Thursday, January 29, 2009

The leaks in the plan to fix my leaky roof



·           January 29, 2009

Good news! My roof is leaking. We noticed how bad it was getting last fall, when it rained and bits of plaster began to flake off the ceiling in the smallest bedroom upstairs. Lately, the problem hasn't gotten any worse, perhaps because Toronto is locked in a new ice age.

Assuming the glaciers retreat by spring, though, there's going to be trouble overhead. So was I ever glad to see Finance Minister Jim Flaherty's new temporary Home Renovation Tax Credit (HRTC). It will give a 15-per-cent tax credit, up to $1,350, on any home fix-it project that is "enduring in nature" and costs more than $1,000. What's the definition of "enduring in nature"? It appears to be anything that lasts longer than one year.

My new roof will certainly last longer than a year, unless I attempt the work myself, in which case it will take eight months to finish and will be leaking again three weeks thereafter. Luckily, I've already lined up a nice young man from Newfoundland to handle the job. By my calculations, the credit will save me $750 in taxes, based on his quote of roughly $6,000.

Thank you, Mr. Flaherty - and you too, Michael Ignatieff, for ensuring the budget will pass before the melting season begins. As tax policy, it is ridiculous. But the Commons is going to take care of my house. Why complain?

The Newfoundland kid did say he'd give a price break if I paid in cash. In that case, I'd presumably save $300 in GST. I don't want to give his business secrets away, but in total, I'd save more than $750.

And the money would be in my pocket today, not next year at tax time, which means I could go out and, you know, stimulate the economy when it's really needed. Of course, I'd never abet such a scheme to deprive the federal treasury of even a tiny portion of its rightful $225-billion in revenue. Who would? It's morally wrong, and that's why home renovations in Canada are never, ever done under the table.

It's a certainty that thousands of others will be taking up Mr. Flaherty on his generous offer to subsidize the home repairs they were planning to do anyway. And it's an equally sure thing contractors, painters and roofers will jack up their estimates accordingly, to claim a piece of the tax break for themselves. Maybe the Newfoundland kid will now say his quote is no longer valid. Those Newfoundlanders aren't dumb. They re-elected Danny Williams, you know.

Anyway, it's a quite a change from the Finance Minister who once declared that the federal government is "not in the pothole business." Maybe not on roads and highways, but if the pothole is in your driveway, Ottawa is pleased to assist. Driveway resurfacing is mentioned specifically in the budget as being HRTC-eligible. If you put down new sod, that's also eligible for a tax break, even if your teenage son tears it up practising his golf swing. But a new washing machine is not "enduring" enough.

If you lay a new carpet, that's worthy of a tax credit. But if you clean an existing carpet, it's not. What about a throw rug? The budget is not clear, but you've got to believe that someone, somewhere in the Department of Finance is considering the revenue implications of throw rugs versus carpets. Ah, well. The tax gurus need something to do, now that they've settled that bruising debate over the GST status of Timbits.

The most hilarious part isn't the arcane rulebook. It's the "examples" Finance officials have helpfully written to illustrate how the tax credit works. On page 129, Sally and Ed decide to replace their windows and insulation, and get tax relief of $1,350. Maybe next time they should inject some reality: "Sally and Ed decide to renovate their kitchen. After three months of arguing about it, Ed moves into the basement. The paint he buys to brighten his dismal new 'bachelor pad' is eligible for a tax credit, but the used couch is not."

And what will be the tax cost of all this hammering and painting and deck building and stimulating? About $3-billion over the next 14 months, Finance says. That's a lot of money, but it's nothing compared to the total cost of all the other exemptions and credits that governments have been inventing for years to suck up to this interest group or that industry.

Our tax system is riddled with these. Ottawa gives credits and deductions for buyers of textbooks, for tools for tradespeople and apprentice mechanics, for transit passes, for interest on student loans, for kids' soccer camp fees, for investors in speculative mining shares, and on and on. Liberal and Conservative governments alike are both at fault. Wonder why Mr. Flaherty can't afford to do more with income tax cuts? This is a big reason.

Many tax credits are legitimate. Who could seriously argue against giving a break for the cost of caring for young children, or the disabled, or educating university and college students? Those are in the public interest.

Fixing my roof is not. But I'll take the money anyway. Thanks again, Minister.


