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His Excellency the Governor General recommends to the House of
Commons the appropriation of public revenue under the circumstances,
in the manner and for the purposes set out in a measure entitled ``An Act
to amend the National Housing Act and the Canada Mortgage and
Housing Corporation Act and to make a consequential amendment to
another Act''.
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This enactment amends various provisions of the National Housing
Act and the Canada Mortgage and Housing Corporation Act.
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Parts I, I.1 and VIII of the National Housing Act dealing,
respectively, with housing loan insurance, guarantees of
mortgage-backed securities and interest rate protection by the Canada
Mortgage and Housing Corporation are combined into a new Part I. The
detailed terms and conditions in the Act governing the provision of
housing loan insurance, guarantees and interest rate protection are
replaced by a general power for the Corporation to set terms and
conditions.
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The enactment simplifies the provisions in the Act dealing with
various types of housing assistance, replacing them with authority to
make loans and contributions and forgive loans on terms and conditions
to be set by the Corporation.
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The enactment authorizes the Corporation to participate in research
and development of housing internationally and to promote the export
of Canadian expertise and products relating to housing.
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The enactment consolidates various provisions of the Act relating to
financing of the Corporation for activities carried out under the Act. It
also permits the Corporation to set fees and charges for services
provided by the Corporation under the Act.
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The amendments to the Canada Mortgage and Housing
Corporation Act authorize the Governor in Council to increase the
capital of the Corporation. The Corporation is also authorized to
cooperate and enter into agreements with other persons and
government organizations for the carrying out or assumption of
functions related to housing.
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The enactment also repeals certain spent provisions of An Act to
amend the National Housing Act and the Canada Mortgage and
Housing Corporation Act.
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Clause 1: (1) This amendment would repeal certain
definitions that are no longer required and repeal the
definition ``owner'', which is replaced by the new
subsection 2.1(2). The definition ``owner'' reads as
follows:
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``owner'' includes
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(a) a lessee under a lease the term of which extends beyond the
maturity date of a mortgage of the lease for a number of years
sufficient, in the opinion of the Corporation, to provide adequate
security for an insured loan, and
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(b) a buyer under a conditional sales contract for the sale of a
building or movable structure;
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(2) The definitions ``approved lender'', ``housing
project'', ``insured loan'' and ``rental housing project''
read as follows:
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``approved lender'' means a lender designated as such by the
Corporation pursuant to section 4.1;
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``housing project'' means a project consisting of one or more houses,
one or more multiple-family dwellings, housing accommodation of
the hostel or dormitory type, one or more condominium units or any
combination thereof, together with any public space, recreational
facilities, commercial space and other buildings appropriate to the
project, but does not include a hotel;
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``insured loan'' means a loan in respect of which an insurance policy has
been issued under this Act and is in force;
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``rental housing project'' means a housing project built, converted or
acquired for rental purposes;
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(3) New.
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Clause 2: Sections 2.1 and 3 are new. Subsection
2.1(2) would provide a general interpretation of who can
be treated as an owner and would replace the present
defininton ``owner'' in section 2. The subject-matter of
the present section 3 is contained in the new section 6.
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Clause 3: This amendment would enact a new Part I,
containing provisions dealing with insurance and
guarantees in respect of housing loans and securities and
interest rate protection. Some of the provisions are new,
while the subject-matter of other provisions is derived
from provisions in the present Parts I, I.1 and VIII.
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Sections 5 and 6 consolidate, with a few changes,
provisions that deal with the designation and powers of
approved lenders. They are no longer part of Part I.
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Clause 4: Sections 22 to 25 would replace existing
sections 22 to 31 and deal with loans, contributions and
guarantees in respect of rental housing.
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Clause 5: This amendment would delete references to
section 37, which was previously repealed.
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Clause 6: The subject-matter of section 34 is replaced
by the new section 100.1, proposed by clause 24. The
repeal of section 35 is consequential on the repeal of
subsection 23(1).
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Clause 7: Section 51 would replace existing sections
51 to 55 and deals with loans and financial assistance for
repair, rehabilitation, improvement and conversion of
buildings for housing purposes.
