Office of Housing Regulation

 
Office of Housing Regulation

                REGULATION POLICY & PROCEDURES
                                     for
                Registered* Community Housing Organisations
       (* Under the SA Co-operative and Community Housing Act, 1991)

                                           VERSION NUMBER: 6
                                            STATUS: Approved
                                              January 2015

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Regulation Policy and Procedures

DOCUMENT DETAILS

 Document Name                      Regulation Policy and Procedures
 Division                           Office of Housing Regulation
 Responsible Officer                Housing Regulator
 Approval                           Housing Regulator
 Version                            v.6 [For details of version changes, refer to Section 9: Version Record]
 Status                             Approved
 Issued                             January 2015
 Next Review                        2016

AUTHORITY APPROVAL

 Manager                                                      Executive

 ……………………………………………………….                                       ………………………………………………………
 NAME                                                         NAME
 MANAGER, Community Housing Regulation                        Housing Regulator and Registrar
 OFFICE OF HOUSING REGULATION                                 OFFICE OF HOUSING REGULATION

 Date: ……. / .... / 2015                                      Date: ……. / .... / 2015

FURTHER INFORMATION

Queries regarding the content of this document (including suggestions for future versions) can be directed to
the Office of Housing Regulation, as follows:

Phone: 1300 700329
Address: Level 3, 182 Victoria Square, Adelaide SA 5000
Postal address: GPO Box 292, Adelaide SA 5001

Electronic versions of this document can be found on the Community Partnerships and Growth website,
http://www.sa.gov.au/communityhousing.

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Regulation Policy and Procedures

                                                   Table of Contents

1      LEGISLATIVE / AUTHORITY BASE ..................................................................................... 4
2      RESPONSIBILITIES & EXPECTATIONS ............................................................................. 4
       2.1 South Australian Government: Community Partnerships and Office of Housing
       Regulation .................................................................................................................... 4
       2.2 Community Housing Organisations ........................................................................ 5
3      PURPOSE AND SCOPE ......................................................................................................... 5
4      RELATED DOCUMENTS ........................................................................................................ 5
5      REGULATORY APPROACH .................................................................................................. 6
6      MONITORING HEALTHY ORGANISATIONS ..................................................................... 6
       6.1 Regular performance monitoring ............................................................................ 7
7      INDICATORS OF ORGANISATIONAL DIFFICULTY ......................................................... 7
8      ENGAGEMENT ......................................................................................................................... 9
       8.1 Identification of a Community Housing Organisation in breach or difficulty ............ 9
       8.2 Performance development plan............................................................................ 11
9      INVESTIGATION .................................................................................................................... 12
       9.1 Appointment of an independent investigator ........................................................ 13
10     INTERVENTION ..................................................................................................................... 14
       10.1         Declaration of Intervention ............................................................................ 14
       10.2         Outcomes of intervention .............................................................................. 15
       10.3         Report to the Office of Consumer and Business Affairs for Associations ...... 19
       10.4         Revoking the declaration - Ceasing intervention ........................................... 19
       10.5         Prosecution ................................................................................................... 20
       10.6         Right of appeal .............................................................................................. 20
11     SUMMARY FLOWCHART .................................................................................................... 21
12     GLOSSARY ............................................................................................................................. 22
13     REVIEW DATE ........................................................................................................................ 24
14     VERSION RECORD ............................................................................................................... 24
       APPENDIX 1 .............................................................................................................. 25
       APPENDIX 2 .............................................................................................................. 30

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Regulation Policy and Procedures

1      LEGISLATIVE / AUTHORITY BASE
       The legislative basis for this policy is in:
        South Australian Co-operative and Community Housing Act (SA) 1991 (SACCH Act)
          sections 7 and 69 - 72
        Schedule 1 to the SACCH Act 1991, sections 9 and10
        Associations Incorporation Act (SA) 1985

       The Minister, pursuant to section 7 of the SACCH Act, has delegated all of the powers and
       functions of the Minister pursuant to sections 71 and 72 of the Act, to the Executive Director,
       Housing SA.

       The Office of Housing Regulation will administer and manage the investigations and
       intervention processes for Community Housing Organisations, in accordance with the above.

2      RESPONSIBILITIES & EXPECTATIONS
2.1 South Australian Government: Community Partnerships and Growth and Office
    of Housing Regulation
       Community Partnerships acts as funder and developer, and contract administrator of
       Community Housing in South Australia, acting for the State Government of South Australia.
       The Office of Housing Regulation regulates the manages the legislative investigation and
       administration functions under the SACCH Act.

       2.1.1       As funder of the community housing sector in SA, Housing SA invests assets and
                   resources (e.g. properties, retention of rental revenue, grants etc) with Community
                   Housing Organisations to enable the provision of housing services.

       2.1.2       As the developer of the community housing sector in SA, Community Partnerships will
                   develop tools; provide information; deliver learning programs; and broker development
                   packages to build the management capacity of individual Community Housing
                   Organisations, thus promoting a well managed, well governed and viable sector.

       2.1.3       As regulator of the community housing sector, Office of Housing Regulation has
                   legislative responsibilities to ensure adequate controls are in place to safeguard the
                   use of public funds and resources. This includes ensuring:

                   a.           Good tenancy and property management.

                   b.           That the SA Government policies are implemented and that the
                                Government's housing assets are well maintained.

                   c.           That Community Housing Organisations are effectively managed, while
                                preserving and respecting their independence, diversity, self management and
                                volunteer effort. The SA Government respects the right of an organisation's
                                management to determine its own policies and activities, within the SA
                                Government's legislative, contractual and policy framework that Community
                                Housing Organisations are required to adhere to.

                   d.           That all performance issues will be assessed and managed with sensitivity
                                and in accordance with the principles of Natural Justice.

