As federal funding for hotels for asylum seekers ends, Ottawa seeks solutions

The federal government’s decision to withdraw funding for hotel rooms for asylum seekers has raised concerns that the costs and responsibilities will trickle down to municipalities and non-profits.

In Ottawa, the federal government’s decision to withdraw funding “will likely have a negative effect on Ottawa’s shelter system, which is already overburdened and at max capacity,” said Kale Brown, the city’s acting director of housing and homelessness services.

According to the most recent figures, released in April, 708 families were living in hotels and transitional housing. About half were newcomers, said Kaite Burkholder Harris, executive director of the Alliance to End Homelessness Ottawa.

It represents a significant pressure on municipal finances, Burkholder Harris said.

“Other levels of government have to step up.”

Non-profit and community groups in Ottawa are anticipating increased pressure on their programs, too. 

“It’s obvious that offering hotel rooms is expensive and its doesn’t provide wraparound supports that will result in long-term success for newcomers,” said Kailee Brennan, executive director of Matthew House Ottawa, which provides support and housing to refugee claimants. “But taking that option away without offering other options will increase stress on the entire system.”

Q: Why did IRCC cancel funding for hotels? 

A: Immigration, Refugees and Citizenship Canada (IRCC) has funded hotels since 2017, but this was always a temporary measure to ease pressure on local shelters, and it was clearly communicated to occupants from the outset, said Julie Lafortune, an IRCC  spokesperson.

“This transition ends hotel use and refocuses IRCC on its core asylum role while supporting provinces and municipalities to build cost-effective and sustainable long-term solutions,” she said.

Since 2017, the Interim Housing Assistance Program (IHAP) has provided about $1.5 billion to provincial and municipal governments to help cover emergency housing costs from increased numbers of asylum claimants. The 2024 budget provided $1.1 billion billion to extend IHAP for three years.

Through the 2024 budget and direct communication with stakeholders, IRCC made clear that program criteria “would be adjusted to reflect a renewed focus on helping partners develop more sustainable and cost-effective long-term housing solutions.”

All claimants in Ottawa hotels had secured new accommodations and were to relocate no later than Oct. 1, Lafortune said.

“IRCC and the City of Ottawa worked with service providers to connect all claimants to housing. Families received one-on-one case management, referrals to landlords and a range of supports,” she said.

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Both sites provide accommodations for up to a year and offer intensive, housing-focused case management and settlement supports.

“The goal is to transition individuals staying at the sites into long-term housing as quickly as possible and help them become part of the community,” Brown said.

The problem is that St. Joseph and 230 Queen St. don’t have transitional housing for families. The city has a launched Request for Offer looking to buy or lease a building or part of a building and seeking proposals from owners of motels, hotels, retirement residences, apartments and other properties for immediate, medium- and long-term accommodations suitable for families.

At this stage, no budget has been set as the city is first soliciting potential sites, Brown said. Submissions will be reviewed and analyzed, with prospective proponents contacted as part of the process. Any decision to purchase or lease a site will follow the city’s Real Property Acquisition Policy and require council approval, he said.

Even if the right building can be found at the right price, it will still take time, said Myriam Mekni, executive director of CCI Ottawa (former Catholic Centre for Immigrants), which provides settlement services to newcomers. Past experience has shown it takes about a year for a new building to be ready for people to start moving in, depending on the state of the building, she said.

Q: Why does it take so long for asylum seekers to find permanent housing? 

A: Affordable housing is in high demand, but it’s more complicated than that. The process of getting refugee status is not guaranteed and it can take a long time.

Another problem is the low level of subsidies available to asylum seekers, said Karen Walker, chair of the subsidy committee at OMRA, an Ottawa charity that provides rental subsidies, mostly to government- or privately-sponsored refugees. 

Under Ontario Works, a single asylum seeker qualifies for $390 a month for rent, plus $343 for all other needs, giving them a total of $733 a month, Walker said.

“That has not gone up since 2018,” she said. “Even a room in a rooming house costs $800 to $900 a month.”

Asylum seekers don’t qualify for certain benefits, including the Ontario Student Support Program (OSAP), Better Jobs Ontario and the Canada Child Benefit, until they have Immigration and Refugee Board decisions and gain “protected person” status, which recognizes them as refugees, she said.

The Canada Child Benefit, along with a provincial component, provides $810 per child under the age of