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Clause 8: Sections 57 and 58 would replace existing
sections 57 to 60 and deal with loans and contributions
to facilitate home ownership.
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Clause 9: Section 61 would replace existing sections
61 to 63 and deals with loans and contributions for
cooperative housing. In addition, this amendment would
repeal Part VIII, which deals with interest rate
protection.
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Clause 11: (1) New. The relevant portion of
subsection 75(1) reads as follows:
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75. (1) Subject to subsection (2), the Corporation may
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(2) Subsection 75(2) reads as follows:
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(2) No power of the Corporation is exercisable
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(a) pursuant to any of paragraphs (1)(a) to (f) or paragraph (1)(h),
except with the approval of the Minister; or
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(b) pursuant to paragraph (1)(g) or (i), except with the approval of the
Governor in Council.
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(3) Subsection 75(5) reads as follows:
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(5) The maximum contingent liability of the Corporation under
contracts entered into pursuant to subsection (3) shall not at any time
exceed ten million dollars, and any amount required to be paid by the
terms of any such contract may be paid pursuant to section 29 of the
Financial Administration Act and shall not be included in computing
the aggregate of payments made to the Corporation pursuant to section
77.
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Clause 12: Section 77 is new. Section 76 reads as
follows:
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76. (1) Where a person
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(a) advises the Corporation that the person wishes to undertake a
project
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(i) for individuals or families of low income, or
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(ii) to meet the needs of individuals resulting from age, infirmity
or other disability, and
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(b) satisfies the Corporation
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(i) that the person requires financial assistance for any purpose
related to the development of proposals for the project or the
initiation thereof, and
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(ii) in the case of any advice under paragraph (a) in respect of a
project to meet the needs of individuals resulting as described in
subparagraph (a)(ii), that those needs are not adequately met by
housing accommodation ordinarily available on the current
rental market in the area in which the individuals live,
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the Corporation may make a loan for the purpose referred to in subpara
graph (b)(i), subject to such terms and conditions as it considers proper,
if the project is one for which a loan may be made under this Act.
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(2) The aggregate amount of loans made under subsection (1) with
respect to any one project shall not exceed the amount prescribed by
regulation.
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(3) Where a proposal or project is, in circumstances prescribed by
regulation, abandoned after a loan has been made under this section for
any purpose related to the development of that proposal or to the
initiation of that project or the development of any proposal for that
project, the Corporation may, subject to any terms and conditions
prescribed by regulation, forgive payment by the borrower of the loan
to the extent prescribed by any such regulation.
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Clause 13: Sections 78 to 80 would replace existing
sections 78 to 83 and deal with development and
financing for public housing.
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Clause 14: Subsections 84(4) and (5) read as follows:
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(4) The amount of the capital costs, profits and losses to be shared by
the Corporation pursuant to an agreement referred to in subsection (1)
shall not exceed seventy-five per cent of the total capital costs, profits
and losses of the project undertaken pursuant to the agreement.
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(5) Subject to subsection (7), the Minister, out of the Consolidated
Revenue Fund,
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(b) shall reimburse the Corporation for losses sustained by it as a
result of the sale or operation of any of the projects undertaken by the
Corporation under this section and for its share of preliminary costs
and expenses of investigation of projects that are abandoned.
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Clause 15: Subsection 85(3) reads as follows:
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(3) A loan made under this section shall
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(a) bear interest, to be paid not less frequently than annually, at a rate
determined by the Corporation;
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(b) not exceed ninety per cent of the cost, as determined by the
Corporation, of realizing the purposes referred to in subsection (1);
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(c) be secured by such security as the Corporation deems adequate
to safeguard its interests; and
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(d) be for a term not exceeding
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(i) fifty years, for that part of the loan that is to be used in respect
of lands and services that are to be leased by the province, agency
or corporation to which the loan is made, and
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(ii) twenty-five years, for the other part of the loan.
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Clause 16: Sections 87 and 88 would replace existing
sections 87 to 90 and deal with loans and contributions
for student housing projects.
