The Ontario auditor general and ombudsman should have the power to look under the hood of Tarion, the private corporation created by the government to protect new homebuyers, according to a private member’s bill tabled Wednesday at Queen’s Park.
The bill, entitled the Tarion Accountability and Oversight Act, would also force Tarion Warranty Corp. to publish detailed information about builders’ track records, require employees who make more than $100,000 annually to be included on the provincial “sunshine list,” and make the corporation’s bylaws subject to government approval.
“For a number of years, there has been growing concern that Tarion is not living up to its responsibility to provide consumer rights protection,” said NDP MPP Jagmeet Singh, who tabled the private member’s bill. “Largely, the problem around Tarion is that there is no proper oversight and accountability.”
The NDP introduced a similar bill last November but the legislation died when the provincial election was called earlier this year.
Last year, a Toronto Star investigation found that Tarion keeps secret records of shoddy or incomplete work by homebuilders. As a result, new homebuyers aren’t able to get a full picture from Tarion about builders with deficiencies on their records.
A Star survey of Tarion’s online builder directory this week reveals that the corporation continues to keep details of specific problems — a cracked garage floor or a missing exhaust fan, for example — off builders’ records.
David Orazietti, government and consumer services minister, said he is not opposed to more detailed information being added to online builder records so that the public can make more informed choices.
In an interview with the Star, Orazietti stressed that his government has worked with Tarion to improve consumer protection over the past 10 years by doubling warranty coverage to $300,000 from $150,000, removing the majority of builders from Tarion’s board and launching a new builder education program.
“But I am aware that there is more work to do,” he said. “I am committed to finding ways to continue to improve protection for consumers.”
Melissa Yollick, a Tarion spokesperson, said Wednesday that Tarion “proudly protects the new homebuyers of Ontario.”
“As a private organization that administers the Ontario New Home Warranties Plan Act, we will continue to work closely with the Minister of Government and Consumer Services who has oversight of our legislation,” Yollick told the Star. “We look forward to maintaining this partnership with the Province, and continuing to improve the statutory safeguards for Ontario’s new home buyers.”
The auditor general’s office told the Star last year that the legislature’s public accounts committee could ask for a review of Tarion and that the office would support such a review, subject to the provisions of the Auditor General Act of Ontario. The province’s ombudsman, André Marin, whose office received close to 300 complaints about Tarion between 2007 and 2013, has said publicly he has “long believed that Tarion lacks proper oversight.”
Tarion was created by the province nearly 40 years ago to administer the Ontario New Home Warranties Plan Act. It is funded mostly by Tarion’s “warrantee enrolment fees” — anywhere from about $435 to $1,600 — that are usually passed on to buyers.
The corporation does not receive any direct government funding, meaning it is not subject to oversight by the auditor general.
But Singh argues that because Tarion is the only provider of new home warranties in Ontario, homebuyers have no choice but to pay these enrolment fees — effectively making the charges a tax.
“Tarion’s whole source of revenue flows from the fact that government has appointed them the providers of the warranty,” he said. “It’s essentially the taxpayers that are paying Tarion to exist.”
Jeffrey Ferland, one of more than a dozen homeowners who attended Queen’s Park on Wednesday to lend support to Singh’s bill, said he has been in a dispute with Tarion for more than a year over a cement floor in his home that he says does not meet the Ontario Building Code.
Ferland says in September 2013 Tarion originally asked the builder to repair the floor and offered Ferland a cash settlement. But Ferland says the builder did nothing.
Then, seven months later, he says Tarion changed its position and said no offer would be made.
Ferland has already spent 14 days fighting Tarion’s decision at the provincial Licence Appeal Tribunal (LAT), with another 18 days of scheduled hearings.
“In our case, the legislation was inadequate to ensure that our builder provided what was in our agreement and that our home was also built according to the Ontario Building Code,” Ferland said.
Tarion declined to comment specifically on Ferland’s issues, but said it looks forward “to a resolution in this case, and welcomes a “decision from a third-party independent body like LAT.”