Wednesday, January 28, 2009

New tax credit for home improvements has a short lifespan

Jan 28, 2009 04:30 AM

OTTAWA–Installing a new furnace this year? Building a deck?

The proposed federal budget offers a temporary new tax credit for your home renovations – provided you do them soon.

The Home Renovation Tax Credit (HRTC) is designed to get Canadians spending now to help create jobs in industries typically hurt by an economic downturn.

"These measures to support home construction and renovation will help stimulate our construction and building-supplies industries," Federal Finance Minister Jim Flaherty said in his speech. "This in turn will support forestry and other Canadian industries. It will give an immediate boost to our economy, and help to create jobs."

Effective today through Jan. 31, 2010, homeowners can claim a tax credit for 15 per cent of renovation expenses between $1,000 and $10,000. The maximum tax credit (on $9,000 in renovations) is worth $1,350.

The government estimated the total value of the tax credit at about $3 billion, and expects about 4.6 million families to benefit.

The tax credit would apply to a variety of home improvements, such as renovating a kitchen, bathroom or basement, new carpet or hardwood floors, building an addition, deck, or fence, installing a new furnace, painting the inside or outside of a house, or laying new sod.

Expenses such as building permits, professional services, and equipment rentals are also eligible. Routine repairs and maintenance will not qualify for the credit. Nor will the cost of purchasing furniture, appliances, electronics, or construction equipment.

Houses, cottages and condominium units owned for personal use are eligible.

Canada's leading home improvement retailer, Rona Inc., said the measure is "positive" for the home improvement industry and it would announce additional incentives, similar to those it announced last week in Quebec.

Rona is offering Quebec customers 10 per cent off materials purchased for projects that qualify for that province's home improvement tax credit program.

Rival Home Depot Canada said yesterday it's unclear what impact the tax credit program would have on its business. "We don't know the conditions around it, so it's hard to comment at this point," said spokesperson Tiziana Baccega.

Toronto-area home renovator Mark Denington, who works mainly on jobs valued under $10,000, was skeptical of the program's benefits, saying it's unlikely to sway consumers on a tight budget.

"If you couldn't afford to do a $5,000 job without the tax break, you probably can't afford to it with the tax break," said the Beach neighbourhood contractor.

Denington said the recession has so far been good for his business, because homeowners have been scaling back to focus on the kind of smaller renovation projects he specializes in.

It's too early to tell whether his business will drop off this spring, as it's always slow in January, he added.

Top of Form


Saturday, January 17, 2009

Reno rage

My kitchen sink was a white plastic laundry tub that wobbled and leaked. Then one night, I lost it


From Friday's Globe and Mail

When I tell people my sink story they're speechless.

I'm 5-foot-3 and after three kids I can still fit into my size 6 jeans. I am not a big woman. But one night many sleeps ago, I ripped out a laundry tub with my bare hands.

This wasn't just any laundry tub. This white plastic laundry tub had served as our makeshift kitchen sink for what became a six-year kitchen renovation. The sink's legs wobbled on stacked pieces of 2-by-4, wedged between plywood that served as our countertop. For the most part it did the trick, but during one dark moment in the depths of our renovation, this mamma had a meltdown.

After we fell in love and married, we fell in love again with a century-old house that had been sitting empty for 12 years. It was owned by a developer and slated for demolition. The old house was beyond reasonable, realistic repair. It was far too expensive for us to afford and far too large for the two of us and our first child, whose arrival was imminent.

A momentary lapse of judgment we signed a deal with the devil and purchased the house. Two days after we moved in I went into premature labour. Our son was born.

Our new home needed, for starters, de-batting (of the flying kind), running water, a septic tank overhaul, a new heating system, new roof, new plumbing and new wiring. The structural work took forever and cost a fortune. After years of dealing with these deficiencies, it was finally time to tackle the kitchen.

My husband decided to hire a crew and gut the kitchen while I gave birth to our second son. From floor to ceiling to exterior walls everything was gone. Gutted. All that remained of the floor were the joists. One misstep could send me plummeting to the basement below.

The refrigerator sat in the back hallway, the stove was stored in the garage. The ancient porcelain sink was dumped in the driveway. Colicky baby in one arm, jealous toddler yanking on the other, postpartum lurking in the shadows, the devil knocking at the door. I. Was. Living. In. Hell.

