20200714pm Hansard n340

British Columbia — Debates (Hansard)

Fifth Session, 41st Parliament OFFICIAL REPORT OF DEBATES (HANSARD) Tuesday, July 14, 2020 Afternoon Sitting Issue No. 340 THE HONOURABLE DARRYL PLECAS, SPEAKER ISSN 1499-2175

PROVINCE OF BRITISH COLUMBIA (Entered Confederation July 20, 1871) LIEUTENANT-GOVERNOR Her Honour the Honourable Janet Austin, OBC Fifth Session, 41st Parliament SPEAKER OF THE LEGISLATIVE ASSEMBLY Honourable Darryl Plecas EXECUTIVE COUNCIL Premier and President of the Executive Council ............................................................................................................... Hon. John Horgan Deputy Premier and Minister of Finance............................................................................................................................Hon.

Carole James Minister of Advanced Education, Skills and Training..................................................................................................... Hon. Melanie Mark Minister of Agriculture.........................................................................................................................................................Hon. Lana Popham Attorney General.................................................................................................................................................................Hon.

David Eby, QC Minister of Children and Family Development ............................................................................................................ Hon. Katrine Conroy Minister of State for Child Care...................................................................................................................................... Hon. Katrina Chen Minister of Citizens’ Services...................................................................................................................................................Hon.

Anne Kang Minister of Education ............................................................................................................................................................ Hon. Rob Fleming Minister of Energy, Mines and Petroleum Resources ..................................................................................................... Hon. Bruce Ralston Minister of Environment and Climate Change Strategy............................................................................................. Hon.

George Heyman Minister of Forests, Lands, Natural Resource Operations and Rural Development ..............................................Hon. Doug Donaldson Minister of Health .....................................................................................................................................................................Hon. Adrian Dix Minister of Indigenous Relations and Reconciliation ......................................................................................................... Hon.

Scott Fraser Minister of Jobs, Economic Development and Competitiveness.............................................................................Hon. Michelle Mungall Minister of State for Trade...............................................................................................................................................Hon. George Chow Minister of Labour ...................................................................................................................................................................Hon.

Harry Bains Minister of Mental Health and Addictions............................................................................................................................ Hon. Judy Darcy Minister of Municipal Affairs and Housing.................................................................................................................. Hon. Selina Robinson Minister of Public Safety and Solicitor General ........................................................................................................... Hon.

Mike Farnworth Minister of Social Development and Poverty Reduction..............................................................................................Hon. Shane Simpson Minister of Tourism, Arts and Culture.....................................................................................................................................Hon. Lisa Beare Minister of Transportation and Infrastructure................................................................................................................ Hon.

Claire Trevena LEGISLATIVE ASSEMBLY Leader of the Official Opposition................................................................................................................................Andrew Wilkinson, QC Leader of the Third Party .................................................................................................................................................................Adam Olsen Deputy Speaker................................................................................................................................................................................

Raj Chouhan Assistant Deputy Speaker............................................................................................................................................................. Simon Gibson Deputy Chair, Committee of the Whole ................................................................................................................ Spencer Chandra Herbert Clerk of the Legislative Assembly ...........................................................................................................................................

Kate Ryan-Lloyd Law Clerk and Parliamentary Counsel.............................................................................................................................. Seunghee Suzie Seo Clerk Assistant, Parliamentary Services...........................................................................................................................

Artour Sogomonian Clerk Assistant, Committees and Interparliamentary Relations ..............................................................................................Susan Sourial Senior Research Analyst ................................................................................................................................................................. Jennifer Arril Senior Research Analyst ...................................................................................................................................................................

Karan Riarh Acting Sergeant-at-Arms..................................................................................................................................................................Greg Nelson

ALPHABETICAL LIST OF MEMBERS Ashton, Dan (BC Liberal) ......................................................................... Penticton Bains, Hon. Harry (NDP)................................................................ Surrey-Newton Barnett, Donna (BC Liberal) .....................................................Cariboo-Chilcotin Beare, Hon. Lisa (NDP)..............................................

Maple Ridge–Pitt Meadows Begg, Garry (NDP) .......................................................................Surrey-Guildford Bernier, Mike (BC Liberal) .........................................................Peace River South Bond, Shirley (BC Liberal)...........................................Prince George–Valemount Brar, Jagrup (NDP).......................................................................Surrey-Fleetwood Cadieux, Stephanie (BC Liberal)........................................................

Surrey South Chandra Herbert, Spencer (NDP) .......................................Vancouver–West End Chen, Hon. Katrina (NDP)...................................................... Burnaby-Lougheed Chouhan, Raj (NDP) .................................................................Burnaby-Edmonds Chow, Hon. George (NDP).................................................Vancouver-Fraserview Clovechok, Doug (BC Liberal) ..................................Columbia River–Revelstoke Coleman, Rich (BC Liberal) ................................................................ Langley East Conroy, Hon.

Katrine (NDP)...........................................................Kootenay West Darcy, Hon. Judy (NDP) ............................................................. New Westminster Davies, Dan (BC Liberal) ........................................................... Peace River North de Jong, Michael, QC (BC Liberal) ..............................................Abbotsford West Dean, Mitzi (NDP)................................................................ Esquimalt-Metchosin D’Eith, Bob (NDP) ................................................................Maple Ridge–Mission Dix, Hon.

Adrian (NDP)....................................................... Vancouver-Kingsway Donaldson, Hon. Doug (NDP)...................................................................... Stikine Eby, Hon. David, QC (NDP).............................................. Vancouver–Point Grey Elmore, Mable (NDP).........................................................Vancouver-Kensington Farnworth, Hon. Mike (NDP) ........................................................Port Coquitlam Fleming, Hon. Rob (NDP) ......................................................

Victoria–Swan Lake Foster, Eric (BC Liberal).............................................................Vernon-Monashee Fraser, Hon. Scott (NDP) ..................................................Mid Island–Pacific Rim Furstenau, Sonia (BC Green Party) .............................................Cowichan Valley Gibson, Simon (BC Liberal) ...................................................Abbotsford-Mission Glumac, Rick (NDP).........................................................Port Moody–Coquitlam Heyman, Hon. George (NDP) ................................................Vancouver-Fairview Horgan, Hon.

John (NDP) ................................................ Langford–Juan de Fuca Hunt, Marvin (BC Liberal) ........................................................ Surrey-Cloverdale Isaacs, Joan (BC Liberal) .......................................... Coquitlam–Burke Mountain James, Hon. Carole (NDP).................................................... Victoria–Beacon Hill Johal, Jas (BC Liberal).................................................Richmond-Queensborough Kahlon, Ravi (NDP)............................................................................... Delta North Kang, Hon.

Anne (NDP)......................................................... Burnaby–Deer Lake Kyllo, Greg (BC Liberal)..............................................................................Shuswap Larson, Linda (BC Liberal) .............................................. Boundary-Similkameen Lee, Michael (BC Liberal) ........................................................Vancouver-Langara Leonard, Ronna-Rae (NDP) ..................................................... Courtenay-Comox Letnick, Norm (BC Liberal).............................................

Kelowna–Lake Country Ma, Bowinn (NDP) .....................................................North Vancouver–Lonsdale Malcolmson, Sheila (NDP) ........................................................................Nanaimo Mark, Hon. Melanie (NDP) .......................................Vancouver–Mount Pleasant Martin, John (BC Liberal)....................................................................... Chilliwack Milobar, Peter (BC Liberal)..................................... Kamloops–North Thompson Morris, Mike (BC Liberal) ........................................... Prince George–Mackenzie Mungall, Hon.

Michelle (NDP)......................................................Nelson-Creston Oakes, Coralee (BC Liberal) ............................................................ Cariboo North Olsen, Adam (BC Green Party)............................ Saanich North and the Islands Paton, Ian (BC Liberal).......................................................................... Delta South Plecas, Hon. Darryl (Ind.) ........................................................... Abbotsford South Polak, Mary (BC Liberal) ............................................................................. Langley Popham, Hon.

Lana (NDP)............................................................... Saanich South Ralston, Hon. Bruce (NDP) ............................................................Surrey-Whalley Redies, Tracy (BC Liberal) .......................................................Surrey–White Rock Reid, Linda (BC Liberal) ................................................. Richmond South Centre Rice, Jennifer (NDP) ............................................................................. North Coast Robinson, Hon.

Selina (NDP) .........................................Coquitlam-Maillardville Ross, Ellis (BC Liberal)................................................................................... Skeena Routledge, Janet (NDP) ....................................................................Burnaby North Routley, Doug (NDP) ................................................. Nanaimo–North Cowichan Rustad, John (BC Liberal) ................................................................Nechako Lakes Shypitka, Tom (BC Liberal) ..............................................................

Kootenay East Simons, Nicholas (NDP) ......................................... Powell River–Sunshine Coast Simpson, Hon. Shane (NDP)..................................................Vancouver-Hastings Sims, Jinny (NDP) ........................................................................ Surrey-Panorama Singh, Rachna (NDP) .........................................................Surrey–Green Timbers Stewart, Ben (BC Liberal) ................................................................. Kelowna West Stilwell, Michelle (BC Liberal)...............................................

Parksville-Qualicum Stone, Todd (BC Liberal)..........................................Kamloops–South Thompson Sturdy, Jordan (BC Liberal)........................................ West Vancouver–Sea to Sky Sullivan, Sam (BC Liberal)................................................ Vancouver–False Creek Sultan, Ralph (BC Liberal) ...........................................West Vancouver–Capilano Tegart, Jackie (BC Liberal) ................................................................. Fraser-Nicola Thomson, Steve (BC Liberal)......................................................

Kelowna-Mission Thornthwaite, Jane (BC Liberal) ...............................North Vancouver–Seymour Throness, Laurie (BC Liberal) .......................................................Chilliwack-Kent Trevena, Hon. Claire (NDP) ................................................................North Island Wat, Teresa (BC Liberal) ................................................. Richmond North Centre Weaver, Dr.

Andrew (Ind.)................................................Oak Bay–Gordon Head Wilkinson, Andrew, QC (BC Liberal) ................................Vancouver-Quilchena Y ap, John (BC Liberal)............................................................Richmond-Steveston LIST OF MEMBERS BY RIDING Abbotsford-Mission............................................................................Simon Gibson Abbotsford South....................................................................... Hon. Darryl Plecas Abbotsford West......................................................................

Michael de Jong, QC Boundary-Similkameen...................................................................... Linda Larson Burnaby–Deer Lake....................................................................... Hon. Anne Kang Burnaby-Edmonds................................................................................Raj Chouhan Burnaby-Lougheed .................................................................... Hon. Katrina Chen Burnaby North .................................................................................

Janet Routledge Cariboo-Chilcotin .............................................................................Donna Barnett Cariboo North.................................................................................... Coralee Oakes Chilliwack ............................................................................................... John Martin Chilliwack-Kent ...............................................................................Laurie Throness Columbia River–Revelstoke .........................................................

