Ontario, feds make progress on housing deal but disagree on infrastructure funds

Ontario remains at odds with the federal government over charging homebuilders for new infrastructure, but a meeting between the two housing ministers seems to have brought the province closer to securing $357 million in funding for affordable housing. 

The federal government has made freezing development charges a condition of receiving a cut of its $6-billion infrastructure fund, with Housing Minister Sean Fraser saying the fees reduce affordability because costs are passed on to buyers, much to the frustration of cities like Ottawa. 

While Ontario's Minister of Municipal Affairs and Housing Paul Calandra was in the capital this week to announce a $9.5-million investment in supportive housing units, he met with his federal counterpart to plead his case. 

Calandra said homebuilders have told him they face two key challenges: high interest rates, and infrastructure. 

"Without sewer and water, we can't build you anything," he told CBC on Wednesday. "We are hearing that loud and clear."

Calandra 'optimistic'

Municipalities convinced the province to ease the restrictions to the per-unit charges in its soon-to-be-implemented Bill 185, said Calandra. He sent those arguments up the chain to Fraser.  

"I helped him understand our experiences over the last little bit," Calandra said. "I'm optimistic that they will understand the challenges that we're all facing — not just Ontario, frankly. I think across Canada, provincial premiers are very unified in how important it is to get infrastructure in the ground." 

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But when CBC reached out to Fraser's office, that optimistic view had somewhat dimmed.

Spokesperson Micaal Ahmed wrote in a statement that Fraser "understood" the province's position, but "underlined that he cannot ignore that development charges make building homes significantly more expensive and that raising them during a housing crisis is counterproductive."

The "starting point" of negotiations for infrastructure funding, it said, remains unchanged. 

Progress on affordable housing

There was good news, though: Fraser's office said the conversations yielded "meaningful progress" on the bilateral agreement under the National Housing Strategy, under which Ontario stands to receive $357 million for building affordable housing. 

In March, Fraser called the province's action plan a disappointment. At the time, Calandra argued that Ontario was focusing on repairing and renovating its aging stock of social housing. 

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The debate over housing counts may now be settling in the province's favour, the statement from Fraser's office suggests. It said Ontario agreed to adjust its data collection methods to "avoid similar pitfalls in the future."

"Ontario has been identifying additional provincial investments into housing units and outlining more robust communication methods between Ontario and its service managers," it said.

It also said Calandra and Fraser hope to share further details on their progress "very soon."