The Ontario and Canadian governments have allocated $1 billion to support municipalities that do not impose development charges in constructing and revitalizing essential infrastructure. This initiative was announced by Todd McCarthy, Ontario’s acting minister of infrastructure, Rob Flack, Ontario’s minister of municipal affairs and housing, and Jennifer McKelvie, parliamentary secretary to the federal minister of housing and infrastructure during the Association of Municipalities of Ontario (AMO) conference in Ottawa.
Under the Municipal Housing Infrastructure Program (MHIP), each government level will contribute $500 million to establish a new funding stream specifically for municipalities that do not collect development charges. This financial support aims to assist these communities in funding crucial infrastructure such as bridges, roads, and water systems to facilitate new housing developments and safeguard the existing housing supply.
During the announcement, McCarthy expressed optimism about the collaboration between federal, provincial governments, and municipalities in achieving common goals. Originally, McCarthy indicated that the $1 billion funding was separate from the $8.8 billion pledged earlier; however, his office later clarified that the new funding is part of the $8.8 billion agreement.
Notably, the Ontario government has already designated up to $1.5 billion to the City of Toronto to mitigate the financial impact of reducing development charges. Similarly, the City of Ottawa plans to slash development charges by 54% to receive $478 million in infrastructure funding.
Premier Doug Ford emphasized the high demand for funding compared to available resources during a speech to municipal politicians, urging municipalities to further reduce development charges and assuring additional funding if needed. The first round of applications for the new funding stream will open on October 29, with project selections expected in the spring.
Mississippi Mills Mayor Christa Lowry, chair of the Rural Ontario Municipalities Association (ROMA), praised the funding’s potential to benefit numerous communities, especially emphasizing the readiness of many municipalities to expand and develop their areas.
Additionally, the fund’s creation aims to address economic uncertainties, such as U.S. tariffs, and help local economies thrive. McCarthy highlighted that the cost of infrastructure development remains a significant barrier to housing development, particularly for municipalities facing repair backlogs, escalating construction expenses, and limited funding sources.
Furthermore, the Ontario Big City Mayors (OBCM) group reiterated concerns about addressing homelessness and addiction crises, advocating for stronger provincial actions. The group’s recommendations include establishing a dedicated ministry for addiction issues, expanding treatment options, and potentially declaring a state of emergency to tackle these pressing challenges.
Mayor Marianne Meed Ward of Burlington, Ont., chair of the OBCM, emphasized the importance of exploring all avenues to address the crisis effectively, calling for open dialogue and collaboration to find sustainable solutions. Meed Ward indicated plans to engage with provincial officials during the ongoing AMO conference in Ottawa, where Ontario Premier Doug Ford is also expected to address attendees.
The $1 billion funding initiative represents a significant step towards supporting municipalities that do not impose development charges and enhancing infrastructure development across Ontario.