Ontario town will return federal housing money after vote against density

An Ontario town is returning $1.28 million that it received in housing funds from the federal government after shooting down measures that would build more density — a key condition of the deal.

On Wednesday, Housing Minister Sean Fraser said the federal government was terminating its deal with the Town of Oakville, Ont., after the town council and Mayor Rob Burton rejected a motion that would allow more dense forms of housing, such as fourplexes and student housing, to be built.

On Thursday, a spokesperson for the mayor’s office told Global News that the town would be returning the money.

“The Town is returning the money and is awaiting instructions from CMHC (Canada Mortgage and Housing Corporation) on how to proceed,” Jorge Gomez in the mayor’s office said.

Gomez added that the amount to be returned was “approximately $1.28 million.”

Under the federal government’s Housing Accelerator Fund, Oakville received $1.28 million, which was to be part of a larger sum of $25 million that it would receive over time. This was done after the town council on Jan. 22 agreed to make zoning changes to become compliant with federal requirements.

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That motion read, “In support of the Housing Accelerator Fund Application, as advised by Minister Fraser with due regard for heritage conservation and infrastructure capacity and servicing, that staff be directed to bring forward a zoning by-law amendment permitting four storeys within 800 metres of Sheridan College for Council’s consideration within 90 days of the passing of this resolution.”

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However, earlier this month the town council voted 14-1 against the motion.

The council also voted against a motion that would allow four dwelling units on residential properties townwide. Making zoning requirements that build what some experts call “gentle density” is part of the conditions for receiving money under the Housing Accelerator Fund.

On Wednesday, Fraser posted on the social media website known as X, “In order to receive funding, our partners need to implement the measures they agreed to.”

“After voting down ambitious housing reforms, the Town of Oakville is in breach of its agreement under the Housing Accelerator Fund and won’t receive federal funding,” he added.

The Housing Accelerator Fund is a $4-billion funding allocation program for municipalities that bring their zoning laws up to scratch with federal standards and goals.

Since the program was launched in May of last year, cities have been rushing to claim the incentives that are tied to zoning changes. The HAF is intended not only to “build more homes, faster,” but also to diversify the kind of housing being built in Canada.