Residents of a seniors’ apartment building in Nelson are stunned by a rent increase they say is illegal.
The building owner, however, says the increase is both justified and within the law.
Dixie Champ received her annual rent increase notice on Nov. 29, 2022, from Golden Life Management, the co-owner and manager of Lake View Village that provides 90 apartments for seniors at 1020 Seventh St.
Champ’s rent pays for not only the occupancy of her apartment but for hospitality services such as one meal per day, weekly cleaning, cable, shuttle bus service, and night-time supervision. Before the increase, Champ’s rent (including those hospitality services) was one inclusive lump sum: $3,090.69.
The hospitality services are built into the rent and tenants cannot opt out of paying for them.
Champ’s increase amounted to $141.81, or 4.5 per cent as of March 1. B.C.’s Residential Tenancy Act caps residential rent increases at two per cent per year.
When she got the notice Champ assumed it was an error. Rent increases in the past had never exceeded the two per cent limit, she said.
She went to the building manager and was told that this year the company was raising the cost of the hospitality services more than two per cent because those services are not, strictly speaking, rent. They do not fall under the province’s rent increase limit, the manager told her.
Dede Shave also received a similar increase of more than two per cent.
“I think it’s very wrong,” Shave said, adding that she signed a tenancy agreement in good faith and doesn’t see how the company can unilaterally change the nature of it by saying part of the payment is not actually rent.
“I’m quite determined to see that this won’t go through, she said.
Golden Life Management, based in Cranbrook, owns and operates 16 seniors housing facilities in B.C. and Alberta. The Columbia Basin Trust is a half owner of Lake View Village, but plays no part in its management.
Champ and Shave are co-chairs of a residents’ council that has been in discussions with Golden Life Management about the increase.
Champ said one resident of Lake View Village who does not want to be named has formally disputed the rent increase under the Residential Tenancy Act, and a hearing will be held with a provincial arbitrator on May 7. This person has disputed the increase in their own name only, not on behalf of all residents.
Celeste Mullin, vice president of Golden Life Management, told the Nelson Star that the company will take its guidance from whatever is decided at that hearing.
The arbitrator will have to decide whether the hospitality provisions of the tenancy agreements are covered by rent controls.
If they are covered, Mullin said, “We will honour that decision.”
If it is determined that hospitality provisions are not covered by rent controls, Mullin said the rent increases they have imposed this year will stay.
“Once we receive that guidance from them, then we can re-look at the lease agreement. Maybe it’s fine the way it is, maybe it’s not,” Mullin said.
The Residential Tenancy Act, in its definition section, states that “rent” means money paid by a tenant to a landlord in return “for the right to possess a rental unit, for the use of common areas and for services or facilities.”
The act goes on to provide a list of things that can be considered services or facilities. However, to complicate this matter further, that legislated list includes some of the services provided at Lake View Village and not others.
There is an additional legal wrinkle in this story.
Lake View Village has 65 units classed as independent living — these include Shave’s and Champ’s — and 25 that provide assisted living, a different category with different services and rules.
Assisted living means that the facility provides individual assistance with daily living such as getting dressed, personal hygiene and eating meals.
Lake View Village is listed in B.C.’s registry of assisted living facilities. A provision of the Residential Tenancy Act states that the act does not apply to assisted living facilities. Therefore there are no rent controls.
Does this mean that some Lake View assisted living residents do not fall under rent controls and others categorized as independent living do?
A spokesperson from the Ministry of Housing told the Nelson Star in an email that it is possible that some units in a building could come under the Residential Tenancy Act while other units (because they are assisted living) do not.
Mullin said the company determines its annual rent increase by looking at the cost of housing and of the services the company provides.
“We look at what our cost is, then we go back and we look at what are seniors receiving for their government subsidies, such as their [Canadian Pension Plan], their [Old Age Security].”
She said recent cost increases, especially for food, have raised the company’s hospitality costs, while this year’s increases in CPP, OAS and [Guaranteed Income Supplement] benefits indicate that the tenants can afford an increase.
Shave doesn’t think using pensions as a reference point is fair because inflation has hit seniors on fixed incomes too.
“It took generations to get those pensions going for seniors,” she said. “And we have a lot of expenses outside of living here — just take our medical expenses alone.”
Champ said the company changed the rules in mid-stream without clear legal justification and without clear communication with the tenants.
Mullin says the company has attempted this communication and is trying for balance.
“It has to make sense for us economically, but it also has to be affordable for seniors,” she said.