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Regulation Policy and Procedures

                   e.        That, where there is an identified risk to organisational viability, Office of
                             Housing Regulation will communicate promptly with the Association/Co-
                             operative and maintain communication throughout any developmental
                             processes or initial investigation/s. However where investigation of a
                             complaint or allegation may be compromised, the Office of Housing
                             Regulation may need to limit communication to protect the integrity of the
                             investigation.

 Note - Natural Justice refers to the legal principles which ensure that people are entitled to fair and
equitable processes. Natural Justice includes:
 adequate notice of the process;
 all parties having the opportunity to be heard, and having access to all the information under
   consideration; and
 unbiased decisions based on relevant considerations.

2.2 Community Housing Organisations
       In achieving registration under the SACCH Act and entering into any associated agreements,
       all Community Housing Organisations have an obligation to ensure they act as independent
       and effective managers of their business, and the Government assets for which they have
       responsibilities.

3      PURPOSE AND SCOPE
3.1 To outline the respective responsibilities of Office of Housing Regulation and Community
       Housing Organisations in regard to regulation of and compliance under the SACCH Act.

3.2 To set out when and under what circumstances the powers of investigation under the SACCH
       Act would/may be used.

3.3 To set out when and under what circumstances the special powers of intervention under the
       SACCH Act would/may be used.

4      RELATED DOCUMENTS

             Funding Agreement with Community Housing Organisations
             The SACCH Act,
             The South Australian Co-operative and Community Housing (General) Regulations (SA)
              2007
             The South Australian Co-operative and Community Housing (Housing Co-operatives—
              Investment Shares) Regulations (SA) 2007
             The South Australian Co-operative and Community Housing (Housing Associations)
              Regulations (SA) 2010.
             Associations Incorporation Act (SA) 1985 and Associations Incorporation Regulations
              (SA) 2008.

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Regulation Policy and Procedures

5      REGULATORY APPROACH
       This escalation diagram provides a broad overview of the regulatory approach taken by the
       Office of Housing Regulation. Regulation occurs in 4 distinct stages ranging from monitoring
       to intervention.

                                                                                           Intervention
                                                                                       (Refer to section 10 of
                                                                                            this Policy)

                                                                 Investigation*
                                                              (Refer to section 9 of
                                                                   this Policy)

                                       Engagement
                                   (Refer to section 8 of
                                        this Policy)

          Monitoring Healthy
           Organisations
          (Refer to section 6 of
               this Policy)

                                       * The seriousness of some situations may warrant immediate
                                       investigation.

6        MONITORING HEALTHY ORGANISATIONS

         The monitoring process occurs where there are no known regulatory issues with a
         Community Housing Organisation.

         Office of Housing Regulation will:
          Monitor reporting and other regulatory requirements
          Provide a Learning & Development program and tools for continuous
             improvement
          Develop policies to provide clarity for Community Housing Organisations’
             management and continous improvement.

         The Community Housing Organisation will:
          Ensure its governance, decision making and group processes are managed well
          Ensure tenancies are managed well
          Continue its reporting and other management activities
          Develop strategic solutions to any concerns arising.

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Regulation Policy and Procedures

6.1      Regular performance monitoring
         Community Housing Organisations must meet the requirements of the SACCH Act and any
         agreement entered into for the management of Government funds, assets and resources.

         Office of Housing Regulation will examine the following three key areas via regular
         performance monitoring:
         1. The health of the Community Housing Organisation - i.e. financial viability and
             performance are positive (monitored by e.g. financial statements, monthly reports);
         2. The health of tenancies - i.e. tenants are appropriately treated, rent arrears are
             managed, members/tenants understand their right to appeal organisational decisions;
             and
         3. The health of the assets - i.e. properties are responsibly managed and maintained.

         Where no indicators of organisational difficulty are identified, no action is required by Office
         of Housing Regulation.

         Office of Housing Regulation welcomes contact by any Community Housing Organisation
         seeking to improve its management practices, or where the organisation has identified a
         possible issue in their business. Office of Housing Regulation will work in collaboration with
         that organisation to resolve the identified issue. Refer to Appendix 1 for tips on ways of
         keeping Community Housing Organisations healthy.

7        INDICATORS OF ORGANISATIONAL DIFFICULTY
         Where Office of Housing Regulation identifies indicators of organisational difficulty, it has a
         legislative duty to respond to issues of governance, management and viability of registered
         Community Housing Organisations. Office of Housing Regulation will encourage
         Community Housing Organisations to resolve issues before the need for investigation and
         intervention. The Community Housing Organisation has a responsibility to work with Office
         of Housing Regulation to resolve the identified issue/s.

         The grounds on which Office of Housing Regulation, the Minister, or his/her delegate, may
         initiate appropriate action to attempt to resolve the identified issue/s and prevent further
         deterioration are:

         SACCH Act section 71(2) and Schedule 1(10)
         Please note that paragraphs in bold are specifically for Co-operatives, the other sections are for both
         Co-operatives and Associations. (Refer to Appendix 2 for examples)

         a) That the CO-OPERATIVE has ceased to be administered on the basis of the
            principles of co-operation; or

         b) That the CO-OPERATIVE does not commence operations within six months from
            its incorporation or suspends or ceases its operations for six months or more; or

         c) That serious irregularities or difficulties have occurred or arisen in the management of
            the Co-operative/Association or the administration of its affairs; or

         d) That the CO-OPERATIVE has ceased to be managed by tenant-members of the
            Co-operative; or

         e) That the committee members of the management committee have acted in the affairs of
            the Co-operative/Association in their own interests rather than in the interests of the
            members as a whole, or in any other manner that appears to be unfair or unjust to other
            members; or

