agenda london & middlesex community housing …the annual meeting and present the report of the...

Board Member:

Aynsley Anderson

John Millson

Paul Yeoman

Rosanna Wilcox

AGENDA

LONDON & MIDDLESEX COMMUNITY HOUSING (LMCH)

Board of Directors Meeting

Corporate Boardroom 1299 Oxford Street East, Unit 5C5

London, Ontario

Thursday, May 21, 2020

5:30 P.M. – 7:30 P.M.

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Item Lead Time 1. Call to Order A. Mackenzie 5:30

2. Recognition of Indigenous Peoples and Lands A. Mackenzie 5:32

3. Completion and Acceptance of Agenda A. Mackenzie 5:35

4. Disclosures of Interest A. Mackenzie 5:36

5. Approval of the Minutes of the Previous Meeting A. Mackenzie 5:40

6. Communications A. Mackenzie 5:41

7. Delegation None

8. Board Chair Elections A. Mackenzie 5:42

9. Reports and Businessa. CEO Updateb. Staff Report 2020 – 19 – May Vacancy Managementc. Staff Report 2020 – 20 – AGMd. Staff Report 2020 – 21 – 2019 Audite. Staff Report 2020 – 22 – ERM Program Reviewf. Staff Report 2020 – 23 – KPIs for February and Marchg. Staff Report 2020 – 24 – 2020 Capital Budgeth. Staff Report 2020 – 25 – Capital Work Update Reporti. Staff Report 2020 – 26 – 2020 Operating Budgetj. Staff Report 2020 – 27 – Landscape Tenderk. Staff Report 2020 – 28 – Mortgage Renewall. Staff Report 2020 – 29 – Operating and Capital Februarym. Staff Report 2020 – 30 – Operating and Capital March

A. Mackenzie A. Mackenzie A. Mackenzie

N.van der Velde N.van der Velde N.van der Velde N.van der Velde N.van der Velde N.van der Velde

B. Leslie N. van der Velde N. van der Velde N.van der Velde

5:50 6:00 6:10 6:20 6:30 6:40 6:50 7:00 7:10 7:20 7:30 7:40 7:50

10. New Business / Enquires

11. In Camera Mattersa. A matter pertaining to litigation or potential litigation,

including matters before administrative tribunals,affecting the Corporation

8:00

12. Meeting Adjourn 8:10

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Recognition of Indigenous Peoples and Lands Statement

We would like to begin by acknowledging the treaty territory of the Anishnaabeg, which is defined within the pre-confederation treaty know as the

London Township Treaty of 1796. Throughout time, this region has also become the current home to the Haudenosaunee and Lenni-Lenape Nations.

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BOARD OF DIRECTORS MEETING Thursday, April 9, 2020 at 2:00 PM

London & Middlesex Community Housing Board Room, 1299 Oxford Street East, Unit 5C5, London, ON.

Board Member Present: Senior Staff Present:

S. Datars Bere, Board Member, Managing Director, Housing, Social Services & Dearness Home, City of London

Meeting to Order S. Datars Bere called the meeting to order at 2:04 PM.

Recognition of Indigenous Peoples and Lands

S. Datars Bere provided the following recognition address:

We would like to begin by acknowledging the treaty territory of the Anishnaabeg, which is defined within the pre-confederation treaty known as the London Township Treaty of 1796. Throughout time, this region has also become the current home to the Haudenosaunee and Lenni-Lenape Nations.

Completion and Acceptance of the Agenda

With regard to the completion and acceptance of the agenda, moved and resolved by S. Datars Bere that the agenda BE ACCEPTED and APPROVED.

CARRIED.

Declaration of Conflict of Interest

The Chair called for declaration of conflict of interest with respect to the agenda. There were no conflict of interests declared.

Board Meeting Minutes of March 12, 2020

With regard to the Board Meeting Minutes of December March 12, 2020, moved and resolved by S. Datars Bere that the Minutes BE APPROVED.

CARRIED.

A. Mackenzie Interim CEO N. van der Velde Director, Finance (Interim) K. Van Slyke Manager, Finance T. Smuck Manager, Community

Development B. Leslie Manager, Capital Projects &

Construction T. Paget Manager, Executive

Administration M. Banuelos Manager of Portfolio Strategy

Development

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Communications The board would like to thank all staff for the last five to six weeks. The board could not be prouder of the work being done to support tenants, especially considering the difficulty of rotating in and out of the office.

Delegation(s) No delegations.

CEO Update With regard to the general update provided by the Chief Executive Officer, moved and resolved by S. Datars Bere that the update BE ACCEPTED and APPROVED regarding the following:

i. Government Relations & Sector Engagementii. COVID

iii. Organizational Plans, Regeneration Plansiv. Community & Tenant Engagementv. Laserfiche

vi. Enterprise Risk Managementvii. Fanshawe College Partnership

CARRIED.

Staff Report 2020 – 12 AprilVacancy Report

With regard to Staff Report Staff Report 2020 – 12 April Vacancy Report, moved and resolved by S. Datars Bere that the report BE ACCEPTED and APPROVED.

CARRIED.

Staff Report 2020 – 13 January 2020KPI Report

With regard to Staff Report 2020 – 13 January 2020 KPI Report moved and resolved by S. Datars Bere that the report BE ACCEPTED and APPROVED.

CARRIED.

Staff Report 2020 – 14 AMP Update2020

With regard to Staff Report 2020 – 14 AMP Update 2020 moved and resolved by S. Datars Bere that the report BE ACCEPTED and APPROVED.

CARRIED.

Staff Report 2020 – 15 CapitalBudget

With regard to Staff Report 2020 – 15 Capital Budget, moved and resolved by S. Datars Bere that the report BE ACCEPTED and APPROVED.

CARRIED.

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Staff Report 2020-16 Capital Work Update

With regard to Staff Report 2020-16 Capital Work Update, moved and resolved by S. Datars Bere that the report BE ACCEPTED and APPROVED.

CARRIED.

Staff Report 2020 – 17 January 2020Operating and Capital

With regard to Staff Report 2020 – 17 January 2020 Operating and Capital, moved and resolved by S. Datars Bere that the report BE ACCEPTED and APPROVED.

CARRIED.

New Business No new business or enquiries noted.

In Camera Matters

With regard to In Camera Matters and consistent with the provisions of Section 239 of the Municipal Act, moved and resolved by S. Datars Bere that the Board move In Camera to discuss:

a) A matter pertaining to litigation or potential litigation, includingmatters before administrative tribunals, affecting the municipality

CARRIED.

Date of Next Board Meeting

The Board scheduled the next meeting for May 21, 2020 at 5:30 PM.

Adjournment Moved and resolved by S. Datars Bere that the meeting BE ADJOURNED at 3:51 PM.

S. Datars Bere, Board Member Andrea Mackenzie, Interim CEO

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Update from the CEO

Board Meeting of May 21, 2020

a) GovernmentRelations &SectorEngagement

LMCH is working with Western Health Sciences on an Ontario wide research project that is examining the needs of tenants within social housing. A survey will be distributed to social housing staff across Ontario in the coming weeks.

Additionally, LMCH is collaborating with London Community Foundation and other community organizations to identify programs and solutions to support tenants in mitigating the impacts of COVID-19. The solutions will focus on basic needs and mental health.

LMCH met with the LHC forum to discuss business intelligence, key performance indicators, government relations, and future LHC practitioners forums.

b) OrganizationalPlans, RegenPlan

Staffing updates – As of May 7, 2020 Shellie Chowns joined the Senior Leadership Team at LMCH as Director of Assets and Property Services.

Redesign of our office at 1299 Oxford Street began based on designs completed by City of London facilities staff. Phase one of construction is adding three new offices to the southeast corner of the office. Phase two will add additional workspaces, improved filing systems, and redesign our front lobby space. The renovations will create space for new hires approved through MYB Business Case 19.

Regen2020 regular meetings between LMCH, HDC, City of London are producing draft policies and communication plans. The Regen group is engaging in discussions about site modelling and a meeting between HDC & LMCH will walk through a modelling exercise on May 19, 2020.

c) Labour Relations The Union and management met for a regular meeting on April 7, 2020. Discussion topics included Benefits, Return to Work Committee, and Vacancy Management.

The next meeting will be on June 2, 2020.

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d) Community &TenantEngagement

CMHA moved into renovated office space at 241 Simcoe Street. The office will function as CMHA staff space for the Simcoe Gardens Housing with Supports project.

The Sleep Country CARES program donated 25 Bed sets to LMCH. The bed sets will be given to tenants who are entering LMCH housing from homelessness.

LMCH is collaborating with neighbourhood resource centers, The Boys and Girls Club and LCC to support food deliveries to 100+ households in seven communities.

Boys & Girls Club and LMCH staff delivered youth engagement kits to over 350 family units this month.

e) LaserFicheProject

LMCH met with the project lead for LaserFiche to conduct a test of the system. Laserfiche scheduled an additional test for May 25, 2020.

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300 Dufferin Avenue P.O. Box 5035 London, ON N6A4L9

LondonCANADA

May 12, 2020

Chair and Members Board of DirectorsLondon & Middlesex Community Housing 1299 Oxford Street East, Unit 5C5 LONDON ON N5Y4W5

Dear Chair and Members:

Re: 2019 Annual General Meeting of the Shareholder for London & MiddlesexCommunity Housing - June 9, 2020, not to be heard before 4:30 PM, Remote Participation

This is to provide you with notice that the 2019 Annual General Meeting of the Shareholder for London & Middlesex Community Housing will be held at a meeting of the Strategic Priorities and Policy Committee on June 9, 2020. The 2019 Annual General Meeting is scheduled to not to be heard before 4:30 PM by remote participation the purpose of receiving the report from the Board of London & Middlesex Community Housing in accordance with the Shareholder Declaration and the Business Corporations Act, R.S.O., 1990, c.B.16.

I wish to extend an invitation to the Chair of the Board of Directors to remotely attend the Annual Meeting and present the report of the Board in accordance with Article 7.1 of the Shareholder Declaration. I would kindly request that you provide me with an electronic copy of any documentation that you will be presenting, in addition to the Annual Report, by 9:00 AM, Monday, June 1,2020, for inclusion on the Agenda for the June 9, 2020 meeting. A reminder that in accordance with the Council Procedure Bylaw, delegations are limited to 5 minutes, unless otherwise permitted by a decision of the Standing Committee.

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For your information, the City of London is now holding Council and Standing Committee meetings electronically, as provided for in the Municipal Emergencies Act, 2020. We therefore advise that the representative, identified by your organization to speak, will receive an invitation by separate email on the day of the meeting, with instructions, as to how to join the meeting by using the Zoom platform. As a result of the limitations presented through electronic participation, we request that only one person speak. For security reasons, we ask that you not forward the Zoom invitation to others. The meeting can be viewed on the City of London’s website and YouTube.

If you have any questions or require clarification, please do not hesitate to contact me.

Ci „ rsCity Clerk

c. Mayor E. HolderChief Executive Officer, LMCH B. Westlake-Power, Deputy City ClerkA. L. Barbon, Managing Director Corporate Services and City Treasurer, Chief Financial OfficerB. Card, Managing Director, Corporate Services and City SolicitorK. Dickens, Acting, Managing Director, Housing, Social Services & Dearness Home

Sincerely,

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STAFF REPORT 2020 – 19

TO: LMCH Board of Directors

FROM: Andrea Mackenzie, Interim Chief Executive Officer

SUBJECT: Vacancy Management Update

DATE: May 21, 2020

RECOMMENDATION:

That, on the recommendation of the Interim Chief Executive Officer, the Vacancy Management Update report BE RECEIVED for information.

Purpose:

To update the Board, Shareholder and Service Manager regarding the status of LMCH’s Vacancy Management.

April 2020 Progress

1. Total Vacancy: This includes all units within LMCH portfolio that are not occupied. It is inclusive ofNon-Rentable (Units), Active Restoration (Units) and Rent Ready Stock (Target: 3%)

Current Total Vacancy: 4.0% or 132 units Future Leased: 0.45% or 15 units Final Vacancy: 3.5% or 117 units

2. Active Rental Stock: These are all units that are rent ready and available to offer. Units leave thiscategory when they are future leased or leased (when the actual lease is signed and keys are handedto the new tenant).

Current Active Rental Stock: 1.8% or 60 units

3. Non-Rentable or in Active Restoration: This category includes all remaining units that have sufferedcatastrophic loss, i.e. fire, flood or other insurable damage. Construction projects such as portfolioimprovements and secondary suites. Units that are in pre-pest clearance as well as any that are pestcleared and are now in active restoration.

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Current Active Repair, Construction or Restoration: 2.2% or 72 units

Conclusion:

LMCH continues to improve its vacancy management process and further decrease in the number of units undergoing repair or restoration in April. Given the current realities of COVID-19 and having to operate on a reduced staffing model, LMCH continues to prioritize unit repair and restoration of vacant units in an effort to reach a target of 2% of units in active repair.

LMCH is continuing to offer and lease units safely in accordance with measures to keep tenants safe from COVID-19. LMCH leased 11 units in the month of April and future leased 15 units.

REVIEWED and RECOMMENDED BY:

ANDREA MACKENZIE, INTERIM CHIEF EXECUTIVE OFFICER

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Staff Report 2020 - 20


FROM: Andrea Mackenzie, Interim Chief Executive Officer

SUBJECT: Annual General Meeting Report and Presentation

DATE: May 21, 2020

PURPOSE: Section 4.8 LMCH’s Shareholder Agreement with the City requires that LMCH present to council annually.

