Canada-Ontario infrastructure funding partnership a ‘positive step’ in solving housing crisis – mayor

A ten year $8.8 billion federal-provincial investment to support housing-enabling infrastructure investments for Ontario municipalities is a “positive step” in addressing the housing affordability crisis and “an example of what’s possible when all levels of government work together on shared solutions,” said Whitby Mayor Elizabeth Roy.

Roy said she was “encouraged” seeing the two levels of government working together to fund the infrastructure needed to support housing growth.

“This signals a more balanced approach – one that recognizes the cost of building complete communities should not fall disproportionately on homebuyers or property taxpayers, Roy said. “At a time when affordability is out of reach for many, any step that helps ease that burden is welcome.”

Ontario Premier Doug Ford called it “transformative” for both Ontario and Canada in delivering new homes, transit and infrastructure and supporting good-paying jobs by “lowering the cost of building, getting shovels in the ground faster, cutting red tape and investing in workers.”

A key pillar of the agreement is a shared commitment to boosting housing supply. Ontario and the federal government will cost-match a total of $8.8 billion over 10 years, focused on housing-enabling infrastructure projects.

The majority of funding will be used to support the reduction by up to 50 per cent of municipal development charges, which can add hundreds of thousands of dollars to the cost of new homes in Ontario municipalities. The new infrastructure funding will offset much of the financial impact of reductions on development charges implemented during Ford’s tenure.

Roy said the inclusion of funding prioritized to municipalities that discount development charges on new homes by up to 50 per cent is “particularly significant.”

“Ontario’s Big City Mayors has been clear that any changes to development charges must be matched with sustainable infrastructure funding from senior levels of government. This announcement reflects that advocacy and is an important step toward resetting how we fund growth in rapidly expanding communities.”

Whitby Mayor Elizabeth Roy

The province will work with municipalities and partners to put forward a list of infrastructure projects for approval with a focus on speed and efficiency, Ford said. These investments are expected to encourage new home construction and reduce barriers and costs to housing development to help more people realize the dream of homeownership.

The Whitby mayor said it will be “critical” that the province respects municipal capital planning processes and ensure project vetting is efficient. “Requiring alignment across three levels of government, while well-intentioned, could introduce complexity and delays. We must ensure processes are streamlined so critical infrastructure can be delivered without unnecessary barriers.”

“It will be important to understand how funding will be allocated, how projects will be prioritized, and how quickly municipalities can access these resources to deliver infrastructure,” she added. “The path forward will require continued collaboration across all levels of government and meaningful input from municipalities to ensure these investments translate into real results.”

Prime Minister Mark Carney said the agreement is about trying to tackle the housing crisis “from every angle” to build up housing supply.

“Our new partnership with Ontario is about building more affordable homes, more transit and more careers in the skilled trades.”

The Canada-Ontario Partnership to Build commits to several funding promises:

• HST Rebate on New Homes: Ontario and Canada will work together to remove the full 13 per cent HST for eligible buyers of new homes in Ontario valued up to $1 million and extend the maximum rebate amount of $130,000 to new homes valued between $1 million and $1.5 million. The federal government will provide Ontario a payment in the amount of $875 million that may be applied against the federal five per cent portion of the HST that is being removed from new homes in Ontario. This partnership would provide an estimated $2.2 billion in total tax relief for housing in Ontario.
• Waterfront East Transit: three-way cost share between the Ontario government, the federal government and the City of Toronto to construct the Waterfront East Transit line serving Toronto’s eastern waterfront, including the East Bayfront and Port Lands.
• GO 2.0: commit to working collaboratively to increase passenger service along freight-owned corridors across the Greater Golden Horseshoe region, to support improved service along existing GO lines and the potential creation of new GO lines in the region.
• Alto High-Speed Rail: commit to working collaboratively to support the planning and advancement of the Alto HSR initiative that will connect millions of people living along the Toronto–Quebec City corridor.
• Priority transit projects in the Greater Toronto and Hamilton Area: execute federal contribution agreements on announced transit projects, including the Ontario Line, Eglinton Crosstown West extension, Scarborough Subway extension, Yonge North Subway extension and Hamilton LRT.