ABOVE GUIDELINE RENT INCREASE [AGI]
What You Should Know
SOME BASICS
• As we know only too well, an annual rent increase is allowed by law - subject to a guideline % set by the Province
• Landlords can apply to the Landlord & Tenant Board to increase rents by a greater amount
• The Residential Tenancies Act [2006]
established clearer rules as to what is allowed – which can work to the advantage of either side
SOME BASICS
• When an application is made you must be
notified in writing 90 days before the date it will – if approved – take effect. This will be the same
date as your “normal” annual increase. We will all see one in due course for 2016
• The Landlord must make the information &
records about the application available to you if you so request
• There will be a hearing before the Board – you
will be told the time & place. Probably May 2016 at the earliest!
SOME BASICS
• You have the right to appear at the hearing to challenge ALL or PART of the requested
increase
• If you wish you can authorize – IN WRITING – someone to appear on your behalf
• The Board’s decision applies to ALL residents – not just those who appear at the hearing
SOME BASICS
• You do not have to start paying the AGI part of the total increase on your due date unless it has been approved by that date
• You DO have to pay the “annual guideline
increase” portion and you can choose to pay the AGI as well
• IF the AGI is approved after your date & you have not been paying, you must pay the
arrears in a lump sum
SOME BASICS
• If you have been paying the AGI and it is not approved OR reduced you will get a refund
• You must let Parkbridge know if you want to start paying the AGI immediately on the due date – they will act as if you do NOT unless so informed
Reality check
• As we noted earlier, the new rules are
considerably clearer as to what may or may not be the subject of an AGI application
• The Association would not be doing residents any favours by raising false hopes or
expectations as to the possibility of challenging ALL of the present application
• Let’s look at the details which are taken directly from a Landlord & Tenant Board document
THE LANDLORD MAY APPLY IF:
• The landlord’s costs for municipal taxes and/or utilities (heat, water and electricity combined) have increased by an “extraordinary” amount.
• The landlord did “extraordinary” or
“significant” renovations, repairs,
replacements or new additions. This type of work is called a “capital expenditure”
MUNICIPAL TAXES
• An increase in costs for taxes is considered
“extraordinary” if it is greater than the annual guideline increase for the calendar year in
which the increase requested will take effect plus 50% of that guideline.
• The Guideline for 2016 is 2% so the tax portion paid by Parkbridge must have increased more than 3%
CAPITAL EXPENDITURES
• When deciding whether to allow a capital expenditure, the Board must consider:
• Whether the work meets the definition of a capital expenditure in the regulations to the Act
• When the work was done
• Whether the work is “eligible”
• If an item was replaced, whether it needed replacing.
CAPITAL EXPENDITURES
• A capital expenditure is an amount that was spent for an extraordinary or significant
renovation, repair, replacement or new addition that has an expected benefit of at least five years.
It does not include:
• Routine or ordinary work
• Regular maintenance work
• Work that is considered substantially cosmetic in nature
• Work that is designed to enhance the level of prestige or luxury offered by the complex
ELIGIBLE CAPITAL EXPENDITURES
• A capital expenditure is eligible if it:
• Is necessary to protect or restore the physical integrity of the complex
• Is necessary to maintain health, safety or housing standards
• Is necessary to maintain plumbing, heating,
mechanical, electrical, ventilation or air conditioning systems
• Provides access to persons with disabilities
• Promotes energy or water conservation
• Maintains or improves the security of the complex
PARKBRIDGE ARE REQUESTING FOR:
• Municipal Taxes
• Chair Lifts at the Wheel
• Replacement of failed equipment at our water pumping station
• Tree removal & trimming
• Road Work
MUNICIPAL TAXES
• The documentation provided by Parkbridge supports an “extraordinary” increase
• This is caused by a combination of increases in property tax rates and MPAC’s assessment of property value
• Certain information has not been provided due to privacy issues. We intend to explore this as it may reduce the amount claimed
WHEEL CHAIR LIFTS
• This is clearly an eligible capital expenditure and can not be challenged
WATER PUMPING STATION
• The failed equipment that was replaced is required by law as part of the water testing requirements
• As such it is a health issue and is, again, clearly eligible and can not be challenged
• In any event, the $ amount is insignificant
TREE REMOVAL & TRIMMING
• In the opinion of the Association this is NOT capital expenditure – for several reasons - but maintenance and will be challenged
ROAD WORK
• This is for work of the type that has been
recently carried out on Broadway and other areas.
• It would appear to covered by the “significant renovations, repairs or replacements”
definition and, if so, would be “eligible”
• There are potential arguments against this – however a legal opinion would be needed before considering a challenge
IN SUMMARY:
• The Association will challenge on the matter of tree removal & trimming
• We will seek a closer examination of the amount in regard to taxes
• We continue to examine the claims in respect of Road Work & will challenge if practical
• If you wish to challenge personally [in addition to the Association] you are entitled to so do