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Regulation Policy and Procedures

         f)   That the Co-operative/Association is experiencing serious internal disputes or otherwise
              is not functioning in a proper manner; or

         g) That the Co-operative/Association has insufficient members to operate efficiently and
            effectively; or

         h) That there are insufficient committee members to form a quorum of the committee of
            management; or

         i)   That the by-laws of the Co-operative/Association contain an unreasonable provision that
              affects the rights of members of the Co-operative/Association; or

         j)   That an irregularity has occurred in relation to the issue, redemption or
              cancellation of any shares in the CO-OPERATIVE; or

         k) That the Co-operative/Association has contravened or failed to comply with a condition
            imposed in relation to the Co-operative/Association by SAHT or the Minister under this
            Act; or

         l)   That the Co-operative /Association has failed to comply with a term of an agreement
              under Part 7; or

         m) That the Co-operative/Association has intentionally committed a serious breach of this
            Act or the rules of the Co-operative/Association; or

         n) That the Co-operative/Association has committed any breach of this Act or the rules of
            the Co-operative/Association and the Co-operative/Association has, after notice by the
            Minister of the breach, failed, within the time referred to in the notice, to remedy the
            breach; or

         o) That the Co-operative/Association is insolvent or in danger of becoming insolvent or has
            taken unreasonable action contrary to the interest of its creditors; or

         p) Such other grounds as may be prescribed by the regulations.

         Housing Associations only under Schedule 1(10)
         a) That it appears that the ASSOCIATION is no longer a housing association that is eligible
            for registration under this Act, or has ceased to carry on operations as a housing
            association.

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Regulation Policy and Procedures

8        ENGAGEMENT

        Engagement occurs when there are regulatory issues identified by Office of Housing
        Regulation or the Community Housing Organisation itself.

        Action
        Office of Housing Regulation contacts and works with the Community Housing
        Organisation to identify and remedy a breach or concern.

        Office of Housing Regulation will:
         Document the nature of the matter
         Request information from the Community Housing Organisation to ascertain the
            nature and severity of the breach or concern. This will involve Office of Housing
            Regulation:
            o advising of its regulatory powers to examine accounts, records, documents,
                take oral statements under section 69 and 70 of the SACCH Act
            o provide a list of all information Office of Housing Regulation requires access
                to
            o stipulate timeframes
         Issue a notice advising of the breach and make recommendations or issue
            specific directions to the Community Housing Organisation that must be
            addressed.

        The Community Housing Organisation will:
         Nominate a representative to liaise with Office of Housing Regulation
         Provide a response detailing the Community Housing Organisation's
           understanding of the breach or issue, including:
           o remedy breach within specified timeframe, or
           o request to jointly develop a performance development plan with Office of
              Housing Regulation.

        Outcome:
         The breach or concern is remedied and no further action is required; or
         Further action or investigation is required.

8.1      Identification of a Community Housing Organisation in breach or difficulty

         In the majority of cases, if indicators of organisational difficulty or breach have been
         identified, Office of Housing Regulation will initiate an engagement response, i.e. working
         together with the Community Housing Organisation to identify and remedy the difficulty or
         breach. However, where an issue is identified that poses serious/immediate threat to the
         ongoing viability of the organisation or the safety of tenants or members, the regulatory
         response may be escalated to an independent investigation (refer to section 9 of this
         Policy).

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Regulation Policy and Procedures

         8.1.1     Complaints

                   Office of Housing Regulation receives allegations or complaints about community housing
                   organisations from a variety of sources including members, tenants, staff, ex-staff, members
                   of the public, and Community Housing Organisations themselves. Office of Housing
                   Regulation must always remain responsive to allegations or complaints regarding breaches
                   of legislation or funding agreements. This includes assisting people to formulate their
                   complaint, and recording it on a database. Office of Housing Regulation will assess the
                   complaint or allegation, and generally take into consideration the seriousness of the alleged
                   breach and the likely impact, the availability of supporting evidence, the identity or
                   anonymity of the complainant, and the likelihood of the event. Office of Housing Regulation
                   needs sufficient grounds to conduct independent investigations, and has discretion under
                   legislation and policy as to what constitutes such grounds. It is therefore not always
                   possible for Office of Housing Regulation to ensure that a complainant will be satisfied with
                   the outcome of a complaint.

                   Examples of matters that will not satisfy the grounds for independent investigation include
                   disputes about minutes, isolated concerns about general business practices and decision
                   making, isolated membership disputes involving natural justice, or breach of tenancy
                   agreements. In some of these cases Office of Housing Regulations may use other non-
                   intervention measures such as contacting the Community Housing Organisation to raise the
                   issue, recommending training, or referring the complainant to the Tenancy Information and
                   Advocacy Service (TIAS) for further advice in relation to specific tenancy issues. Generally
                   Office of Housing Regulation attempts to resolve the matters raised by working
                   collaboratively with the Community Housing Organisation to bring it back to compliance.

         8.1.2 Internal Disputes

                   Where there are serious internal disputes within Community Housing Organisations,
                   Office of Housing Regulation may in the first instance suggest resolution strategies
                   for both the complainant and Community Housing Organisation.

                   Alternatively, if either the complainant or Community Housing Organisation wishes to
                   seek assistance from Office of Housing Regulation to engage an external mediator
                   or facilitator this request must be made in writing to the Regulation Analyst who will
                   then forward the request onto Community Partnerships and Growth, who will:

                       Seek written confirmation within 30 days from the other party involved in the
                        dispute that they are agreeable to mediation, and
                       Appoint a mediator of its choice for a period of no more than three months, at
                        which time the mediator will provide Community Partnerships and Growth and
                        the Office of Housing Regulation with a written report, advising in their opinion if
                        the mediation / facilitation process has been successful.