Doug Clovechok Coquitlam–Burke Mountain.................................................................. Joan Isaacs Coquitlam-Maillardville ...................................................... Hon. Selina Robinson Courtenay-Comox................................................................... Ronna-Rae Leonard Cowichan Valley .............................................................................

Sonia Furstenau Delta North.............................................................................................Ravi Kahlon Delta South ..................................................................................................Ian Paton Esquimalt-Metchosin ..............................................................................Mitzi Dean Fraser-Nicola .........................................................................................

Jackie Tegart Kamloops–North Thompson .............................................................Peter Milobar Kamloops–South Thompson..................................................................Todd Stone Kelowna–Lake Country .....................................................................Norm Letnick Kelowna-Mission ..............................................................................

Steve Thomson Kelowna West ..........................................................................................Ben Stewart Kootenay East.......................................................................................Tom Shypitka Kootenay West........................................................................ Hon. Katrine Conroy Langford–Juan de Fuca .............................................................. Hon. John Horgan Langley .....................................................................................................

Mary Polak Langley East.........................................................................................Rich Coleman Maple Ridge–Mission.............................................................................. Bob D’Eith Maple Ridge–Pitt Meadows............................................................Hon. Lisa Beare Mid Island–Pacific Rim................................................................ Hon. Scott Fraser Nanaimo......................................................................................

Sheila Malcolmson Nanaimo–North Cowichan............................................................... Doug Routley Nechako Lakes........................................................................................ John Rustad Nelson-Creston ................................................................... Hon. Michelle Mungall New Westminster........................................................................... Hon. Judy Darcy North Coast ...........................................................................................

Jennifer Rice North Island.............................................................................. Hon. Claire Trevena North Vancouver–Lonsdale................................................................... Bowinn Ma North Vancouver–Seymour........................................................Jane Thornthwaite Oak Bay–Gordon Head............................................................Dr.

Andrew Weaver Parksville-Qualicum.......................................................................Michelle Stilwell Peace River North ................................................................................... Dan Davies Peace River South ................................................................................ Mike Bernier Penticton ................................................................................................. Dan Ashton Port Coquitlam...................................................................... Hon.

Mike Farnworth Port Moody–Coquitlam.......................................................................Rick Glumac Powell River–Sunshine Coast....................................................... Nicholas Simons Prince George–Mackenzie....................................................................Mike Morris Prince George–Valemount ..................................................................

Shirley Bond Richmond North Centre..........................................................................Teresa Wat Richmond-Queensborough.........................................................................Jas Johal Richmond South Centre ......................................................................... Linda Reid Richmond-Steveston ...................................................................................

John Y ap Saanich North and the Islands .............................................................Adam Olsen Saanich South .............................................................................Hon. Lana Popham Shuswap...................................................................................................... Greg Kyllo Skeena........................................................................................................... Ellis Ross Stikine....................................................................................Hon.

Doug Donaldson Surrey-Cloverdale ................................................................................ Marvin Hunt Surrey-Fleetwood.....................................................................................Jagrup Brar Surrey–Green Timbers........................................................................Rachna Singh Surrey-Guildford......................................................................................Garry Begg Surrey-Newton ..............................................................................Hon.

Harry Bains Surrey-Panorama ...................................................................................... Jinny Sims Surrey South ................................................................................ Stephanie Cadieux Surrey-Whalley ......................................................................... Hon. Bruce Ralston Surrey–White Rock .............................................................................. Tracy Redies Vancouver-Fairview.............................................................. Hon.

George Heyman Vancouver–False Creek........................................................................ Sam Sullivan Vancouver-Fraserview...............................................................Hon. George Chow Vancouver-Hastings ............................................................... Hon. Shane Simpson Vancouver-Kensington....................................................................... Mable Elmore Vancouver-Kingsway..................................................................... Hon.

Adrian Dix Vancouver-Langara................................................................................ Michael Lee Vancouver–Mount Pleasant..................................................... Hon. Melanie Mark Vancouver–Point Grey ............................................................Hon.

David Eby, QC Vancouver-Quilchena........................................................Andrew Wilkinson, QC Vancouver–West End .....................................................Spencer Chandra Herbert Vernon-Monashee ....................................................................................Eric Foster Victoria–Beacon Hill.................................................................. Hon. Carole James Victoria–Swan Lake.................................................................... Hon. Rob Fleming West Vancouver–Capilano...................................................................

Ralph Sultan West Vancouver–Sea to Sky................................................................Jordan Sturdy Party Standings: BC Liberal 42; NDP 41; Independent 2; BC Green Party 2

CONTENTS Tuesday, July 14, 2020 Afternoon Sitting Page Routine Business Tabling Documents............................................................................................................................................................... 12001 Report pursuant to the COVID-19 Related Measures Act regarding Order-in-Council 391/2020

Schedule of Estimates ........................................................................................................................................................... 12001 Hon. M. Farnworth Orders of the Day Second Reading of Bills ........................................................................................................................................................ 12001 Bill 14 — Municipal Affairs and Housing Statutes Amendment Act (No. 2), 2020(continued) T. Stone M. de Jong A. Olsen J. Isaacs J. Thornthwaite J. Sims B. Stewart L. Throness T. Wat R. Coleman Hon. S.

Robinson Bill 20 — Motor Vehicle Amendment Act (No. 2), 2020 Hon. D. Eby M. Lee J. Johal Hon. D. Eby Bill 21 — Wills, Estates and Succession Amendment Act, 2020 Hon. D. Eby M. Lee Hon. D. Eby Committee of the Whole House.......................................................................................................................................... 12030 Bill 2 — Motor Vehicle Amendment Act, 2020 M. Hunt Hon. M. Farnworth Hon. C.

Trevena Report and Third Reading of Bills....................................................................................................................................... 12034 Bill 2 — Motor Vehicle Amendment Act, 2020 Committee of the Whole House.......................................................................................................................................... 12034 Bill 13 — Miscellaneous Statutes Amendment Act, 2020 M. Lee Hon. D. Eby

TUESDAY , JULY 14, 2020 The House met at 1:34 p.m. [Mr. Speaker in the chair.] Routine Business Tabling Documents Mr. Speaker:Members, I have the honour to present a report regarding a regulation made under the COVID-19 Related Measures Act. [1:35 p.m.]

Schedule of Estimates Hon. M. Farnworth:I want to table the

schedule for the Committee of Supply budget estimates for Thursday, July 16 and Friday, July 17. Orders of the Day Hon. M. Farnworth:I call continued second reading debate on Bill 14, Ministry of Housing statutes amend- ment act. [R. Chouhan in the chair.] Second Reading of Bills BILL 14 — MUNICIPAL AFFAIRS AND HOUSING STATUTES AMENDMENT ACT (No. 2), 2020 (continued) T. Stone:I do appreciate the opportunity to continue my remarks on Bill 14. I will say, at this point, that I am the designated speaker for the official opposition on this par- ticular piece of legislation.

I ended, just before the noonhour, listing off the names of real people that are experiencing real financial distress and anxiety as a result of soaring strata insurance costs. I think that’s important for us to always remember — that there are real people involved here. These are hard-work- ing men and women. These are retirees. These are all kinds of different British Columbians in communities across this province who have been impacted. I talked about Paul in Chilliwack, Bob and Susan in Kelowna, Jack in Coquitlam and Wendy in Delta.

I talked about the financial stress that’s been faced by Chris in Chilliwack, Marilyn in Richmond, Leanne in Penticton and Monica in Vancouver. There are a couple more that I wanted to enter in for the record, and then I’ll move through the different sections of this bill. I want to acknowledge a note that I received from Joseph in Surrey. He had this to say: “The condo owners in our building had to pay a special levy of almost $2,000 above our regular strata fees. A majority of the owners in our complex are in their 70s, 80s and 90s. We just can’t afford this. ” That’s, again, a note from Joseph in Surrey.

Jacqueline in Kelowna. She sent us a note, a pretty detailed email, including copies of her insurance premium statements from last year and previous years and the most recent one that she received. This is a very well-maintained condo in Kelowna. It’s about 20 years old. They’ve had no significant insurance claims of record in those 20 years. Jacqueline and her husband have lived in this building since 2005. Their premiums have gone up from $58,000 and change to $326,000 — an outrageous increase in the strata insurance premiums that they have to pay.

Their sewer backup and water damage deductible went from 10 to 50. Flood went up to 50 from five. And on and on it goes. They simply can’t afford these added costs. The last example that I’ll read into the record is one from my own community in Kamloops. Again, a relat- ively new building. We’re talking a building of less than five years old. No major claims. No claims at all. Cer- tainly, nothing that would provide a rational explana- tion for the increase in their costs. They have seen their annual premium go up from $26,000 to $113,000.

The water damage deductible has gone up from $5,000 to — get this — $250,000. Likewise, for floods and sewer backup deductibles. Their condo strata housing complex has opted to address this in two ways. Every unit owner is being hit with $100-per-month increases in their strata fees — so 1,200 bucks for a 12-month period — as well as a one-time $1,200 hit in the form of a special assessment. So Peter and his neighbours are looking at, this year, an additional $2,400 of cost that they weren’t planning on that has just hit them in the side of the head like a 2-by-4.

People can- not afford these increases. [1:40 p.m.] Now, we in the opposition have been quite alive to this issue. The first media reports of there being issues in Brit- ish Columbia’s strata insurance market actually came out a year ago. In July of 2019 there were news reports of strata complexes, strata corporations and strata owners receiv- ing renewals, insurance renewals, with huge increases, as I have talked about. That’s a year ago. It certainly appeared to accelerate and further intensify through this last winter and into 2020. We decided, as an opposition….

Part of the role of a responsible opposition is to actually put some ideas on the table from time to time, to suggest some solutions, to urge the government to take specific actions to address challenges that we see facing British Columbians. So we did exactly that. We’ve done that at a series of steps along the way. We introduced a private member’s bill in February of this year that contained a number of proposed solutions, 12001

a number of actions. The government didn’t call that bill for debate. They didn’t call that bill for debate, but we proposed a bill that, certainly modest in its contents, was intended to provide some initial steps that the government could take, recognizing the challenges that were unfolding in front of so many British Columbians. We called upon the government, in addition to those measures in that private member’s bill, to create a water damage prevention program.

Again, I read into the record before 12 noon today that one of the key findings of the B.C. finance authority report that looked at what is going on in the strata insurance market in British Columbia…. One of the key findings that they came back with, which, frankly, I don’t think has surprised anyone who lives in a townhome or a condo, was that over half of all of the claims that are hitting strata units and strata corporations relate to water damage, most of which is preventable with appropriate maintenance and upgrades being made. So we thought, “Let’s be thoughtful here.

Let’s propose some legislative changes, some legislative actions, and let’s suggest a water damage prevention program, ” again to help homeowners and strata corporations invest in the main- tenance and upgrades to prevent water damage events from happening in the first place.