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Clause 18: (1) New. The relevant portion of
subsection 92(2) reads as follows:
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(2) The Corporation may
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(2) Subsection 92(7) reads as follows:
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(7) The Minister shall, out of the Consolidated Revenue Fund,
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(a) reimburse the Corporation for losses sustained by it as a result of
the sale or operation of housing projects in designated areas; and
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(b) pay to the Corporation its costs and expenses incurred in the
administration of this section with respect to housing projects in
designated areas.
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Clause 19: The relevant portion of subsection 93(3)
reads as follows:
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(3) A contract with a builder entered into under this section may, in
addition to the provisions thereof made pursuant to paragraphs 5(2)(a)
to (c), provide
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Clause 20: Sections 94 and 95 read as follows:
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94. For the purposes of section 34, moneys expended for purchases
pursuant to paragraph 93(2)(c) shall be deemed to be loans made under
Part II, and losses resulting from purchases made pursuant to that
subparagraph shall be deemed to be losses in respect of loans made
under Part II.
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95. (1) In this section, ``eligible contribution recipient'' means
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(a) a corporation described in paragraph 27(2)(c) or a non-profit
corporation;
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(b) a province or municipality or a public housing agency within the
meaning assigned by section 78;
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(d) a group of Indians each of whom resides on a reserve; or
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(e) any person who owns or operates a rental housing project,
including the Corporation where the Corporation owns or operates
a rental housing project.
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(2) For the purpose of enabling an eligible contribution recipient to
meet the costs of rental housing projects and to reduce the rentals
thereof, the Corporation may, subject to and in accordance with any
regulation of the Governor in Council, make a contribution to that
eligible contribution recipient in an amount determined in the manner
prescribed by the regulation but no such contribution shall be made to
a non-profit corporation by which land is leased from the Corporation
pursuant to subsection 42(2) for the purposes of any of the projects.
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(3) Where the Corporation is satisfied that the amount of a loan made
under section 51 to the owner of a rental housing project has been used
for the repair, rehabilitation, conversion or improvement of housing
accommodation in relation to which the loan was made, the Corporation
may make a contribution to that owner for the same purposes, in the
same manner and subject to the same conditions, with such
modifications as the circumstances require, as if that owner were an
eligible contribution recipient to whom a contribution may be made
under subsection (2).
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(4) The Governor in Council may by regulation prescribe the manner
in which contributions may be made under subsection (2) or (3), the
maximum aggregate amount of those contributions in any year and the
manner of determining that maximum aggregate amount.
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Clause 21: Section 98 reads as follows:
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98. The Corporation may, subject to and in accordance with
regulations of the Governor in Council, make loans to Indians for the
purpose of assisting in the purchase, improvement or construction of
housing projects on reserves.
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Clause 22: The relevant portion of section 99 reads as
follows:
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99. The Corporation may provide any service or facility
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(b) for inspecting property, to any warrantor or prospective
warrantor whose warranty meets the requirements of paragraph
9(1)(h) or would do so if the warranty were provided, or
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Clause 23: New.
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Clause 24: Section 100.1 would consolidate certain
provisions that deal with reimbursements and payments
to the Corporation. Section 101 reads as follows:
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101. In addition to the authority conferred on the Governor in
Council elsewhere in this Act, the Governor in Council may make
regulations for any purpose for which regulations are to be made under
this Act.
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Clause 25: (1) Subsection 6(1) reads as follows:
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6. (1) The Board of Directors shall consist of the Chairman, the
President, a Vice-President who shall be designated by the Governor in
Council, and seven other members, two of whom shall be selected from
the public service of Canada and five of whom shall be selected from
outside the public service of Canada.
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(2) Subsection 6(4) reads as follows:
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(4) Each director, other than the Chairman and the President, shall be
appointed or designated, as the case may be, by the Minister, with the
approval of the Governor in Council, to hold office during pleasure for
such term not exceeding three years as will ensure, as far as possible, the
expiration in any one year of the terms of office of not more than one
half of the directors.
