Backgrounder Housing Services Corporation The Housing Services Corporation (HSC) was created to allow affordable housing providers to save money by making bulk purchases of natural gas and insurance, and to manage pooled capital reserves for housing providers. The revenue which funds the operations and expenses of the HSC and its subsidiaries comes from affordable housing providers - primarily by charging a premium on the insurance and natural gas that the housing providers are required to buy through them. In 2013, 99.4% of HSC’s revenue came from affordable housing providers. Cost to municipalities Many municipalities have reported that they are paying more for natural gas and insurance because they are required by the Housing Services Act, 2011 to purchase it through HSC. Examples include: • in one year Hamilton reported spending $1.1 million more for natural gas because it had to purchase it through HSC; • Thunder Bay reported paying an additional $750,000 for gas over three years – or an extra $5,000 a week; • Peel Region reported that due to HSC it paid an additional $200,000 for gas in one year; and • housing providers are only allowed to opt out of HSC’s insurance to go with a lower cost provider if they pay HSC a fee equivalent to 2.5% of the premium, over the last two years this has cost Region of Waterloo $20,000. Sunshine List • In 2010 HSC (then known as Social Housing Services Corporation) reported nine employees on the sunshine list, but due to changes to the legislation that created the corporation they are no longer required to report salaries over $100,000. • In 2005 HSC’s total budget for salaries and benefits was $1.2 million, by 2012 that budget had increased to $7.5 million. Questionable costs A number of questionable expenses at HSC or Social Housing Services Corporation have recently been discovered, including: • $72,000 paid to a provincial appointee’s private consulting firm; • the cost of establishing six for-profit subsidiaries, including one that is a partnership with a British organization; • trips by the CEO Howie Wong to Australia, Los Angeles, Vancouver and seven trips to Europe within 16 months; and • more than $1 million dollars given to for-profit company InnoServ Solar, this includes a 2008 loan of $400,000 which written off in the same year and a 2010 additional loan of $330,000 which was again written it off as an uncollectable debt.