                   Should the other party involved in dispute not agree to mediation or facilitation within
                   30 days, Office of Housing Regulation may progress to an independent investigation.

                   Should the mediation / facilitation not be successful, Office of Housing Regulation
                   may also commission an independent investigation.

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Regulation Policy and Procedures

         8.1.3. Information Gathering Powers (SACCH Act, section 69 and 70)

                   Section 69 of the SACCH Act enables the Minister, or his/her delegate, to appoint
                   Housing SA (Office of Housing Regulation) officers, other Government officers, or
                   independent individuals as Authorised Officers. Under section 70, Authorised
                   Officers have the powers to examine the accounts, records, and conduct interviews.
                   The exercise of this power is an interim step to provide Office of Housing Regulation
                   and the Community Housing Organisation with an efficient and formal process to
                   gather the facts.

                   An Authorised Officer will notify the Community Housing Organisation when he/she
                   is using these powers to collect information.

                   A person who is in a position to provide information relevant to the examination,
                   must do so when requested by an Authorised Officer.

                   An Authorised Officer can require the following information, relevant to the
                   examination:
                    Any Community Housing Organisation books, documents or records in their
                      possession;
                    Information stored on computer, microfilm or by any other process;
                    Conduct interviews with officer bearers, employees, members, and tenants of the
                      Community Housing Organisation.

                   An Authorised Officer can make copies, take extracts or take possession of these
                   records as required.

                   Where formal Authorised Officer action occurs, the Community Housing
                   Organisation must work with the Authorised Officer by providing any relevant
                   requested information in accordance with section 70 of the SACCH Act.

         8.1.4     Notices

                   Where regulatory issues have been identified, Office of Housing Regulation will send
                   a notice to the Community Housing Organisation which will include:
                    detailed description of Office of Housing Regulation’s understanding of the
                      breach or issue
                    specified timeframes to remedy breach or issue
                    contact details of the Office of Housing Regulation representative who will liaise
                      with the Community Housing Organisation
                    opportunity to dispute any notice. A dispute of Office of Housing Regulation’s
                      findings needs to be supported by appropriate evidence.

8.2      Performance development plan

         Office of Housing Regulation will consider developing a performance development plan with
         the Community Housing Organisation where the issue or breach is not easily remedied by
         the organisation within the specified notice timeframe. This will occur when the organisation:
          provides Office of Housing Regulations with a written request for a performance
             development plan; and
          provides Office of Housing Regulation with the reasons for not being able to meet the
             notice timeframe.

         A performance development plan will clearly document:
          The nature of the regulatory issue/s identified
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Regulation Policy and Procedures

             Expectations and outcomes required
             An agreed course of action to resolve the issue/s
             Training to be considered
             Possible information sources/mentors
             How Office of Housing Regulation will monitor progress
             Timeframe for addressing the identified issue/s
             The consequences of failure to address the issue within the timeframe specified.

         8.2.1     In addition to a performance development plan, Office of Housing Regulation and the
                   Community Housing Organisation may agree to other possible responses, for
                   example engaging a suitable service provider or mentor to:
                    to undertake a range of functions (e.g. rent management, financial management)
                       or 'on the job' mentoring/group learning (e.g.chairing meetings);
                    guide the Community Housing Organisation to improve organisational culture,
                       practices, systems, policies and processes, where required.

                   Any costs involved in engaging a service provider will be met by the Community
                   Housing Organistion. The cost of mentoring or training will be met through
                   Community Partnerships and Growth’s Learning and Development program.
                   A Community Housing Organisation may choose to approach Community
                   Partnerships and Growth for assistance in identifying suitably qualified service
                   providers.

9        INVESTIGATION
         An investigation may occur where the regulatory issues identified have not been resolved
         through Office of Housing Regulation engagement with the Community Housing
         Organisation, or where Office of Housing Regulation considers the matter to require a
         formal independent investigation.. The purpose of the investigation is to formally gather
         more information to determine whether there are grounds for intervention or other
         corrective action.

         Action:
         Office of Housing Regulation exercises its power to appoint an independent investigator.
         This is a formal way for Office of Housing Regulation to undertake an independent and
         detailed assessment of the financial or operational issues of the Community Housing
         Organisation.

         Office of Housing Regulation will:
          Send formal notification of the appointment of an independent investigator.

         The independent investigator will:
          Provide a draft report for the Community Housing Organisation to comment and
            make submissions, and
          Provide a final report to Office of Housing Regulation and the Community Housing
            Organisation based on the grounds for investigation.

         The Community Housing Organisation will:
          Co-operate with the independent investigator's requests, and
          Advise all office bearers, members and tenants (for co-operatives only) of the
            investigator's role and powers, and distribute any draft and final reports from the
            independent investigator, and
          Organise any submissions to the independent investigator.

         Outcome:
          The independent investigator makes findings, based on the grounds for investigation,
            which will be considered by Office of Housing Regulation.

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Regulation Policy and Procedures

9.1      Appointment of an independent investigator

         Section 71 (3) of the SACCH Act states that the Minister or his/her delegate will appoint an
         independent investigator to carry out an investigation, examine the issues and report to the
         Minister on the matter.

         The appointment of the independent investigator will be managed by Office of Housing
         Regulation on behalf of the Minister. Office of Housing Regulation will send a letter to the
         Community Housing Organisation, advising of the decision to initiate a formal investigation.