RECOMMENDATION: That, on the recommendation of the Interim Chief Executive Officer, the draft Annual Report 2019 be APPROVED for presentation to council.

SIGNATURE:

PREPARED BY: RECOMMENDED BY:

ANGELA SERRA COMMUNICATIONS SPECIALIST

ANDREA MACKENZIE INTERIM CHIEF EXECUTIVE OFFICER

Appendix A – Draft Annual Report 2019 Council Presentation

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FROM: Nick van der Velde, Interim Director of Finance

SUBJECT: 2019 Audit Report and Audited Financial Statements

DATE: May 21, 2020

RECOMMENDATION: That, on the recommendation of the Interim Director of Finance and the Interim Chief Executive Officer, the Board of Directors approve the 2019 Audit Findings Report and Audited Financial Statements.

REASONS FOR RECOMMENDATIONS:

LMCH is subject to an annual external financial audit in accordance with Canadian Public Sector Accounting Standards (PSAS), which KPMG completed as part of the City of London financial audit. As the City of London is the sole shareholder of LMCH, the audited results are consolidated into the City of London financial results. KPMG completed the audit of the 2019 results remotely in April 2020 without any complications.

Audit Findings

All audit procedures were completed as expected and there were no significant findings identified during the course of the audit to report to the board. Similarly, there were no unadjusted or adjusted misstatements identified and in the opinion of KPMG the financial statements present fairly, in all material respects, the financial position of the LMCH as at December 31, 2019 and are in accordance with Canadian PSAS.

There are presentation differences between the external financial statement and LMCH’s internal financial statements that are used to determine our surplus or deficit reported to the City of London. Per the audited financial statements, LMCH reported an annual surplus of $4,596,766 versus the previously reported deficit of $(363,231), which was approved by the Board on March 12, 2020.

The major difference between the external and internal financial statements is the treatment of capital assets. Internally capital assets are defined as spend incurred on approved capital projects which are funded through the City of London’s capital project allotment or alternative sources of capital funding such as the provincial SHAIP program. Externally capital assets are determine based on specific criteria set out by the Canadian Public Sector Accounting Board

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(PSAB) that is assessed on an asset-by-asset basis. LMCH internally reports operating spend and capital spend separately whereas the external financial statements include capital spend and accumulated amortization on the assets within the statement of operations. The table below details the adjustments required to reconcile the external and internal Statement of Operations.

The external financial audit completed by KPMG resulted in the following audit opinion as per the Independent Auditors’ Report and will be forwarded to the City of London for consolidation purposes.

“In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Entity as at December 31, 2019, and its results of operations, its changes in net debt and its cash flows for the year that ended in accordance with Canadian Public Sector Accounting Standards.”

SIGNATURE:

PREPARED and RECOMMENDED BY: RECOMMENDED BY:

NICK VAN DER VELDE INTERIM DIRECTOR OF FINANCE

ANDREA MACKENZIE CHIEF EXECUTIVE OFFICER

Audited Capital PSAS vs Internal Adj. Extraordinary InternalStatement of Funding & Capitalization (Surplus)/ Net Bad Debt Losses Statement ofOperations Amortization Policy Deficit Reclass Reclass Operations

Rental revenue 11,870,011 (438,474) 11,431,537 City of London funding - operating 10,698,018 10,698,018 capital 6,664,904 (6,664,904) - funding adjustment 363,231 (363,231) - Energy rebate 0 0 - Other 340,231 340,231

29,936,395 (6,664,904) 0 (363,231) (438,474) 0 22,469,786

Salaries 5,576,501 5,576,501 Maintenance materials and servic 6,013,830 (225,088) (67,203) 5,721,539 Utilities 4,026,281 4,026,281 Amortization 1,930,562 (1,930,562) - Property - insurance, taxes etc 5,717,335 5,717,335 Tenant program and supports 0 - Administration 2,075,120 87,512 (438,474) 1,724,158

25,339,629 (1,930,562) (137,576) 0 (438,474) (67,203) 22,765,814 Extraordinary Losses 67,203 67,203

4,596,766 (4,734,342) 137,576 (363,231) 0 0 (363,231)

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London & Middlesex Community Housing Inc. Audit Findings Report for the year ended December 31, 2019

May 21, 2020

kpmg.ca/audi t

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Audit Findings Report

Table of contents EXECUTIVE SUMMARY 1

AUDIT RISKS AND RESULTS 2

FINANCIAL STATEMENT PRESENTATION AND DISCLOSURE 5

UNCORRECTED DIFFERENCES AND CORRECTED ADJUSTMENTS 6

CONTROL DEFICIENCIES AND OTHER OBSERVATIONS 7

APPENDICES 8

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Audit Findings Report P a g e | 1

Executive summary Purpose of this report1 The purpose of this Audit Findings Report is to assist you, as a member of the Board of Directors, in your review of the results of our audit of the financial statements as at and for the year ended December 31, 2019. This Audit Findings Report builds on the Audit Plan we presented to the Board of Directors.

Changes from the Audit Plan

There have been no significant changes regarding our audit from the Audit Planning Report previously presented to you, other than the fact that we completed our audit fieldwork remotely rather than being on site.

Finalizing the Audit

As of the date of this report we have completed the audit of the financial statements, with the exception of certain remaining procedures, which include:

obtaining a copy of the 2020 budget approved by the Board; obtaining a signed copy of the management representation letter; completing our discussions with the Board of Directors; obtaining evidence of the Board’s approval of the financial statements.

We will update the audit Board of Directors, and not solely the Chair, on significant matters, if any, arising from the completion of the audit, including the completion of the above procedures. Our auditors’ report will be dated upon the completion of any remaining procedures.

Independence

We are independent of the Corporation in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada.

Uncorrected differences

We did not identify differences that remain uncorrected.

Control deficiencies

We did not identify any control deficiencies that we determined to be significant deficiencies in internal control over financial reporting.

1 This Audit Findings Report should not be used for any other purpose or by anyone other than the Board of Directors. KPMG shall have no responsibility or liability for loss or damages or claims, if any, to or by any third party as this Audit Findings Report has not been prepared for, and is not intended for, and should not be used by, any third party or for any other purpose.

Relevant factors affecting our risk assessment

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Audit risks and results

We highlight our significant findings in respect of significant financial reporting risks as identified in our discussion with you in the Audit Plan, as well as any additional significant risks identified.

1 Significant Risk Management override of controls

Significant financial reporting risk Why is it significant?

Fraud risk from management override of controls This is a presumed fraud risk. We have not identified any specific additional risks of management override relating to this audit.

Our response and significant findings

We performed the following procedures as noted in our audit planning report:

Testing of journal entries and other adjustments including procedures to gain assurance over completeness of the journal entry population. Performed a retrospective review of estimates and evaluated business rationale of significant unusual transactions.

Audit findings :

– No significant issues were noted as a result of our procedures

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Audit risks and results (continued) Significant findings from the audit regarding other areas of focus are as follows:

2 Other area of focus Cash and accounts payable and accrued liabilities

Other area of focus Why are we focusing here?

Cash The dollar value of cash makes this a significant financial reporting caption.

Accounts payable and accrued liabilities The dollar value of accounts payable and accrued liabilities makes this a significant financial reporting caption.



Obtained confirmation from third parties to verify cash balances at year-end. Reviewed bank reconciliations and performed verification of significant reconciling items. Reviewed financial statement disclosure.

Audit findings:

No significant issues were noted as a result of our procedures. .


Updated our understanding of activities over the initiation, authorization, processing, recording and reporting of accounts payable and accrued liabilities. Performed a search for unrecorded liabilities.

Audit findings:

No significant issues were noted as a result of our procedures.

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Audit risks and results (continued)

2 Other area of focus Tangible capital assets

Other area of focus Why are we focusing here?

Tangible capital assets The dollar value of tangible capital assets makes this a significant financial reporting caption



Updated our understanding of activities over the initiation, authorization, processing, recording and reporting of tangible capital assets. Vouched a selection of additions and disposals throughout the year to supporting documentation. Performed a substantive analytical procedure over depreciation expense. Obtained details of repairs and maintenance expenses recorded during the year. Vouched a selection of expenses to supporting documentation. For the items selected

for testing, obtained an understanding of the nature of the expense to gain assurance that it was not capital in nature. Obtained management’s assessment of the impact of the Contaminated Sites standard (PS 3260) and reviewed the impact to the financial statements, if any.

Audit findings:

No significant issues were noted as a result of our procedures.

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Financial statement presentation and disclosure The presentation and disclosure of the financial statements are, in all material respects, in accordance with the Corporation’s relevant financial reporting framework. Misstatements, including omissions, if any, related to disclosure or presentation items are in the management representation letter.

We also highlight the following:

Form, arrangement, and content of the financial statements

The form, arrangement, and content of the financial statements is adequate.

Application of accounting pronouncements issued but not yet effective

No concerns at this time regarding future implementation. Information regarding upcoming PSAB standard changes was previously communicated to the Board of Directors as part of our audit planning report.

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Uncorrected differences and Corrected Adjustments Differences and adjustments include disclosure differences and adjustments.

Professional standards require that we request of management and the Board of Directors that all identified differences be corrected. We have already made this request of management.

Uncorrected differences We did not identify differences that remain uncorrected.

Corrected adjustments We did not identify any adjustments that were communicated to management and subsequently corrected in the financial statements.

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Control deficiencies and other observations In accordance with professional standards, we are required to communicate to the Board of Directors significant deficiencies in internal control over financial reporting (ICFR) that we identified during our audit.

The purpose of our audit is to express an opinion on the financial statements. Our audit included consideration of ICFR in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of ICFR. The matters being reported are limited to those deficiencies that we have identified during our audit and that we have concluded are of sufficient importance to merit being reported to the Board of Directors

Significant deficiencies

Description Potential effect

No significant deficiencies in ICFR identified.

Other observations

Item Observation

2020 Budget Approval KPMG was unable to obtain the 2020 Budget as it was not yet approved as at the date of fieldwork. KPMG notes this does not affect the current year audit, however, as a best practice, we recommend that the budget is completed and approved prior to the commencement of the fiscal year or shortly thereafter.

Recommendation: KPMG recommends that the budget be completed and approved within a reasonable time frame. This will allow management and the Board to assess performance in a timely manner and facilitate informed decision making.

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Appendices Content

Appendix 1: Required communications

Appendix 2: Audit Quality and Risk Management

Appendix 3: Draft Auditors’ Report

Appendix 4: Management Representation Letter

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Appendix 1: Other Required Communications

In accordance with professional standards, there are a number of communications that are required during the course of and upon completion of our audit. These include:

Auditor’s report Management representation letter

The conclusion of our audit is set out in our draft auditors’ report as attached. Refer to Appendix 3.

In accordance with professional standards, a copy of the management representation letter is provided to the Board of Directors. The management representation letter is attached. Refer to Appendix 4.

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Appendix 2: Audit Quality and Risk Management KPMG maintains a system of quality control designed to reflect our drive and determination to deliver independent, unbiased advice and opinions, and also meet the requirements of Canadian professional standards.

Quality control is fundamental to our business and is the responsibility of every partner and employee. The following diagram summarizes the key elements of our quality control system.

What do we mean by audit quality?

Audit Quality (AQ) is at the core of everything we do at KPMG.

We believe that it is not just about reaching the right opinion, but how we reach that opinion.

We define ‘audit quality’ as being the outcome when audits are:

– Executed consistently, in line with the requirements andintent of applicable professional standards within a strongsystem of quality controls and

– All of our related activities are undertaken in anenvironment of the utmost level of objectivity,independence, ethics, and integrity.

Our AQ Framework summarises how we deliver AQ. Visit our Audit Quality Resources page for more information including access to our Audit Quality and Transparency report.

Audit Quality Framework

Governance and leadership

Code of conduct, ethics

and independence

Associating with the right

clients

Performing audits in line with our AQ

definition

Appropriately qualified team,

including specialists

Smart audit tools and

technology

Methodology aligned with professional

standards

Honest and candid

communicationTransparency

Industry expertise and

technical excellence

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Appendix 3: Draft Auditors’ Report

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INDEPENDENT AUDITORS’ REPORT

To the Board of Directors of London & Middlesex Community Housing Inc.

Opinion We have audited the financial statements of London & Middlesex Community Housing Inc. (the “Entity”), which comprise:

the statement of financial position as at December 31, 2019

the statement of operations for the year then ended

the statement of change in net debt for the year then ended

the statement of cash flows for the year then ended

and notes to the financial statements, including a summary of significantaccounting policies

(Hereinafter referred to as the “financial statements”).

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Entity as at December 31, 2019, and its results of operations, its change in net debt and its cash flows for the year then ended in accordance with Canadian public sector accounting standards.

Basis for Opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the “Auditors’ Responsibilities for the Audit of the Financial Statements” section of our auditors’ report.

We are independent of the Entity in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada and we have fulfilled our other ethical responsibilities in accordance with these requirements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

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Responsibilities of Management and Those Charged with Governance for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with Canadian public sector accounting standards and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Entity’s ability to continue as a going concern, disclosing as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Entity or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Entity’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit.

We also: Identify and assess the risks of material misstatement of the financial

statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.

