Exempting Heritage Property from HPA
The Government of British Columbia passed the Homeowner Protection Act (HPA) in 1998 following a commission of enquiry into leaky condos. The primary purpose of the Act is to strengthen consumer protection for buyers of new homes.
Under the HPA, residential builders are required to arrange for third party home warranty insurance on new homes before obtaining a building permit. The minimum coverage and standards for home warranty insurance policies, set by regulation, are two years on labour and materials, five years on the building envelope and 10 years on the structure of the home.
The HPA applies to all new homes in B.C., including the conversion of non-residential buildings to residential use, or single-family homes to a multiple–home configuration.
While there is a certain logic to applying the HPA to all new homes, when it is applied to heritage buildings unintended consequences, such as the removal and destruction of historic fabric, may result. These unintended negative impacts on heritage character occur when warranty providers and professional envelope consultants rigidly apply new construction standards to the rehabilitation of historic buildings. Claiming an inability to ascertain their risk exposure in guaranteeing the performance of existing wall assemblies and windows that do not completely conform to the current building code, warranty insurance providers are requiring the replacement of existing windows and substantial rebuilding of walls with new materials (rainscreening) as a prerequisite for coverage. Under the HPA a project cannot proceed without insurance, so heritage typically loses these contests.
There is little or no evidence that these actions are necessary to protect the consumer, which is the purpose of the HPA. Many of the buildings affected are a century old and have a proven track record, well beyond the 2-5-10 coverage mandated by the Act. There is also no evidence that residential conversion of historic buildings is resulting in serious complaints from home buyers.
The unintended consequences of the HPA for heritage put it in conflict with other provincial statutes and programs, and the policies, regulations and programs of many local governments. The Heritage Conservation Act and Part 27 of the Local Government Act, among other provincial statutes, establish a foundation for the conservation of heritage resources in B.C. Similar powers are entrenched in the Vancouver Charter. Thousands of historic buildings are protected under municipal bylaws as designated heritage property or listed properties within Heritage Conservation Areas. Many local governments have implemented incentive programs to promote the conservation of heritage buildings, providing tax incentives, density bonusing and transfer, rezoning and bylaw relaxations, and grants. The total value of these incentives runs into the hundreds of millions of dollars. The provincial government supports these local efforts to conserve heritage and has also, over the past three decades, contributed tens of millions of dollars in grants and programs to advance the cause of heritage conservation. Possibly more significantly, the owners and developers of heritage buildings have made their own investments in rehabilitation and conservation, many times over that of government.
The destruction of the historic character of heritage buildings as a result of the HPA runs directly contrary to these efforts, expenditures and policies.
Heritage BC first raised these concerns with the Homeowner Protection Office (HPO) in 2006. Established under the HPA, the HPO administers the Act. Subsequently, a working group, including Heritage BC, representatives of local government, trades, and the provincial Heritage Branch has had meetings with the HPO, gathered a number of case studies, and in May of 2008 submitted to the HPO the report, “Some Negative Effects of the Homeowner Protection Act on the Character of British Columbia’s Built Environment”.
The principal recommendation of this report is that heritage buildings as defined in the B.C. Building Code should be exempt from the specific requirements of the HPA.
The HPA includes the power to exempt classes of property. Several classes of property and persons are currently exempted under the Act. A heritage exemption would affect an extremely small percentage of new homes being constructed annually in B.C. There is no evidence to suggest that consumer protection for the buyers of new homes would be eroded by such an exemption.
An exemption for heritage property would be consistent with provincial policy to support the conservation of heritage resources. It would also remove a serious impediment for local governments endeavoring to preserve historic buildings.