         In accordance with the principles of Natural Justice this letter will include:
          Advice of the impending investigation
          The matters that will be investigated under section 71(2) of the SACCH Act
          Summary of the cirumstances leading to the appointment of an independent investigator
          Notice of who the independent investigator will be
          Timeframe for the investigation
          Authority of the independent investigator
          Rights of the organisation and the principles of Natural Justice i.e. they will be given a
             reasonable opportunity to make submissions in relation to the matter to the independent
             investigator.
         The skill set of the investigator appointed will be matched to the nature of the investigation.

         The terms of appointment of the independent investigator will be set out in an Individual
         Service Contract negotiated between the investigator and Office of Housing Regulation.

         This contract will include:
          timelines for investigation including responses from the organisation
          background to the investigation
          scope of the investigation.

         9.1.1     Report of the independent investigator
                   The independent investigator will prepare a report to the Minister, or his/her
                   delegate, based on the findings of the investigation.

                   The report will include:
                    Executive summary and recommendations
                    Instructions from Office of Housing Regulation to the investigator
                    Investigation processes i.e. methodology: member or tenant interviews, surveys,
                      review of documentation
                    Introduction
                      - Organisation profile
                      - Background (indicators leading to the investigation)
                    Findings (against Part 9 of the SACCH Act)
                    The Community Housing Organisation's submission and response to these
                      findings
                    Response to the Community Housing Organisation's submission
                    Conclusion
                    Appendix - documents provided to assist in the investigation
                      - by Office of Housing Regulation
                      - by the Community Housing Organisation
                      - by individual tenants.

                   Based on the findings of the report the Minister, or his/her delegate, will decide either
                   that:

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                   a) There are insufficient grounds for formal intervention. The Minister, or his/her
                      delegate, will inform the Community Housing Organisation of this outcome and
                      continue to work with the organisation to remedy issue/s of concern. This may
                      involve Office of Housing Regulation staff attending meetings of the Community
                      Housing Organisation, assisting in the preparation of performance development
                      plans and/or providing advice.
                   OR
                   b) There are sufficient grounds for a formal intervention. The Minister, or his/her
                      delegate, will inform the Community Housing Organisation of this outcome.

         9.1.2     Natural Justice
                   Section 71(4) of the SACCH Act provides that the independent investigator/s must
                   give the Community Housing Organisation a reasonable opportunity to make
                   submissions in relation to the matter.

                   For the purpose of this sub-section, a reasonable opportunity is deemed to mean:
                    The independent investigator has made the organisation aware of the nature of
                      the investigation in writing and has provided the Community Housing Orgnisation
                      an opportunity to respond either in writing, personally or through an advocate; for
                      a period not exceeding 21 days and
                    The Community Housing Organisation has been provided with a copy of the draft
                      report and been given the opportunity to respond to any possible innaccuracies
                      in the recording of the facts, prior to the final report and findings being provided
                      to the Minister, or his/her delegate.

10       INTERVENTION

         Intervention may occur when the Minister or his/her delegate considers that the findings
         from an independent investigation show sufficient grounds for intervention.

         Action:
         The Minister or his/her delegate intervenes into the operations of the Community Housing
         Organisation.

         Office of Housing Regulation will:
          Recommend to the Minister or his/her delegate to issue a Declaration of Intervention
             for the Community Housing Organisation; and
          Implement and/or enforce the Orders contained in the Declaration of Intervention.

         The Community Housing Organisation will:
          Implement the Orders contained in the Declaration of Intervention, or appeal the
            Declaration of Intervention.

         If an Administrator has been appointed, the Administrator will:
          Manage the affairs of the organisation.
          Implement the Orders contained in the Declaration of Intervention.

         Outcome:
          The Orders are implemented, after which the Declaration of Intervention is revoked.

10.1     Declaration of Intervention
         If the findings from an independent investigation show there are grounds for formal
         intervention, a declaration to formally intervene under section 71(1), and Schedule 1(10) of
         the SACCH Act may be made by the Minister or his/her delegate.

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         Where the Minister, or his/her delegate, declares that there are sufficient grounds for
         intervention into the affairs of the Community Housing Organisation, the organisation will be
         advised in writing and provided with a copy of the official declaration of intervention.

         The declaration to formally intervene under the SACCH Act will state one or more of the
         following actions as per sections 71, 72, 78 and Schedule 1(10):
         a) Order an audit of the affairs of the Community Housing Organisation by an auditor
              approved by the Minister or his/her delegate at the expense of the organisation;
         b) Require the members of the Community Housing Organisation to take specified action to
              ensure the organisation is acting efficiently, effectively and co-operatively;
         c) Require the Community Housing Organisation to take specified action to ensure
              compliance with the SACCH Act and/or their Rules;
         d) Require the Community Housing Organisation to correct specified irregularities or to
              reverse specified action;
         e) Require the Community Housing Organisation to apply specified management practices;
         f) Stipulate principles in accordance with which the affairs of the Community Housing
              Organisation are to be conducted;
         g) Require the Community Housing Organisation to alter its Rules (see 10.2.1 of this
              Policy);
         h) Remove a committee member from office;
         i) Suspend or terminate the membership of a member of the Community Housing
              Organisation;
         j) Prohibit or restrict the raising of funds by the Community Housing Organisation or the
              exercise of any other specific powers;
         k) Appoint an Administrator (who must not be a Housing SA staff member) to conduct the
              affairs of the Community Housing Organisation (refer 10.2.2 of this Policy);
         l) Require the Community Housing Organisation to dispose of specified property in
              accordance with the directions of the Minister or his/her delegate. This may include the
              transfer of the property to Housing SA or another organisation.
         m) Require members of the Community Housing Organisation to attend any meeting called
              by a person nominated by the Minister or his/her delegate, with a view to overcoming
              any problems through discussion and/or conciliation;
         n) Recommend to the Minister that the Community Housing Organisation be de-
              registered/dissolved;
         o) Take such other action as may be prescribed by the Regulations.

