Changes to the calculation of the FCHI-2 rental assistance
Effective as of October 1, 2021
- Minimum occupancy charge - FOR ALL REGIONS
- Calculation of rental assistance (where the income is from social assistance that includes a shelter component) - FOR ALL REGIONS EXCEPT QUEBEC
As a result, housing providers will be required to update their rental assistance calculations for affected households, which are effective as of October 1, 2021. The revised Reference Guide reflects the new changes effective October 1, 2021.
The calculation worksheet available in the resources section has been revised to reflect these changes. Since the new calculation worksheet includes several built-in formulas, housing providers who are unable to use Excel to perform the calculations are asked to contact CMHC for support.
If you need more information or support on how to apply these changes, please do not hesitate to contact your CMHC Specialist directly or the Agency for Cooperatives, if applicable.
The Federal Community Housing Initiative (FCHI) is a $500 million fund to support federally administered community housing projects reaching the end of their operating agreements from past social and affordable housing programs.
The initiative has two phases:
- FCHI-Phase 1, provided $38 million in federal funding over a two-year period.
- FCHI-Phase 2 will provide $462 million in funding from September 1, 2020 to March 31, 2028.
The two FCHI-2 funding streams are:
- Rental Assistance: The rental assistance stream provides financial assistance for low-income households. Housing providers may apply for this rental support, which aims to fund the gap between 30% of an assisted household’s gross monthly income and the occupancy charge.
Transitional Funding: The transitional funding stream is
available to housing providers having trouble transitioning to the new
program. The temporary funding will cover eligible operating costs for up to
24 months following the expiration of past federal agreements. This funding
stream has a limited budget and is reserved for the most vulnerable groups,
such as deep subsidy projects or urban Indigenous projects. Transitional
funding is provided alongside the rental assistance stream as a separate,
additional form of assistance.
Once the transitional funding ends, housing providers will continue to receive rental assistance until the end of the FCHI-2 agreement.
RENTAL ASSISTANCE ELIGIBLITY:
To be an eligible FCHI-2 Housing Provider, you must meet the following criteria:
- Be a non-profit housing provider or a housing co-operative whose federal operating agreement with CMHC has ended or will end naturally between April 1, 2016, and March 31, 2028. Eligibility does not extend, at this time, to projects with agreements that expired before April 1, 2016.
Be a provider whose operating agreement with CMHC is under one of
the following social housing programs:
- Section 95 (Pre-86) non-profit, co-operative, urban native
- Section 95 (Post-85) non-profit, co-operative, urban native
- Section 95 (Post-85) Index-Linked-Mortgage (ILM) co-operatives
- Section 27, 61 non-profit and co-operatives
- Section 26 non-profit
- Section 95 Rent Supplement (units currently leased from a private property owner and rented to those in need).
An exception exists for ILM co-operatives where, they are eligible for FCHI-2 as soon as the first mortgage has been repaid and federal assistance (for the operating expenses) has ceased to be paid.
Note that housing providers who meet the general rules and have a rent supplement agreement, or who have another subsidy agreement with their province or municipality can submit a request only for units not covered by those other agreements. Once these agreements have expired, the units may be eligible for FCHI-2, subject to need and available funds at that time.
Breach of a previous operating agreement(s) could affect eligibility for FCHI-2. In this case, CMHC will contact the housing providers to discuss their specific case.
In cases where a housing provider is eligible for FCHI-2, but whose agreement ended before March 31, 2020, CMHC may request additional documents to confirm that the housing provider’s status is active and that it complies with its legal obligations (e.g. financial statements, proof of payment of property taxes, etc.)
Throughout the program, CMHC will identify eligible non-profit housing providers and housing co‑operatives and send them an enrolment form at least six months before the end of their agreement in effect with CMHC.
TRANSITIONAL FUNDING ELIGIBLITY:
Transitional funding is reserved for housing providers experiencing challenges transitioning to the new program model. This funding will be reserved for the most vulnerable groups, such as deep subsidy or urban Indigenous projects. It will be granted for twenty-four (24) months from the effective date of the FCHI-2 agreement.
Transitional funding is a complement to the rental assistance component. Eligible groups will receive funding from both streams simultaneously. The analysis process for transitional funding is completed in conjunction with CMHC’s review of the housing provider’s enrolment for the rental assistance of FCHI-2. First, the amount of rental assistance is calculated. Note that housing charges are of particular importance to this calculation. They should be established at a level that will support the viability of the project. CMHC will accept rents that are reasonably in line with market rents and that support the economic sustainability of the housing provider.
