# 2013-049 Pay and Benefits, Home Equity Assistance Program (HEAP), Integrated Relocation Program (CF IRP)

Case Summary

F&R Date: 2013–09–20

The grievor lost $40,000 on the sale of his residence in British Columbia. He received reimbursement in the amount of $15,000 based on his core benefit and $3,614.53 as a custom benefit under the Canadian Forces Integrated Relocation Program (CF IRP). He submitted an application for the reimbursement of the full amount of his remaining loss on the grounds that he was forced to sell his residence during the period when the market was depressed, under article 8.2.13 of the CF IRP.

The Director Compensation and Benefits Administration (DCBA) denied the request, stating that the overall loss incurred on the property was less than 20% and therefore, the request for 100% HEA [Home Equity Assistance] from core benefit did not meet the intent of the policy.

The grievor challenged DCBA's decision, indicating that in order to qualify for a 100% reimbursement from the core benefit, it is the housing market itself that must be depressed more than 20%, and not his property.

The Committee agreed with the grievor that the DCBA had misapplied the policy and that, in fact, it is the market that must have declined by more than 20% in order to meet the depressed market definition found in the CF IRP. The Committee then considered whether the real estate market for single family dwellings in the area where the grievor lived had declined by over 20%. The Committee consulted a number of on-line research sources in an attempt to verify whether the market for single family residences in the grievor's area had in fact declined more than 20% during the grievor's three years there. After reviewing these sources, as well as the materials submitted by the grievor, including the listings and sale of properties comparable to his residence, the Committee found that the market for single family dwellings in the grievor's area had not dropped by more than 20% during the grievor's time in the residence.

The Committee noted that the grievor had to borrow $15,000 to pay his bank because the selling price of the house was not sufficient to cover the remaining mortgage. In fact, the grievor also expressed his concern that he was no longer able to purchase a home at his new posting as he lacked the necessary down-payment. He feared that by the time he saves enough money for a down-payment to purchase a house, the two-year time limit for purchasing a house under the CF IRP program will have expired and he would be forced to cover the purchase costs himself, further compounding his financial loss. The Committee found that in the absence of any specific exclusion regarding replacement residence benefits, CF IRP article 2.9.01 could be applied to the grievor's case and that the two-year time limitation should be extended because the grievor's situation is exceptional.

In previous grievance files, the Committee has expressed its concerns regarding the deplorable inadequacy of the current HEA policy. In a recent decision, the Chief of the Defence Staff (CDS) agreed that the policy on the HEA benefit fails to account for the current reality that a member faces when he/she is required to sell their home on posting. In fact, the CDS directed the Director General Compensation and Benefits to review the adequacy of the CF IRP HEA provisions with the Treasury Board to minimize any negative impact to Canadian Armed Forces members brought on by the exigencies of military service.

The Committee recommended that the CDS deny the grievance while directing that the grievor be granted an extension of time for reimbursement of relocation expenses should the grievor wish to purchase a replacement residence and claim the associated benefits following the expiration of his initial two-year limitation period.

CDS Decision Summary

CDS Decision Date: 2014–03–17

The CDS agreed with the Committee's recommendation that the grievance be denied. Since the grievor bought a new house and received the relocation benefits in accordance with the CF IRP, it was unnecessary for the CDS to consider extending the two-year limitation period.