10.2     Outcomes of intervention

         10.2.1 Alteration to Rules
                Where a Community Housing Organisation is required to alter its Rules under
                section 71(5) of the SACCH Act -
                a) The Community Housing Organisation does not require the approval of its
                    members; and
                b) The Minister, or his/her delegate, may make the required alteration if the
                    Community Housing Organisation fails to comply with the requirement within a
                    reasonable time.

         10.2.2 Appointment of an Administrator
                In accordance with section 72 of the SACCH Act, the following conditions apply in
                relation to the appointment of an Administrator:

              10.2.2.1       Powers of an appointed Administrator
                             Where an Administrator is appointed to conduct the affairs of a Community
                             Housing Organisation -
                             a)    The Administrator has all the powers, functions and duties of the
                                   Community Housing Organisation and may act in its name and on its
                                   behalf; and
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                             b)        The Administrator must report regularly to the Minister or his/her
                                       delegate on the progress of the administration.
                             c)        An Administrator of a Community Housing Organisation may require a
                                       written report on specific matters relating to the affairs of the
                                       organisation (SACCH Act 72(4)). The Administrator's request for a
                                       report to be prepared must be made in writing to a current, or former,
                                       officer or employee of the Community Housing Organisation. A
                                       person who fails to comply with this requirement is guilty of an
                                       offence.
                             d)        A person who is required to provide such a report may be reimbursed,
                                       for costs and expenses that are reasonable incurred in preparation of
                                       the report. Reimbursement will be from the operating funds of the
                                       Community Housing Organisation. Receipts must be presented and
                                       all expenses must be considered and approved by the Administrator
                                       prior to any reimbursement.

              10.2.2.2       Possible actions/interventions by an Administrator
                             a)     Transfer of the Community Housing Organisation's properties to
                                    another agreed organisation, with or without tenancies in accordance
                                    with the intervention order (refer to 10.2.3.3 of this Policy for more
                                    information regarding tenancies).
                             b)     Arrange for a sale of a portion of the Community Housing
                                    Organisation's properties in accordance with the intervention order
                                    (refer to 10.2.3.3 of this Policy for more information regarding
                                    tenancies).
                             c)     Implement outstanding Housing Appeal Panel orders.
                             d)     Respond to registrants on the Community Housing Customer Register
                                    who have the Community Housing Organisation listed as their
                                    Primary Contact Organisation.

              10.2.2.3       Remuneration of an appointed Administrator
                             An Administrator of a Community Housing Organisation is entitled to such
                             remuneration as is approved by the Minister or his/her delegate.

                             The remuneration of the Administrator and all other costs and expenses
                             arising out of the administration of a Community Housing Organisation are
                             payable out of the Community Housing Organisation's operating funds.

              10.2.2.4       Committee of Management
                             On the appointment of an Administrator of a Community Housing
                             Organisation, all committee members are suspended from managing the
                             affairs of the Community Housing Organisation, unless otherwise determined
                             by the Minister or his/her delegate. Members of the Community Housing
                             Organisation may still meet, but have no decision making powers regarding
                             the affairs of the organisation.

              10.2.2.5       Conclusion of an Administrator's appointment
                             Section 72(8) of the SACCH Act provides that, before recommending
                             termination of the appointment of an Administrator, the Minister or his/her
                             delegate must:
                             a)     Ensure committee members of the Community Housing Organisation
                                    have been elected in accordance with their Rules, at a meeting
                                    convened by the Administrator. In this case the elected committee
                                    members will hold office until the next annual general meeting.
                             OR

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                             b)        Appoint the committee members. In this case, the appointed
                                       committee members will hold office until the annual general meeting
                                       that follows the revocation of the Administrator's appointment.

                             An appointed Administrator must, on the termination of his/her appointment,
                             fully account for the administration of the Community Housing Organisation
                             to the Minister or his/her delegate.

         10.2.3 De-registration/dissolution of a Community Housing Organisation
                If an Association is de-registered in accordance with the SACCH Act Schedule 1
                section 10(5)(k) or, for Co-operatives, dissolved in accordance with the SACCH Act
                section 76, the Minister or his/her delegate may, in relation to property that is subject
                to the charge under section 66(2):
                a) Order that steps be taken to transfer the property to -
                    i) the South Australian Housing Trust, or
                    ii) another registered Community Housing Organisation
                OR
                b) Order that steps be taken to sell the property on the open market.

                   The Administrator will action the Minister's or his/her delegate's order and manage
                   the outstanding affairs of the organisation. Once a final audit of financial statements
                   has taken place, the Community Housing Organisation will be de-
                   registered/dissolved.

              10.2.3.1       Maintenance issues
                             a)    The Administrator will facilitate property inspections and manage
                                   property maintenance leading up to the de-registration/dissolution of
                                   the Community Housing Organisation. Office of Housing Regulation
                                   will work together with Community Partnerships and Growth and the
                                   Community Housing Organisation and the Administrator and develop
                                   strategies to ensure the properties are in good order for receiving
                                   organisations.
                             b)    Funding for any unfunded maintenance requirements will come from
                                   the sales of the Community Housing Organisation’s properties, or
                                   properties in the receiving Community Housing Organisation’s
                                   portfolio (refer to 10.2.2.2 (b) of this Policy for more information
                                   regarding sales arranged by an Administrator).

              10.2.3.2       Property dispersal
                             The tender process for the dispersal of properties will be organised by
                             Community Partnerships and Growth. Community housing providers wishing
                             to tender for such properties must:

                             a)        be registered under the National Regulatory System (NRS) as a Tier 1
                                       or Tier 2, or in the case of Tier 3 organisation or organisations not yet
                                       registered under the NRS, have previously held Preferred Growth
                                       Provider status. Common Equity Housing South Australia is eligible to
                                       tender.
                             b)        have no unfunded maintenance liabilities
                             c)        have population group compatibility
                             d)        have property type compatibility.

