In 2007, the Alberta Affordable Housing Task Force recommended that the Government of Alberta enhance capital resources for affordable housing supply. The task force estimated the need for 12,000 affordable housing units at a cost of $480 million annually over five years for a total cost of $2.4 billion. The Department of Municipal Affairs responded by creating the municipal block funding and housing capital initiatives programs to fund the development of 11,000 affordable housing units for low-income Albertans.
In September 2011, the department reported that it had met its objective of approving funding for the development of 11,000 affordable housing units. In total, the department’s investment of $1.1 billion combined with $1.1 billion of investment from partnerships with municipalities, non-profit groups and the private sector resulted in $2.2 billion of investment in affordable housing across the province. As of April 2013, 5,900 units have been built. The remaining units are in various stages of development.
Objective and Scope
We examined the department’s systems to plan, award, monitor, report on and evaluate the two affordable housing grant programs. Our objective was to determine whether the department had adequate systems to deliver grant programs to increase Alberta’s supply of affordable housing. Our audit was not an assessment of whether the programs’ goals were met, but rather an audit of the systems management used to deliver the grant programs.
The department approved funding to its partners for the development of 12,000 affordable housing units over a five-year period, which met the program objective of increasing supply in Alberta. However, we found several areas where the department’s systems to deliver grant funding for these two programs could be improved.
We made two recommendations to the department to improve its monitoring processes and develop an effective evaluation system. The grant agreements require municipal block funding and housing capital initiatives grant recipients to provide and maintain affordable housing for 10 and 20 years, respectively.
Therefore, it is critical that the department establishes and maintains effective monitoring processes to ensure these housing units remain affordable, available and the savings are passed along to Albertans in need.
The department should also evaluate whether its affordable housing grant programs are operating efficiently, achieving value for money and meeting their objectives. Evaluations become more difficult if performance targets or benchmarks are not established or considered as part of the program design. However, evaluations should still be conducted and can be useful to identify lessons learned that the department could apply to future housing grant programs.
We did not make recommendations related to our findings for the planning and awarding processes because grant applications are no longer being accepted. However, we expect the department to apply lessons learned to its other housing grant programs.