urban planner at a desk with wooden house models

How can municipalities access and use federal funding for housing projects?

How can municipalities access and use federal funding for housing projects?

Synopsis
5 Minute Read

The Federal Government introduced the Housing Accelerator Fund (HAF) and the Canada Housing Infrastructure Fund to boost housing availability and affordability in response to Canada’s severe housing shortage.

Review the details of each program and explore the solutions that municipalities could implement using the federal funding, including:

  • Modular housing initiatives
  • Supportive housing programs
  • Non-profit housing developers
Partner, Consulting

Municipalities throughout Canada are facing housing challenges — and a lack of financial resources is a key barrier to solving this issue. In response to Canada’s severe housing shortage, the Federal Government introduced the Housing Accelerator Fund and the Canada Housing Infrastructure Fund to significantly boost housing availability and affordability.

These programs provide the financial resources needed by provincial and municipal governments to accelerate both the development of new homes and build or upgrade housing infrastructure. In this insight, we unpack the program details and identify solutions that municipalities could implement using the federal funding.

Housing Accelerator Fund

Overview of the Housing Accelerator Fund (HAF)

The Housing Accelerator Fund (HAF) is designed to provide incentive funding to local governments across Canada, including First Nations, Métis, and Inuit governments. This program aims to foster the removal of barriers to the housing supply and accelerate the development of complete, sustainable, and diverse communities. The fund targets the issuance of permits for an additional 100,000 housing units — promoting significant and long-term housing supply growth.

Eligibility criteria

Local governments within Canada that have authority over land use planning and development approvals are eligible applicants for the HAF. This includes municipal-level authorities, regional districts, and provincial or territorial governments in their absence.

Qualifications for the Housing Accelerator Fund

  • Action plan — Applicants must develop a comprehensive action plan as part of their application, outlining detailed initiatives and growth targets to enhance the housing supply.
  • Growth target commitment — The action plan must include a commitment to increase the average annual rate of housing supply growth by at least 10 percent and must exceed a 1.1 percent growth rate.
  • Housing needs assessment — A recent housing needs assessment report is required unless recently completed or updated.
  • Reporting obligations — Applicants must adhere to strict reporting requirements to track and justify the use of HAF funding.

These structured requirements ensure that the fund effectively supports projects that align with its objectives of increasing housing supply and fostering community development.

Canada Housing Infrastructure Fund

Overview of the Canada Housing Infrastructure Fund

The government’s allocation is designed to ignite a wave of construction and infrastructure improvement. The fund is split in two areas:

  1. Urgent infrastructure needs — $1 billion is dedicated to immediate infrastructure challenges.
  2. Provincial and territorial agreements — $5 billion is set aside for agreements with provinces and territories, encouraging them to boost the housing supply.

Qualifications for the Canada Housing Infrastructure Fund

To qualify for the fund, the provinces and territories must meet certain conditions:

  • Municipalities must allow more missing middle homes, such as duplexes, triplexes, and townhouses.
  • Implement a three-year freeze on increasing development charges for municipalities with populations larger than 300,000.
  • Adopt incoming changes to the National Building Code aimed at supporting more accessible, affordable, and environmentally friendly housing options.
  • Permit pre-qualified or as-of-right construction, where developments conform to existing building and zoning approvals and don’t require discretionary approval, for the federal housing design catalogue.

Municipalities will have up to a year to reach agreements with their respective provinces and territories beforehand through an application process and continuous monitoring. More details on the application process will be released in the near future.

Spotlight solutions: How to use the funding

The federal funding announcements provide clarity for how the housing solutions will be funded, but many municipalities are still determining exactly what solutions they should implement. The options below provide a starting point for consideration.

Modular housing initiatives

Municipalities are adopting modular housing to swiftly bolster the supply of affordable homes. These prefabricated units can be assembled quickly and affordably, offering essential shelter for those in dire need. Municipalities can employ cutting-edge construction techniques to promptly remedy housing shortages through collaborating with modular housing enterprises.

Benefits include:

  • Rapid assembly — Modular homes are constructed in significantly less time than homes constructed by traditional methods, enabling a swift response to urgent housing requirements.
  • Cost efficiency — This economical building alternative is viable for municipalities with constrained budgets, seeking to expand their affordable housing inventories.
  • Scalability — The modular building process allows for production to scale with demand and shifting needs.

Supportive housing programs

Certain municipalities have launched supportive housing initiatives that blend affordable living spaces with comprehensive services. These programs cater to the intricate needs of those at risk, offering stable housing coupled with essential services such as mental health support, addiction treatment, and life skills coaching.

Benefits include:

  • Comprehensive care — Supportive housing provides a spectrum of services tailored to individuals in need, facilitating life stabilization and community reintegration.

Non-profit housing developers

This innovative approach to solving housing challenges uses a combination of new builds, renovations, and supportive services to offer dignified, independent, and affordable living spaces for people experiencing housing insecurity. Non-profit housing developers typically rely on a blend of government funding and public donations and offer health and wellness services in their housing complexes for a holistic living environment.

Benefits include:

  • All-encompassing care — This approach ensures residents have more than just a roof overhead by providing access to counseling, skill development, and community participation.
  • Social inclusion — The non-profit development approach promotes social integration by creating mixed-income communities, bridging socioeconomic divides.
  • Eco-conscious construction — Non-profit developers typically use sustainable design to minimize environmental impact and operational expenses in the long run.

Learn more

Creating the right housing strategy for your municipality is difficult work — however, strategy development is crucial to access these funding programs. From strategic advisory to project management support, MNP offers the expertise you need to build an effective housing roadmap.

To learn more, contact Sylvia Tello, PMP, Partner, Consulting.

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