The types of upgrades that we’re talking about here that could be funded through this kind of a grant pro- gram would involve things like installing automatic water shutoff valves, hard-wired water leak detection systems, steel-braided hoses, low-flow toilets, laundry and washroom floor drains, recessed sprinkler heads and protective sprinkler guards, just to name a few. But this stuff costs money. When we put this idea out there, we suggested that the government could fashion this water damage prevention program.

They could fashion it or model it on the HAFI program that exists, the Home Adaptations for Independ- ence program, which we’re very proud of in the oppos- ition. We created it when we were in government. That program is all about ensuring that people have the finan- cial wherewithal to make investments in mobility-related upgrades so they can remain in their homes longer and do so with as high a quality of life as possible. That program provides between $5 million to $10 mil- lion of one-time funding per year.

Those kinds of dollars would go a long ways to assisting folks who live in condos and townhomes to be able to afford the kinds of upgrades that are needed to prevent water damage events from hap- pening in the first place. But again, the government has driven right past that idea. We hear today about a $12½ billion projected deficit here in British Columbia. We hear about all of the things that the government is proud of doing in stepping up to support British Columbians in need.

They trumpet their investments roundly, right across the board. [1:45 p.m.] Here we have half of the population of Metro Vancouver and one-third of the population of British Columbia suf- fering under the weight of unexpected, unrealistic, high additional insurance costs, and the government is missing in action. The government wouldn’t even embrace a simple suggestion like a water damage prevention program. We thought…. Again, we pride ourselves in the opposi- tion of being resourceful. We pride ourselves on being col- laborative. We pride ourselves on bringing forward solu- tions.

We thought we would try again, so we wrote a letter to the Premier. It was dated June 16. We sent the letter to the Premier with a number of commonsense, practical, achievable steps that could be embraced very quickly by the government, that would begin to provide some relief to British Columbians facing this significant challenge. We called for the implementation of a temporary tax holiday on the 4.4 percent insurance premium tax that’s applicable on strata property. Let’s leave those dollars in the pockets of townhome and condo owners.

Let’s leave those dollars in the pockets of people who live in strata housing across British Columbia. That 4.4 percent insurance premium tax, by the way, is applied on about $300 million of estimated revenue that comes in from strata insurance premiums. That’s accord- ing to the B.C. Financial Services Authority report. Just providing a temporary tax holiday on that piece would leave potentially upwards of $13 million in the pockets of people who live in strata units and strata corporations. No interest on the government’s

part in that idea. We suggested that we extend, on a temporary basis, the property tax deferment program. Everyone is aware of this program at the present time. Y ou can defer your property taxes or a portion of your property taxes if you’re over 55 or if you are a surviving spouse or if you are a person with a disability. A very, very successful program that we’ve had in British Columbia for a num- ber of years. Why not extend that program to provide some relief for people on their property taxes? Again, no interest in the government in that idea.

We proposed a wide range of additional changes to the Strata Property Act, the regulations, involving every- thing from the contingency fund to how depreciation reports are handled to requiring some level of mandat- ory education and training for strata councils, mandat- ing certain types of supports that need to be there from the Ministry of Municipal Affairs to the strata corpor- ation world. A whole bunch of ideas. Most of that has been passed by, by the government.

We suggested that perhaps it was time to, again, do another review of the B.C. building code and look at implementing new requirements focused on the preven- tion and the severity of water damage events. No mention of the building code in any review whatsoever in the gov- ernment’s program to this point. Quite importantly, and I really want to underscore this point, we also called for a requirement to be put in place for the B.C. Financial Services Authority to make public 12002 British Columbia Debates Tuesday, July 14, 2020

the data and the information that it’s gathering from insur- ance companies to better understand the current climate of rapidly rising strata insurance. Imagine that. Some transparency. Now, let’s let British Columbians see what the calculations are, what the numbers are that go into the calculations that, supposedly, according to the insurance industry, are driving the costs of insurance into the strato- sphere. But no commitment from the government in their action plan to enhance transparency of that data and that information to ensure better accountability. No commit- ment from government to do that.

We held a town hall as well, a virtual town hall — the opposition leader and I did — a few weeks ago. We had hundreds of people online with us. This was a non-par- tisan event. It was promoted by a number of the different condominium owners associations and, certainly, folks that have approached us, as an opposition, with concerns that are specific to them. [1:50 p.m.] We held a really good discussion. We did a lot of listen- ing. Many of the stories that I read into the record earlier reflect the feedback that we received in that town hall. The most disappointing piece at this point, I think, would be this.

As I said earlier, there were signs that this strata insurance crisis was building a year ago. We brought forward some ideas for government’s consideration in February. We then followed those up with a series of more ideas. We’ve put some ideas on the table that would actu- ally provide relief for British Columbians. For the most part, with only a few exceptions, the government has opted not to embrace any of this. I mean, where is the sense of urgency? I heard it again today from the Minister of Housing, as she stands in the House here — in introducing this bill, in second reading.

She talks about how it’s so important to get on with actions that are going to help people with these added costs. Y et there’s nothing in this bill that actually does that. She talks about how critical it is to understand that these are just first steps — that there’s more work to do, there’s more consultation to do, there’s more engagement to do. Well, we’ve known about this problem and government has known about this problem for a year. People need the help now, not months and years from now.

The Finance Minister, back in February — I believe in responding to the private member’s bill that I had intro- duced in this House — was really pressed on: do you really understand the urgency of the situation, and if so, when can condo and townhome owners expect some action? When can they expect a plan? When can they expect some relief? The Finance Minister’s response was: “I hope in the next month we’ll be able to have some ideas, but again, it’s going to be determined by conversations we have with the industry and with strata owners. ” Well, fair enough. That was five months ago.

I am absolutely alive to the fact that we’re still in the middle of a pandemic, but the operations of government continue. It’s taken five months from that comment to get to the point where the government has finally brought forward some ideas. This should’ve been done sooner. The government should’ve brought forward an action plan much sooner than the last couple of weeks. As I said, it’s not like this issue just happened, has just popped up over the last couple of weeks. The government’s known about it. It’s been building.

The government has waited this long to actually take some action, and the action that they’re tak- ing isn’t actually going to make much difference for those folks who are most impacted.

There are a few items in the NDP’s plan that may make a difference from a long-term perspective — the require- ment for proof of insurance on an information certificate, contribution requirements to a contingency fund, require- ment for a strata corporation to inform owners and ten- ants of any material change in insurance coverage, a cap on an owner’s liability for events or claims that happened in their units where there’s no negligence involved and a few other things. Fair enough. Those are, perhaps, worthy points of discussion and areas to look at changing for the mid- to long term.

Again, the fundamental question with this piece of legislation is: how is this going to make life any better? What in this bill is actually going to make life better for British Columbians? The answer is that there’s not much. What the government has come up with provides no fin- ancial relief for thousands of British Columbians hit hard. There’s nothing in this bill that will keep money in the pockets of condo and townhome owners. There’s no water damage prevention program. Even the Finance Minister, back in February, had this to say about the importance of preventative maintenance.

She said: “What can we do on the prevention end and how can we work with the industry and strata owners to make sure we come up with a solution that’s really going to work?” Well, the water damage program was an attempt to sug- gest something that was fairly practical that would address that. We offered a whole bunch of ideas. [1:55 p.m.] There are a few items that we are particularly concerned about and that we will be canvassing in committee stage on this bill. The first involves the deferral of depreciation reports.

The NDP , the government, keeps saying that this is to close a loophole that exists in the legislation. The reality is that all they’re doing through this amendment, through this bill, is moving the ability to defer depreci- ation reports into regulation. The ability to do so will still be there in

section 12(a). It does beg the question: what will those regulations look like? Will the ability to defer a depreciation report apply to all stratas? Will it apply only to certain types of stratas — again, recognizing that a duplex is very differ- ent than a condo unit, which is very different than a bare land strata? Will it take into account the size of the over- Tuesday, July 14, 2020 British Columbia Debates 12003

all strata complex, the type of structure that it is, the loca- tion of it, the age of it, the claims history of a building? We don’t know. None of those details are included in this bill. They’ll come later. The government says that it’s willing to change the current requirement for full replacement cost coverage. On the surface of it, that might make sense under certain circumstances. But again, what would those circum- stances be? Is the government suggesting that a new minimum replacement value would be 50 percent of the cost of the building or 80 percent of the cost of the build- ing? We don’t know.

The challenge here is that there are strata corporations all over the province that are making some pretty import- ant decisions around special assessments, one-time assess- ments, increases in monthly strata fees and whether they continue to try to shop around for a better policy that might be out there that has been elusive to this point. How many more sleepless nights? We don’t know, because those details aren’t included. Contingency reserve funds.

Section 6 of this bill enables stratas to access contingency reserve funds to obtain and maintain insurance if that item “ …has not been put for- ward for approval in the budget or at an annual or special general meeting…. ” Again, fair enough. But it’s been quite amusing — that is probably a good word — to watch the Housing Minister on the one hand talk about how important it is for preventative mainten- ance to take place. How important it is for strata corpora- tions to be investing in upgrades and so forth. Make sure that they’ve got the contingency reserves that they need.

And then to come along and say: “Hey, but go ahead and use your contingency reserve fund to pay for your current year’s insurance requirements. ” As if it’s like this is a money tree that’s just going to regenerate automatically by itself every single year. What do you do in year two when you have drained your contingency reserve fund the previous year? We have asked that question to the Housing Minister. No answer. I know the reason is because she doesn’t have a good answer to that. It’s not a panacea to just encourage strata corpor- ations to go and raid their contingency reserve fund.

That might buy you one month or one year. As I said earlier, the government took a year to get to this point. It was cold comfort for strata owners to read in the government news release, when they announced this bill, that a whole bunch of the sections of the bill actu- ally won’t come into force on the day that this bill receives — should it receive — royal assent. There’s a whole bunch in this bill that is dependent on further consultation and engagement. What does the government have to consult and engage on? What do they need to do here? There’s a whole bunch more work apparently coming.

And 14 of the 16 sections in this bill are dependent on the development of regulations at a later date or on consulta- tions that the government plans on doing — which, again, could take months or, potentially, years. People just don’t have that kind of time. [2:00 p.m.] This bill is not a solution to the problem at hand. This is an empty bill. I said in this House a few days ago that, again, you don’t have to take my word for it.

The Min- ister of Finance had this to say back in March: “Bring- ing forward a bill that does nothing to address the pres- sures that are being faced does not make a good solu- tion. ” I couldn’t agree with her more. Only she and her colleagues have brought a bill to the floor of this Legis- lature that does exactly that. It doesn’t provide any relief for British Columbians. It doesn’t purport to solve the challenges that people are facing. It holds out this promise of further engagement and consultation, which is going to take months and months more to do just to kick the can down the field.

That is abso- lutely not good enough. I will end on this note. We are very proud, as an oppo- sition, that we brought forward a private member’s bill. We brought forward a whole bunch of ideas in letters to the Premier. We’ve been advocating as strongly as we possibly can, with the resources we have as an opposi- tion, to hopefully light a fire under the government’s butt on this one. Unfortunately, we are where we are, with a really empty bill. But I can assure you, Mr.