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(3) Subsection 6(7) reads as follows:
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(7) The directors appointed from outside the public service of
Canada are entitled to receive for attendance at directors' meetings and
Executive Committee meetings such fees as may be fixed by the
Governor in Council.
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Clause 26: Subsection 7(3) reads as follows:
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(3) The Board, with the approval of the Governor in Council, shall
appoint three Vice-Presidents and fix their salaries and,
notwithstanding section 108 of the Financial Administration Act, the
salary of the Vice-President who is designated as a director.
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Clause 27: Section 9 reads as follows:
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9. There shall be an Executive Committee of the Board consisting of
the Chairman, the President, the Vice-President designated a member of
the Board by the Governor in Council, and two other directors selected
by the Board.
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Clause 28: Subsection 12(2) reads as follows:
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(2) In the event of the absence or incapacity of the President, or if the
office of President is vacant,
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(a) the Vice-President designated a member of the Board by the
Governor in Council, or
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(b) in the event of the absence or incapacity of the Vice-President
referred to in paragraph (a) or if that office is vacant, such director
or officer of the Corporation as shall be designated by the Board,
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has and may exercise and perform all the powers and functions of the
President.
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Clause 29: Section 14 reads as follows:
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14. The Corporation may establish branches or employ agents in any
part of Canada.
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Clause 30: Section 16 reads as follows:
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16. The capital of the Corporation is twenty-five million dollars.
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Clause 31: Section 17 reads as follows:
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17. Subject to section 33 of this Act and to subsection 75(2) and
section 100 of the National Housing Act, the Corporation shall, on
behalf of Her Majesty and in the place of the Minister, have, exercise
and perform all rights, powers, duties, liabilities and functions of the
Minister under the Housing Acts or under any contract entered into
under those Acts, except the authority of the Minister under those Acts
to pay moneys out of the Consolidated Revenue Fund.
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Clause 32: Subsection 21(2) reads as follows:
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(2) The Corporation may borrow money otherwise than from the
Crown and is hereby authorized to so borrow money in amounts such
that the total indebtedness outstanding at any time in respect of such
borrowings does not exceed the aggregate of
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(a) one and one-half billion dollars, and
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(b) any additional amounts authorized by Parliament for the
purposes of this subsection.
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Note: Parliament authorized an additional amount of
13.5 billion dollars in 1994 by S.C. 1994, c. 5.
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Clause 33: The relevant portion of subsection 28(1)
reads as follows:
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28. (1) The Corporation may
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(c) subject to such terms, conditions and restrictions as the Minister
of Finance may establish, make any investment and enter into any
kind of transaction for the financial management of the Corporation,
including investments and transactions that are insured or
guaranteed by the Corporation and, without restricting the generality
of the foregoing, enter into
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Clause 34: New.
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Clause 35: Subsection 30(2) reads as follows:
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(2) No person is eligible to be appointed an auditor unless that person
is an accountant who has for at least six years preceding the date of that
person's appointment practised the profession of accountant and is a
member in good standing of an institute or association of accountants
incorporated under the authority of the legislature of a province.
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Clause 36: The heading before section 35 and sections
35 to 37 read as follows:
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35. Notwithstanding the repeal of Part V of the National Housing Act
by section 23, Part IV of and Schedule II to the National Housing Loan
Regulations remain in force until revoked by an order made under
section 37 and may be amended by the Governor in Council as if section
47 of the National Housing Act were not repealed but only apply in
respect of home improvement loans made before November 1, 1986.
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36. Notwithstanding the amendments made to section 23 of the
Canada Mortgage and Housing Corporation Act by section 33, the
Minister continues to be obliged to reimburse the Corporation for
payments made by it to a bank or an approved instalment credit agency
under the provisions repealed by section 23 out of moneys appropriated
for those payments by the Minister under those provisions.
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37. The Governor in Council, when satisfied that sections 35 and 36
are spent, may, by order, repeal those sections and revoke Part IV of and
Schedule II to the National Housing Loan Regulations.
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