The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances, but not for

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the purpose of expressing an opinion on the effectiveness of the Entity's internal control.

Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made bymanagement.

Conclude on the appropriateness of management's use of the going concernbasis of accounting and, based on the audit evidence obtained, whether amaterial uncertainty exists related to events or conditions that may castsignificant doubt on the Entity's ability to continue as a going concern. If weconclude that a material uncertainty exists, we are required to draw attentionin our auditors’ report to the related disclosures in the financial statements or,if such disclosures are inadequate, to modify our opinion. Our conclusions arebased on the audit evidence obtained up to the date of our auditors’ report.However, future events or conditions may cause the Entity to cease to continueas a going concern.

Evaluate the overall presentation, structure and content of the financialstatements, including the disclosures, and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

Communicate with those charged with governance regarding, among othermatters, the planned scope and timing of the audit and significant audit findings,including any significant deficiencies in internal control that we identify duringour audit.

London, Canada

Date

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Appendix 4: Management Representation Letter

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(Letterhead of Client)

KPMG LLP Address

Date

Ladies and Gentlemen:

We are writing at your request to confirm our understanding that your audit was for the purpose of expressing an opinion on the financial statements (hereinafter referred to as “financial statements”) of London & Middlesex Community Housing Inc. (“the Entity”) as at and for the period ended December 31, 2019

General:

We confirm that the representations we make in this letter are in accordance with the definitions as set out in Attachment I to this letter.

We also confirm that, to the best of our knowledge and belief, having made such inquiries as we considered necessary for the purpose of appropriately informing ourselves:

Responsibilities:

1) We have fulfilled our responsibilities, as set out in the terms of the engagement letter datedSeptember 15, 2016, including for:

a) the preparation and fair presentation of the financial statements and believe that thesefinancial statements have been prepared and present fairly in accordance with therelevant financial reporting framework.

b) providing you with all information of which we are aware that is relevant to thepreparation of the financial statements (“relevant information”), such as financialrecords, documentation and other matters, including:

— the names of all related parties and information regarding all relationships andtransactions with related parties;

— the complete minutes of meetings, or summaries of actions of recent meetings forwhich minutes have not yet been prepared, of shareholders, board of directors and committees of the board of directors that may affect the financial statements. All significant actions are included in such summaries.

c) providing you with unrestricted access to such relevant information.

d) providing you with complete responses to all enquiries made by you during theengagement.

e) providing you with additional information that you may request from us for the purposeof the engagement.

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f) providing you with unrestricted access to persons within the Entity from whom youdetermined it necessary to obtain audit evidence.

g) such internal control as we determined is necessary to enable the preparation offinancial statements that are free from material misstatement, whether due to fraud orerror. We also acknowledge and understand that we are responsible for the design,implementation and maintenance of internal control to prevent and detect fraud.

h) ensuring that all transactions have been recorded in the accounting records and arereflected in the financial statements.

i) ensuring that internal auditors providing direct assistance to you, if any, were instructedto follow your instructions and that we, and others within the entity, did not intervene inthe work the internal auditors performed for you.

Internal control over financial reporting:

2) We have communicated to you all deficiencies in the design and implementation ormaintenance of internal control over financial reporting of which we are aware.

Fraud & non-compliance with laws and regulations:

3) We have disclosed to you:

a) the results of our assessment of the risk that the financial statements may be materiallymisstated as a result of fraud.

b) all information in relation to fraud or suspected fraud that we are aware of that involves:

— management;

— employees who have significant roles in internal control over financial reporting; or

— others

where such fraud or suspected fraud could have a material effect on the financialstatements.

c) all information in relation to allegations of fraud, or suspected fraud, affecting thefinancial statements, communicated by employees, former employees, analysts,regulators, or others.

d) all known instances of non-compliance or suspected non-compliance with laws andregulations, including all aspects of contractual agreements, whose effects should beconsidered when preparing financial statements.

e) all known actual or possible litigation and claims whose effects should be consideredwhen preparing the financial statements.

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Subsequent events:

4) All events subsequent to the date of the financial statements and for which the relevantfinancial reporting framework requires adjustment or disclosure in the financial statementshave been adjusted or disclosed.

Related parties:

5) We have disclosed to you the identity of the Entity’s related parties.

6) We have disclosed to you all the related party relationships and transactions/balances ofwhich we are aware.

7) All related party relationships and transactions/balances have been appropriately accountedfor and disclosed in accordance with the relevant financial reporting framework.

Estimates:

8) Measurement methods and significant assumptions used by us in making accountingestimates, including those measured at fair value, are reasonable.

Going concern:

9) We have provided you with all information relevant to the use of the going concernassumption in the financial statements.

10) We confirm that we are not aware of material uncertainties related to events or conditionsthat may cast significant doubt upon the Entity’s ability to continue as a going concern.

Non-SEC registrants or non-reporting issuers:

11) We confirm that the Entity is not a Canadian reporting issuer (as defined under anyapplicable Canadian securities act) and is not a United States Securities and ExchangeCommission (“SEC”) Issuer (as defined by the Sarbanes-Oxley Act of 2002).

12) We also confirm that the financial statements of the Entity will not be included in the groupfinancial statements of a Canadian reporting issuer audited by KPMG or an SEC Issueraudited by any member of the KPMG organization.

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Yours very truly,

_______________________________________ Kara Van Slyke, Finance Manager

_______________________________________ Andrea Mackenzie, Interim CEO

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Attachment I – Definitions

Materiality

Certain representations in this letter are described as being limited to matters that are material. Misstatements, including omissions, are considered to be material if they, individually or in the aggregate, could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements. Judgments about materiality are made in light of surrounding circumstances, and are affected by the size or nature of a misstatement, or a combination of both.

Fraud & error

Fraudulent financial reporting involves intentional misstatements including omissions of amounts or disclosures in financial statements to deceive financial statement users.

Misappropriation of assets involves the theft of an entity’s assets. It is often accompanied by false or misleading records or documents in order to conceal the fact that the assets are missing or have been pledged without proper authorization. An error is an unintentional misstatement in financial statements, including the omission of an amount or a disclosure.

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kpmg.ca/audit

KPMG LLP, an Audit, Tax and Advisory firm (kpmg.ca) and a Canadian limited liability partnership established under the laws of Ontario, is the Canadian member firm of KPMG International Cooperative (“KPMG International”).

KPMG member firms around the world have 174,000 professionals, in 155 countries.

The independent member firms of the KPMG network are affiliated with KPMG International, a Swiss entity. Each KPMG firm is a legally distinct and separate entity, and describes itself as such.

© 2019 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with

KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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FROM: Enterprise Risk Management (“ERM”) Committee

SUBJECT: LMCH – Enterprise Risk Management

DATE: May 21, 2020

RECOMMENDATION: That, on the recommendation of the Director of Finance and the Interim CEO, the following report BE RECEIVED for information purposes.

BACKGROUND The former Board requested that LMHC develop an Enterprise Risk Management framework to improve the organization’s capacity to manage risk. LMCH Management supported the development and implementation of this framework through the purchase of professional services with BDO as the Corporation did not have the required internal expertise.

ERM OVERVIEW

Risk may be defined as “anything that may prevent LMCH from achieving objectives at the strategic, operational and project/program level.” Enterprise risk management is the process undertaken to identify, assess, respond, monitor and review the full spectrum of LMCH’s risks. The ERM process can help LMCH assess the effect of risk against objectives at the strategic, operational or project/program level.

LMCH worked with BDO to develop an Enterprise Risk Management program, and to embed risk management in decision making at all levels across the corporation. The benefits of an ERM Program include: • Providing the Board with reasonable assurance that LMCH is managing risks;• Developing a common language for discussing risk at all levels of the Corporationand with the Board; and • Assisting with enterprise-wide planning and decision-making.

The ERM framework is defined as the “set of components that provides the foundations for designing, implementing, monitoring, reviewing and continually improving risk management throughout the corporation.”

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ERM Framework & ERM Policy BDO guided the implementation of the ERM Program, with co-leadership by the ERM Committee (consistent of IT Coordinator, Manager of Executive Administration, Finance Manager, Interim Director of Finance and Interim Chief Executive Officer) through the development of a draft ERM Framework and ERM Policy. These documents (attached) provide an overview of all key activities required for a successful ERM Program and associated timelines and responsibilities.

Risk Identification One on one interviews were conducted with 14 members of the Corporation, including the ERM Committee which identified 28 risks across the following risk areas: Financial, Health & Safety, Human Resources, Operational, Regulatory, and Reputational – a breakdown of the risks can be found below:

- Five (5) risks were assessed with a severity score of severe; - Twelve (12) risks with a severity score of high; - Eleven (11) risks with a severity score of modest.

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Risk Assessment Risk Assessment workshops were held wherein committee members were asked to rate each risk identified by two factors: • Impact – What will happen if the risk occurs?• Likelihood – How likely is the risk to occur?

The workshops focused on residual risk, which is the measure of each risk remaining after controls have been put in place to mitigate the inherent risk.

Risk Response (and Action Plans) Risk responses and actions plans are additional measures to be undertaken to further mitigate risks. Generally, an organization will focus on risk response measures for its highest risks. LMCH and the ERM Committee developed high-level action plans for each identified risk in the severe category.

Risk Monitoring Management has identified key risk indicators to help monitor each of the risks, which can be found in the risk registry. Additionally, management continues to incorporate dialogue around risk within regular staff and management discussions to ensure risks are continuously monitored and identified on an ongoing basis.

Risk Reporting BDO has developed reporting tools and templates to assist management in their reporting requirements for ERM.

To ensure success, the ERM process will continue to be slowly phased into strategic and business planning activities and will adhere to a best practice ERM methodology.

ROLE OF THE BOARD

The Board will play an important role in the oversight of ERM and accordingly, this report is an effort to introduce ERM, explain the ERM process and methodology and to show alignment of the proposed framework with best practices, not the mention the Risk Report illustrating an overview of risks for Q4 2019 and Q1 2020.

CONCLUSION: The purpose of ERM was to develop a framework to proactively identify, assess, respond to and monitor risks across the corporation. Rather than managing risks in silos, ERM involves all divisions across the corporation and promotes an understanding of how risk is inter-related across all divisions and the impact this has on the corporation as a whole.

The development and implementation of an ERM framework has assisted LMCH in further strengthening corporate governance practices. The ERM framework will provide a common language for discussing risk at all levels of the Corporation and with the Board. It will also provide clear guidelines and predefined timeframes for reporting key risks to the Board, particularly those that may impact our ability to successfully deliver on our strategic priorities and corporate goals. This will provide the Board with assurance that LMCH is managing risks in an effective and efficient manner.

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SIGNATURE:

PREPARED AND RECOMMENDED BY: RECOMMENDED BY:



Appendix A – LMCH – ERM Framework; Appendix B – LMCH – ERM Policy; Appendix C – LMCH – Final Presentation.

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ENTERPRISE RISK MANAGEMENT FRAMEWORK

PURPOSE London & Middlesex Community Housing’s (“LMCH”) Enterprise Risk Management (“ERM”) Framework presents the concepts, processes, and tools to allow LMCH to effectively understand, assess, and manage enterprise-level risks in a consistent manner. The ERM Framework consists of the following key concepts and phases:

1. ERM Methodologya. Risk Identificationb. Risk Analysis & Evaluationc. Risk Measurement Criteriad. Risk Categorizatione. Risk Responsef. Risk Monitoring and Reporting

2. Risk Appetite and Risk Tolerance3. Risk Governance

ERM METHODOLOGY LMCH’s risk management approach includes a systematic and repeatable process for identifying, assessing, and mitigating risks, while maintaining flexibility to ensure it is able to adapt to the changing needs of the business. Key employees across the various business lines are involved in the risk management process to ensure effective risk management at both the operational and strategic levels.

Risk Identification

The objective of risk identification is to identify all possible risks, including both existing and emerging risks, by recognizing all possible events that might prevent, degrade, delay, or enhance the achievement of LMCH’s strategic objectives. Risks are identified through the following:

Establishment of an enterprise-wide risk management culture; Participation in facilitated risk identification sessions; Participation in ongoing quarterly discussions; Annual meetings with the Senior Leadership Team and the Board of Directors; and Management’s day-to-day activities.

Risk Analysis & Evaluation

Identified risks are measured and prioritized to ensure risk levels are managed within defined thresholds. Risk analysis and evaluation includes understanding the nature of the identified risks and then assessing the risk based on pre-determined criteria. Risks are evaluated on a residual basis and assigned a formal assessment rating. The following provides definitions of inherent and residual risk.

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Inherent Risk: The risk to an entity in the absence of any actions management might take to alter the risk’s likelihood or impact.

Residual Risk: The level of risk after implementing risk response tactics or mitigating strategies.

The following risk assessment scales provide the criteria for assessing LMCH’s exposure to each identified risk on a residual level.

Risk Measurement Criteria

Likelihood

Likelihood is the probability of the risk event actually occurring. Considerations that may have a bearing on the level of likelihood are the number, frequency, or nature of the event over a period of time. The likelihood score will typically increase when the frequency is higher or there is more complexity, and where a risk event is likely to occur sooner rather than later.