Weeks became months. A flapping tarp covering the gaping hole where our new bay window should have been was no match for nightly raids by raccoons. I became proficient in microwave cooking and dial-up dinners. Our firstborn thought it was just like camping. I wish.

Finally, a floor: 3-foot by 3-foot slabs of granite, installed to look like one continuous piece. It was magnificent. Radiant heat warmed the granite. Our feet were in heaven. Our children put their cheeks to the floor, marvelling in the magic.

The floor looked expensive because it was. We ran out of money. The renovation ground to a halt.

Months became years. Somewhere along the way the aforementioned tub cracked. It leaked every time I used it. A friend tried to shame my husband into replacing it, but he refused, oblivious to my pain. The laundry tub was supposed to be a temporary measure while our kitchen came together. It had more than earned its keep. It owed us nothing, which is why I am ashamed to say that I took out my renovation rage on it. But I did.

An old apple juice can caught the dripping water that leaked from the tub. As long as I remembered to empty the can, the system worked. After one particularly stressful day and dinner, I began the cleanup routine. I picked up the can and began to pour the catch of the day down the drain when something caught my eye. A dead mouse bobbed in the water, apparently driven to drink like I had been on many recent occasions.

With a tin can filled with stinking dead mouse water in one hand, and a dirty dinner plate in the other, I discovered what my limit was that night because I had just reached it.

I threw the plate against our beautiful granite floor. It smashed into smithereens. It felt good. Two plates felt great. A stack felt amazing. Plate after plate exploded as they hit the granite floor. I felt empowered. I ran out of plates before I ran out of rage. And then I turned my attention to the sink.

With both hands I grabbed my stinking, leaking, teetering white laundry tub and ripped it from the wall. Water spewed from the pipes, turning our granite floor into a death trap. My husband and sons ran into the kitchen. One after another they slid across the floor like Bambi on ice.

If I said we can look back on that night and laugh it would be a lie. I am not proud of my behaviour, but most people sympathize. Renovations are not for the faint of heart. It does not take 24 minutes and three commercial breaks to get to that heavenly "after" shot. And it always costs more than you budget for. Way more.

Our marriage survived that night. Two years later we finished our kitchen renovation, and 19 days after that we welcomed our daughter into our completely renovated world.

Renovators paint uneven picture of job prospects

Some are keeping busy as homeowners fix up their houses, rather than risking a move, but others see 'horrendous' year ahead

In Bruce Resnell's home, near Eglinton Avenue and the Don Valley Parkway, the new year has started with a whimper. His days are quiet - he reads the newspaper, or takes afternoon walks - but mostly, he just searches for something to do.

The 75-year-old general contractor doesn't want it to be this way. He relies on his Mister Renovator business for income, but in October that business started drying up.

The impact of a sputtering economy on home-renovation contractors is uneven: Some are still filling order books as homeowners go ahead with long-delayed renovations rather than risk the sagging real estate market.

But at Mr. Resnell's home-based business, contractors are cold-calling him in a bid to land work. His almost-blank work calendar offers them little.

"This is the first time in, I guess, five years that I haven't been booked two months in advance," Mr. Resnell said. "With everything that's going on, I bet you I don't do 50 per cent of what I did last year."

To help boost the economy in general, and the construction and building products industries in particular, federal officials have reportedly considered introducing a refundable tax credit for home renovations.

In theory, it's an incentive for homeowners to spend money that would mostly stay in Canada. In reality, workers say it could help stabilize a shaky-looking year for hundreds of Toronto labourers, contractors and business owners.

"It has a ripple effect through a large part of the economy," said carpenter Dennis Bryant of Bryant Renovations.

"I know that there are quite a lot of renovators who are not working right now. It would be better off if they were working."

The value of building permits in Toronto fell to $694.5-million for the month of November, according to Statistics Canada. That's well down on the $824.2-million in October, and $1.13-billion last July.

That's part of the economic downturn that has changed renovation trends: Where customers were lining up for aesthetic improvements, they now want extensions and renovations to spare them from moving house.

"We already know residential is going to almost slow down completely. It's going to be horrendous for people," said tile setter Dino Scarola.

