 

An organization like this could produce new power for our cities' non-profit developers who currently have to all expend independent resources to navigate the landscape, apply and track funding opportunities & still serve the marginalized communities they are mandated to serve. They are spread thin and too often the government relies on our hard working non-profits to be the all encompassing problem solvers of what we often heard called ‘social issues’. The culture of government being a ‘corporation’ with ‘customers’ has to end. 

In closing, it is important to establish that the approach we have been taking since the 90’s was to cut funding at the provincial and federal levels left the success of the housing sector mostly in the hands of private developers. It has consistently created housing scarcity which culminated in the crises we are in today. We need to inspire a new generation of tradespeople to build the homes we need to be certain. We also need new entities at the municipal level to coordinate and champion the development of affordable housing. We need a Municipal Housing Entity