# 2019-251 Pay and Benefits, Home Equity Assistance

Case summary

F&R Date: 2020-10-30

In October 2014, the grievor was posted to Cold Lake, Alberta, where he purchased a house and subsequently spent $11,135 on making capital improvements (CI). In May 2017, the grievor was posted from Cold Lake. Despite immediately listing the house for sale, it remained unsold. On 19 April 2018, revisions to the Canadian Forces Integrated Relocation Program (CFIRP) came into effect, removing the option to apply for 100% Home Equity Assistance (HEA) reimbursement from the Core envelope for homes sold in a depressed market area. The revised CFIRP also removed the CI Benefit for homes sold after 18 April 2018. The grievor's home sold in May 2018 and he suffered an equity loss of $70,000. Combined with his CI expenses, his total equity loss was $81,135.

The grievor argued that he should be administered under the same version of the CFIRP policy that was in place when his relocation was ordered in 2017. He sought the full reimbursement of his equity loss as redress.

The Initial Authority (IA) found that on 17 July 2018, the Treasury Board Secretariat (TBS) declared that houses sold in Cold Lake after 18 April 2018 would be subject to the revised version of the CFIRP HEA policy, which no longer considered the depressed market status. The IA denied the grievance, finding that the grievor's home sold after 18 April 2018 and that it could not be administered under the previous CFIRP version for that reason.

The Committee first considered whether the grievor had a vested right to be administered under the previous CFIRP version but found that the grievor would have had to sell his house before 19 April 2018 to have locked-in a vested right. The Committee then noted that in an interview given by the Director of Compensation and Benefits Administration (DCBA) to the Canadian Broadcasting Corporation in May 2018, the DCBA stated that the intent of the Canadian Armed Forces (CAF) was to address catastrophic home equity losses using a “caveat” found in the CFIRP. DCBA staff advised the Committee that the “caveat” was CFIRP article 2.1.01. The Committee found that CFIRP article 2.1.01 did apply to the grievor's situation, in that his issue was directly related to relocation, and the extent of his losses was exceptional in nature. The Committee recommended that the Final Authority (FA) direct DCBA to forward the grievor's claim for full reimbursement of his equity loss and CI expenses to the TBS with the full support of the CAF.

FA decision summary

The Acting Chief of the Defence Staff (CDS) agreed with the Committee's findings and recommendation that the grievor be afford redress and directed that the grievor's claim for full reimbursement of his equity loss, referring to article 2.1.01 of the CFIRP. However the Acting CDS did not agree with the recommendation that CI be reimbursed as he did not consider the grievor's situation as being exceptional in circumstances.

The Acting CDS also directed the Chief of Military Personnel (CMP), in cooperation with the TBS, to review CFIRP HEA provisions with an aim to implementing some form of catastrophic loss protection and, in doing so, minimize the negative impacts on CAF families. This should include a discretionary mechanism to deal with undue financial hardship in unique situations such as the grievor’s. In the interim, the Acting CDS also directed the CMP, in accordance with article 2.1.01 of the CFIRP, to ensure that a case is made to TBS for all CAF members who have incurred catastrophic loss of equity over $30,000 since 18 April 2018.