RATING LEVEL PROBABILITY FREQUENCY DESCRIPTION

4 ALMOST CERTAIN

Event is expected to occur in most circumstances

Highly likely to occur annually > 85%

3 LIKELY Event will probably

occur in most circumstances

Has occurred or is expected to occur once in a two (2) year

timeframe 50% - 85%

2 POSSIBLE Event could occur at some time

Has not yet occurred but could occur or is expected to occur

once in a five (5) year timeframe

15% - 49%

1 UNLIKELY Event may occur only

in exceptional circumstances

Has not yet occurred but could occur or is expected to occur

once in a ten (10) year timeframe

< 15%

Impact

Impact is the consequence of the risk occurring. Quantitative and qualitative measures have been used to define various impact scores. The measures for each score and range of outcomes have been established by the ERM Committee. When assessing impact, the rating for the highest consequence is assigned.

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CATEGORY EXAMPLES

RATING & LEVEL EXAMPLES

4 SIGNIFICANT

3 MAJOR

2 MINOR

1 INSIGNIFICANT

OPERATIONAL

Serious incident within the community resulting in the cessation of operations

Widespread or long-term shut down due to internal operational issue

Significant incident within the community resulting in the temporary shut-down of operations

Significant, sustained, internal operational issue

Modest incident within the community resulting in minimal loss of support

Modest internal operational challenge in size or duration

Minor incident within the community resulting in a brief negative reaction

Minor internal operational inefficiency

HEALTH & SAFETY

Incident results in a fatality to staff and/or tenant(s)

Full breach of health and safety regulation

Event results in a long-term disability to staff and/or tenant(s)

Significant regulatory health and safety violation

Incident results in a short-term disability to staff and/or tenant(s)

Escalation of resources committed to address health and safety regulatory concern

Minor incident requiring minimal first aid to staff and/or tenant(s)

Low significance health and safety regulatory incident

REPUTATIONAL

Event results in sustained, serious loss of stakeholder confidence

Intense negative attention in national news/social media

Event has a major impact on stakeholder confidence that damages the organization’s image

Negative attention in local news/social media

There is a modest impact on organization’s image

Limited negative attention in local news/social media

Event has limited, localized impact on organization’s image

Brief negative attention in local news/social media

REGULATORY

Material breach of legislation with very significant consequences, requiring substantial resources to rectify

Regulatory breach with material consequences, requiring several resources to rectify

Regulatory breach with minor consequences, requiring some resources to rectify

Regulatory breach with minimal consequences, readily rectified with limited resources

HUMAN RESOURCES

Unexpected/unplanned loss of whole team

Serious incident occurs resulting in significant resources required to rebuild culture

Unexpected/unplanned loss of key individuals

Significant incident occurs resulting in an immediate, lasting shift in culture, requiring several resources to rectify

Unexpected/unplanned loss of a key individual

Modest incident occurs resulting in a shift in culture requiring time/effort to rectify

Unexpected/unplanned loss of a single staff member

Minor incident occurs resulting in a temporary shift in culture

FINANCIAL > $500K $200K - $500K $50K - $200K < $50K

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Severity

Severity is the product of the likelihood and impact scores that determines the magnitude of the risk under consideration. Severity scores and relevant ranges are associated with the organization's risk tolerance levels. The table below outlines the severity scores under a 4-point scale with a range of possible scores between 1 and 16.

SEVERITY LEVEL EQUIVALENT SEVERITY SCORE

Low Less than 5

Modest 5 to less than 8

High 8 to less than 12

Severe Greater than or equal to 12

Risk Categorization

LMCH categorizes risks based on the type of risk and level of controllability. Outlined below is a summary of LMCH’s approach to risk management. Risk mitigation objectives and tactics will differ depending on the risk category assigned to each risk.

PREVENTABLE RISKS STRATEGIC RISKS EXTERNAL RISKS

Risks arising from within the business that generate minimal strategic benefits

Risks taken on for strategic returns External, uncontrollable risks

RISK MITIGATION OBJECTIVES

Avoid or eliminate occurrence cost-effectively

Reduce likelihood and impact of occurrence cost-effectively

Reduce impact cost-effectively should risk become reality

RISK MITIGATION TACTICS & TOOLS

Effective governance and oversight

Key tools: Mission, vision, and values Integrated organizational

culture Governing policies,

procedures, and controls Rules and boundary

systems

Continuous interactive discussions to understand risks and their associated consequence to hinder the pursuit of strategic objectives

Key tools: Assessing likelihood/

impact of risk occurrence Managing lead/lag

indicators of risk occurrence

Allocation of resources to manage risks

Identify, foresee criticality, and mitigate effect

Key tools: Sensitivity/stress testing Scenario planning "What if" analysis

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Risk Response

Risk owners identify key risks and effectively develop and implement risk mitigation tactics to minimize a risk’s likelihood and impact, in line with risk appetite and tolerances.

Depending on the severity of the risk, LMCH will implement cost-effective strategies and action plans to respond to the risk’s magnitude. Once “High” and “Severe” risks are identified, management determines the appropriate risk response tactic to reduce the risk to an acceptable level. Risk response strategies include risk avoidance, sharing, mitigation, and acceptance. In considering its response, management assesses the effect on the risk’s likelihood and impact, as well as the costs and benefits, in selecting a response that reduces the residual risk within desired risk tolerance levels.

Risk Monitoring and Reporting

Continuous risk monitoring helps to ensure that business activities align with LMCH’s risk management culture and overall strategy. As part of risk monitoring activities, the execution of planned strategies are reviewed and evaluated for effectiveness. Periodic risk reports aggregate measures of risk across business units and are used to assess compliance with policies and frameworks. These reports also provide a clear statement on the number, category, and severity of the various risks within LMCH. The Senior Leadership Team and the Board of Directors use this information to gain an understanding of LMCH’s risk profile. The following reports, at a minimum, are to be provided to the Board of Directors:

REPORT FREQUENCY

Risk profile outlining significant risks at a residual level (i.e. risk registry) Annually

Summary of emerging risks and new risks Annually, unless a material risk

emerges, then as required

ERM Risk Reporting Dashboard Annually

Staff Reporting Quarterly

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RISK APPETITE AND RISK TOLERANCE

Risk Appetite

At the enterprise level, risk appetite is communicated in broad terms, which reflects the acceptable level of risk to be undertaken in pursuing LMCH’s strategic objectives. Risk appetite statements define the amount of risk, on a broad level, that LMCH is willing to accept in pursuit of value. The high-level qualitative statement expresses LMCH’s attitude towards risk taking.

Annually, or as events or circumstances change, the risk appetite statement will be revaluated to ensure it appropriately reflects the level of acceptable risk in the pursuit of LMCH’s strategic objectives.

LMCH’s current risk appetite statement is the following:

LMCH's approach to enterprise risk management is to have zero tolerance for exposure to health and safety incidents and minimize exposure to regulatory violations, reputational damage, and financial risk. Modest risk will be accepted in the pursuit of LMCH's mission, vision, values, and strategic objectives. Our appetite for risk may vary according to the activity undertaken, and we may knowingly accept risk, upon understanding the potential risks and benefits, and establishing measures to mitigate any undue risk.

Risk Tolerance

Risk tolerances define the acceptable level of variation relative to the achievement of a specific objective. As events or circumstances change, risk tolerances may be revised.

Four defined risk tolerance levels have been established by the ERM Committee in line with LMCH’s 4-point severity scale, as identified below. Specific action plans have been identified to outline the action required for each risk tolerance level.

RISK TOLERANCE DESCRIPTION ACTION PLAN

ACCEPTABLE Risk level is acceptable No action is taken.

MANAGE WITH KEY

RISK OWNER OVERSIGHT

Risk level has somewhat exceeded the associated

risk tolerance

Action is taken by the key risk owner and/or the risk is monitored by the Senior Leadership Team. Any associated risks are reviewed, the Senior

Leadership Team gains an understanding of the tolerance breach, and action plans and/or monitoring plans are developed and executed as required.

The ERM Committee is updated at least quarterly.

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RISK TOLERANCE DESCRIPTION ACTION PLAN

MANAGE WITH SENIOR LEADERSHIP

TEAM OVERSIGHT

Risk level has exceeded tolerance

Action is taken by the Senior Leadership Team. Any associated risks are reviewed, the Senior

Leadership Team gains an understanding of the tolerance breach, and action plans are developed and executed as required.

The ERM Committee is updated at least monthly.

CRISIS MANAGEMENT

Risk level has significantly exceeded tolerance

Immediate action is taken by the Senior Leadership Team and the ERM Committee. Any associated risks are reviewed, the Senior

Leadership Team and the ERM Committee gain an understanding of the tolerance breach, and action plans are developed and executed as required.

The Board of Directors is updated at least quarterly.

Risk Appetite & Risk Tolerance Metrics

RISK APPETITE & RISK TOLERANCE DEVELOPMENT AND IMPLEMENTATION

AREA TASKS KEY TASK OWNER(S) OCCURRENCE

Quarterly Annually

Enterprise-wide risk appetite statement

Development/reassessment of enterprise-wide risk appetite statement

ERM Committee X

CEO X

Approval of enterprise-wide risk appetite statement

Board of Directors X

Risk tolerances

Development/reassessment of risk tolerances ERM Committee X

Approval of risk tolerances CEO X

Monitoring of risk appetite and risk tolerances

Preparation of risk registry ERM Committee X

Review of ERM Risk Reporting Dashboard Board of Directors X

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RISK GOVERNANCE

ERM Roles and Responsibilities

A summary of the key ERM roles and responsibilities is included in the table below.

ROLE HIGHLIGHT OF KEY RESPONSIBILITIES

Board of Directors

Provide oversight of strategy and carry out risk governance responsibilities to support management in achieving strategy and business objectives

Review the risk appetite with the ERM Committee Review the risk registry and challenge the risk severity ratings, if required Monitor actions and processes to ensure a review of ERM practices is

conducted Receive reports on breaches of risk appetite

ERM Committee

Assist in the development of frameworks, policies, and procedures, and ensure documentation remains up-to-date

Set the risk appetite, in consultation with the Board of Directors and the CEO, and communicate it throughout the organization

Implement the Board's risk policy and strategy Support investigations of incidents and near misses Coordinate the risk management activities Compile risk information and reports for the Board Assess the level of assurance on the controls in place

Senior Leadership Team &

Management

Set the tone at the top for risk management Embed the risk management culture throughout the organization Participate in the risk assessment process to assess risks at a residual level Monitor the operation of controls to ensure they are operating with

sufficient effectiveness to justify the residual risk rating Identify and report changes in the external or internal environment that

may affect the risk profile Consider new and emerging risks as part of decision-making

Staff

Understand, accept, and implement risk management processes Be alert to risks associated with day-to-day activities Report inefficient, unnecessary, and unworkable controls Report losses and near misses

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DOCUMENT CONTROL

PREPARED BY ROLE DATE

APPROVED BY ROLE DATE

DOCUMENT REVISION HISTORY

REVISION REASON FOR REVISION DATE

RELATED DOCUMENTS

DOCUMENT TITLE DOCUMENT ID

Enterprise Risk Management Policy TBD

Risk Register TBD

– End of Document –

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ENTERPRISE RISK MANAGEMENT POLICY

INTRODUCTION Enterprise Risk Management ("ERM") is fundamental to the success of London & Middlesex Community Housing ("LMCH"), and is recognized as a core component of LMCH's overall approach to achieving its mission, vision, values, and strategic objectives. LMCH's risk management culture is shared by its Board of Directors ("Board"), ERM Committee, the Senior Leadership Team, management, and its employees.

This Policy will identify the purpose, scope, objectives, roles and responsibilities, and define key terminology to ensure a successful ERM program is embedded throughout the organization.

PURPOSE LMCH established an ERM Policy to ensure that the outcomes of risk-taking activities are consistent with LMCH’s strategies and objectives, and that appropriate monitoring of key risks is present. Having an ERM Policy in place ensures that a consistent approach is taken to risk management and enables the integration of risk into business practices and organizational culture. The ERM Policy is subject to regular evaluation to ensure it meets the challenges and requirements of the environment in which LMCH operates.

SCOPE This ERM Policy applies to the Board of Directors, ERM Committee, the Senior Leadership Team, management, and employees. As applicable, the ERM Policy also applies to specifically designated and approved strategic partnerships and outsourced third-party service providers.

OBJECTIVES The key objectives of the ERM Policy are to ensure the following: The responsibility for the implementation of the ERM program is defined appropriately Outcomes of risk-taking activities are consistent with LMCH's strategies, and that there is an

appropriate balance between risk and reward Existing and potential material risks that could impact LMCH are identified, managed, and mitigated Appropriate resources and controls are in place for controllable risks Non-controllable risks are identified, monitored, and mitigated, where possible

ROLES AND RESPONSIBILITIES

BOARD OF DIRECTORS

Provide oversight of strategy and carry out risk governance responsibilities to support management in achieving strategy and business objectives

Review the risk appetite with the ERM Committee Review the risk registry and challenge the risk severity ratings, if required Monitor actions and processes to ensure a review of ERM practices is conducted Receive reports on breaches of risk appetite

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ERM COMMITTEE



Implement the Board's risk policy and strategy Support investigations of incidents and near misses Coordinate the risk management activities Compile risk information and reports for the Board Assess the level of assurance on the controls in place

SENIOR LEADERSHIP TEAM & MANAGEMENT

Implement the risk management frameworks, policies, and procedures with feedback from the ERM Committee.

