Ontario adding more ‘strong mayors,’ creating $1.2B in housing incentive fund

Ontario Premier Doug Ford is expanding so-called strong mayor powers to a total of 49 communities across the province and is offering $1.2 billion in incentives for cities and towns to meet housing targets.

Ford’s announcement on Aug. 21, in a speech at the Association of Municipalities of Ontario’s conference, comes as the province’s housing starts are well below what’s needed to hit the premier’s target of building 1.5 million homes by 2031.

A sharp rise in population growth is also adding pressure on the province to build, and has been cited by Ford in defence of his controversial move to open up land in protected Greenbelt areas for housing development.

“Failing to act would worsen the housing supply affordability crisis,” Ford said Monday in announcing the new fund and strong mayor powers.

“Failing to act would hurt everyone in Ontario by driving up the cost of goods and services, and by hampering new job creation and investments. Failing to act would threaten to erode Canadians’ unwavering support for immigration at a time when our economic success depends on welcoming skilled newcomers to fill critical labour gaps.”

Strong mayor powers which include allowing mayors to propose housing-related bylaws and pass them with the support of one-third of councillors, as well as override council approval of certain bylaws and prepare their city’s budget, instead of council have been decried by critics as undemocratic.

The latest expansion involves municipalities with populations projected to exceed 50,000 by 2031, such as Aurora, Welland and North Bay, and will put the total number of strong mayors at 49 when the new ones come into effect Oct. 31.

The province had earlier given strong mayor powers to the heads of 28 cities, though several of those mayors say they do not intend to use them.

Ford had previously assigned housing targets to 29 cities, but Newmarket has refused to commit to its target, so it has been left off the list of strong mayors. Newmarket Mayor John Taylor has said he couldn’t commit to the province’s target of 12,000 new homes for his municipality because Newmarket doesn’t currently have the sewage capacity to serve more than a couple thousand more homes.

Monday’s 21 new additions to the strong mayor list will have to agree to their housing targets in order to get the new powers.

Ford said conferring targets on those communities will see them qualify for the new three-year, $1.2-billion Building Faster Fund.

It will be open to municipalities that meet at least 80 per cent of their housing target, and could dole out bonuses to communities that exceed their target, Ford said.

Ten per cent of the fund is being reserved for small, rural and northern communities that don’t have assigned housing targets.

The exact parameters of what the money could be spent on still needs to be worked out, Ford said, but it’s intended to go toward housing-enabling infrastructure and other projects that support community growth, such as roads and water lines.

Municipalities have been raising concerns about a provincial law that cuts some of the fees developers pay, which the communities use to fund such infrastructure.

Colin Best, president of the Association of Municipalities of Ontario, said municipalities welcome the new funding but will need at least $1 billion annually to address that shortfall in housing-related infrastructure funding created by the provincial law.

“To meet the province’s target of building 1.5 million new homes by 2031, municipalities need to invest in infrastructure such as water and wastewater, roads, parks, emergency services and more,” Best wrote in a statement.

“Ontario municipalities estimate that additional funding of at least $1 billion annually will be needed to address the shortfall created by changes to the Development Charges Act.”

NDP Leader Marit Stiles said in a speech to the AMO conference that the new, three-year program “does not come close” to replacing the revenue municipalities will lose due to the provincial cuts to developer fees.

“It’s more than a little backwards to effectively punish municipalities for not building housing when they don’t have the funding or the provincial partner they need to do so,” she said.

Municipal Affairs and Housing Minister Steve Clark launched audits of six select municipalities in the wake of those concerns, and has said the province will make municipalities “whole” if the law leaves them unable to pay for housing-related infrastructure.

Clark has suggested in a letter to AMO that offsetting a loss of municipal development charge revenue will be contingent on the communities meeting their housing targets, but many municipalities have expressed concern that there is only so much control they have over the number of housing units that get built.

“If we issue permits and approvals, but the shovels don’t get in the ground because of high interest rates, supply chain, labour matters, unfavourable federal policy, other taxes and fees and other levels of government, then we’re not that much further ahead,” Marianne Meed Ward, mayor of Burlington, Ont., and chair of the big city mayors group said recently.