His business expects a 30-per-cent increase in business this year, but that's due to a thick roll of commercial and government contracts. Without them, Mr. Scarola said the coming year would be grim.

Back in Mr. Resnell's home, the success of the past two years may not be enough to counter what's ahead. In the last recession, the slump lasted a year, and then it took two more years to climb out of the doldrums.

"I'm worried," he said. "It's not good for me to be sitting at home. Besides that, I don't know what to do with myself. I'm going crazy."

Thursday, January 15, 2009

The $235,000 Bathroom Renovation


Interior Secretary Dirk Kemthorne is the owner of one mighty fine office bathroom for the next couple weeks until he leaves office. Photo courtesy of Wikipedia.

The $235,000 Bathroom Renovation

A bathroom renovation totaling $235,000 is a lot to spend. Luckily for the outgoing Secretary of the Interior and former Idaho governor Dirk Kempthorne, it was all paid for by you, the American taxpayer. The renovations on his office bathroom included a new shower, wood paneling and tile, refrigerator, freezer and monogrammed towels. Not sure why anyone would want a refrigerator in a bathroom, but I guess he wanted to make it extra swanky. This might be the most expensive bathroom renovation I've ever read about.

Home reno program filling up


January 13, 2009 01:00

If you’ve always wanted to learn how to renovate a house, a new program at Humber might be for you.

Hoping to capitalize on the home renovation industry, the Humber College Institute of Technology & Advanced Learning will offer a Home Renovation Technician diploma program at its Toronto and Orangeville campuses starting in September. 

The intensive one-year program will run a full 12 months through the summer of 2010, letting students complete the equivalent of four semesters of study in three semesters — essentially doing a two-year diploma in one year.

“It’s for people who want to build things — it’s designed to provide them an opportunity to get their hands dirty,” said Joe Andrews, director of Humber’s Orangeville campus. 

Guy Morrison, co-ordinator of the program at Humber, says students will get to put their renovation skills to the test in a real-world setting as Humber is building two houses in a special warehouse near campus. 

“When students will install a kitchen or a bathroom, they’ll actually do it in a real house, so it’s a lot more realistic,” Morrison said.

With decades of renovation experience himself as a carpenter and electrician, Morrison says the thrill he still gets out of doing a renovation work boils down to the knowledge that you’ve done a good day’s work.

“The satisfaction of seeing the finished product and knowing that you did it — that’s something I still don’t know how to describe, but it’s a good feeling,” Morrison said.

Humber is taking 20 students for the program at the Orangeville campus and 20 at its Rexdale campus in Toronto in September and 40 more Toronto students in the spring of 2010. 

Spots are filling up quickly, so Morrison suggests getting in touch with Humber before the end of January if you’re interested. 

You can find out more about the program at or contact Guy Morrison directly at

Plan offers tax credit for home renovations

Flaherty floats idea before meeting with premiers today


From Thursday's Globe and Mail

OTTAWA — The Harper government has been floating the idea of a tax credit for home renovations - an idea that could deliver significant stimulus for Canada's residential construction industry in the Jan. 27 budget.

Deliberations continue as Canada's premiers meet today in Ottawa to put the final touches on a budget request for Prime Minister Stephen Harper - one that sources say will include more cash for employment training, more benefits for the jobless and extra funding for infrastructure.

Finance Minister Jim Flaherty, meanwhile, has been conducting his own consultation on the looming budget, expected to deliver up to $30-billion in stimulus to soften an economic downturn.

During a closed-door session in Montreal last week, Mr. Flaherty asked participants' opinion on a partly refundable tax credit for renovations. Some economists among the more than 20 attendees criticized the proposal while representatives of the building-trades sector lauded it. Tax credits can be used to reduce the amount of taxes a person owes to the government, but refundable tax credits can benefit filers even if they have no taxes to be paid; in that case, they could get a refund based on the credit.

The federal Finance Department looks favourably on stimulus spending that helps builders, in part because so many of their materials are made in Canada. This ensures more benefits of stimulus spending remain in this country than if the money goes to taxpayers in the form of rebates to spur consumption. There's a good chance that consumer spending would leak the benefits of stimulus to foreigners: 50 per cent of durable goods bought in Canada are imported.