Embed the risk management culture throughout the organization Participate in the risk assessment process to assess risks at a residual level Monitor the operation of controls to ensure they are effective and justify the residual risk rating Identify and report internal and external changes that may affect the risk profile Consider new and emerging risks as part of decision-making

STAFF

Understand, accept, and implement risk management processes Be alert to risks associated with day-to-day activities Provide feedback on the effects of risk controls on their areas of responsibility. Report losses and near misses

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KEY TERMINOLOGY Enterprise Risk Management ("ERM") is a management process to manage risks and seize

opportunities that would impact an organization's ability to achieve its oganizational objectives.

ERM Committee consists of members representing each business unit as designated by the CEO. The ERM Committee consists of the CEO, Director of Finance, Director of Tenant Services, Finance & IT Manager, Tenant Services Manager, Manager Executive Administration, Manager Capital Projects and Construction and Information Systems Coordinator.

Key Risk is a risk that has a high likelihood of occurrence, could have a major and/or significant impact on the organization, and for which the organization has a low or modest risk tolerance.

A Policy describes accountabilities and responsibilities. While accountabilities are not delegated, responsibilities may be delegated by the person who is accountable.

A Process is a sequence of logically related tasks that you perform to achieve a defined business outcome.

Residual Risk is the level of risk after implementing risk response tactics or mitigating strategies.

Risk is the potential effect of uncertainty on objectives that may have a positive or negative impact (or both) and is characterized by a cause-and-effect relationship.

Risk Appetite is the level of uncertainty an organization is willing to asssume given the corresponding reward associated with the risk.

Risk Assessment is the overall process of risk identification, risk analysis, and risk evaluation.

Risk Impact is the consequences of the risk occurring.

Risk Likelihood is the probability of the risk event actually occurring.

Risk Management Process is the systematic application of management policies, procedures, and practices to the tasks of communicating, identifying, analyzing, evaluating, treating, monitoring, and reviewing risk.

Risk Severity is the product of the likelihood and impact that determines the magnitude of the risk under consideration.

Risk Tolerance is the amount and type of risk that an organization is willing to accept in order to meet its strategic objectives.

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DOCUMENT CONTROL

PREPARED BY ROLE DATE

APPROVED BY ROLE DATE

DOCUMENT REVISION HISTORY

REVISION REASON FOR REVISION DATE

RELATED DOCUMENTS

DOCUMENT TITLE DOCUMENT ID

Enterprise Risk Management Framework TBD

Risk Register TBD

– End of Document –

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BOARD MEETING LMCH - ENTERPRISE RISK MANAGEMENT

MAY 21, 2020

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OVERVIEW OF ENTERPRISE RISK

MANAGEMENT

REVIEW THE ENTERPRISE RISK MANAGEMENT

PROCESS COMPLETED TO DATE AND NEXT

STEPS

REVIEW THE RISK REPORT PROCESS, FORMAT

AND CURRENT RESULTS

ERM ObjectivesAGENDA

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3

WHAT IS ERM?

Enterprise risk management is described by the

International Organization of Standardization (ISO) simply

as, “coordinated activities to direct and control an

organization with regard to risk”.

A coherent risk management framework is crucial to

effectively embedding risk management within the

organization. BDO’s framework sets out the basic

foundations on which effective risk management can be

built. It recognizes that risk management is an ongoing

process and needs to be systematically and continually

carried out to ensure the organization can achieve its

objectives.

LMCH has decided to actively implement ERM to enhance

their understanding of the risks to the organization and

proactively manage these risks. In turn, this will help LMCH

become more accountable and responsive over their

strategic planning activities.

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4

And why now?PURPOSE OF ERM

Oversight:

All critical risks have been identified and are being

managed and monitored under a holistic approach

consistent with the Board approved risk appetite.

Ownership and Responsibility:

The ownership of risk is assigned to management

individuals who are responsible for identifying,

evaluating, mitigating and reporting risk exposures.

Assurance:

The Board, management and members have

reasonable assurance that risk is being

appropriately managed within defined levels to

bring value to the organization.

The purpose of LMCH’s ERM Program is to create, protect, and enhance LMCH’s viability by managing the uncertainties that could influence achieving strategic objectives.

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5

BDO provided tools and templates to assist management in the

development of an ERM Framework and Policy that governs the

ERM process. This provides the foundation to which enterprise-

wide risks are identified, assessed and managed.

ERM FRAMEWORK & POLICY

BDO facilitated risk identification sessions with management that

resulted in a comprehensive list of sources and drivers of risk and

events that might impact the achievement of objectives.

Risk statements have been developed that include a description

of the possible occurrence and related impact, as detailed within

the risk registry.

RISK IDENTIFICATION

Surveys were shared to obtain feedback from relevant

stakeholders on the perceived residual (after controls) risk levels

and severity based on the likelihood and impact of each risk

identified.

An ERM Workshop was conducted to consolidate and calibrate

survey results to determine a risk rating and severity score for

each of the risks, as documented within the risk registry.

RISK ASSESSMENT

Risk response is the process of selecting and implementing

measures to modify the risk. Mitigating efforts/tactics have

been identified by management and recorded within the risk

registry.

RISK MITIGATION

Management has identified key risk indicators (KRIs) to help

monitor each of the risks.

Management has incorporated risk within regular staff and

management discussions to ensure risks are continuously

monitored and identified on an ongoing basis.

MONITORING

BDO has developed reporting tools and templates to assist

management in their reporting requirements for ERM.

The ERM Report will be presented for review and approval

from the Board.

REPORTING

Where are we now?PROGRESS & STATUS UPDATE

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6

How do we continue to succeed?NEXT STEPS

Adoption & Continuous Improvement

ERM is not a one-time process, it requires buy-in from staff,

management and you, as the Board.

ERM should be reported to the Board on an annual basis with

quarterly updates on major changes, emerging risks, and risks

that remain outside of the organization’s risk appetite.

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RISK REPORT

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8

RISK REPORT

28 risks were identified across the following risk areas: Financial, Health & Safety, Human Resources, Operational,

Regulatory, and Reputational.

A breakdown of risks by risk area is provided below.

Risk Profile Overview

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9

8 risks were assessed with a severity score of severe, 10 risks with a severity score of high, and 10 risks with a severity

score of modest.

A breakdown of risks by severity rating, as well as by risk area, is provided below.

For the period ending December 31, 2019RISK PROFILE OVERVIEW

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10

5 risks were assessed with a severity score of severe, 12 risks with a severity score of high, and 11 risks with a severity

score of modest.

A breakdown of risks by severity rating, as well as by risk area, is provided below.

For the period ending March 31, 2020RISK PROFILE OVERVIEW

5

12

11

NUMBER OF RISKS BY SEVERITY RATING

Severe

High

Modest

Low

0 1 2 3 4 5 6 7 8 9

Reputational

Regulatory

Operational

Human Resources

Health & Safety

Financial

NUMBER OF RISKS BY SEVERITY RATING AND RISK AREA

Severe High Modest Low

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11

Q4 2019 RISK REPORT

RISK AREA

TOTAL ASSESSED RISKSNUMBER OF

SEVERE RISKSTREND

Strategic Preventable ExternalPreventable /

ExternalTotal

FINANCIAL 1 2 2 1 6 2

HEALTH & SAFETY - 1 1 2 4 2

HUMAN RESOURCES 1 5 - 1 7 1

OPERATIONAL 2 3 3 - 8 3

REGULATORY - 1 - - 1 -

REPUTATIONAL - 2 - - 2 -

TREND ANALYSIS LEGEND

Risk is decreasing over period

Risk remains stagnant over period

Risk is increasing over period


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12

Q1 2020 RISK REPORT

RISK AREA

TOTAL ASSESSED RISKSNUMBER OF

SEVERE RISKSTREND

Strategic Preventable ExternalPreventable /

ExternalTotal

FINANCIAL 1 2 2 1 6 1

HEALTH & SAFETY - 1 1 2 4 2

HUMAN RESOURCES 1 5 - 1 7 1

OPERATIONAL 2 3 3 - 8 2

REGULATORY - 1 - - 1 -

REPUTATIONAL - 2 - - 2 -






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13

SEVERE RISKS & TREND ANALYSIS





RISK

REFERENCE

NUMBER

RISK AREA TOPIC RISK STATEMENT

RISK CATEGORY

(Preventable /

Strategic /

External)

RESIDUAL SEVERITY SCORE

TREND

ANALYSIS

COMMENTS /

EMERGING

ISSUES

ACTION PLANSPRIOR PERIOD:

December 31,

2019

CURRENT

PERIOD:

April 30, 2020

1Health &

Safety RiskOn-site Safety

Health and safety incidents at

housing sites resulting in

violence/harm to employees,

tenants, and/or third-party

stakeholders/ partners.

Preventable /

External16.00 16.00

COVID-19

exposure for

residents and

staff

Enhance the current monitoring process (enforcing

reactions to alerts, always having someone

watching over sites)

Implement a fob system for sites

Additional staffing requests to provide additional

resources to higher risk buildings

Utilize a virtual concierge in high acuity buildings

2Financial

Risk

Capital &

Liquidity

Lack of access to capital and/or

liquidity due to funding

restrictions resulting in the

organization's inability to meet

operational requirements and

strategic objectives.

External 16.00 10.00

Risk reduced due

to additional

funding

VFH Report; identifying the lifespan of various

assets

Opening the Shared Agreement

Working with the City to gain further access to

funding for projects

The City maintains a reserve of funding that LMCH

has access to

Inform and educate the City as LMCH does not have

lobbyists who advocate on their behalf

Establishing a program with the City to advance

funding at the beginning of a period (instead of

billing the City afterwards)

Q1 2020 (for the period ending March 31, 2020)

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14






RISK

REFERENCE

NUMBER


RISK CATEGORY

(Preventable /

Strategic /

External)


TREND

ANALYSIS

COMMENTS /

EMERGING

ISSUES


December 31,

2019

CURRENT

PERIOD:

April 30, 2020

3Operational

Risk

Sole

Shareholder

Relations

Strained relationship with the

sole shareholder, the City of

London, resulting in potential

changes to operations and

restrictions on funding.

Strategic 14.00 8.00 Quarterly updates provided to key City of London

representatives

4Health &

Safety Risk

Tenant/Staff

Wellness

Failure to address tenant and/or

staff mental health needs,

including support services,

resulting in a crisis/incident

involving tenants and/or staff.

Preventable /

External14.00 14.00 Housing Stability Plan

5

Human

Resources

Risk

Resourcing

Insufficient staff resources to

effectively support operations

and strategic initiatives

impacting the quality of output

and the ability to execute daily

functions.

Preventable 14.00 8.75Funding has

reduced risk

Aligning resources to objectives

Business case for staffing in multi-year budget

KPI reporting


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15






RISK

REFERENCE

NUMBER


RISK CATEGORY

(Preventable /

Strategic /

External)


TREND

ANALYSIS

COMMENTS /

EMERGING

ISSUES


December 31,

2019

CURRENT

PERIOD:

April 30, 2020

6Operational

Risk

IT Capability

and Capacity

Failure of IT systems and

insufficient resourcing resulting

in disrupted business operations,

reputational damage, and/or

financial implications.

Preventable 12.00 12.00

Plan to develop Super Users of technology used

within LMCH to mitigate the key person

dependency in IT

Enhanced policies/procedure documentation with

defined roles and responsibilities at the start of

projects

Development of a general IT Strategy

7Operational

Risk

Policy and

Procedures

Lack of formalized policies and

procedures that result in

inconsistent completion of tasks,

operational inefficiencies, and

dependency on key personnel.

Preventable 12.00 12.00

Update all current policies and procedures

Update all job descriptions to reflect the roles and

responsibilities of individuals

8Financial

Risk

Financial

Reporting

Inability to produce accurate

financial data resulting in

inaccurate reporting and

hindering the decision making

process.

