Published April 2, 2024

Ottawa to launch $6B infrastructure fund to help build homes — with strings attached

By Nojoud Al Mallees

The upcoming federal budget will include a $6-billion infrastructure fund that would require provinces and territories to adopt certain housing policies in order to access the money, Prime Minister Justin Trudeau said Tuesday.

Trudeau was in Dartmouth, N.S., alongside Housing Minister Sean Fraser as part of the government's pre-budget tour, which aims to drum up attention and win back support for the Liberals on cost-of-living issues. 

"Building more homes faster — this is how we'll address the shortage of housing options for Canadians, and this is how we'll make it fairer for younger generations who feel like they're falling behind because housing costs are too high," Trudeau said.

The federal government said $1 billion would be directly available to cities for urgent infrastructure needs, with that money flowing in the 2024-25 fiscal year. 

The other $5 billion would be allocated to agreements with provinces and territories meant to support long-term priorities.

Municipalities have been aggressively urging the federal government to commit more dollars toward infrastructure, noting their communities cannot significantly ramp up homebuilding without things like water supply and roads. 

While Tuesday's announcement appears to respond to that plea, the federal government is also using the infrastructure fund to push provinces and territories to co-operate on the Liberal government's housing agenda. 

To access funding, provinces and territories would have to agree to a set of conditions, including the adoption of the recently announced renters' bill of rights, which would create a national standard lease agreement and require landlords to disclose previous rent prices. 

The federal government is also demanding that provinces and territories freeze development charges for three years and require municipalities to broadly allow the construction of fourplexes. 

The deadline to secure a deal will be Jan. 1, 2025 for provinces and April 1, 2025 for territories. 

If a province or territory doesn't secure  a deal by those deadlines, their funding will be transferred to the municipal stream of the infrastructure fund, the government said.

Last week, Ontario Premier Doug Ford said his government would not introduce legislation to automatically legalize fourplexes across the province, arguing that such a move would lead to pushback from some residents. 

The upcoming budget will also add more funding to the existing housing accelerator fund. 

The first $4-billion phase of the fund saw Ottawa striking deals with cities and offering money in exchange for changes to municipal bylaws and regulations that are supposed to boost homebuilding. 

Trudeau announced Tuesday that another $400 million is being added to the pot. 

The Liberal government also said that future public-transit funding will require municipalities to meet certain criteria.

Requirements would include eliminating all mandatory minimum parking requirements and allowing high-density housing within 800 metres of a high-frequency transit line.

Banner image: Prime Minister Justin Trudeau, centre, is flanked by Minister of Housing, Infrastructure and Communities Sean Fraser, left, and mayor of Halifax Mike Savage while making a housing announcement in Dartmouth, N.S. on Tuesday, April 2, 2024. THE CANADIAN PRESS/Darren Calabrese

This report by The Canadian Press was first published April 2, 2024. 

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