Jim Kenyon, the minister responsible for the Yukon Housing Corp. (YHC), says a local non-profit housing co-operative is not viable, and will never be viable, according to a reputable consulting firm.

The Crown corporation plans to seek a court order to dissolve the Whitehorse Housing Co-operative and take ownership of the 12 units because that's the best course of action, Kenyon said in an interview outside the legislature Wednesday.

He said it would preserve the multimillion-dollar asset as public housing stock, and relieve the YHC of ongoing costs it faces as the court-appointed receiver looking after the troubled organization.

A study commissioned by the YHC on behalf of the 12 tenants who form the co-operative clearly shows that even with short-term solutions, there's no way to overcome inevitable long-term problems, Kenyon pointed out.

"Right now, we are not seeing viability," the minister emphasized.

On the other hand, the national organization which represents 887 housing co-peratives and their 57,000 housing units maintains the Whitehorse

Housing Co-operative is viable, and it intends to fully support it in court if need be.

Karla Skoutajan of the Co-operative Housing Federation of Canada said there is a viable restructuring plan in place for the Whitehorse co-op that would remove the need for a receiver and put its board of directors back in control of the organization.

If the YHC would agree to sit down and work through the process with the co-op and the national federation, she suspects it could take as little as two months to come up a plan to satisfy the court, she said.

"I disagree the co-op can't govern itself, and is not viable," Skoutajan said.

"It is viable, it is home and has been home for members of the Whitehorse Housing Co-operative."

Housing co-operatives, she said, run into trouble from time to time, and that is why her organization and another national group provide financing to assist co-ops in trouble.

Having the government attempt to take over the Whitehorse co-op's assets because of a bump in the road is not a just of Yukon interest, but of national interest, she said.

Skoutajan said if the matter does go to court, Yukon Housing would have to show how the restructuring plan proposed by the co-op and the federation is not viable, and she doesn't believe it can.

Furthermore, she pointed out, under existing legislation, there are regulations setting out how to disburse assets of non-profit housing co-operatives which are dissolved.

It would be the position of the national federation that the Yukon government would have to pay out the difference between the debt owed by the co-op and the value of the assets, in accordance with the law, she said.

Currently, the mortgage debt is $1.4 million.

A recent appraisal commissioned by the co-op puts the market value of the 12 single-family units at $3.2 million, leaving a net value of $1.8 million.

The Whitehorse Housing Co-operative was formed in 1988, and its 12 units were occupied in 1990. It ran into financial problems in 2003 because of internal financial management problems which drew the attention of the RCMP but resulted in no criminal charges.

The YHC was brought in as a court-appointed receiver to assist the organization.

Records show the YHC has so far provided the co-op with $85,000 in assistance: $30,000 to cover three months of mortgage arrears; $20,000 in tax arrears and $20,000 in maintenance since 2003.

In an interview last week, Doug Bishop, the co-op's vice-president, said the organization has been operating in the black ever since the internal problems were dealt with in 2003.

It's beyond him, he said, why the YHC appears so anxious to take over ownership of the assets instead of doing what receivers normally do, and that is help the troubled party get back on track.

Kenyon said Wednesday that by taking ownership of the 12 units, the YHC preserves the six units currently used to provide social housing, and gains the ability to add another six units to the social housing stock.

The assets could be sold on the private housing market, but then there would be a loss of six social housing units, as well as the ability to put six more into use.

The minister said Yukon Housing has tried, but any way it looks at it, the co-op is not viable, and it's time to make decisions.

Staff of the Crown corporation are putting a lot of energy into the co-op as the receiver, he said.

Kenyon said Yukon Housing needs to move on with this issue after five years.

If the national co-op organization wants to step forward and take over the role as receiver, he'd be the first to stand up in court and approve the move, he said.

The minister pointed out Yukon Housing has made its best assessment, and as a result has chosen to seek ownership of the assets.

The court, he emphasized, has the last say, but this is the best option Yukon Housing has.

Meanwhile, the housing co-op has written a letter to Rudy Couture, chair of the YHC's board of directors, inviting him to sit down and explore options other than Yukon Housing's stated intent to take over the assets.

In a Jan. 16 letter to the 12 tenants, Yukon Housing notes it has the territorial government's approval to soon seek ownership of the 12 units through the courts.

The letter indicates the six tenants who pay market rent will be given a year to move, while Yukon Housing will assess the needs of the six tenants on subsidized rent to determine if the dwelling is appropriately sized for their needs.

As with other privately-owned housing units and apartments, Yukon Housing pays the subsidized rent for those tenants occupying the six social housing units owned by the co-op.