Preventable 12.00 12.00 Action plans to be developed by LMCH


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16

RISK ASSESSMENT RESULTS - TREND ANALYSIS

1 2 3 4

1

2

4

3

Impact of Occurrence

1 2 3 4

1

2

4

3

Impact of Occurrence

Lik

elihood o

f O

ccurr

ence

PRIOR PERIOD RESIDUAL RISK ASSESSMENT (as at December 31, 2019)

CURRENT PERIOD RESIDUAL RISK ASSESSMENT

(as at March 31, 2020)





1,

2

3

4,

5

6

7,

8

Lik

elihood o

f O

ccurr

ence

Q4 2019 vs. Q1 2020

1

2

3

7,8

6

4

5

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APPENDICES

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18

RISK ASSESSMENT CRITERIALikelihood Scale

RATING LEVEL PROBABILITY FREQUENCY DESCRIPTION

4ALMOST

CERTAIN

Event is expected to occur

in most circumstancesHighly likely to occur annually > 85%

3 LIKELYEvent will probably occur in

most circumstances

Has occurred or is expected to occur

once in a two (2) year timeframe50% - 85%

2 POSSIBLEEvent could occur at some

time

Has not yet occurred but could occur

or is expected to occur once in a five

(5) year timeframe

15% - 49%

1 UNLIKELYEvent may occur only in

exceptional circumstances

Has not yet occurred but could occur

or is expected to occur once in a ten

(10) year timeframe

< 15%

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19

RISK ASSESSMENT CRITERIAImpact Scale

CATEGORIES

RATING & LEVEL

4

SIGNIFICANT

3

MAJOR

2

MINOR

1

INSIGNIFICANT

OPERATIONAL

Serious incident within the community

resulting in the cessation of operations

Widespread or long-term shut down due to

internal operational issue

Significant incident within the community

resulting in the temporary shut-down of

operations

Significant, sustained, internal operational

issue

Modest incident within the community

resulting in minimal loss of support

Modest internal operational challenge in

size or duration

Minor incident within the community

resulting in a brief negative reaction

Minor internal operational inefficiency

HEALTH & SAFETY

Incident results in a fatality to staff and/or

tenant(s)

Full breach of health and safety regulation

Event results in a long-term disability to

staff and/or tenant(s)

Significant regulatory health and safety

violation

Incident results in a short-term disability to


Escalation of resources committed to

address health and safety regulatory

concern

Minor incident requiring minimal first aid to


Low significance health and safety

regulatory incident

REPUTATIONAL

Event results in sustained, serious loss of

stakeholder confidence

Intense negative attention in national

news/social media

Event has a major impact on stakeholder

confidence that damages the organization’s

image

Negative attention in local news/social

media

There is a modest impact on organization’s

image

Limited negative attention in local

news/social media

Event has limited, localized impact on

organization’s image

Brief negative attention in local

news/social media

REGULATORY

Material breach of legislation with very

significant consequences, requiring

substantial resources to rectify

Regulatory breach with material

consequences, requiring several resources

to rectify

Regulatory breach with minor

consequences, requiring some resources to

rectify

Regulatory breach with minimal

consequences, readily rectified with

limited resources

HUMAN RESOURCES

Unexpected/unplanned loss of whole team

Serious incident occurs resulting in

significant resources required to rebuild

culture

Unexpected/unplanned loss of key

individuals

Significant incident occurs resulting in an

immediate, lasting shift in culture,

requiring several resources to rectify

Unexpected/unplanned loss of a key

individual

Modest incident occurs resulting in a shift

in culture requiring time/effort to rectify

Unexpected/unplanned loss of a single staff

member

Minor incident occurs resulting in a

temporary shift in culture

FINANCIAL > $500K $200K - $500K $50K - $200K < $50K

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20

RISK ASSESSMENT CRITERIASeverity Scale

Severity is the product of likelihood and impact that determines the magnitude of the risk under consideration.

The table below outlines the severity scores under a 4-point scale with a range of possible scores between 1 and 16

The range of scores are associated with LMCH’s risk tolerance levels

SEVERITY LEVEL EQUIVALENT SEVERITY SCORE

LOW Less than 5

MODEST 5 to less than 8

HIGH 8 to less than 12

SEVERE Greater than or equal to 12

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21

RISK MANAGEMENT APPROACHMitigation and Response

PREVENTABLE RISKS STRATEGIC RISKS EXTERNAL RISKS

DEFINITIONRisks arising from within the

organization that generate

minimal strategic benefits

Risks taken on for strategic returnsExternal, uncontrollable

risks

RISK

MITIGATION

OBJECTIVES

Avoid or eliminate occurrence

cost-effectively

Reduce likelihood and impact of

occurrence cost-effectively

Reduce impact cost-

effectively should risk

become reality

RISK

MITIGATION

TACTICS

Effective governance and

oversight

Continuous interactive discussions

to understand risks and their

associated consequence to hinder

the pursuit of strategic objectives

Identify, foresee

criticality, and mitigate

effect

KEY RISK

MITIGATION

TOOLS

Mission, vision, and values

Integrated organizational

culture

Governing policies,

procedures. and controls

Rules and boundary systems

Internal audit

Assessing likelihood/impact of

risk occurrence

Managing lead/lag indicators of

risk occurrence

Allocation of resources to

manage risks

Sensitivity/stress

testing

Scenario planning

"What if" analysis

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22

GOVERNANCE – ROLES & RESPONSIBILITIESWho is accountable?

ROLES RESPONSIBILITIES

BOARD

Provide oversight of strategy and carry out risk governance responsibilities to support management in achieving strategy and business

objectives

Review the risk appetite with the ERM Committee

Review the risk registry and challenge the risk severity ratings, if required

Monitor actions and processes to ensure a review of ERM practices is conducted

Receive reports on breaches of risk appetite

ERM COMMITTEE



Implement the Board's risk policy and strategy

Support investigations of incidents and near misses

Coordinate the risk management activities

Compile risk information and reports for the Board

Assess the level of assurance on the controls in place

MANAGEMENT

Set the tone at the top for risk management

Embed the risk management culture throughout the organization

Participate in the risk assessment process to assess risks at a residual level

Monitor the operation of controls to ensure they are operating with sufficient effectiveness to justify the residual risk rating

Identify and report changes in the external or internal environment that may affect the risk profile

Consider new and emerging risks as part of decision-making

INDIVIDUAL EMPLOYEES

Understand, accept, and implement risk management processes

Be alert to risks associated with day-to-day activities

Report inefficient, unnecessary, and unworkable controls

Report losses and near misses of 123

QUESTIONS?

JOE FILIPPELLI

CPA, CA

Senior Manager

Advisory Services

(416) 985-5639

[email protected]

KAYLEIGH PHYPERS

CIA, Certified in ERM Fundamentals

Manager

Strategy & Operations

(647) 730-6766

[email protected]

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FROM: Joseph Bonasia, KPI & Business Analyst

SUBJECT: Key Performance Indicators (KPIs) for February & March 2020

DATE: May 21, 2020

RECOMMENDATION:

That, on the recommendation of the (Interim) Director of Finance, the following report BE RECEIVED for information purposes.

BACKGROUND:

A benchmark framework for KPI selection and evaluation has been developed in part with LMCH’s strategic plan. Data driven decision making can help streamline many of the processes within our organization and will add an evidence-based layer to future strategic planning and organizational governance. At the end of 2019, the state of LMCH’s data flow and state of the data was low on the Data Process Maturity spectrum1, because the organization had some facts and data, but the collection and usage was ah-hoc, sporadic and un-coordinated.

Over the course of 2020, an understanding the current state of data flow and the state of the data itself is underway, with intention of setting standardizations for data tracking, validation and accountability over the course of Q2/Q3 in 2020. Several data audits have taken place to better understand these processes. Also, a data schedule with monthly timelines was identified and communicated to key staff, clearly delineating roles and responsibilities and appropriate data delivery deadlines.

DATA:

1 See Appendix B

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Appendix A is the chart which lists each KPI and its associated February and March preliminary unaudited data for 2020.

NEXT STEPS:

Work is currently underway for building a high level KPI dashboard. The first version will be drafted on our local servers immediately with a tentative early May delivery schedule, and a first version cloud-based tool for continued tracking and real-time status updating will proceed with a tentative mid-late Q2 delivery schedule. Iterations of continuous improvement will be made weekly with newly acquired data, testing the accuracy and real time capability of the tool.

CONCLUSION:

The purpose of this report is to present progress for LMCH’s KPI data audit initiative, as part of the strategic plan. The current state of LMCH’s organizational data process maturity is deemed to be low. Standardization and departmental accountability are of critical importance at this point of the development phases and must be exercised in the near future for the benefit of the organization. These potential improvements will help move the organizational data process maturity level to a mid-level status.

SIGNATURE: PREPARED BY: RECOMMENDED BY:

JOSEPH BONASIA KPI & BUSINESS ANALYST


Organizational Data Processes Audit

High-Level Visualization Dashboard

Standard Operating Procedures for 2020

Data Practices

Iterations of Continuous

Improvement

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Appendix A – Data Process Maturity Appendix B – February and March Data 2020

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Appendix A: Data Process Maturity (end of 2019)

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Organization Finance Tenant Services Community Development

Property Services Regeneration & Capital

Creating a Healthy & Effective Organization

Establish long–term financialgrowth and stability

Engage, Support andEmpower Tenants

Safe & healthy communities

Improve, Renewal and Maintainthe homes we offer

Revitalizing how we manage our properties

Sustainable housing portfolio

Realizing financial and physical infrastructure sustainability

Responding to tenant needs (better service to tenants)

Creating healthiercommunities

Improving and maintaining buildingsQuality homes Tenants

living in clean, maintained buildings

• Sick Days – 58.62

• Vacation Days – 43.42

• Incidents – 7

• Grievances – 0

• CARE ConversationsCompleted – 0.00%

• Turnover Rate – -0.94%

• New Hires – 1

• Manageable Costs – $642,842

• Surplus/(Deficit) – ($374,332)

• Rent Arrears – $296,942

• Rent Arrears Percentage – 14.84%

• Rent Arrears per Unit – $616

• Days to Monthly Close – 53

• Call Received – 1268• Calls Answered – 790• Calls Dropped – 478• Average Wait Time – 1:37• Average Call Duration – 1:32• Average Drop Time – 3:42• Walk Ins – 613

• Complaints – 244• Referrals – 19• Move–Outs – 21• Average Days to Lease –40.59• Units Leased - 61

• Community Partner meetings– 65

• Tenant Meetings – 21

• Tenant Run Activities –28

Work Order Summary• Balance Forward – 9555• Created – 1788• Closed – 1872• Balance End – 9471• Days to Respond – 62.63• Days to Completion – 62.38

• Average Days to Turnover – 100.80• Units Confirmed Ready – 45• Average Days Vacant – 155.24• Vacant Units – 140• Vacancy Rate – 4.36%

• FCI (Percentage ofBuildings in Range) – 55%

• Building Audit ScoresPortfolio 1 – 76.63 (4)Portfolio 2 – 83.28 (2)Portfolio 3 – -- (0)Total – 78.84 (6)

February 2020 KPI Summary

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Organization Finance Tenant Services Community Development

Property Services Regeneration & Capital

Creating a Healthy & Effective Organization

Establish long–term financialgrowth and stability

Engage, Support andEmpower Tenants

Safe & healthy communities

Improve, Renewal and Maintainthe homes we offer

Revitalizing how we manage our properties

Sustainable housing portfolio

Realizing financial and physical infrastructure sustainability

Responding to tenant needs (better service to tenants)

Creating healthiercommunities

Improving and maintaining buildingsQuality homes Tenants

living in clean, maintained buildings

• Sick Days – 43.71

• Vacation Days – 23.95

• Incidents – 2

• Grievances – 0

• CARE ConversationsCompleted – 0.00%

• Turnover Rate – -1.92%

• New Hires – 0

• Manageable Costs – $980,163

• Surplus/(Deficit) – ($661,910)

• Rent Arrears – $343,540

• Rent Arrears Percentage – 11.43%

• Rent Arrears per Unit – $687

• Days to Monthly Close – 36

• Walk Ins – 336

• Complaints – 364• Referrals – 11• Evictions – 3• Move–Outs – 28• Managed Arrears – 72• Average Days to Lease – 36.93• Units Leased – 25

• Community Partner Meetings– 60

• Tenant Meetings – 7

• Tenant Run Activities – 21

Work Order Summary• Balance Forward – 9480• Created – 1440• Closed – 1673• Balance End – 9247• Days to Respond – 10.38• Days to Completion – 10.79

• Average Days to Turnover – 76.94• Units Confirmed Ready – 43• Average Days Vacant – 118.70• Vacant Units – 143• Vacancy Rate – 4.36%

• FCI (Percentage ofBuildings in Range) – 55%

• Building Audit ScoresPortfolio 1 – -- (0)Portfolio 2 – 74.11 (2)Portfolio 3 – -- (0)Total – 74.11 (2)

March 2020 KPI Summary

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SUBJECT: Re-costed 2020 Capital Budget

DATE: May 21, 2020

RECOMMENDATION: That, on the recommendation of the interim Director of Finance, Director of Assets and Property Services, and the Interim Chief Executive Officer the board APPROVE the 2020 Re-costed Capital Budget covering 32 new capital projects totaling $3,509,786, the SHAIP deficit coverage of $490,214, 11 carry-forward SHAIP projects totaling $3,892,922, 16 carry-forward projects from 2018/2019 totaling $1,151,903.

BACKGROUND: The Board of Directors previously approved the 2020 Provisional Capital Budget on December 18, 2019 subject to re-costing expenditures. LMCH completed a budget process to build the 2020 Capital Budget following board approval.

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2020 Re-costed Capital Budget

London & Middlesex Community Housing has reviewed the budget submission for the 2020 Capital Budget of $4,000,000 and have made no allocation changes1 to the projects approved on April 9, 2020. In review of the prior year, the following carryforward projects remain open and approval of the remaining spend is requested:

Social Housing Apartment Improvement Program (“SHAIP”): 3,892,922 2018 Capital Program: 489,368 2019 Capital Program: 662,536

Total: $5,044,825

Carryforward Projects Overview:

2020 Capital Program – a breakdown of priority projects can be found below and an overview with specific projects and sites can be found on the next page of this report.

1 Project 2020-0001 sites were labelled incorrectly during the last Board Meeting and have been changed from Dundas and Kent St. to McNay, Baseline, Simcoe and Walnut.

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High Priority Projects: 2,094,843 Medium Priority Projects: 663,730 Low Priority Projects: 50,000 Other Capital: 701,213 SHAIP Deficit: 490,214

Total: $4,000,000

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2020 Capital Program - Overview

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2020 Capital Program – Deferral note: As London & Middlesex

Community Housing continues to operate in an ever-changing eco-system and the Property Services department and Asset Management Team provided a selection of projects that could be deferred if financial constraints presented themselves over the course of the fiscal year. In total, five (5) projects can be deferred for a project value of $933,835.

