N.S. quadruples housing development fund, approves its use for health-care facility loan

Opposition leaders are criticizing a move by the Nova Scotia government that quadruples the borrowing limit for the housing development fund and allows it to offer a loan to the developer of a health-care facility.

The order-in-council, which was signed off on last week, increases the borrowing limit for the fund to $630 million from $154 million.

It also expands the ability of Housing Minister John Lohr to use the fund for the province’s “current transitional-care facilities commitments.”

The only such commitment is Hogan Court, a former hotel construction project in West Bedford. The province bought the unfinished hotel from a developer to convert into a site for hospital patients who are recovering or waiting for a long-term care placement, but no longer need an acute care bed.

Earlier this year, the province accepted an unsolicited proposal from long-term care provider Shannex to buy the building, complete renovations and operate the site when it is finished.

NDP Leader Claudia Chender said Hogan Court is not an appropriate use for the housing development fund.

“Nobody lives there,” she said in an interview. “It’s not housing. It’s a medical facility, and I think Nova Scotians should be very concerned with the way their money is being spent.”

Lohr could not provide details about the loan to Shannex, in part because a contract for the property sale is still not complete. Generally, however, he said the housing development fund offers the best rate the government can access plus a small premium.

“It would be a per cent or two, maybe, below the best rate that you could get in the market if you were going to get a mortgage from a bank,” Lohr said in an interview last week.

“It’s a favourable rate, but it’s for things that we want to see happen.”

While Chender said the fund should be used to build housing, Lohr said the higher borrowing limit will also address the growing demand for housing projects from various government departments.

The minister said that includes the Department of Community Services, as well as the down payment assistance program for first-time home buyers and the community housing acquisition program, which is aimed at increasing affordable housing units.

A spokesperson for Lohr’s department later added the higher borrowing limit is based on a projected increase in program uptake for the next five years.

Liberal Leader Zach Churchill said Lohr and the premier owe the public more details, given the massive increase to the fund.

“Tim Houston has become very sneaky with the public’s money,” Churchill said in an interview.

Like Chender, Churchill said the government should not be using a fund earmarked for housing to give Shannex a loan.

He called Hogan Court “a money pit.”

“It certainly doesn’t seem like we’re going to get any housing out of it. That hasn’t been part of any of the announcements so far,” said Churchill.