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Habitat Canada points to Habitat Kamloops’ private home sales as a reason for disaffiliation

Lack of financial transparency another reason cited by national organization
Habitat for Humanity Canada announced Oct. 13 that it is ‘disaffiliating’ Habitat for Humanity Kamloops, but former Kamloops executive director Bill Miller says it will have no effect on car raffle, ReStore in Salmon Arm or housing developments. (File photo)

By Michael Potestio, Kamloops This Week

Privately selling homes and a lack of financial transparency were among the reasons Habitat for Humanity Canada cited for stripping the Kamloops non-profit branch of its affiliation with the national organization.

Habitat Canada is providing more details over its decision to disaffiliate Habitat for Humanity Kamloops, which was effective as of Oct. 13.

The decision means Habitat Kamloops can no longer use that brand and must remove the name and logo from all of its social media accounts, advertising and other assets. As of Tuesday, they remained on Habitat Kamloops’ website and Facebook pages.

Initially, Habitat Canada issued a release stating that its board of directors voted to disaffiliate Habitat Kamloops because Habitat Kamloops failed to adhere to the national organization’s high standards of operation and governance, but did not specify the manner in which Habitat Kamloops has not done so.

Via email in response to KTW’s questions, Habitat Canada communications director Sarah Austin explained Habitat Kamloops was not providing transparent reporting of its finances to the national body.

“We became aware that the former affiliate was having a number of disputes with local vendors and contractors, some of whom provided their goods and services on a discounted basis or as volunteers,” Austin said. “These people are so important for our work and being at odds with them is unacceptable. We also received information on their [Habitat Kamloops’] most recent project in Blind Bay, B.C. that was of concern.”

KTW has learned Habitat Kamloops is privately selling four new homes in Blind Bay in the Shuswap as opposed to homes being sold to families in need.

Austin said the Blind Bay homes were built with funding from Habitat Canada based on a commitment to make them available as long-term affordable housing, but are instead being sold on the open market.

“This was inconsistent with our funding agreement and our vision and one of the reasons we felt it necessary to terminate the relationship,” Austin said, noting the former affiliate was no longer committed to serving families living with low incomes.

Homes built by Habitat are sold to families who are chosen from applications to buy the residence. Those families help with construction. The sales are at current market value, with special conditions, including no down payment, an interest-free mortgage that is carried by Habitat and a buy-back provision if the homeowner decides to sell. Homeowners are also responsible for paying property taxes and strata fees and covering maintenance costs.

Austin said while sometimes Habitat homes or other assets may need to be sold for a variety of reasons, it is not the intention, nor is it in the spirit of the organization’s mandate, to build homes with donated dollars and labour, only to immediately sell the homes at market rates.

“We do not condone these actions,” she said.

In August, KTW reported Habitat Kamloops was the subject of a trio of lawsuits launched between April and July of this year. Asked if this too was a factor in disaffiliating Habitat Kamloops, Austin said there were many determining factors involved in the decision to ultimately disaffiliate the organization, noting Habitat Canada only learned about the lawsuits recently due to reporting in KTW.

“And it was one of the issues we were pursuing quite seriously with the former affiliate,” Austin said.

According to online court documents in August, the society was being sued for $19,000 by A&R Site Services for an outstanding bill. It was also being sued for $12,000 by a former employee and for $375,000 in connection with unpaid monies in an asset purchase agreement.

Habitat Canada said it has been working with the now former affiliate, Habitat Kamloops, over the past year to help the organization meet the national body’s mandatory standards through a defined process, but Habitat Kamloops was unable to meet these standards.

Read more: Habitat for Humanity Canada announces it’s ‘disaffiliating’ Habitat Kamloops

Read more: Habitat for Humanity committed to becoming part of Salmon Arm

Asked what specifically that process has involved, Austin said Habitat Canada has a standards program and, when an affiliate does not comply with the agreed standards, it is subject to defined consequences and provided with a series of formal communications.

That correspondence notifies the affiliate what standards it has not met, provides deadlines for honouring the commitments required and advises of consequences of continued non-compliance, which range from sanctions through to the last resort of disaffiliation.

“At every step, Habitat Canada offers staff resources, support and conversations to help the affiliate understand the requirements and support them in remedying the standards that are not being met,” Austin said.

“In the case of the former affiliate, this included senior representatives of Habitat Canada travelling to meet with the former affiliate and reiterate Habitat Canada’s offer of assistance to help them comply.”

She said Habitat Canada is not in any sort of legal dispute with Habitat Kamloops.

In August, Habitat Kamloops executive director Bill Miller told KTW the organization was not in financial trouble, despite the fact it is the subject of numerous civil lawsuits and has closed its ReStore on the North Shore, moving it to Salmon Arm. The ReStore is a home and building supply store that provides a source of revenue for the charity.

Read more: Habitat for Humanity moves its Kamloops ReStore operations to Salmon Arm

Read more: Habitat for Humanity moves ahead with Salmon Arm 20-unit housing project

“I’m not going to debate what our legal issues are in the news,” Miller said in August, adding there are bound to be some disputes with contractors and suppliers for an organization that undertakes millions of dollars worth of construction.

“And that’s exactly what’s going on,” he said. “And we will prevail. I have no concerns about that at all.”

KTW called Miller on Oct. 13, asking for more information regarding the disaffiliation and to elaborate as to why, according to the Canada Revenue Service, Habitat for Humanity Kamloops has not filed its charity returns or financial statements since 2020.

Miller returned a call after hours on Oct. 17, leaving a message. KTW will have a follow-up story once it can again connect with Miller.

Habitat Kamloops has told other local media outlets via news releases that it has been in a dispute with Habitat’s national office, which includes legal action, and that Habitat Kamloops has retained a lawyer to assist in the separation.

In the release, Habitat Kamloops also claimed the disaffiliation is a mutual process dating back to December 2021 and that Habitat Canada accelerated the disaffiliation before a separation agreement was reached.

Austin, however, told KTW that Habitat Canada made the disaffiliation decision independently.

“We were not made aware of any internal discussions or decisions made by the former affiliate to mutually part ways,” Austin said. “Since they are an independent organization operating under their own management, we are not involved in their internal discussions or decisions.”

Habitat Kamloops operates in Kamloops, Princeton, Lytton, Lillooet, Merritt, Prince George, McBride, Lumby, Enderby, Armstrong, Salmon Arm, Cache Creek, Williams Lake, 100 Mile House, Quesnel and Revelstoke. Miller has told local media outlets Habitat Kamloops will continue to develop attainable housing in the regions it serves, albeit under a new name.
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