                             Community Partnerships and Growth will work together with successful
                             tender/s to transfer assets and tenancies.

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              10.2.3.3       Tenancies
                             Where a Community Housing Organisation is de-registered/dissolved, or
                             where a portion of the organisation's properties are transferred or sold, Co-
                             operative member-tenants and Association tenants will not be evicted, unless
                             they have breached the Residential Tenancies Act (SA) 1995 (RTA) tenancy
                             requirements.

                             Terms and conditions of Co-operative non-member tenants will be protected
                             for the term of their current tenancy agreement, unless they have breached
                             RTA tenancy requirements.

                             People who have applied or registered an interest for tenancy with a de-
                             registered/dissolved Community Housing Organisation will be contacted by
                             the Administrator to discuss alternative organisations.

              10.2.3.4       Costs where Office of Housing Regulation winds up a Community Housing
                             Organisation
                             Where the Office of Housing Regulation winds up a Community Housing
                             Organisation and subsequently transfers tenanted properties from one
                             Community Housing Organisation to another, any associated conveyancing
                             fee costs and statutory search fees (as listed in the table below) will be borne
                             by Community Partnerships and Growth and not passed on to either
                             Community Housing Organisation. The cost of the adjustment of any
                             statutory charges that Housing SA has incurred, and maintenance work
                             required to bring the property up to the required standard will be funded
                             through the winding up Community Housing Organisation’s maintenance
                             account funds, wherever possible.

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TABLE 1: COSTS ASSOCIATED WITH TRANSFERS

                              ORGANISATION / AGENCY RESPONSIBLE FOR COST                                        CPG

                       CONVEYANCING FEE COSTS                                                            Reference 6.6.2
                       This includes costs re:                                                             (Community
                        Preparation of the Memorandum of Transfer                                       Partnerships and
                                                                                                         Growth’s wind up
                        The preparation of the Cancellation of Charge                                       transfer)
                          [the Cancellation of Charge is the document used to take the
                          Statutory Charge off the Certificate of Title]The preparation of the
                          Statutory Charge
                          [the Statutory Charge is an obligation registered on the title]
                        The preparation of the Debenture
                          [the Debenture is the document setting out obligations as per the
                          Funding Agreement]
                       SEARCH FEES TO DETERMINE STATUTORY CHARGES AT                                      Reference 6.6.2
                       DATE OF TRANSFER – (These are fixed costs by each Authority)                    (Community
                          Council                                                                     Partnerships and
                          SA Water                                                                    Growth’s wind up
                                                                                                       transfer)
                          Revenue SA Search Fees (Emergency Services Levy)
                          Strata Fees
                          Other applicable to an individual property
                       STATUTORY CHARGES DISBURSEMENTS (Cost adjustments                                   Reference 6.6.2
                       made at transfer between actual transfer date and end of current                     (Community
                       billing cycle)                                                                     Partnerships and
                        Council Rates – must be paid in full to the end of the financial                 Growth’s wind up
                            year                                                                       transfer – will recover
                        Water Rates and Water Usage – must be paid in full and in                           unpaid cost
                            advance to the end of the current quarter cycle                               adjustments from
                                                                                                       wound up CHO funds
                        Emergency Services Levy– must be paid in full to the end of the                 and from Receiving
                            financial year                                                                  CHO where
                        Strata fees for properties that are community titled (must be paid                applicable e.g.
                            in full and advance to the end of the current cycle – the billing            Council rates, ESL)
                            cycle varies per situation.

10.3     Report to the Office of Consumer and Business Affairs for Associations
         In accordance with the SACCH Act, Schedule 1 section 10(10), if the Minister or his/her
         delegate:
         a)     Appoints an investigator;
         OR
         b)     Declares that there are grounds for formal intervention into the affairs of a
                Community Housing Association;

         the Minister or his/her delegate must furnish a report on the matter to the Office of
         Consumer and Business Affairs.

10.4     Revoking the declaration - Ceasing intervention
         The Minister or his/her delegate will revoke the intervention declaration, and bring the formal
         intervention to a close when he/she is satisfied that it is appropriate to do so, i.e. when the
         Community Housing Organisation has rectified the issues identified by the independent
         investigation to the Minister's or his/her delegate's satisfaction, or when the Community
         Housing Organisation has been de-registered/dissolved.

         The Community Housing Organisation can at any time apply to the Minister or his/her
         delegate in writing for the formal intervention to end. The Minister or his/her delegate will
         consider the request on the basis of the following:
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         a)        A written report from the Administrator (where appointed);
         b)        That all the requirements set forth by the Declaration have been completed within
                   the timeframes specified;
         c)        That compliance reporting and required returns are up to date;
         d)        In the case of financial mismanagement, an interim audit may be requested.

         If the formal intervention is to cease, the Minister or his/her delegate will inform the
         Community Housing Organisation in writing.

10.5     Prosecution
         There are specific instances where an office bearer(s) of a Community Housing
         Organisation, failing to comply with a specific requirement of the SACCH Act, may be guilty
         of an offence. The Minister or his/her delegate reserves the right to commence legal
         proceedings where it is deemed appropriate.
         Section 102 of the SACCH Act provides that a prosecution for an offence against this Act—
         (a)     may be commenced—
                 (i)     by the Minister; or
                 (ii)    by an officer or employee of the Department; or
                 (iii)   with the consent of the Minister, by any other person; and
         (b)     must be commenced within three years after the date on which the offence is alleged
                 to have been committed or such further period as the Attorney-General may, in a
                 particular case, allow.

