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Province cuts operating budgets for hotels

The province has quietly cut operating budgets for the single-room-occupancy hotels it owns in the Downtown Eastside, at the same time that it's telling operators every room in the buildings must provide "low-barrier" housing, which can involve significant added costs.

That shift to accommodate the homeless, mentally ill and drug-addicted has resulted in at least one non-profit agency walking away from its agreement to run a hotel over concerns that it can't provide adequate support services.

"The financial modelling that they are doing for these hotels does not allow for adequate supports to be in place," Mark Smith, executive director of RainCity Housing, said Monday in an interview.

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"So essentially what you're doing, from our perspective, is bringing people indoors and putting a lid on the joint."

Other housing groups also expressed concerns about the funding cuts, saying they make it difficult to provide services such as communal kitchens in single-room occupancies, the housing of last resort on the Downtown Eastside.

The province is trimming budgets in light of economic conditions, but remains committed to its pledge of two, 24-hour staff people for each SRO, BC Housing regional director Dale McMann said yesterday.

And while there will be less money for some services, the province hopes to provide those through other means, including links to health and non-profit agencies, Mr. McMann said.

RainCity was so concerned by the funding cuts that it recently backed away from its agreement to run the Backpackers hotel, a 40-unit facility the province purchased earlier this year. RainCity's budget for the hotel was cut from $900,000 to about $460,000 after the provincial budget was unveiled in February, Mr. Smith said.

The Backpackers hotel will now be run by the Portland Hotel Society. The budget has yet to be finalized, but the Portland believes it can run the building within the province's constraints, spokesman Mark Townsend said yesterday.

Until a few weeks ago, the hotels - quietly purchased for about $40-million before a surprise announcement in April, 2007 - were expected to house a mix of tenants, ranging from homeless people to pensioners.

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But that changed, largely as a result of findings from temporary shelters set up by the city's Homeless Emergency Action Team.

"The learning for us is that the HEAT shelters - where the approach is, 'we take everyone, we take your dog, we take all of your problems, we take all of your blemishes' - is working," Mr. McMann said.

As SROs being renovated come on stream, they will become low-barrier housing, he added. With that shift, the province hopes to get 500 people off the streets by October.

Operating agreements are still being negotiated, but not every agency will face the kind of shortfall RainCity encountered, Mr. McMann said.

"We have established a budget model for each hotel that is fair and adequate for the model we now have," Mr. McMann said.

Asked if the push to get people off the street is connected with the 2010 Olympics, Mr. McMann responded with a firm "no."

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"I have been involved in literally hundreds of meetings on this topic and I can tell you that at no point did that ever come up as an issue."

A city council report on SROs shows the province owns 11 per cent of SROs in the Downtown Eastside. The biggest portion, 67 per cent, is owned by private operators. The buildings are notorious havens for crime, rats and bedbugs. And city efforts to clean them up can make matters worse: When the city ordered repairs to several rooms at an SRO building, the owner "opted to close an entire floor rather than incur the costs of those repairs."

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About the Author
National correspondent

Based in Vancouver, Wendy Stueck has covered technology and business and now reports on British Columbia issues including natural resources, aboriginal issues and urban affairs. More

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