Speaker, and I can assure Brit- ish Columbians out there who have been impacted, that we’re not done, in the opposition, in terms of bringing for- ward solutions and ideas. We’re going to continue to fight for you. We’re going to continue to do everything we can to urge the government to take action that’s actually going to make a difference — that’s actually going to provide relief. Y ou can take that and count on it, because to not do so would otherwise let down, as the government currently is doing, a heck of a lot of British Columbians who really need some help.

With that, I conclude my remarks in second reading on Bill 14. M. de Jong:We have heard in great detail from my col- league, the member for Kamloops–South Thompson, on the nature of the problem we are confronted by. It is wide- spread. It is dramatic. It is significant in terms of the num- bers of families that it is impacting, and it is significant in terms of the magnitude of the impact it is having on those families. We have heard, again compliments of my colleague from Kamloops South, about the history of how this problem has begun to reveal itself.

It is important, I believe, for the assembly to acknow- ledge that this is not a problem that has presented itself in the last few weeks. The evidence that this issue would require the attention of government, of regulators, began to reveal itself a year ago. Certainly, by the fall of last year, it was becoming abundantly clear that there were challenges afoot. 12004 British Columbia Debates Tuesday, July 14, 2020

We are confronted, as a society, by the actions of a sector of our economy, in this case the insurance sector, that would see the premium costs associated with the product that they not only offer but that statutes, generated by this assembly, require be in place…. For hundreds of thou- sands of families, we are seeing the premium costs associ- ated with that product increase anywhere between 50 per- cent and 500 percent. [2:05 p.m.] If that were happening anywhere else in our economic life, there would be outrage.

I cannot, for the life of me, understand the lack of attention, the lack of priority, that this has been given by the government thus far. To be sure, there has been another issue that has attracted the atten- tion of government but surely not to the exclusion of all others. The magnitude of the problem is this. We are told that there are upwards of about 700,000 strata titles registered in British Columbia — 700,000. Many of them include families — more than one person.

It is undoubtedly true that people can own more than one, but to suggest that one million families are impacted by this challenge is not, I would suggest, to exaggerate. One million of 4½ million people in British Columbia impacted by what is taking place in the insurance sector. And what is taking place? Well, massive, massive premium increases.

Y ou know, I have to say I hear from those who are trying to explain this, those from the insurance sector who have tried to minimize the impact of this by saying: “Y es, there are some outlying examples, but on balance, it is an aver- age of 50 to 60 percent. ” Fifty to 60 percent is unaccept- able. I hope they hear me say that loud and clear. At a time when inflation hovers around 1 or 2 percent, for someone to come along and say an insurance premium of $80,000 or $100,000 is going up 50, 60 percent, let alone 300, 400, 500 percent, is unacceptable.

I hope this industry is under no illusions about where reasonable, thinking legislators — I hope on both sides of the House — stand on that matter. It is unacceptable. To foist those kinds of increases on people in a single year…. And in this year, of all times, when hundreds of thousands of families are out of work, when people are concerned about their future, uncertainty reigns. The industry says to a group of people who live in a neighbourhood — 100 families: “By the way, the insurance premium that last year you paid $80,000 for has gone up to $540,000. ” It is egregious. It is unreasonable.

It is indefens- ible. It is at times like this that we rely upon the govern- ment to step in and take corrective actions and provide some safeguards. Regrettably, we have seen precious little of that. I am hopeful that that will change, and we are beginning the discussion today. Y ou know, it occurred to me that it is one thing for a sec- tor of the economy — the insurance industry, in this case — to say to people: “Well, you know, we’ve done some ana- lysis.

Y our premiums have to go up. ” But imagine the reac- tion of a family or a strata council in Langley, Kamloops, Abbotsford, the Kootenays, Prince George and the Lower Mainland who are confronted by a bill from their friendly insurance broker that says: “On the one hand, your premi- um is going up 300 percent. Oh, and by the way, I have to direct your attention to page 2, because not only is your premium going up 300, 400 or 500 percent, that deductible that used to exist at $20,000 for you last year is now going up to $250,000. ” We heard specific examples from the member from Kamloops South about that.

I advanced examples of that several days ago in this chamber — $250,000. I do not profess to be an expert on any real estate market, least of all ones around Metro, what the price of a condo today in Metro Vancouver is worth, but I can tell you this. In my hometown, $250,000 would exceed the value of many, maybe even most of the condos that people inhabit. [2:10 p.m.] So your premium is quadrupling, and your deductible is going up more than that.

To add insult to injury, the same broker says to that group of families that are repres- ented by that strata corporation: “Oh yes, but we have a product for you called deductible insurance, and we’ll sell you that. ” That is…. Well, despite the protections afforded by this chamber, I’m going to use the words “inexcusable” and “indefensible, ” but I can think of stronger language. We must act, and we must act now. In fact, we should have acted…. The government needed to act sooner than this. As we heard a few moments ago, this is not an anti- cipatory discussion.

We’re not talking about a challenge, a problem, a crisis that is about to reveal itself in a matter of months. This is a crisis for families that exists today. Today as we debate this bill, there are strata corpora- tions…. That is a fancy word for groups of people and fam- ilies that live in a building, neighbourhoods, who are sit- ting down and making a decision. It’s happening in Kam- loops. It’s happening in Langley. It’s happening in Abbots- ford. It’s happening in Metro Vancouver. It’s happening right across British Columbia.

Families are sitting down and having to make a decision about whether to sign on to an insurance policy that is going to generate increases to their strata fees that in many cases may drive some of those families out of their build- ings because they won’t be able to afford the monthly fees and the monthly fee increases that will be required to pay those dramatically, indefensibly increased insurance rates. As they used to say in legal circles, time is of the essence. In fact, it is long past time for action, but here we are.

Again, as we have heard from the opposition critic and designated speaker, we had expected more from the gov- ernment, and we had expected more sooner from the gov- ernment. We are disappointed that they have chosen not to act and chosen not to act both as quickly and as imagin- atively as we think appropriate. They have tabled Bill 14. There has been much wringing of the hands. I must say that it is striking to see the dif- Tuesday, July 14, 2020 British Columbia Debates 12005

ference that manifests itself on the part of members who are now ministers who, 2½ to three years ago, professed great powers on the part of government to take steps when confronted by injustice. I use that word here as it relates to what is happening to people and families with respect to insurance premiums. A great wringing of the hands from the minister, who says: “This is the private sector, and there’s not really any- thing that we can do about that.

We must, after all, ensure that the private sector insurance industry is in a position to generate healthy returns for their corporate clientele and for their shareholders. ” It’s novel. It’s interesting. It’s fascinating commentary to hear from members of the NDP government, but I’m afraid it is also camouflage for the fact that the government either doesn’t know what to do or, if it has an inkling of what to do, doesn’t want to do it and doesn’t want to do it in a timely way. If it is the latter, then I am at a loss to explain why. We have before us Bill 14, which purports to do a num- ber of things.

In its early provisions, it contemplates changes to the amount of money that can be transferred to a contingency reserve — and this is a theme that exists throughout the bill — yet it provides no inkling of what those changes to the present percentages of 5 and 25 per- cent might be. [2:15 p.m.] Surely, it has occurred to the government that those families sitting down at tables today, this week and next week need to have that information in order to make informed choices about how to plan for their future and pay for the insurance that they are obliged to have.

There are provisions in this bill that require better dis- closure of insurance coverages to owners and purchasers. I don’t think that the government should anticipate much in the way of opposition from this side of the House to those provisions. Won’t get much argument from us there. What they will get is our concern that increasingly, without proper and appropriate response from govern- ment, the disclosed information that owners will receive from strata corporations is that they no longer have insurance on their buildings, because they couldn’t afford it.

So it will be a pretty hollow instrument if the disclosure requirements are followed with information that says, “We don’t have insurance. Notwithstanding what the state of the law is, we don’t have insurance, because we weren’t able to afford a $200-, $300- or $400-a-month strata fee increase, ” which some of these premium increases are driving. There are sections in this bill that eliminate options around…. Well, they seem to eliminate options around the obtaining of depreciation reports. But as my colleague pointed out, maybe not.

Because in the very same breath, the government in this, legislatively, includes provisions that would allow that to be altered by regulation. But again, no indication whatsoever of what the intention is there, with respect to what those regulations might be.

Those provisions seem — around the mandatory nature of depreciation reports — to be rooted in the belief, and this is something the insurance sector has been advancing, that the existing provisions have been used by strata cor- porations as a means by which they are avoiding doing the maintenance on buildings that is required and, therefore, increasing the risk of a claim. Well, we haven’t seen any real evidence of that, but that seems to be the story.

But if that is, in part, the rationale for the inclusion of the provision to eliminate what the minister keeps referring to as a loophole, and it’s probably more accurately referred to as substituting one for another, then I am at a loss to explain the pres- ence of the very next provision in the bill, which seems to be the most direct and immediate response to the crisis we are confronted by today. It seems to be a statutory recommendation by the gov- ernment to strata corporations, which goes like this.

When the notion of creating a contingency reserve fund was cre- ated and embedded in the statute, it was designed to ensure that there would be money set aside to deal with the expenses that will come up on a cyclical basis. Not every year. Not on an annual basis, but every ten years — to make sure the roof is replaced, expenses of that sort. This provision says that that money must be there, and it must be safeguarded. It cannot be used for annual operating expenses. Y et this provision says, and, in fact, encourages strata councils to access those moneys to pay for their insurance.

Well, as my colleague pointed out, talk about digging one hole to fill the other. Because that may allow a strata corporation and the families in that community to get past the obstacle they are confronted by this week or next. But next year or the year after, when it’s time to replace the roof, there won’t be any money. There won’t be any money whatsoever. Guess what’s going to happen. The insurance company that has been happy to collect $500,000 a year in insurance premiums is suddenly going to come along and say: “Hey, you didn’t replace your roof.

We’re not going to insure you. ” [2:20 p.m.] It is an irresponsible response to a situation that is confronting…. It is the ultimate irresponsible stopgap measure. There are provisions in here that allow for less than full replacement cost insurance to be purchased. I agree with my colleague and, I guess, by implication, with the govern- ment that that is an idea worth exploring. Having done some modest investigative work…. The act is clear. It requires coverage for full replacement costs. I am told that in 55 years, there has been one total loss claim, in the 55-year history of strata title in British Columbia.

So it would seem, on the basis of that, that requiring full replacement cost coverage is a bit of insurance overkill. 12006 British Columbia Debates Tuesday, July 14, 2020

Now, I’m sure the insurance companies are quite happy to collect premiums on that basis, because they never have to pay out that much. I think the idea has merit and is worthy of exploration. But those families gathered around the table need to know what the number is, as my colleague from Kamloops– South Thompson said. Is it going to be 80 percent? Is it going to be 50 percent? There are, I’m sure, rational argu- ments to be made, but it is of no help to those families today, who may sign on to an insurance premium cost only to discover, three weeks or three months from now, that they dramatically overpaid.