10.6     Right of appeal
         In accordance with appeal policy, organisations have the right to appeal the decisions of the
         South Australian Housing Trust or the Minister, or his/her delegate, relating to intervention
         resulting from an investigation.

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11       SUMMARY FLOWCHART

                                                                                                         Monitoring

                                                                                     Unsatisfactory
                                                                                                                  Satisfactory performance
                                                                                      performance

                                                                                                                      No regulatory response
                                                                                     Engagement                         required, return to
                                                                                                                            monitoring

                                                                                       Decision

                                                                    Unsatisfactory
                                                                                               Satisfactory response
                                                                   response by the
                                                                                                by the Community
                                                                  Community Housing
                                                                                               Housing Organisation
                                                                     Organisation

                                                                     Investigation             Return to monitoring

                                                                       Decision

                                                   Grounds for                        No grounds for
                                                   intervention                        intervention

                                                                                CPG to work with the
                                                                                Community Housing
                                                   Intervention
                                                                               Organisation, and may
                                                                              continue close monitoring

                                                       Decision

                                                                     CPG to work with the
                      De-registration/dissolution of
                                                                     Community Housing
                          Community Housing
                                                                    Organisation, and may
                             Organisation
                                                                   continue close monitoring

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12       GLOSSARY

Administrator
An administrator is appointed under section 72 and Schedule 1 of the SACCH Act to conduct the
affairs of a Community Housing Organisation for a specific period.

Associations
A Community Housing Organisation that is managed by a separate group (i.e. not the tenant) that
collects rents and manages maintenance etc on behalf of tenants. Associations are similar to
traditional housing models where a landlord rents a property to a tenant. Associations are however
often managed by groups linked to community based organisations e.g. support services, churches,
welfare or charitable organisations. Associations are often established to assist people with specific
needs e.g. women escaping domestic violence, people with intellectual disabilities, people on low
income etc. See also Co-operatives.

Authorised officer
Section 69 of the SACCH Act enables the Minister or his/her delegate to appoint (Office of Housing
Regulation) officers as Authorised Officers to examine the accounts, records and other prescribed
documents specified in legislation or in the Funding Agreement. A person who is in a position to
provide information relevant to the examination, must do so when requested by an Authorised
Officer of the Office of Housing Regulation.

Community Housing Council of South Australia Inc (CHCSA)
CHCSA is the peak representative body funded by Housing SA to provide advocacy, advice,
networking, policy development and training for the community housing sector in South Australia.

Community Housing Organisation
An organisation registered under the SACCH act 1991, see associations and co-operatives.

Community Partnerships and Growth
Formerly the Office for Community Housing, and prior to July 2007, the South Australian
Community Housing Authority (SACHA). Community Partnerships is a directorate within Housing
SA, Department for Communities and Social Inclusion, and acts as funder, developer, and contract
administrator of community housing in South Australia. Further information can be found at
http://www.sa.gov.au/communityhousing

Complaint
A complaint is a request for redress by a person or organisation who feels aggrieved or unhappy
with the effect of some else’s actions on them, or disagrees with a policy of the Community Housing
Association/Co-operative.

Conflict Of Interest
A person has a conflict of interest when he/she has an involvement which may affect, or may be
seen as, affecting their judgement or could create a perception of bias. The SACCH Act 1991,
section 42, specifies that having a conflict of interest whilst participating in a decision making
process could result in serious penalties.

Co-operatives
A community housing organisation that is managed for and by its members e.g. tenants generally
collect their own rents, manage their own maintenance, and report back to Housing SA, Community
Partnerships and Growth according to the requirements of the funding agreement etc. Co-
operatives are commonly established by people with specific interests or needs e.g. single parents,
aged, people with specific disabilities or people from specific cultural backgrounds. See also
Associations.

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Funding Agreement
The agreement signed and sealed by a Community Housing Association/Co-operative and Housing
SA which outlines the administrative and financial arrangements and obligations of both parties.

Governance
The processes and systems that guide and direct the way in which an organisation is controlled, as
distinct from management which is focused on the organisation of activities within the organisation.

Housing SA
Housing SA is part of the wider State Government Department for Communities and Social
Inclusion. Housing SA overseas all Government funded social housing programs. Community
Partnerships and Growth is a directorate within Housing SA.

Independent Investigator
An independent investigator is appointed under the SACCH Act to research and report on a
Community Housing Organisation’s situation in a number of areas (e.g. financial, legal, social).

Insolvency
Where an organisation is unable to pay its debts and meet financial commitments.

Office of Housing Regulation
Formerly within the Community Partnerships and Growth, and now separated out into an
independent regulatory office headed up by the Housing Regulator, who reports to the Minister on
regulatory matters, and Housing SA Corporate Services on administrative matters.

Performance Development Plan
Agreement developed by Community Partnerships with the Community Housing Organisation to
enable the organisation to meet legal, member, tenant, financial and maintenance responsibilities.

Primary Contact Organisation
Customers lodging a Registration of Interest for Community Housing will be assigned a ‘primary
contact’ organisation. This is the organisation receiving their Registration of Interest Form and
administering the registration process for the customer. It may be a Housing Association or the
Housing SA Contact Centre.

Regulator
Office of Housing Regulation, , Department for Communities and Social Inclusion.

Service Provider
A person or organisation which the Association or Co-operative chooses to engage to provide some
level of administration, property or tenancy service on a fee for service basis.

South Australian Co-operative and Community Housing Act (SA) 1991 (the SACCH Act)
This Act is the main legislation setting out the power and duties of Housing SA.

Viability
To be sustainable over the long term.

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