The Ontario and Canadian governments have jointly allocated $1 billion to support municipalities that do not impose development charges in enhancing and renewing essential infrastructure. This initiative was revealed 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.

Both levels of government will contribute $500 million each to establish a new branch of the Municipal Housing Infrastructure Program (MHIP). This specific segment, known as the “non-development charge municipalities stream,” is designed to assist these communities in funding critical infrastructure such as bridges, roads, and water systems to facilitate new housing developments and safeguard the existing housing stock.

McCarthy expressed enthusiasm about the collaboration between federal and provincial governments and municipalities, emphasizing the positive outcomes achieved through this partnership. Initially, McCarthy mentioned that the $1 billion funding was separate from the $8.8 billion pledged earlier in March. However, his office later clarified that the new funding is indeed part of the $8.8 billion agreement.

Furthermore, the Ontario government has already earmarked up to $1.5 billion for the City of Toronto to offset the financial implications of reducing development charges. Similarly, the City of Ottawa intends to slash development charges by 54% to secure $478 million in infrastructure funding.

Premier Doug Ford addressed hundreds of municipal representatives, highlighting the high demand for funding and encouraging municipalities to further reduce development charges. He assured additional financial support if needed. The government announced in June that cities would need to contribute 10% towards new infrastructure costs to access the $8.8 billion funding, but this requirement will not apply to municipalities covered under the new funding stream.

The application process for the new funding stream will commence on October 29, with project selections expected in the spring. Christa Lowry, Mayor of Mississippi Mills and chair of the Rural Ontario Municipalities Association (ROMA), expressed optimism about the impact of the funding on numerous communities, particularly noting that over 200 out of Ontario’s 444 municipalities do not collect development charges.

McCarthy emphasized that the funding stream aims to bolster local economies amidst economic uncertainties arising from U.S. tariffs. He highlighted the challenges faced by municipalities, including backlog repairs, escalating construction costs, and limited funding sources for critical infrastructure projects.

Robin Jones, outgoing president of AMO and Mayor of Westport, Ontario, commended the initiative, underscoring the infrastructure pressures faced by rural, small, and northern communities. The Ontario Big City Mayors (OBCM) group also reiterated concerns regarding homelessness and addiction crises, advocating for stronger provincial actions to address these issues.

Mayor Marianne Meed Ward of Burlington, Ontario, and chair of the OBCM emphasized the need for comprehensive solutions and discussions to tackle these pressing challenges. The AMO conference, where these issues were discussed, is ongoing in Ottawa, with Premier Doug Ford scheduled to address the participants on Monday morning.