Ontario’s “Protecting Tenants and Strengthening Community Housing Act”—otherwise known as Bill 184—has raised the ire of tenant advocacy groups in recent weeks over concerns it will drive cash-strapped renters further into debt while making evictions easier for landlords.
Since mid-March, Ontario rental-housing providers have been unable to evict non-paying tenants in an effort by the Province to protect vulnerable households impacted by COVID-related income loss. But as the health crisis eases and the moratorium on evictions comes to an end, the enactment of Bill 184 will require anyone with rent arrears to pay back their landlords in a structured repayment plan.
Sound fair and reasonable? To some onlookers it might, but for those on either side of the rental transaction, the bill isn’t gaining widespread support. Many small landlords—having been stretched too thin by the ongoing pandemic as it is—say the income loss they’ve incurred to date has already put their businesses in jeopardy.
“The net profit from a rental property is much lower than tenants, the media, and the government seem to think,” said Chris Seepe, president of the Landlords Association of Durham and owner of a mid-sized rental portfolio. “It’s these same entities who collectively believe residential landlords are playing the system and can afford to carry all the losses of COVID-19.”
Arguing that landlords shouldn’t be expected to absorb months of missed rent payments while shouldering the heightened costs of operating a rental property safely amid a pandemic, Seepe and other landlords are defending their right to retroactively collect unpaid rent—or evict those unable to honour the terms of their lease agreements. Meanwhile, tenant advocacy groups concerned that the bill will lead to a spike in evictions and eventual homelessness are calling for better protection for renters and more restrictions on future rent increases.
Kenneth Hale, the Director of Advocacy and Legal Services at the Advocacy Centre for Tenants Ontario (ACTO), contends that government programs are available to support businesses and can be expanded to help small landlords, while vulnerable tenants cannot afford to shoulder that cost. “Protecting public health must take priority over protecting the financial wealth of property owners,” he said in a statement. “Putting tenants in jeopardy of homelessness and increased poverty is cruel, and puts the lives of all Ontarians at risk.”
Key points of contention
At a hearing in late June, ACTO representatives urged members of the Social Policy Committee to scrap Bill 184 and adopt alternative recommendations it believes would better serve and protect vulnerable tenants. Primarily, the group raised concerns over the pressure the bill will put on COVID-impacted renters to sign repayment plans they cannot afford, permitting landlords to seek eviction orders without a hearing should they falter. But the recommendations put forth by ACTO were rejected in favour of amendments that will speed up the new eviction rules and force landlords and tenants into a mediation process.
According to Joe Hoffer of Cohen Highley LLP, the bill makes some practical changes that will benefit tenants and others that will benefit landlords, but the big problem is that it doesn’t address the bureaucratic and procedural paralysis of the Landlord and Tenant Board/Social Justice Tribunal.
“In my view the entire adjudicative structure has abandoned its statutory mandate to deal with proceedings expeditiously and cost-effectively and there is a cohort of “bad tenants” out there who cannot believe their good fortune while gloating about the fact that they can live rent free and the landlord can do nothing,” he said.
Adding to that, Hoffer warned that any small landlord who tries to avoid RTA rules in order to gain vacant possession to flip apartments are at risk of very harsh consequences. “Some innocent landlords will likely blunder into a situation where they are offside with the changes and will be greatly and unfairly harmed by the bill,” he said. “Other landlords abusing the current rules warrant the more rigorous legislative oversight.”
Hoffer also sees the two-year limitation on rent repayment as a potential source of concern. “The short time frame by which landlords must initiate formal proceedings at the LTB could significantly and negatively affect all involved,” he said. “Currently a landlord can go back six years when working with tenants to catch up with missed payments. If Bill 184 passes, the landlord will have to be rigorous in going after a tenant within the two-year time frame.”
On the positive side, the ability to recover charges such as unpaid utilities at the LTB rather than having to go to Small Claims Court, will make life easier for landlords. “However,” Hoffer said, “there is a gap in Bill 184 for the mobile home sector, where landlords will still have to go to Small Claims Court to recover unpaid property taxes and water testing charges even though the LTB is best equipped to adjudicate such changes.”
What ACTO wants in place of Bill 184:
- The continued restriction of evictions to urgent cases where public safety is at stake.
- Restricting rent increases to maintain current rent.
- Eliminating rent increases in newer units that are exempt from rent regulation as of November 2018.
- The limiting of “rent gouging” by landlords by restricting rent increases between tenancies.
- Assurance that the Landlord and Tenant Board’s rules make ongoing preservation of homes the object of the dispute resolution process.