The Canada Revenue Agency has revoked the charitable status of a nonprofit whose former low-income tenants were evicted by the buyer of its East Vancouver apartment building.

As of February 9, the Voice of the Cerebral Palsied of Greater Vancouver is no longer registered as a charitable organization.

Although the $4-million sale of the rental building at 577 East 8th Avenue in November 2011 and the subsequent eviction of the tenants by the new owner the following spring weren’t issues the CRA looked at, the property figured prominently in the federal body’s review of VCP’s operations.

In addition to the group’s failure to devote its resources substantially to charitable activities, the CRA also established that it didn’t properly account for its ownership of the 39-unit Richard Watson Court.

Speaking through Jonn Olldym from the group’s Kingsway office in Vancouver on February 12, executive director Yoshinori Tanabe declined a Georgia Straight request for comment.

According to documents provided by the CRA, an audit of VCP’s operations between April 1, 2006, and March 31, 2008, was conducted.

In a letter dated January 8, 2009, CRA auditor Ashley Thompson outlined to Tanabe the ways in which his group hadn’t complied with the provisions of the Income Tax Act. One reason given was its failure to record Richard Watson Court as a significant asset.

It also allowed the building to be operated by a sister organization, the Voice of the Cerebral Palsied Housing Society, on behalf of B.C. Housing, the provincial agency responsible for housing. VCP likewise paid rent of more than $15,000 in 2007 and 2008 for its use of office space in a building it owns.

Thompson explained that although registered charities can make gifts to other organizations, these recipients must be qualified donees as set out in the Income Tax Act. The housing society wasn’t one of these.

The CRA auditor noted that the ex-charity explained that when it was constructing Richard Watson Court with the help of the Canada Mortgage and Housing Corporation, the federal housing agency required that a separate society be created for funding purposes.

According to Thompson, Tanabe “asserted that the building belongs to the Charity ‘in name only’ ”.

“This finding is concerning to the CRA given that the Charity has allowed another entity to control and use its asset, has received no compensation for this and has failed to account for the asset in its records,” Thompson wrote.

On July 20, 2009, Terry de March, director general of the CRA’s charities directorate, notified VCP of the federal agency’s intention to revoke the group’s charitable registration.

The nonprofit filed an appeal with the federal Court of Appeal. However, it withdrew the appeal on October 25, 2012.

Around the same time, the property, which had been renovated and renamed Watson Manor Apartments by its new owner, was opened for public viewing. Located in Mount Pleasant, the refurbished rental building was scheduled to be ready for occupancy in December of last year. One-bedroom and two-bedroom units now rent for $895 and $1,275 a month, respectively.

When renters were fighting their impending eviction by the new owner in March 2012, Laurette Yelle, assistant executive director of VCP, told the Straight that B.C. Housing took over administrative control of the building in 2006. Yelle also said her group was advised by B.C. Housing in October 2009 that there would be no new money for repairs and that the organization’s best option was to evict the tenants and tear down the property. The building was later put up for sale.

Tristan Markle of the Vancouver Renters Union remembers 577 East 8th Avenue well. His group fought on behalf of the former tenants.

“This was an important example of loss of really valuable low-income housing,” Markle told the Straight by phone. “They [the units] were lost to gentrification.”