Social Offsets FAQ

1. What is a “social offset”?

  • A social offset is an investment you can make to offset the social impact of your housing choices
  • Just as a carbon offset mitigates your impact on the climate, a social offset mitigates your impact on housing affordability in your community by creating new alternatives for residents

2. Why are social offsets needed?

· New developments in areas such as the DTES of Vancouver can be great economic stimulants and start to regenerate neighborhoods. Unfortunately, the benefits of this revitalization are distributed very unevenly. Existing low-income resident are no longer able to afford to live in their own neighbourhood. They are often forced to leave – either for economic reasons or simply because they have been evicted and their building torn down

3. How does it work?

o When you buy a social offset, you are contributing to a national fund to build local projects. The philosophy is “give nationally, build locally”

o The goal of this approach is to engage citizens across the country to become part of the solution by funding innovative creative solutions for affordable housing. Local expertise is used to evaluate proposals ensuring both community involvement and community appropriateness

4. What kind of “projects” does socialoffsets fund?
We fund a variety of projects that meet our criteria of innovative and affordable housing that:

o improves livability

o fosters community

o enables Community Economic Development

o Example projects include: (link to spreadsheet)

· Providing a seed capital grant to a group of local residents buying an apartment block to create a housing co-op. Capital for these projects can be very difficult to find due to both the newness of the co-op model and the lack of financial background of the residents.

· socialoffsets can act as “first funder” for many types of projects to allow for the entry of secondary funders

5. What do the finances look like?

o A typical project could look like this:

o As you can see, without the socialoffsets.ca grant and the carrying matching funds, the co-op would have no way to qualify for a mortgage of this size

6. Shouldn’t the city or province or federal government take care of this? Why should I pay for this?

o There is currently no co-ordinated housing policy in Canada and each municipality approaches the issue differently

o While we should certainly be working towards a national solution, socialoffsets.ca takes the approach that we need to start now rather than waiting for government

o As citizens, we all need to take responsibility for our choices and the impacts of those choices. This applies to social justice issues just as much – if not more than – environmental issues.

7. What is a “social certification”?

o When you make a housing choice that has a social certification, you can be sure that your choice does not displace existing residents — think of it as “fair trade housing”

o In addition to this, the developer has provided living wages to everyone on site – contractors and sub-contractors – as well as providing job training opportunities for local residents. A great example of this is the construction of the Eva’s Phoenix facility in Toronto. The construction company worked with the builders’ union to give classroom and on-site training to youth workers – the same youth who were going to live in the complex!

8. Will I get a tax refund?

o Absolutely. socialoffsets.ca is a registered charity with CCRA. This means that your contribution is tax deductible so you may end up saving money with your contribution!

9. What do developers think?

a. We believe that developers are in the business of developing housing. Given that they are building new units in existing communities, they must follow the local rules and regulations. In most municipalities this has mean the inclusions of social benefits such as parks and child care spaces.

b. What we are proposing is that developers embed the social offset into the cost of new units and use these funds for the creation of affordable housing in the area

c. Given that developers are in the business of building for-profit housing, socialoffsets.ca provides a simple way for developers to meet their social obligations without taking on the burden of becoming affordable housing developers

10. What other groups are you working with?

a. We coordinate efforts with a number of groups including those interested in preserving space for Canadians such as the Land Conservancy and MEC, government (local, provincial and federal) agencies, local non-profits such as the United Way, progressive financers like Vancity and Coast Capital, local resident and co-op associations and professional groups like architects and engineers

b. And of course, the developers.

11. What about CMHC? Doesn’t that body take care of housing issues in Canada?

o The Canadian Mortgage and Housing Corporation is very active in the housing space. However, over the years the organization has had to take on enormous responsibility for large-scale housing projects. Given this responsibility, CMHC cannot afford to take on risky projects

o socialoffsets is specifically designed to fund and encourage new and innovative approaches to affordable housing such as co-op seed funding and new architecture styles like the “grow home”

12. Will people really be willing to pay extra for this?

o Many people asked the same question about carbon offsets, green products and organic produce

o The market has shown that consumers will in fact make choices that impact their wallet if they believe their choice to either make an impact on their community or will benefit them personally

o Further research is needed to determine an optimal price point for offsets. Given that studio apartments in Vancouver are starting at $300,000 a 5% offset on a typical condo (e.g. $15,000 in this scenario) seems appropriate

13. How will you let people know about this?

o There will need to be substantial education on three fronts

o First, on the issues themselves

o Second, making the connection between personal choice and social impact. This is something that the green movement has been very good at. However, the challenge is greater for issues of social justice that are less tangible and less ???

o Third is general awareness of the issues. This will be accomplished through connections with various audience and media such as:

· leveraging the 2010 games for publicity

· UN conferences

· Provincial and National co-op associations

· raising the issue during municipal/federal elections

· Facebook groups

· University/college students

· Schools

14. What does the “CED lens” mean?

o The core of Community Economic Development is the community involvement in planning and developing their own neighbourhoods. There is more than just economic development – the fostering of community relationships and building a livable community are just as important. We believe that this philosophy is the best approach for creating new, sustainable affordable housing initiatives

o The second key component of the CED framework is that CED tends to work with government but not wait for government in creating solutions. This spirit of self-sufficiency and entrepreneurship enables local communities to take control of their development

15. What else does socialoffsets.ca do?

a. In addition to the core housing functions, socialoffsets.ca provides training to groups such as developers, professional architect/engineer/and planner organizations and university students in related disciplines

One response to “Social Offsets FAQ

  1. Pingback: What are social offsets? « Social Offsets

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