They bought a product they were no longer required to buy. That’s not good enough. That’s not good enough, confronted by what we’re con- fronted by. We have tried, in the opposition, as my colleague poin- ted out, to provide some suggestions, written letters. My colleague tabled a private member’s bill to try and signal the seriousness with which this issue needs to be addressed. I’m going to try, in the time available to me, to offer yet another suggestion about what I think is required, which is a shift in the model, a significant rethink.

I realize the min- ister is a busy person and, I’m sure, is tracking the debates, and her staff. I hope they will consider what I’m about to offer, and consider it seriously, and will be in a position to discuss it further when we get to the committee stage of the bill. I was sitting on my deck on my farm on Matsqui Prairie. I was looking out across the fields, and I was thinking about this. I was thinking back to a time before I was born, just after the Second World War. I’m still surrounded by farms. There are more berry farms than there were back then.

It was mostly dairy farms — farmers, growers, dairy farms — after the Second World War. They wanted to borrow money to expand. It was a time when expansion was on everyone’s mind. The population was growing. We needed more dairy products. The big banks in Canada wouldn’t lend them the money. They couldn’t get access to capital. So they took matters into their own hands. The reason that British Columbia today is the centre of the credit union movement in Canada is because the agrarian sector, farmers, took the lead in pool- ing their resources and looking after one another.

I think this is an idea that has merit, with respect to the insurance crisis we are facing, the cost of insurance. There is an opportunity here, with engagement from the gov- ernment and the regulator, the Financial Services Author- ity, to facilitate what is known in the statutes as a captive insurance company. [2:25 p.m.] We’re one of the few provinces that actually contem- plates such a thing. The term I prefer is self-insurance, the ability for people to get together and generate their own insurance coverage, at rates that are affordable. Y es, it’s a big change.

Y es, as I say this, the insurance sector is going to dismiss it at the same time they are appalled by it. Just as those farmers did 70 years ago, when large finan- cial institutions turned their backs on them, today, when insurance carriers headquartered in other parts of the world are saying, “Well, you’re too risky. We don’t really want to be in your market, ” then I say, as the government of British Columbia, as the parliament, as the Legislative Assembly of British Columbia, let’s give British Columbi- ans an option. Let’s give them the means.

Let’s facilitate, through the regulator and the legislation and transitional support, the means for the owners of strata properties to look after themselves at rates that they can afford. I believe it’s possible. I don’t think it’s possible on the fly. I think it requires a commitment from the government.

I’m hopeful that at the conclusion of second reading and through the committee stage debate, we will receive some kind of a signal from the minister and the government that they’re prepared to explore this, that they are prepared to endorse quick work, expeditious work, by the Financial Services Authority to develop a model. I know this. Confronted by an industry that has adopted a take-it-or-leave-it approach…. “Here are our rates. Y ou can take it or leave it. ” Confronted by an industry that is saying, “Y ou know, we don’t really want to offer this product. We don’t like the risk profile.

Those are our rates, and it’s too bad for you if they’re going to increase 60, 70, 200, 300 or 400 percent…. ” I say the proper response from us as a Legislative Assembly is to say to the people and the families who are being adversely impacted: “We are going to develop an option for you. We are going to develop a choice that you can avail yourself of. ” I think there are some important ancillary benefits that would go along with that. It occurs to me that a self- insured strata corporation is going to be pretty guarded about the nature of the claims that it accepts.

To the extent that the insurance sector laments what they call frivolous claims, I don’t think that’s going to happen. I think a self-insured strata corporation is going to be that much more motivated to ensure that the maintenance on their building is kept up to date, because the money to address any shortfalls or any deficiencies is not going to be coming from some insurance corporation overseas. It’s going to be coming out of the pockets of the members who are paying for the self-insurance. There will be a motiva- tion on the part of the families and the owners to ensure that the work is done.

This is something that I believe is worth pursuing. As I say, I hope the minister will accept the suggestion as one that is made constructively and that we can further explore during the course of the debates. What we have now is not acceptable. It is impacting on families who are already confronted by all of the uncertainty that we are famili- ar with around job security related to the impact of the worldwide pandemic. Tuesday, July 14, 2020 British Columbia Debates 12007

[2:30 p.m.] On top of that, in the midst of that storm, the insurance industry comes along and says to people: “Now your insurance rates are quadrupling. ” That translates into $200, $300, $400 a month, in terms of additional strata fees, at a time when families can least afford it. It’s not just old buildings; it’s happening to newly con- structed buildings. There does not seem to be a rhyme or reason, despite, quite frankly, the lame excuses and explan- ations we are hearing from the insurance sector.

I will ask the minister about the failure to include in this bill the mandatory disclosure of fees and commissions. I think that that time has come as well. But as you can tell from my remarks, I will be very interested in having the minister, as my colleagues will, filling in the blanks now — not three months or six months from now, but now — on what some of these numbers around mandatory coverage and contributions to contingency reserve funds or access to contingency reserve funds will be.

People need that information now because they’re mak- ing decisions now that, in some cases — not all, but in some cases — will be determinative as to whether or not they can keep the home that they are living in. It’s an important issue impacting, as I say, close to a million fam- ilies in British Columbia. I’m hopeful that this assembly can be part of a meaningful solution and that the steps the government will take form a meaningful solution and not just window dressing. Deputy Speaker:My apologies to the member from Saanich North, whose name was unintentionally skipped.

He was supposed to speak before the member for Abbots- ford West. A. Olsen:Thank you for the opportunity to speak to Bill 14, the Municipal Affairs and Housing Statutes Amend- ment Act. I actually appreciate the opportunity to speak following the member for Abbotsford West. I don’t believe that I will be coming with as much bluster, but I do appre- ciate both the words that he shared about the challenges with this bill and, as well, always appreciate when mem- bers provide ideas that can be debated — for us to discuss. [S. Gibson in the chair.] I think that it’s important to acknowledge that we also, in the B.C.

Green caucus, have been hearing from British Columbians over the past year about the substantive chal- lenges that people are facing, British Columbians are facing, as they’re hit with some of the largest insurance rate increases that we’ve ever seen in the province. We’ve been hearing these stories from strata councils who are unable to secure insurance for their buildings, dramatic rate increases, ranging from 50 percent to 300 percent. Y ou hear from owners that they were blindsided by these increases.

The costs for some are upwards of hundreds of dollars, over $1,000 in some cases, on top of housing expenses that were already unaffordable. I think it’s important for us all in this chamber to come to grips with the scale of the problem. Over 1.5 million British Columbians live in a home that’s part of a strata. That’s one in three, 30 percent of the people in our province, and they come from all walks of life. In response to this crisis, the government directed the B.C. Financial Services Authority earlier this year to inquire into the causes of the increase.

The issue was the focus of a number of questions from the official opposition earlier this spring. We’ve done a lot of work on this issue. The member from Kamloops–South Thompson, as we heard earlier, brought in a private member’s bill to really put this issue in front of government as one that needs to be dealt with and addressed with haste. [2:35 p.m.] Now we have this bill, Bill 14, before us to take what the government is calling “First Steps to Address Rising Insurance Costs for Strata Owners. ” I expect, for the most part, Bill 14 won’t be met with significant criticism for what it proposes to do.

The changes appear largely focused on ensuring more transparency for strata owners, provid- ing more clarity, support and direction for strata corpora- tions and better data collection and reporting for the sec- tor. None of those can be complained about. There are questions that I’ll want to ask about the regu- latory power to allow certain stratas to not be required to get full insurance coverage and the potential consequences of such a change. But for the most part, the criticisms on this legislation will be for what it fails to do. We’ve heard from our colleagues.

We’ve heard some of those criticisms already in the second reading stage of the debate. I’m sure that we’re going to be hearing a lot more and raising some more of those concerns in the committee stage of this debate as well. I think it’s fair to say that this is a very complicated issue with few, if any, easy solutions and that there’s plenty of room to make the situation facing one-third of our province potentially even worse. The B.C.

Financial Services Authority, in their interim report issued on June 16, included in their list of causes minor claims due to water damage, poor building main- tenance, initial construction quality issues, challenges with strata policies, high cost of replacement, earth- quakes and a market lacking adequate insurer liquidity.

Add this to the increasing costs associated with more severe weather events due to climate change, and which is only just starting to be grappled with by insurers, and the unique challenges we see due to B.C. ’s overpriced housing market, and you can see the enormity of the task ahead of all of us legislators. So while Bill 14 appears completely supportable, it is essential that we are clear that this is not a strata owner’s or strata corporation’s problem alone.

For instance, Bill 14 will, in the government’s own words “set out clear guidelines for what strata corporations are required to 12008 British Columbia Debates Tuesday, July 14, 2020

insure to help strata councils make informed decisions on their insurance policies. ” Do we have any data that sug- gests that the lack of guidelines has been a significant con- tributing factor? Do we know how much impact we expect this will have on the rates currently facing strata owners? Or how about this change? “Change the minimum required contributions made by strata unit owners and developers to a strata corporation’s contingency reserve fund. ” Will this have a measurable impact on the rates facing British Columbians today? How about for the next year’s expected increase?

My point is that we must not let this issue be so easily defined as an issue with strata owners and strata management without the clear data to reinforce that. We have seen just how devastating the lack of action by the previous government was when it came to the housing market. The deregulation and total free market approach has led to cascading challenges across our province. As it turns out, the so-called free market approach of the B.C. Liberals is not so free at all, is it? In fact, the cost of their policy for British Columbians has been more than most can handle.

I think it’s essential that we ask tough questions about all of these potential challenges and that the government equip itself with the data to inform further policy inter- vention, if so called for. These questions include: has there been any deregulation in the construction sector that has contributed to the construction quality issues that we now face? Have governments been so keen to create housing supply in the market that we failed to ensure that we have the regulatory regimes to support the increasing number of stratas that we see? Has the lack of updates to the Strata Act contributed to the problem?

In one publication I read, Troy Wotherspoon, the pres- ident of the Insurance Brokers Association of B.C., points to “more than 30,000 strata corporations of almost infinite variety. ” Has the Strata Act been modernized to reflect this complexity? Or are British Columbians seeing insurance rates out of line with other jurisdictions because this is an attractive jurisdiction for multinational insurance com- panies to make a profit — a profit on the backs of Brit- ish Columbians? Bill 14 will provide the answers to these questions.

But if we don’t start asking them now, we won’t fix the underlying problem. [2:40 p.m.] The other significant challenge in front of the govern- ment is what Bill 14 is silent on: what support is coming for people who are facing unaffordable increases to their insurance rates? Actually, it should be pointed out…. This is something that has been pointed out, and I’ll reiterate the point that was made by the member who spoke before me. This is not something that is coming. This is some- thing that is here. It is already impacting British Columbi- ans today and for the past year.