Following the rental assistance calculation, if it is determined that there are additional financial needs, then an additional amount through the transitional funding could be offered. Once the transitional funding ends, the housing provider will continue to receive rental assistance until the end of the FCHI-2 agreement.
RENTAL ASSISTANCE ENROLMENT :
CMHC will identify and contact potentially eligible housing providers with an enrolment package at least six (6) months prior to the expiry of their federally administered operating agreement, when possible.
Eligible providers will need to confirm their intent to participate in the FCHI-2 program by the deadline communicated in the enrolment package. The Intent to Opt-in or Opt-out of Rental Assistance Form and FCHI-2 Enrolment Annex, which are included in the enrolment package, should be completed and sent in to CMHC.
CMHC will begin the assessment process once it receives the signed forms. Please note: CMHC will not consider Enrolment Annexes submitted by clients that were not provided an enrolment package by CMHC. If you have not received an enrolment package, and would like more information on your eligibility or your eligibility date, please contact CMHC.
PRO TIP! For help filling out the Annex, please visit the Annex Guide for accounts administered by CMHC (PDF), and the Annex Guide for accounts administered by the Agency for Co-operative Housing (PDF).
TRANSITIONAL FUNDING ENROLMENT
Transitional funding is reserved for the most vulnerable groups, such as deep subsidy or urban Indigenous projects. Housing providers that apply for the rental assistance stream of FCHI-2 are automatically considered for the transitional funding stream. If CMHC identifies your group or project as being in need of this funding after an initial needs assessment, you will be contacted to provide more information after the assessment of your rental assistance application and before the expiration of your previous federal operating agreement with CMHC.
CMHC determines the amount of funding a housing provider receives following a needs and prioritization assessment based on information provided in the Annex. If you are eligible for transitional funding, you will receive a request to provide any additional information required to complete your enrolment for both streams of the FCHI2 program.
Applicants will receive assessment results in writing by way of letter. Funding approvals are provided via the FCHI-2 agreement.
PRO TIP! For a copy of the agreement, check out the FCHI-2 agreement Template
The decision letter will accompany the FCHI-2 agreement and communicate some of the terms and conditions of the funding offer.
PRO TIP! If you still have questions about rental assistance and transitional funding, check out our FAQ document to see the most common questions and answers.
Agreement and Administration
AGREEMENT AND FUNDING DETAILS
Funding to housing providers will be in the form of a contribution, with an agreement between the housing provider and CMHC that sets out the terms and conditions of the funding.
Schedule B of the agreement outlines the funding details of your project under the rental assistance stream. This includes the project address(es), the number of assisted households, and the amount of rental assistance.
Schedule F of the agreement will outline the funding, if any, received through the transitional funding stream.
Schedule B and Schedule F will be amended as the funding amount fluctuates and as phases are added to FCHI-2, if applicable.
For cases where a housing provider has multi-phased accounts with operating agreements expiring at the same time, the FCHI-2 agreement will facilitate the consolidation of all units under one master agreement.
The housing provider will have at least 30 days to confirm whether they wish to sign the agreement and receive the associated funding under FCHI-2.
PRO TIP! If you still have questions about the Agreement, check out our FAQ document to see the most common questions and answers.
ADMINISTERING RENTAL ASSISTANCE
Throughout the lifetime of the FCHI-2 program, the housing provider will administer the following aspects of the program, including but not limited to:
- Determining household eligibility for rental assistance (see the FCHI-2 Reference Guide, Section 3.1 Eligible households)
- Verifying household income (see the FCHI-2 Reference Guide, Section 4.1 Determination of monthly household income)
- Setting the housing charges
- Allocating the provided rental assistance throughout the year
- Reporting on the use of funding received at the end of year through reconciliation activities and the financial statement review
- Providing information to assisted households on program guidelines
PRO TIP! The following tools are available to help you become familiar with the administration of the FCHI-2 Program:
Calculation Worksheet (Excel)
: determine how much rental assistance a household could
*Updated to reflect calculation changes effective October 1, 2021.
- Annual Household Declaration Request for Rental Assistance (PDF) : for households to use in applying for rental assistance, in updating their information when there is a change in the household’s information and in confirming their information each year.
- Request for review of Federal Rental Assistance form (PDF): request a revision to the rental assistance amount to ensure households do not pay more than 30% of their income towards housing
- Frequently Asked Questions: includes common questions and answers concerning the calculation worksheet, utility allowances, rental assistance and many more.