020 Capital Program - Deferrals

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Business Units – London & Middlesex Community Housing has access to the following business units: PD261819, LMH26182, LMH2619, SHAIP. The respective remaining balance are as follows:

PD261819 2,110,656 (Remaining balance from 2018 & 2019 @ Dec 31, 2019) LMH26182 2,208,000 (Regular Capital Allotment from Shareholder) LMH2619 1,792,000 (2020-2023 Multi-year Budget increase, approved March 2, 2020) SHAIP 3,615,003 (SHAIP Balance @ Dec 31, 2019) Total Balance 9,725,659

In summary, the total budget approved and being carried forward (including SHAIP funding) for the 2020 fiscal year is as follows:

City of London Business Units PD261819 2,110,656 LMH26182 2,208,000 LMH2619 1,792,000 SHAIP 3,615,003

Total Available funding 9,725,659

2020 Capital Budget (Spending per Business Unit) PD261819 1,151,903 LMH26182 2,205,550 LMH2619 1,304,236 SHAIP 3,892,922

Total Planned Capital Work 8,554,611

SHAIP Deficit Allocation 490,214 Total Capital Allocation 9,044,825

Unallocated Funding $680,834

The Property Services Department and the Director of Asset Management will prioritize projects to be allocated using the total unallocated funding of $680,834 (7% of total available funding) or otherwise deemed as contingency monies.

FINANCIAL IMPLICATIONS:

The 2020 Re-costed Capital Budget adheres to the current budgetary guidelines and the 2020 Re-costed Capital Budget remains within the limits of the unspent capital reserve balance held by the City of London.

CONCLUSION:

The Capital Budget for 2020 will need to be managed closely and cost saving mechanisms will need to be investigated to ensure risks are mitigated when unbudgeted and unexpected costs arise.

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SIGNATURE:




RECOMMENDED BY: RECOMMENDED BY:

KARA VAN SLYKE FINANCE MANAGER

SHELLIE CHOWNS DIRECTOR OF ASSETS AND PROPERTY SERVICES

Attachments: Appendix I: 2020 Re-costed Capital Budget

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Appendix I: 2020 Capital Budget

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STAFF REPORT 2020 - 25

TO: Members of the Board of Directors

FROM: Bill Leslie, Manager of Construction and Capital Projects & Nick van der Velde, (interim) Director of Finance

SUBJECT: April 2020 – Capital Work Update

RECOMMENDATION: That, on the recommendation of the Manager of Construction and Capital Projects and (Interim) Director of Finance, the Board of Directors:

A) RECEIVE for information purposes the April 2020 – Capital Work Update that showsthat:

a. The SHAIP Capital program concludes the following projects:i. Complete: 17ii. Active: 2iii. Cancelled: 1

b. 2018 Capital Program concludes the following projects:i. Complete: 10ii. Active: 7iii. Cancelled: 1

c. 2019 Capital Program concludes the following projects:i. Complete: 5ii. Active: 9iii. Cancelled: 6

d. 2020 Capital Program concludes the following projects;i. Complete: 0ii. Active: 16iii. Cancelled: 0iv. Planned: 16

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BACKGROUND:

The following report offers a high-level analysis and explanation of LMCH’s current and future capital projects, including an update on SHAIP.

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SHAIP Update – Capital Work Program

1. Complete

2018-0012 – MUA Replacement 2018-0029 – MUA Replacement 2018-0042– MUA Replacement 2018-0043– MUA Replacement 2018-0044 – MUA Replacement 2019-0002– Solar Walls 2019-0002– Solar Walls 2019-0002– Solar Walls 2019-0002– Solar Walls 2019-0019 - SHAIP specific post project for three years following completion 2019-0024 – Lighting Upgrades 2019-0024– Lighting Upgrades 2019-0024– Lighting Upgrades 2019-0024– Lighting Upgrades 2019-0024– Lighting Upgrades 2019-0024– Lighting Upgrades 2019-0029 – Architecture and Design

2. Active

2018-0001 – Cladding (Solar Walls complete) 2018-0002 – Cladding (Solar Walls complete)

3. Cancelled

2019-0025 – MUA Mod

Note: On March 20, 2020, London & Middlesex Community Housing (“LMCH”) forwarded all Substantial Performance Certificates to the City of London for release of funding under the SHAIP Capital Program. Effectively, LMCH satisfied the program deadline of March 31, 2020 for all SHAIP related capital projects, with the expectation of capital project 2018-001 and 2018-002 and its EIFS cladding component, which have been provided with an extended deadline of project completion by June 30, 2020.

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2018 Capital Program

1. Complete

2018-0004 - Universal Access Upgrades 2018-0009 - Exterior Lighting Upgrade 2018-0010 - Elevator Modernization 2018-0014 - Exterior Windows & Doors 2018-0015 - Exterior Windows & Doors 2018-0018 - Fire Panel Upgrades 2018-0019 - Fire Panel Upgrades 2018-0034 - Exterior Doors 2018-AMP - Asset Management Plan - HSC Consult 2018-0005 - Bathroom Rebuilds

2. Active

2018-0003 - Exterior Lighting Redesign Project 2018-0007 – Front Entrance Upgrades 2018-0008 – Lounge Upgrades 2018-0020 - Electrical Systems Review 2018-0022 - Asbestos Re-assessment 2018-0020 – Asbestos Re-assessment 2018-0023 - Technology Contingency 2018-Tech - New Server

3. Cancelled

2018-0013 - LEAC Shield - Under investigation for silica build up on equipment

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1. Complete

2019-0005 - Corridor Painting 2019-0011 - Asphalt - Parking lots and pathways 2019-0012 - Major Elevator Upgrade 2019-0015 - Bathroom Rebuilds 2019-0026 - Lounge Air Conditioning

2. Active

2019-0001 - Door Replacements 2019-0004 - Lobby Upgrades 2019-0007 - Boiler Replacement 2019-0008 - Elevators – Operations 2019-0013 - Universal Access Upgrades 2019-0014 - Physical Security Upgrades 2019-0016 - Unit Flooring 2019-0017 - Technology Contingency 2019-0039 - Fire Alarm Panel Replacement

3. Cancelled

2019-0003 - Generator Replacements 2019-0006 - Boiler Replacement 2019-0009 – Windows/Doors 2019-0010 – Balcony Study 2019-0037 - Generator Replacements 2019-0038 - Generator Replacements

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1. Complete

2. Active

2020-0002 Balcony Study Berkshire, Simcoe, Oxford 2020-0004 Boiler Replacement William 2020-0008 Generator Replacements Walnut 2020-0009 Generator Replacements Baseline 2020-0014 Roofing: Replacement McNay 2020-0015 Technical Contingency Bella 2020-0016 Corridor Security lock System Simcoe & Dundas 2020-0017 Physical Security Upgrades Dundas 2020-0020 Bathroom Rebuilds 15 Bathrooms: Various Sites 2020-0025 Lobby Upgrades Baseline 2020-0026 Unit Flooring Replacement Various Sites 2020-0027 Windows and doors: Town houses County Windows 2020-0028 Mold Abatement Town Home Sites 2020-0030 CRW Office Security upgrades Seven Sites 2020-0031 Universal Access Upgrades Various Sites 2020-0032 Asbestos Re-assessment Various Sites

3. Cancelled

4. Planned

2020-0001 MUA Hook Ups McNay, Baseline, Simcoe, Walnut 2020-0003 Balcony: Fall protection Sites to be determined 2020-0005 Elevators: Capital Repairs Simcoe, McNay 2020-0006 Fire Alarm Panel Replacement Tecumseh 2020-0007 Fire Alarm Systems: annunciators Albert 2020-0010 Main Electrical Service Walnut 2020-0011 Main Electrical Service Simcoe 2020-0012 Major Elevator Upgrade Albert 2020-0013 Fire Alarm Systems Albert, Commissioners 2020-0018 Plumbing Riser Replacement Baseline 2020-0019 Asphalt: Parking Lots and Pathways Various Sites 2020-0021 Corridor Painting Simcoe 2020-0022 Exterior Door Replacement Wharncliffe Entrance Doors 2020-0023 High rise Lighting Various Sites 2020-0024 Kitchen Rebuilds 15 Kitchens: Various Sites 2020-0029 Building Condition Assessments (BCA) 1/3 of the Portfolio

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PREPARED BY: PREPARED BY:

Bill LESLIE MANAGER, CONSTRUCTION & CAPITAL PROJECTS


RECOMMENDED BY:


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SUBJECT: Re-costed 2020 Operating Budget

DATE: May 21, 2020

RECOMMENDATION: That, on the recommendation of the interim Director of Finance the Board APPROVE the 2020 Operating Budget totaling $23,928,784, including $12,249,047 in City of London funding.

BACKGROUND: The Board of Directors previously approved the 2020 Provisional Operating Budget on December 18, 2019 subject to re-costing of revenue and expenditures. LMCH completed a zero-based budget process to build the 2020 Operating Budget following board approval.

Due to receiving funding approval from City Council on March 2nd for the 2020-2023 Multi-year Budget, COVID-19 and business continuity requirements, the 2020 Operating Budget was completed at a later date than anticipated.

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2020 Re-costed Operating Budget

LMCH completed a re-costed 2020 Operating Budget of $23,928,784 and the City of London subsidy of $12,249,047. The total budget increased by $1,050,703 (due to approval of Business Case #19 in the 2020-2023 Multi-year budget) since previously approved by the Board of Directors on December 18, 2019 and the allocation of funding to line items changed slightly. The budget was built by management and reviewed by the interim Director of Finance.

The major changes to the 2020 Operating Budget compared to the previously approved provisional 2020 Operating Budget are:

• Revenue – due to approval of business case #19 by London City Council, LMCH willreceive an additional $1,054,000 with the intention to hire 14 staff in CY2020;

o There have been minor reallocations between line items based on the 2019actuals with minor non-material changes to the other revenue lines;

• Salaries, Wages and Benefits – the increase in budget of $1,123,030 to a total of$6,580,415 is due to additional staffing as outlined in business case #19 in the 2020-2023 Multi-year Budget process;

• Maintenance, Materials & Services – The decrease of $107,022 to a total of $5,271,657is based on an effort to create more intentional and specific spending on behalf of theProperty Services department. The 2019 actuals compared to the 2018 actuals showeda significant increase due to one-time items/programs, such as: mold remediation,vacancy blitzes, and pest management programs at the Simcoe Street and Dundassites. LMCH is not expecting to see these expenditures in CY2020. As 2020 progresses,Finance will try to find cost-savings in other departments, which may be applied toProperty Services department and the Maintenance, Materials and Services section ofthis budget;

• Security – the increase in budget of $153,727 to a total of $273,089 is due to increasingsecurity risks and alignment with LMCH’s commitment to increase security measures.This budget will not adequately cover those risks but will improve site security fortenants;

• Utilities – No material changes to this line;

• Property – the decrease in budget of $491,579 to a total of $5,866,032 reflects areduction in property taxes, based on LMCH’s engagement with RYAN Consulting in2019;

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• Administration – the increase in budget of $558,245 to a total of $2,057,649 is due toadditional costs related to Business Case #19 such as laptops, cellphones, desk phonesand furniture and an office remodel to create space for the additional staff.

LMCH continues to balance budget constraints against increasing and complex challenges in supporting tenants and managing infrastructure. LMCH is managing its budget prudently to ensure funds are being directed to areas where the greatest positive impact is achievable.

CONCLUSION:

The budget for 2020 was purposely built from “zero” for all material accounts to create greater transparency in our budgeting process. Regardless of this approach, the budget will need to be managed closely and cost saving mechanisms will need to be investigated to ensure risks are mitigated when unbudgeted and unexpected costs arise.

SIGNATURE:




RECOMMENDED BY:

ANDREA MCKENZIE INTERIM CHIEF EXECUTIVE OFFICER

Attachments: Appendix I: 2020 Re-costed Operating Budget

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Appendix I: 2020 Operating Budget

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STAFF REPORT 2020 - 27

TO: Board of Directors

FROM: Bill Leslie Manager, Capital Projects & Construction

SUBJECT: LMCH 2020-0031-RT Three Year Service Contract Grounds Keeping Services Multi Storey Buildings and Townhouse Sites in the City of London Portfolio One Portfolio Two Portfolio Three RECOMMENDATION OF AWARD TO CONTRACTOR

RECOMMENDATION:

That, on the recommendation of the Manager, Capital Projects & Construction, the Interim Director of Finance, and the Interim Chief Executive Officer, the above-mentioned portfolios (portfolio one, two and three) be awarded to the lowest compliant bidder, S & K Property Maintenance (S & K) at the stipulated sum as follows:

GROUNDS KEEPING SERVICES - PORTFOLIO ONE

SUB-TOTAL HST TOTAL COST

$204,335.88 26,563.66 $230,899.54

GROUNDS KEEPING SERVICES - PORTFOLIO TWO


$160,448.19 20,858.26 $181,306.45

GROUNDS KEEPING SERVICES - PORTFOLIO THREE


$244,282.17 31,756.68 $276,038.85

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ALL PORTFOLIOS COMBINED

SUB-TOTAL HST STIPULATED SUM

$609,066.24 79,178.60 $688,244.84

Funding to be provided from 2020 - 2022 LMCH Operating Budgets

STRATEGIC ALIGNMENT:

This project is consistent with the objectives the LMCH’s Strategic Plan with particular connection to our goal of “Improve, Renew and Maintain the Homes we offer”.