While direct financial support may help pay the bills in front of people today, that will simply amount to a cash subsidy to insurance companies and risks building the higher rates going forward. We have to be careful. It’s essential that government is developing policy that will help address not just the long-term challenges with strata insurance but the immediate affordability challenge facing people today. It is important to contextualize the challenge that we face. So I’ll repeat a quote from Frank Chong, vice-presid- ent and deputy superintendent of the B.C. Financial Ser- vices Authority.

It was a quote coming from the press release announcing the completion of their interim report in the middle of last month. He said: “The underlying factors contributing to B.C. ’s unhealthy strata insurance market are complex and do not present easy solutions. Everyone involved in the market has a role to play to bal- ance availability and affordability of insurance, going for- ward. ” I certainly do look forward to their final report.

I hope you get some answers to the questions that I have posed in this second reading debate and get a better sense of how Bill 14 fits into the broader approach that this government is going to take on this legislation at the committee stage. Thank you for this opportunity to speak to Bill 14. J. Isaacs:I am pleased to rise today to continue debate on Bill 14. We pass so many bills in this House, and some bills have more impact on citizens than others.

But Bill 14 is a bill that I am compelled to speak to, as I have heard from so many of my constituents that the rising cost of insurance and premiums, deductibles, is having a negative financial impact on them, and they are worried about what the future holds. I have heard from seniors like Jack, who has been a strata resident for 11 years. He has managed a Coquitlam highrise for ten years. Jack is a strata council member. He manages the budget, contractors, cleaners and all aspects of operations. His building has not had a strata fee increase in ten years. The strata building is well-maintained and well-managed.

Jack can see no reason why their building should be subject to such a high premium increase and feels that this insurance increase will “obliterate my hard work, curtail my disposable income and lower the value of my unit. ” But it doesn’t end with Jack’s dedication and good man- agement over the last ten years. Jack wonders how he’s supposed to enjoy his retirement. The maintenance fee will increase $115 a month, just due to the insurance. Jack’s water damage deductible also went up tenfold, from $15,000 to $150,000, making his suite also more expensive.

Like most seniors, Jack and many of his neighbours are on a fixed income. Jack wrote to me and asked for help. But Bill 14 and the government’s response to the growing strata insurance crisis will not provide immediate help for Jack or his neighbours. Over the last few months, we’ve heard from many condo and townhome owners who have watched Tuesday, July 14, 2020 British Columbia Debates 12009

their insurance premiums and deductibles skyrocket to the point where they wonder if they can continue to pay the monthly fee increase. In many cases, the monthly fees have increased by hundreds of dollars per month. Many seniors are wondering if they can remain in their homes.

The high cost of strata fees, insurance premiums and high deductibles is causing a lot of anxiety. [2:45 p.m.] These kinds of increases would be a financial hardship for nearly anyone, but so many strata residents are seni- ors who made the decision to downsize from their fam- ily home, thinking that they could manage the monthly costs and keep a little more money in their pocket for their senior years. I also heard from James, who lives in Coquitlam. James is also worried about the seniors who live in his building. Their insurance premium went up 170 percent.

His strata corporation budgeted for $75,000, but with the premium increase, it is now over $200,000. This premium increase leaves a shortfall of over $127,000, which had to be paid out of the contingency reserve fund. But that money in the contingency reserve fund will not be there in the future, leaving owners wondering what they will do for next year. Not only is James facing incredibly higher premiums, the deductible also went up from between $10,000 and $25,000 per claim to $150,000 to $250,000 per claim.

The rising cost of insurance premiums and a shifting marketplace of insurance providers was evident months ago, almost a year ago. There has been time for govern- ment to evaluate what this means to condo and townhome owners. There has been time for consultation within the industry and with stakeholders. There has been time to provide some solutions that would address the crisis. This is not a partisan issue. This is an issue that affects over one million families in the Lower Mainland. It affects their monthly budget, and it affects their net worth.

Coquitlam has many residential towers, and the official community plan includes ten to 15 more towers as we densify responsibly. So this cost and the rising costs of strata fees have a huge impact on this market. We’ve raised the concerns of strata owners in the House, and we’ve been working hard to encourage gov- ernment to address the situation. In February, we intro- duced a private member’s bill that would’ve taken steps to mitigate the growing problem. But the NDP refused to call it up for debate.

We sent a letter to the Premier with numerous com- monsense ideas that could be implemented fairly quickly to provide relief. But we received no reply. We hosted a strata townhall where we heard directly from strata resid- ents who shared their concerns and examples of just how these significant increases in premiums and deductions were hitting them personally. We’ve been trying to convey, on behalf of our constitu- ents, on behalf of all strata owners, how serious this crisis is and that if some substantial steps are not taken, and in a timely manner, we will see people lose their homes.

The Minister of Housing would give no assurance for those who are asking for action. In fact, the Minister of Housing introduced this bill, completely overstating its substance, and claimed that this would make life better for those struggling with strata insurance. But Bill 14 doesn’t address the major problems related to premiums and deductibles, and it comes up short when strata owners are looking for immediate relief. Many strata owners, especially seniors, cannot wait until government figures out what this is going to look like in the long term. People are looking for and need immedi- ate relief now.

It’s frustrating to see government put aside the concerns of strata owners. We should have seen this addressed months ago. Government should have anticip- ated the financial and negative impact these increases would have on strata owners. I mentioned earlier that Jack’s deductible for water damage went up tenfold, from a $15,000 to $150,000 deductible. Water damage deductibles account for 46 percent of total claimed costs since 2017 and was 56 per- cent in 2018 alone. This is well known.

It’s a well-known concern that frequently affects strata buildings, yet this bill has no water damage prevention program that would assist strata owners with costly upgrades, upgrades that they will need in the long run. Hopefully, they will be able to save money on future fees. [2:50 p.m.] We suggested in our letter to the Premier last month that a temporary tax holiday on the insurance premium would be a reasonable approach and leave a little bit more money in owners’ pockets. This is a 4.4 percent tax that the government collects on every insurance premi- um paid.

According to the FSA, strata insurance gener- ates approximately $300 million in premiums. The total revenue collected by the government from the insurance premium tax is approximately $13.2 million annually. Of course, this revenue to government increases as premi- ums continue to skyrocket. A tax holiday on the insurance premium would make a considerable difference for condo owners. It would be a simple solution to make life just a little bit easier for those who are struggling. Y et this suggestion has been completely ignored.

Instead of implementing real solu- tions and providing some relief, government has taken what they describe as first steps. These first steps simply won’t make much of a difference to the current situation. One step includes requiring stratas to inform owners immediately regarding material changes to their insurance coverage and enables government to prescribe a cap on an individual owner’s liability or an insurance deductible if that claim originated in their unit, but not out of negli- gence.

These kinds of changes will be beneficial down the road, but they certainly do not address the problems in the short term or in the medium term. 12010 British Columbia Debates Tuesday, July 14, 2020

Government needs to listen to what strata owners like Jack are asking. They are asking for help now, not some- time down the road. In the meantime, they don’t want to lose their homes or lose their quality of life. Another step is to remove the ability to defer a depreci- ation report, which is noted in

section 4. They are claiming that the ability to defer depreciation reports is a loophole. But they have simply moved the ability to defer depreci- ation reports into the regulations. It is still there under sec- tion 12(a). It seems like they want to avoid accountability. Once again, this change does nothing to help strata coun- cils and strata owners with the rising costs of premiums and deductibles. Ronald, who lives in Coquitlam, says their strata has hired engineers every year. All of the depreciation reports are in and all are in complete accordance with what is required.

Then, overnight, somebody says: “Y ou’re not doing things right. ” Well, Ronald was doing things right. Despite his best efforts to do things right, his strata insur- ance went up by $200,000. What’s most curious is that the government has intro- duced a bill to be debated and voted on and, at the same time, they’re going to have further consultations on the proposed legislation that is before us today. This is confus- ing and offers no real answers to strata owners who won- der what their future strata fees may look like.

There is no indication when relief will come, and it clearly shows that the minister has not listened to those who have been ask- ing for help. Well, I want to help Jack. I want to help James. I want to help Ronald. I want to help all of the other strata owners who have reached out and voiced their concerns. I hope that as we move to committee stage, we can uncover how substantial — or not — this bill will be for British Col- umbians. British Columbians will be facing excessive cost increases for strata premiums and deductibles, and we look forward to debating this legislation in greater detail. J.

Thornthwaite:I am very happy to speak on this bill, Bill 14, the Municipal Affairs and Housing Statutes Amendment Act. I appreciate my colleagues ahead of me with their thoughtful suggestions to help this real financial crisis that is going on right now. [2:55 p.m.] I thought I’ d give you a little bit of a personal note first. I live in a strata. I don’t know how many people in this House actually live in a strata. But how about this? On January 30, I got a letter from my property management company.

They said: “Please be advised that the 2020 renewal for the strata corpor- ation insurance has increased the deductible significantly, most notably for water damage and sewer backup, which on February 1, 2020, will both be $100,000. ” The letter was sent on January 30. “The deductible for water damage from supply lines will be $250,000 on February 1. “Please review the

summary of the coverages on the back of this notice with your unit and ensure that you have enough insurance on your own unit. ” On February 3, we got a notice. “ As the property manager has advised, there has been a dra- matic increase in the deductibles to the strata’s insurance policy for water damage and damage caused by supply lines. In simple terms, this means that owners face a greater risk of having to per- sonally pay for damage to their units or to the common property in the event of a claim related to water damage or water supply lines.

Because of this sudden change in the deductible, you may not have enough insurance coverage under your current homeowner’s policy. ” “Please take the attached certificate listing the strata’s deductible to your insurance broker and have them review your insurance policy so that you can ensure your policy gives you enough protec- tion. Please do so immediately, as these changes are effective Feb- ruary 1, 2020. ” That came on February 3, 2020. Our property management company scrambled at the last minute to renew our building insurance.

They got it, but then all the owners had to rush out and top up their insurance. I had to change brokers because of it. I had the same broker since the first time I moved out of my house. I’m not going to tell you how long that was. I mean my family house. I was underinsured for a bit but then was fortunate to get the $100,000 deductible from another agent. Plus, four years ago my strata insurance was $412. This year it’s $1,395. That’s a $983 difference, 240 percent in four years. That’s a mortgage payment in many, many cases. Plus, I live in a row townhouse. There is no one above me and no one below me.

Why is my insurance clumped into the same category as a highrise, with condos that are all on top of each other? My building is not old, and it’s not new. It’s just 12 years old, and I believe it has been in good maintenance. If I could afford it, I’ d probably move out of a strata, if I could [audio interrupted] a bigger mortgage for a house. Out-of-control strata insurance fees will disincentivize anyone from downsizing into a strata, which will not help the housing market for those families who want to move into the houses that no one wants to move out of. It won’t help housing affordability.

People will need bigger mort- gages to pay for housing, versus the strata, because they will now be afraid of buying into a strata. Now the stratas are not necessarily more affordable. Maybe this will just keep people renting, if they want to buy. I am very, very concerned. Townhouses and row town- houses like mine are all included in this, just like the same. Townhouses are essentially an attached house. Many younger couples and downsizers rely on these types of houses in their transition to a bigger house or downsizing after the kids move out. In my complex, that’s exactly what we have.

