Toronto is set to receive a major injection of public money aimed at easing its housing crunch. The city will get 1.5 billion dollars in funding to help build housing, part of a broader federal and provincial push to get more homes constructed across Ontario at a time when affordability remains out of reach for many residents.
The money flows from a program first announced back in March. It was unveiled jointly by Prime Minister Mark Carney and Ontario Premier Doug Ford, pairing the federal and provincial governments in a shared effort. Under the plan, the two levels of government will each chip in about 4.4 billion dollars to help stimulate housing construction in the province.
The goal behind the spending is to jump start a market that has stalled. Ontario is still grappling with a housing crisis and a broader affordability crisis, and officials are trying to stimulate what has become a sluggish construction sector. The funding is meant to encourage builders to break ground on the homes the province badly needs.
At the heart of the issue are the fees that can make new projects harder to pencil out. Builders say the development charges levied by municipalities are getting in the way, eating into already thin margins. Reducing those charges is seen as one way to make construction more attractive and to get more shovels in the ground across the province.
But those same fees serve an important purpose for local governments. Municipalities rely on development charges to pay for the infrastructure that new housing demands, including sewers, streets and transit. The program asks them to give up some of that revenue in exchange for funding, and Toronto is set to get its 1.5 billion dollars in return for waiving some of the fees.
Not every community is on board with the arrangement. Smaller municipalities around the province say they simply cannot afford to participate, arguing they need every penny of their development charges to cover essential services. For them, giving up that income is not a tradeoff they can manage, leaving them on the sidelines of the program.
The reluctance has drawn a pointed response from the premier. Asked about the smaller communities that are not applying for the funding, Doug Ford said he was shocked that some governments do not believe in lowering taxes. His comments underscored the tension between the province's push to cut fees and local leaders who say those fees keep their towns running.