BACKGROUND:

The previous Landscape Maintenance Service contract was a three-year service contract awarded to S&K Maintenance Services in 2016 covering the years 2016, 2017 and 2018. It was extended for one year to cover 2019.

The service contract was broken up over three separate portfolios. Each portfolio consists of a number of multi-storey buildings and town house sites.

Portfolio One includes: 136 Albert Street, 170 Kent, 241 Simcoe Street, 345/349 Wharncliffe Road South, Allan Rush Gardens Townhouses, Marconi Boulevard Townhouses and Pond Mills Road Townhouses.

Portfolio Two includes: 632 Hale Street, 202 McNay Street, 304 Oxford Street West, 39 Tecumseh Avenue East, 85 Walnut Street, and Limberlost Townhouses.

Portfolio Three includes: 30 Base Line Road West, 200 Berkshire Drive, 1194 Commissioners Road West, 580 Dundas Street, 872 William Street, Boullee Street Townhouses, Huron Street Townhouses and Southdale/Millbank Townhouses.

The requested services included in the tender consist of Spring Clean-Up, Landscaping, Mowing/Trimming, Treatments, Leaf Raking and Fall Clean-up.

EXPLANATION OF TENDER:

Based on the size and nature of the project, an open tender call was used. In light of the current office closure and social distancing requirements due to the COVID-19 pandemic, the tender documents were posted on Bids and Tenders (“B&T”), a website portal. Typically, LMCH requests bidders submit their bids in hard copy format to our Oxford Street office. As the office is closed, the bidders were requested to submit electronically.

The project was posted on B&T on March 31, 2020, and the tender period closed on April 14, 2020. A number of contractors received notification from Bids and Tenders. Also, two contractors were contacted directly to advise them of the tender posting.

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SUMMARY OF SUBMISSIONS:

Tender procedures were properly maintained throughout the process, ensuring all bids received were submitted with integrity.

Two tenders were submitted.

Both tender packages included properly completed Bid Forms, Contractor Compliance Statement and Qualifications. There were two addendums issued; which were incorporated into both bids. Both bidders attended the mandatory contractor site visit.

A summary of the submissions is as follows:

PORTFOLIO ONE

CONTRACTOR SUB-TOTAL HST TOTAL BID

S&K Property Maintenance $204,335.88 $26,563.66 $230,899.54 Complete

PORTFOLIO TWO


S&k Property Maintenance $160,448.19 $20,858.26 $181,306.45 Complete

Doug’s Snowplowing & Sanding Ltd $569,357.00 $74,016.41 $643,373.41 Complete

PORTFOLIO THREE


S&k Property Maintenance $244,282.17 $31,756.68 $276,038.85 Complete

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PREPARED by: RECOMMENDED by:

BILL LESLIE MANAGER, CAPITAL PROJECTS AND CONSTRUCTION

ANDREA MACKENZIE INTERIM CEO

RECOMMENDED by:


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SUBJECT: Mortgage Renewal with CMHC

DATE: May 21, 2020

RECOMMENDATION: That, on the recommendation of the Interim Director of Finance that staff BE DIRECTED to submit all documentation as needed to satisfy the Social Housing Mortgage Renewal Process through the Ministry of Municipal Affairs and Housing for the property located on 49 Bella St. in Strathroy.

PURPOSE: To receive approval to authorize the Ministry of Municipal Affairs and Housing to arrange LMCH’s mortgage refinancing through its mortgage renewal process for a LMCH property held on 49 Bella Street, Strathroy, Ontario. The term will be that of one year and 8 months with an interest rate to be determined at a later date1, and a starting balance of $92,368.16 (approx.) per June 1, 2020. The 2020-2023 multi-year budget accounts for this cost per annum. The full mortgage will be paid off in the year 2022.

REASONS FOR RECOMMENDATIONS:

In 1987, the Ministry of Municipal Affairs and Housing agreed to arrange mortgage financing for 49 Bella Street in Strathroy, Ontario, one of the assets held in the London-Middlesex Community Housing portfolio.

The original final capital cost for the mortgage was that of $900,000 with a start date of February 1, 1987 and as documentation shows, mortgage terms have always been over a five (5) year time-period. The original amortization period was that of 420 months or thirty-five (35) years.

Originally, the existing charge/mortgage of land had to be renewed by February 1, 2020. Board approval for the mortgage renewal was received on November 27, 2019 and the mortgage renewal package was submitted by LMCH staff on November 29, 2019.

1 Government of Canada Treasury hedges the funds for the mortgages prior to the actual renewal date of the mortgage – CMHC will prepare the application documentation for LMCH (repayment letter and amortization schedule) to outline the new terms. The interest rate isn’t available until the Government of Canada Treasury has completed their process, which is why it’s not included in the transfer offer attached – however, CMHC’s Direct Lending rates are guaranteed to be lower than market.

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Scotiabank responded by confirming that they were declining to provide mortgage funding for the Bella Street property, due to their reluctance to take on a loan with a term of less than two years.

NEXT STEPS LMCH engaged with the Ministry as well as Canadian Mortgage Housing Corporation (“CMHC”), which will provide LMCH with a mortgage on the Bella Street property.

The Board Chair and Interim Chief Executive Officer will be required to sign the necessary paperwork under the Ministry’s Social Housing Mortgage Renewal Process as prepared by the LMCH Finance team. The Finance team will submit said completed / signed paperwork to the Ministry of Municipal Affairs and Housing and CMHC upon receipt of the signed documents.

SIGNATURE:




RECOMMENDED BY:


APPENDIX: A – Mortgage Renewal Form – CMHC; B - 2019 Annual Mortgage Statement for 49 Bella St.

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Appendix A - Mortgage Renewal Form - CMHC

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Appendix B - 2019 Annual Mortgage Statement for 49 Bella St.

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FROM: Bill Leslie (Manager, of Construction and Capital Projects), Kara Van Slyke (Finance Manager), Nick van der Velde, (Interim Director of Finance), Andrea Mackenzie (Interim CEO)

SUBJECT: February 2020 Financial Results Summary – Operating and Capital Results

DATE: May 21, 2020

RECOMMENDATION: That, on the recommendation of the (Interim) Director of Finance, Finance Manager, and interim Chief Executive Officer, the Board of Directors:

A) RECEIVE for information purposes the February 2020 Financial PerformanceResults and its Operating Summary Report that shows an operating deficit of$(374,332) with $(366,925) exceeding the 2020 year-to-date budget due to thefollowing principal reasons:

1. Business Case 19 revenue has not been appropriated yet;2. An expenditure increase in the Maintenance, Materials And Services

budget mainly related to a vacancy focus, increased boilerdiagnostics and repair and additional spending for painting for unitsthat were turned-over;

3. Several fires and floods have occurred at the beginning of the year,which has increased the extraordinary loss line item.

B) RECEIVE for information purposes the February 2020 Financial PerformanceResults and its Capital Summary Report that shows as of February 29th, 2020, atotal expenditure of $1,321,318 on open and budgeted capital projects.

BACKGROUND:

The following report offers a high-level and detailed analysis of LMCH’s February 2020 Financial Results for both operating and capital expenses.

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ANALYSIS:

February 2020 Financial Results - Operating

The year-to-date operational results at February 29th, 2020 ended with an operating deficit of $(374,332) with $(366,925) exceeding the 2020 year-to-date budget.

The analysis includes:

Revenue 1. Municipal Base Funding: $1,865,841 - Approx. $175,000 of Business Case 19

payment not appropriated at this point.

Expenditures 1. Building, General - $212,200 - Building, General expenditures are higher as a

significant number of units were turned over from January to February with extra spending for maintenance supplies, countertops, levers, locks, etc.;

2. Pest Control - $58,317 – Pest control is mostly performed re-active. Currently, thereare heightened pest challenges at various sites in the LMCH portfolio;

3. Electrical - $31,669 - Increased spending on electric systems and service forvarious sites;

4. Equipment - $28,711 - At times, LMCH purchases stoves and/or fridges in bulk tocreate cost savings on equipment purchases;

5. Snow Removal - $286,141 – Use of snow removal contractor was higher thananticipated for this month;

6. Heating & Ventilation - $56,840 - Increased boiler diagnostics and/or repair forvarious sites;

7. Painting - $86,306 - Painting expenditures are higher as a significant number ofunits have been turned over since the beginning of the year;

8. Extraordinary Losses – Fire, wind, etc. - $55,580 – Several fires and floods haveoccurred at the beginning of the year, which has increased the extraordinary loss line item.

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February 2020 Financial Results - Capital

Total Capital Program - As of February 29th, 2020, a total of $1,321,318 has been spent on open and budgeted capital projects.

Breakdown by Program and Year

SHAIP - In summary, as of February 29th, 2020, a total of $852,957 has been spent on open and budgeted capital projects for the SHAIP program.

2018 - In summary, as of February 29th, 2020, a total of $154,580 has been spent on open and budgeted capital projects for the 2018 capital program.

2019 - In summary, as of February 29th, 2020, a total of $313,782 has been spent on open and budgeted capital projects for the 2019 capital program.

SIGNATURE:




RECOMMENDED BY:


Appendix A – February 2020 Operating Results Appendix B – February 2020 Capital Results

Appendix A – February 2020 Operating Results

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Appendix B – February 2020 Operating Results

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FROM: Bill Leslie (Manager, of Construction and Capital Projects), Kara Van Slyke (Finance Manager), Nick van der Velde, (Interim Director of Finance), Andrea Mackenzie (Interim CEO)

SUBJECT: March 2020 Financial Results Summary – Operating and Capital Results

DATE: May 21, 2020

RECOMMENDATION: That, on the recommendation of the (Interim) Director of Finance, the Finance Manager, and the interim Chief Executive Officer, the Board of Directors:

A) RECEIVE for information purposes the March 2020 Financial Performance Resultsand its Operating Summary Report that shows an operating deficit of $(661,910)with $(576,639) exceeding the 2020 year-to-date budget due to the followingprincipal reasons:

1. Business Case 19 revenue has not been appropriated yet;2. An expenditure increase in the Maintenance, Materials And Services

budget mainly related to a vacancy and unit turn over focus,increased boiler diagnostics and repair and pest control issues atvarious sites;

3. Several fires and floods have occurred at the beginning of the year,which has increased the extraordinary loss line item.

B) RECEIVE for information purposes the March 2020 Financial Performance Resultsand its Capital Summary Report that shows as of March 31st, 2020, a totalexpenditure of $2,196,963 on open and budgeted capital projects.

BACKGROUND:

The following report offers a high-level and detailed analysis of LMCH’s March 2020 Financial Results for both operating and capital expenses.

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ANALYSIS:

March 2020 Financial Results - Operating

The year-to-date operational results at March 31st, 2020 ended with an operating deficit of $(661,910) with $(577,379) exceeding the 2020 year-to-date budget.

The analysis includes:

Revenue 1. Municipal Base Funding: $2,798,762 - Approx. $263,500 of Business Case 19

payment not appropriated at this point. In conversation with Corporate Finance at the City of London, these monies will be appropriated by May 2020.

Expenditures 1. Building, General - $352,266 - Property Services focused on vacancy at the

beginning of the year with extra spending for maintenance supplies, countertops, levers, locks, etc.;

2. Pest Control - $109,707 - LMCH is mostly re-active when it comes to pestproblems. Heightened pest challenges at various sites in the LMCH portfolio;

3. Electrical - $41,584 - Increased spending on electric systems and service forvarious sites;

4. Equipment - $36,337 - Additional stove/fridge purchasing (bulk discount) -expected to slow down in the coming months;

5. Snow Removal - $336,545 – Snow removal QTD aligned closer to budget due toMarch’s required of services;

6. Life Safety Systems - $42,194 - Increased cost due to COVID-19, as life safetysystems had to be inspected;

7. Heating & Ventilation - $117,131 - Increased boiler diagnostics and/or repair forvarious sites + Simcoe Boiler Replacement of approx. $32,000;

8. Plumbing - $116,789 - Plumbing supplies related to regular maintenance andrestorations;

9. Painting - $154,797 - Additional spending on painting in relation to turned-overunits;

10. Transportation & Communication – $83,735 - Increased expenditures in admintelephone, Recruitment and Interview Costs and Employee vehicle mileage;

11. Supplies & Equipment – $56,652 - Increased expenditures related to LAN – WANequipment to increase capacity for staff to work from home and various supply cost related to COVID-19.

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February 2020 Financial Results - Capital

Total Capital Program - As of March 31st, 2020, a total of $2,196,963 has been spent on open and budgeted capital projects.

Breakdown by Program and Year

SHAIP - In summary, as of March 31st, 2020, a total of $1,476,666 has been spent on open and budgeted capital projects for the SHAIP program.

2018 - In summary, as of March 31st, 2020, a total of $242,026 has been spent on open and budgeted capital projects for the 2018 capital program.

2019 - In summary, as of March 31st, 2020, a total of $478,272 has been spent on open and budgeted capital projects for the 2019 capital program.

SIGNATURE:




RECOMMENDED BY:


Appendix A – March 2020 Operating Results Appendix B – March 2020 Capital Results

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Appendix A – March 2020 Operating Results

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Appendix B – March 2020 Operating Results

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