We have downsizers, and we have people that are young couples starting out. That’s how the housing market goes. Y ou move up or you move down, depending on your needs. But with these Tuesday, July 14, 2020 British Columbia Debates 12011

strata insurance premiums that are so high, this is going to put a blockage on people either not getting into the market or not wanting to move on or into a house or back into a strata from a house. This strata insurance crisis is clearly not isolated to cer- tain types of housing or geography. I’m in North Vancou- ver. Other people on the strata town hall that I attended were from all over B.C. [3:00 p.m.] The point is that the insurance companies are the responsibility of the provincial government. What could they do to help strata owners? The B.C.

Liberal caucus has some ideas that they presented to government, but Bill 14 is the government’s response. We have watched, over the past few months, as strata insurance premiums and deductibles have skyrocketed across the province, leaving so many condo and town- home owners facing monthly fee increases of sometimes multiple hundreds of dollars every month. On this side of the House, we’ve been working hard to convince govern- ment to address the situation. As the member for Kamloops–South Thompson said earlier, we first heard of this issue over a year ago.

We introduced a private member’s bill back in February that would have taken the steps to mitigate the growing prob- lem. The NDP refused to bring it to debate. We sent a letter to the Premier with numerous commonsense ideas that could be quickly implemented to provide relief. We got no reply. We even held a strata town hall, where we heard dir- ectly from strata residents, like me, at the centre of this crisis. The Minister of Housing would give no assurances to those who asked for action. My colleagues have listed many, many people’s situations in these debates that we’ve heard this afternoon.

The Minister of Housing introduced this bill with great fanfare, claiming that this was going to make life better for those struggling with strata insurance. But is this bill actually going to make a difference for more than one mil- lion British Columbians living in condos and townhomes? I don’t think so. This bill will not address the major prob- lems that we are currently facing now. It’s a dismal dis- appointment to those struggling with these rising strata insurance fees. First and foremost, the legislation that the government has come up with provides no financial relief for those who desperately need it.

There are no measures to keep money in the pockets of strata owners. There is no water damage prevention program to assist strata owners with costly upgrades — upgrades that they will need in the long run to, hopefully, save money on future fees. Instead of implementing real solutions and relief measures, they have taken what they [inaudible record- ing] first steps. That won’t make much difference to the current situation.

These steps include requiring stratas to inform owners immediately regarding material changes to their insurance coverage and enabling gov- ernment to prescribe a cap on an individual owner’s liability for an insurance deductible if the claim origin- ated in their unit but was not out of negligence. While these kinds of changes are needed as a piece of the wider problem, they do not properly address the situ- ation in the short and medium term. It demonstrates that this government has been not listening to British Colum- bians for a year. They need help now.

They need to see this House take steps that will make their lives easier right away — not measures that will only start making a differ- ence long after they possibly have had to lose their homes. Another change of note is

section 4 of this legislation, which removes the ability to defer a depreciation report. The NDP are claiming that the ability to defer depreciation reports is a loophole, in their quest to avoid accountability for their lack of action on the crisis. However, they have simply moved the ability to defer depreciation reports into the regulations. It’s still there, in

section 12(a). Further delaying action, the government has also said that they are going to be launching further consultations on the pro- posed changes in the legislation before us today — more consultation. We heard from other members about the June 29 virtual round table on strata crisis. We heard from people from Richmond, from Penticton, from Williams Lake, from Coquitlam and from Ladner.

But still they’ve not come up with anything that provides financial relief for any of the people that spoke of this on that strata round table — nothing to keep money in the pockets of strata owners and no water damage prevention program to assist strata own- ers with costly repairs. We offered ideas to keep money in the pockets of strata owners, like a temporary tax holiday on the insurance premium tax, an extension of the prop- erty tax deferment program, on a temporary basis. Not only has the NDP wasted months before taking action, they’re apparently going to launch further con- sultations.

Most of the changes in this bill are by regulation and won’t be able to deliver immediate relief. People don’t have the luxury of time. [3:05 p.m.] What did we suggest? Well, we introduced a private member’s legislation, the Strata Property Amendment Act, 2020. We called on government to implement the water damage prevention program. We wrote to the Premier, seeking further action on the strata crisis, to implement the temporary tax holiday on the 4.4 percent insurance premium tax applicable on strata properties, to leave these dollars in the pockets of strata owners.

Y es, the govern- ment is making money on all of this. Extend, on a temporary basis, the property tax defer- ment program to enable strata owners who have faced extraordinary additional expenses related to soaring strata insurance costs to defer a portion of their property taxes. And to implement changes to the Strata Property Act and regulations that ensure that annual contributions are made to the strata corporation’s consolidated revenue fund 12012 British Columbia Debates Tuesday, July 14, 2020

at levels acceptable, considering the building’s age, claims history and other unique circumstances. To require strata corporations to have a depreciation report detailing necessary maintenance every year, and require a strata corporation to inform owners and tenants of any material change in insurance coverage, including an increase in any deductible, as soon as possible. Review the B.C. building code, and implement new requirements focused on the prevention and severity of water damage events. There are other solutions that my colleagues have described, which I will not go over now.

The members for Kamloops–South Thompson, Abbotsford West and Coquitlam–Burke Mountain had some great suggestions. But suffice it to say, I, like my neighbours and the hundreds of thousands of families who live in strata properties, see no help for them. As my colleague mentioned earlier, this is bad enough to happen during a housing affordability crisis, particu- larly when this government had promised to fix the afford- ability crisis in their campaign. But this is during COVID. This is the worst impact on our economy and jobs since the war.

We have seen with previous measures that this govern- ment has presented promises that were simply empty — empty promises. How can this government profess to care about housing affordability and at the same time ignore this strata insurance crisis? I am disappointed. We are all disappointed. J. Sims:It’s a pleasure for me to rise today. Well, actually, I’m going to sit and speak on the legislation before the House, which is the Municipal Affairs and Housing Stat- utes Amendment Act.

Y ou know, I’ve been listening to the debate a fair bit today, and there are a couple of comments that I do want to make before I get into my speech. One of those is to do a huge shout-out to the people in Surrey-Panorama here who have been doing an amaz- ing job, just as the rest of British Columbians have been, at social distancing and making sure that during this time they are taking the proper precautions. It’s because of them that we have the kind of moving into phase 3 that we have been able to do and to get the economy going again.

I also want to do a special shout-out to my staff, both here at the riding, in my constituency, as well as at the Legislature — staff for all of us who help to support us in the work we do. But today we’re talking about a very important issue that impacts so many people in British Columbia, and that is strata insurance. Listening to my colleagues, you would have thought that this just happened out of the blue and that there wasn’t a long-term coming of this day, so to speak.

For the strata owners — and I’ve talked to many of them who live in my riding, both in townhouses and in con- dos — this is a huge challenge. For some of them, they’re finding it difficult to buy insurance, because they can’t find a provider. And for others, the costs have gone up so, so much that it’s hurting them. When I talk to them, they realize that this is not a simple issue. They know that they’re facing challenges, but they tell me over and over again that this is a complex issue.

They also know that this is one of the failures of the sort of private market approach. [3:10 p.m.] One thing we have to know is that government does not set insurance rates for private insurance, which is what this is. This is not ICBC, which is a regulated agency that provides insurance. This is free enterprise. Nor do we have regulations in place at this time that would get the govern- ment to determine the pricing for that insurance. There are some heartbreaking stories, and we’ve been hearing many of them. But really, what is the solution?

Y es, we could sit here and do what my colleagues have been doing, which is just throw darts and arrows, or we could say: “What is the real underlying issue here, and how do we get to finding solutions that will be there long term for the strata owners, for the managers who manage these stratas and for the insurance companies as well?” Because it is a private insurance issue, it is very, very complex. I think everybody involved knows that this is a very complex issue. As a matter of fact, even my col- leagues in the opposition know that this is a very, very complex issue.

For those who either have had their insur- ance denied or are finding that their insurance has gone way up, to know it’s a complex issue is not enough. But because it is a complex issue, we really do need to have a multifaceted approach. This is where I am so proud of the work that has been done by the Minister of Municipal Affairs and Housing. She has demonstrated how our government works in col- laboration.

It’s not about flying in to fix something that is out of our jurisdiction or our control at this moment, but looking to see what are the different components, what are the real causes behind the insurance having gone up so much and then making sure that there are levers in place to ensure that we can stabilize this industry and thus make sure that those who need insurance get insurance and that the costs are not as outrageous as they are. Now, my colleague from Kamloops–South Thompson has said it himself on CKNW , and I actually went back and heard that clip, as well, where he said there is no silver bul- let.

And yet, speaker after speaker that has come on today from the opposition would imply that they have the silver bullet. Let me assure you that we agree. We agree with the Member for Kamloops–South Thompson when he says there is no silver bullet, and so do those representing the strata owners and the insurance industry. They also agree with him that there is no silver bullet and that this has to Tuesday, July 14, 2020 British Columbia Debates 12013

be a collaborative approach, and it has to be done in stages, which is what the minister is doing. Plus, this is not an issue that developed overnight. Often when I listen to my colleagues from across the way and we’re talking about challenges that British Columbians are facing, they speak as if for 16 long years they had nothing to do with the situations that have arisen that they want a magical fix for. I know you’re going to be saying that you were here, or that we’ve been in government for three years. Y es, we have, and we’re proud of the work we’ve done so far. We have lots more to do.

But let me tell you: the damage that was done in a lot of different areas…. It’s not an overnight fix. That’s what we’re trying to do right now. It also is a failure of an unregulated private market insurance system. I know my colleagues across the way absolutely believe in the free market. Y et, it’s strange, because they haven’t quite used the words that we need public insurance for homeowners and for stratas, but I would say that the message behind what they’re saying is almost that. The B.C.

Liberals, you know — and this is not news to any of my colleagues across there — have always been, I would say, the cheerleaders at the altar, so to speak, of the private market. [3:15 p.m.] They’ve been calling for private insurance every time ICBC comes up. We know that’s the dumpster fire they’ve created, and it’s a dumpster fire that…. I’m very proud of the work that the Attorney General is doing to try to get control over ICBC. Once again, we’ve seen some signific- ant changes, and we’re going to be seeing some more to make auto insurance competitive and affordable.

We can do that because it is under our publicly regulated business. But even there, my colleagues across the way, when they were government, were real cheerleaders for private insur- ance, and here we have a private insurance system that has led to strata owners being in the bind they are in. So what is the solution? What is the solution the wor- shippers of free enterprise are throwing out from across the way? They’re saying: “Go in there, and do this, do this, and do that. ” But what about looking at the whole picture? As I said, this is very, very complex, and this is a failure.

