Ontario’s explosive growth in condominium development has triggered an in-depth review of how condo communities should conduct and govern themselves.
Canada’s Public Policy Forum has released a Stage Two report on the province’s condo industry with more than 100 recommendations to overhaul the 12-year-old provincial Condominium Act.
The report is the result of extensive public consultation carried out by the non-profit Public Policy Forum in conjunction with Ontario’s Ministry of Consumer Services.
Some of the main recommendations include the creation of a condo office, an arms-length umbrella organization that would provide functions including dispute settlement, condo manager licensing and a condo registry; and improved consumer education and protection.
Other major recommendations included updated financial management rules and dispute resolution mechanisms; stronger qualification requirements for boards, including mandatory training for first-time members; and a new licensing program managed by the condo office to ensure managers are properly trained and qualified.
The report recommends the new condo office be funded through a combination of user fees and a “modest levy” of $1 to $3 on each condo in the province (Oakville, Ontario condo shown in image).
More than half are condos
Currently, more than half of all new homes built in Ontario are condos. In all, Ontario has more than 600,000 residential units.
The report noted that condos are more than legal entities; they are self-governing communities making up their own bylaws and rules through elected governments or boards of directors.
“Indeed, the condo sector is often referred to these days as ‘the fourth order of government,’ after municipalities, provinces and the federal government,” the report said.
Apparently, though, the “government” has been fraught with problems. An earlier report outlined some of the issues, which included disputes around governance, dispute resolution, consumer protection, financial management and condo manager qualifications.
The previous report said boards needed to take steps to increase their responsiveness, transparency and accountability. The report said the full cost of purchasing and living in a condominium needed to be transparent, and owners need access to tools and information to be well-informed on how their monthly contributions are set and used.
Other reforms discussed in the new report include the creation of an “easy-to-read” condominium guide, and a new dispute resolution office under the condo office that would have the ability in complex disagreements to provide quick, neutral, inexpensive and informed assessments of each case.
A number of issues raised in the first report were deemed to fall outside the condo act. These included everything from property tax concerns and insurance rates to tenant rights and responsibilities. Those matters have been referred to other, relevant provincial government departments.
Application a challenge
Applying the report’s recommendations will be a challenge, however.
The report points out that a “one-size-fits-all” approach will not work. “For example, the qualifications of a part-time manager of a six-unit rural residential condominium might need to be different from those of a manager for a mixed-use, urban condominium tower housing hundreds of owners.”
The new report has received a lukewarm reaction. The Condo Owners Association of Ontario released a statement saying it is “thrilled” with the recommendation condo managers have mandatory training, but reiterated a government licensing structure is needed for condo managers and management companies.
The Association of Condominium Managers of Ontario said it welcomed the new report and will be reviewing the recommendations. “We believe this process will result in new rules and practices that will bring added security for the province’s 1.3 million condominium owners,” association president Steven Christodoulou said in a statement.
The consultation is far from complete. Stage Three involves reviewing the options among the stakeholders, and then presenting them to the government and condominium sector.
“Providing the tools and support needed to strengthen transparency and accountability of boards, ensure better management from managers and encourage greater participation from owners will be challenging,” concludes the report, adding there is still “a long distance to travel,” and that no single reform package should be considered a panacea.
“But a good one should address the critical mass of the issues and garner support from across the community. On this front, there has been real progress.”