"[By] contrast, only 20 per cent of investment in residential and non-residential buildings is imported through such inputs as building materials," the Finance Department said in its recent paper on stimulus.

One important decision Mr. Flaherty will have to make should the Tories proceed with this idea is whether to offer a tax credit for home renovation in general, or merely for retrofits and upgrades that increase energy efficiency.

Toronto Dominion Bank chief economist Don Drummond said stimulus for home renovations would be helpful because there's a limit to how many public works projects Ottawa can kick start soon.

"There's only so much of the big infrastructure stuff you can get going in 2009 and 2010," Mr. Drummond said.

"We are past the peak of employment in the construction industry, and those people are going to be getting laid off."

One drawback of programs such as subsidies for retrofitting and house refurbishment is that they are typically difficult to administer, hard to monitor and susceptible to fraud.

In Ottawa, the premiers plan to ask Mr. Harper when they meet with him tonight and tomorrow for more infrastructure money and increased flexibility in spending it.

The Harper government has committed itself to $33-billion over seven years, and is pledging to accelerate that spending. But premiers want the government to add to the overall global total.

Governments also appear close to an agreement to streamline environmental requirements for infrastructure projects. Ontario is particularly concerned for Ottawa to find a way to increase benefits for the unemployed and not just money for worker training. Toronto wants more workers to be able to access benefits.

Premiers will not put a price tag on their requests. "Most premiers are not looking to jam up the feds and put an astronomical number they can't meet," the source said.

Canada's municipal governments yesterday released a list of more than 1,000 infrastructure projects that they say could start this spring if federal funds become available.

Combined, the projects would create more than 150,000 jobs, the Federation of Canadian Municipalities said in a release.

Wednesday, January 14, 2009

Seniors easy prey for scam artists: Police

Detective will give tips to avoid being a victim
January 08, 2009
"It’s just a matter of educating people on not giving personal information."
From bogus home renovation firms to identity thieves, scam artists are constantly finding new ways to prey on Kanata’s seniors, according to an Ottawa police detective specializing in fraud and identity theft.

Seniors can be easy prey because “they are more trusting and they’re not used to these modern types of frauds,” said Det. Bob Arbour, a member of the police’s organized fraud unit since 2002.

That’s why Arbour is offering a primer on preventing fraud at the next meeting of the Probus Club of Kanata at Kanata United Church on Tuesday, Jan. 13. The meeting starts at 10 a.m.

The police detective has seen it all, from criminals claiming to represent credit card companies to phony door-to-door salespeople trying to auction off counterfeit currency.

But anyone has the potential to be fooled by a scam artist, he said. It just depends on “how good of a fraudster you’re dealing with,” said Arbour.

“It’s human nature,” he said. “We’re honest people and want to believe the people were dealing with are honest.

“But if it sounds too good to be true, it probably is.”

Arbour offers a few basic tips to avoid being had:

  • Never give out your personal information. If your bank or credit card company is calling, they will already have your information. They won’t need to ask. “(Many seniors are) not aware of what they should provide,” said Arbour. “You shouldn’t be providing any information.”
  • Always ask for identification. Make sure you know who you are dealing with. Find out what company they work for and research that company at a later time.
  • Don’t be afraid to walk away from a deal. There’s no harm in taking some time to research your investment, said Arbour. There’s also no harm in deciding you’re not interested either.

“It’s just a matter of educating people on not giving personal information,” said Arbour. “It will eliminate a lot of investigations.”


There are several sophisticated ways a scam artist can illegally dig up your personal information, whether through online phishing – e-mails or websites masquerading as trusted companies – or compromised pin pads at ATM machines. But one of the more popular techniques is also one of the most rudimentary: it’s called dumpster diving.

A scam artist will pick through your garbage and paper recycling bin for unshredded documents. They can do the same at financial institutions that don’t properly destroy their waste.

With that information, Arbour said crooks can sometimes get phony debit cards to access your bank.

But not all scams are that elaborate.

Arbour has seen cases where scamsters were trying to sell fake, blackened currency that they claimed had been illegally smuggled into the country. The buyer is only asked to buy a chemical to remove the black substance.

“That’s why we don’t get very many complaints (about this type of scam) because they think they’re just as guilty as the person scamming them,” said Arbour. “We’re human so we have a certain amount of greed.”