That’s why this bill, in its complexity, challen- ging the very complex problems we’re having, is there. It is there to make sure that we are looking at making sure that the levers are in place for all who are involved so that we can get a long-term fix. Now, it’s very easy, when you’re in opposition, to try to score points, to say, “Look at this government. They are not doing anything, ” and then forget there were actions that the opposition did when they were in government that have led to some of this. Let me tell you that even when we sat down with the dif- ferent partner groups….

I’m proud of the fact that we are a collaborative government. We are not pretending that we have the solutions for everything. We consult experts, we use data, we use science, and we use people’s lived experi- ences to come up with solutions and to find a way forward from people who know those sectors well. They will tell you that there are no simple solutions. We are committed, and our commitment is very, very strong — a very hard-working minister.

I know she has been on this night and day, so to speak, with her very com- plex file but giving this a priority, because we know that there are British Columbians who are hurting, through no fault of their own. There is a system that was in place that has gone awry, and it needs to be brought back into some kind of a con- trol, so to speak. We have to find a solution. We have to find a solution because people are hurting, and when people are hurting, that’s when it’s the role of government to see how they can assist them. Assisting them doesn’t mean coming up with these and just throwing out ideas.

It actually means finding solutions for the long term and for the short term that will work for everyone. This legislation, and we admit it, is the first step. We’re not going to stop trying to fix the failure that the private insurance system has created. It has created a problem. It is more acute here in Brit- ish Columbia, though I have to be honest — and I think my colleagues across the way know this as well — that this is an issue right across the country.

It is compoun- ded here because of the actions of the previous govern- ment, with some relaxation of the rules and regulations they did when they were government. As a result, we find ourselves with a double whammy here, and it is hurting British Columbians. Now, some of these issues could have been addressed by my colleagues while they were in government. But instead, while they were government, they made things worse. When in government, the B.C. Liberals created a loophole that allowed strata boards to put off regular maintenance. We’re not making this up.

The source for this is the Insur- ance Bureau of Canada presentation which I heard and received in May of 2020 through Zoom. [3:20 p.m.] They also, the Liberals, killed the loan program that used to help owners to fix their leaky condos. Two big actions by the previous government that created some of the problems that have led to the insurance situations we are facing today. They also allowed brokers — and this is really important — to hide their commissions from condo owners and enabled building managers to receive kick- backs for referring clients to insurance providers.

If you’re going to criticize and ask the government to take action, part of it should be to take responsibility that you played a role in insurance being the way it is today in British Columbia. That’s the double whammy I am talking about. Y ou created this. Now you’re saying we created this, but you’ll fix it overnight. As my colleague across the way, once again, the member for Kamloops–South Thompson, said…. I don’t often agree with him on many things, but on this issue, I do 12014 British Columbia Debates Tuesday, July 14, 2020

agree with him. When he goes on CKNW and says, “There is no magic bullet, ” I agree on this issue. We do have validators, people who have spoken up and are enjoying the collaboration. Y ou know what I find? Maybe this is part of my teaching background as well. I find that people, when they are facing problems and chal- lenges, do want to be involved when we look for solutions. Often the solutions lie with them because they have the expertise in that area. Listen to this one. This is from Chuck Byrne. He’s the executive director of the Insurance Brokers Association of B.C. This is important for me.

As we all know, when we build a house, a foundation is very important, just as when we learn something, learning the basics is very important. What he says is that the government’s changes “will be crit- ical foundation pieces. ” That’s what this legislation is about. It’s the first step. It has taken time because we have collaborated. It’s going to lay down a foundation so we can address these very seri- ous issues. He goes on to say, on June 23: “These are the first steps necessary to stabilize the strata insurance market in the province. ” That’s not government MLAs or ministers saying that.

Those are the experts who are saying that. Y es, we need the foundational pieces. We need the regulatory legislation in place so we can begin to stabilize the strata insurance mar- ket in this province. I also have a quote here from Tony, who’s the executive director of the Condominium Home Owners Association of B.C. He is a spokesperson and a representative for the Condominium Home Owners Association. What he says is that transparency around reporting….

As I said previ- ously, the Liberals were able to build in all kinds of loop- holes and to take away reporting and requirements, but the transparency around reporting, commissions, disclosure and the changes to enhance owner responsibilities in strata corporations will all contribute to an improving insurance market which will benefit strata owners. He also goes on to say that it’s a great start. We admit it’s a start. The minister says this is a beginning. This is the foundational piece. It’s difficult to build a house without a foundation.

That’s why the foundational work has to be done first instead of sitting in the opposition and throwing darts and arrows. He goes on to say, and uses very strong language, which I want to share with you: “I definitely want to resound a high level of support to the government for introducing these amendments. The initiatives that they have taken in this bill are going to have a positive effect for consumers. ” [3:25 p.m.] Y ou can see that those are very strong words from an industry that is struggling right now, both the owners, the stratas, as well as the insurance companies who are look- ing at how we do this.

It was a bit rich, hearing my colleague from North Van talking about the housing affordability crisis. I kept think- ing…. I ran on that issue as well as on getting a hospital here for Surrey. Affordable housing? Y es. I’m proud of the work we’re doing in the area of affordable housing with our 30-point plan and billions of dollars invested to build more affordable housing, to build more rental units and to get people off the streets and into housing. There is no way I’m going to take any lectures from the opposition on housing affordability when they did noth- ing.

As a matter of fact, they helped to encourage, through their lack of action, the housing market getting out of control. Now professionals like our teachers, our police officers, our nurses…. So many people that could once afford to buy a house now do not qualify for a mortgage to buy a house. Those are the kinds of challenges — the out-of-control housing market — that were allowed to occur under the previous government. So it is a bit rich now when they’re talking about housing affordability, as if it’s something that they have invented. I do want to now take a minute to say….

I’ve talked about it being a complex issue. The B.C. Financial Services Authority has been very, very clear too. There is no quick fix. What they have said is that we all have a role to play. We all have a role to play. We are willing — I think that’s what differentiates us on this side of the House from the other side of the House — to sit with people. We are willing to sit with those who are the experts, who have the information, and together, col- laboratively, find a way forward. That’s who we are.

We’re willing to do that because we know how important it is to bring balance to the market — to bring balance to the mar- ket — and, once again, no quick fixes. We have to recognize there are dynamics driving these increases. There are dynamics driving these increases, and they have been compounded for years and years and years. This did not happen over the last 12 months or the last 24 months or the last 36 months. This has been going on for years. They are playing out in the private insurance industry. Government does not set insurance rates nor does gov- ernment regulate the pricing.

That’s why this legislation is to give some levers so that we can begin to look at some regulations around insurance and the industry. This legis- lation will give more transparency, and transparency is a good thing. It’s a good thing. I can tell you that I was kind of taken aback when I heard about some of the loopholes and some of the things that were happening. We want to make sure that the strata insurance market and the strata councils and owners have levers in order to be able to cope with the current situation.

As the minister often says — and a very hard-working minister at that — this is just the first step. This is the beginning of trying to tackle a very complex problem for which there is no simple pill. In Punjabi, there is a saying, Tuesday, July 14, 2020 British Columbia Debates 12015

miṭhī gōlī, a sweet pill to fix everything. There is no sweet pill that is going to fix and cure everything in this. This is going to take hard work from everyone involved, and we're committed to doing it. The minister is going to continue to work with homeowners, with the strata stakeholders, like the Con- dominium Home Owners Association, and with the insur- ance industry. Every one of them has a role to play to help us to find solutions. We are committed to finding those solutions. [3:30 p.m.] Let me say that my heart breaks. My heart breaks for those seniors.

My heart breaks for the young couples and families, young families, who are facing huge, huge increases in their insurance rates. We have heard 40 per- cent across the board. But I, myself, have heard of some who are facing much higher rates than that. It is a huge challenge for them, and I know that they are struggling. I want them to know that their government is working with all concerned to help find solutions that will be a fix for the long term. [R. Chouhan in the chair.] B. Stewart:It’s a pleasure and an honour to stand today before you and the public in regards to Bill 14.

Having listened to some of the speakers that preceded me, I think it’s clear that everybody recognizes that there is an acute problem that came as a result of no necessarily wrongdo- ing by former governments or people individually. I think what we’ve been talking about is trying to find a solution here that will lead to the issue about the economic pres- sures that are faced by strata owners throughout British Columbia. I think one of the things that was highlighted in June when the B.C.

Financial Services Authority concluded that “the strata insurance market in B.C. is ‘unhealthy’” and not fulfilling the needs of British Columbians…. It further stated that the strata insurance market fails to meet the goals of sustainability, accountability and availability. We can sit here and not talk about solutions. I know that the minister talks about the fact that this bill is a starting point, in terms of the solutions. But there are a lot of things that the government has taken on and a lot of promises. The thing about it is that it isn’t always about governments being able to solve affordability issues.

Let’s take afford- able housing for a moment and talk about the fact of the promise of 114,000 new affordable housing units. The gov- ernment has actually only delivered 2,400 of those. I don’t think that that is quite what the intention was when that promise was made. I think that more importantly, when we talk about solu- tions, we know that affordability is not government hold- ing everybody’s hand and carrying them along to a place where they’re giving them a house.

The bottom line that we’re faced with is we have undue delays and costs and reg- ulations that are causing difficulty and increased cost to homeowners. We’re talking today about the strata amendment act. Bill 14 refers to the fact that we do have an affordability issue, and one of the ways that we’ve been trying to resolve that is by being able to develop cities that are more compact. We talk about the fact that they have livability and all these things. But we won’t get it right if we continue to sug- gest that the problem is with what we did as a government and what you’re doing as a government.

We need to come together and find solutions. There are all sorts of reasons that we need to find solutions to this. Now, the member previously misspoke. The member for Surrey-Panorama declared the fact that the leaky-condo crisis was something of this previous government. That’s categorically incorrect. It was started back in the late ’80s. It went on through the ’90s, when their party was the government. In 2003, we came in and created the B.C. Homeowners Protection Office, with interest-free loans. That’s how we came to a solution.

It’s a building code defi- ciency that was adopted in an effort to build more afford- able housing. The situation is that Tony Gioventu, who is with the Condominium Home Owners Association of B.C., stated categorically that British Columbia’s problem with leaky condos was solved in a big part by the former Min- ister of Housing and the creation of this particular office. I think that the fact that…. We provided interest-free loans for nine years, and those loans were to help people be able to afford the ability to be able to repair con- dominiums. Some of the bills were staggering.

It was $5 billion in terms of repairs. [3:35 p.m.] We’re not talking about a repair job today, but the mem- ber for Kamloops–South Thompson talked very clearly about the fact that one of the issues that was identified by the Financial Services Authority in its review is that there is an ongoing is

Document details

Collection	British Columbia — Debates (Hansard)
Citation	20200714pm Hansard n340
Type	hansard
Volume / chapter	20200714pm Hansard n340
Language	en
Format	pdf
Source	PROVINCIAL
Identifier	8115bc6d9172daa65180861bf1e2afa4fa978efc

Source file is stored in the law ingest library (pdf).