Ontario Investing $1 Billion to Help Municipalities Build More Homes

New loan program will help expand drinking water, wastewater and stormwater capacity

November 28, 2024

TORONTO — The Ontario government is investing up to $1 billion in loans to provide municipalities with more financing options for water infrastructure projects that enable the construction of more homes. The new Housing-Enabling Water Infrastructure (HEWI) lending stream, under Infrastructure Ontario’s (IO) Loan Program, will support the construction, expansion and rehabilitation of drinking water, wastewater and stormwater infrastructure projects that enable new homes. Infrastructure Ontario will begin accepting applications from municipalities on December 2, 2024.

“We continue to hear from our municipal partners that one of the greatest barriers to building more homes is the need for new and expanded drinking water, wastewater and stormwater management facilities,” said Kinga Surma, Minister of Infrastructure. “I know there are communities across the province that want to get new homes built but need to expand their water capacity first. This new flexible financing option will help more municipalities get shovels in the ground on much-needed water infrastructure projects and more homes.”

The new IO HEWI lending stream complements existing provincial programs, such as the Housing-Enabling Water Systems Fund, and delivers on the government’s commitment outlined in the 2024 Ontario Budget to improve flexibility on loans for water infrastructure projects. The lending stream will provide municipalities, including small, rural and northern municipalities, with more flexible loan options during both the construction and repayment phases of the project. Municipalities will be able take advantage of flexible borrowing terms that allow them to defer interest payments during the construction phase until projects are substantially complete, select longer debenture repayment terms of up to 40 years, choose more flexible repayment terms and incur lower administration costs.

“The affordable, long-term financing available to municipalities through IO’s lending program has supported the modernization and renewal of public infrastructure in 335 municipalities across the province,” said Michael Lindsay, President and CEO, Infrastructure Ontario. “We look forward to working with our municipal partners to realize the potential of this lending stream, ultimately to enable the construction of more housing to benefit the people of Ontario.”

The government is also investing nearly $2 billion in housing-enabling infrastructure funding through the Housing-Enabling Water Systems Fund and the Municipal Housing Infrastructure Program, in addition to the provincial Building Faster Fund, to help municipalities deliver the core infrastructure needed – such as roads, bridges, drinking water and wastewater facilities – to build more homes across the province. This investment is part of the most ambitious capital plan in Ontario’s history, with more than $191 billion over the next decade to build and improve transit, highways, hospitals, schools, long-term care facilities and other critical public infrastructure, while strengthening the economy for the future.

Quick Facts

The Infrastructure Ontario Loan Program helps municipalities and other public sector partners to build and renew public infrastructure by providing short-term construction financing and long-term fixed interest-rate loans at affordable interest rates. As of October 2024, the program has supported over 3,800 local infrastructure projects valued at more than $22 billion.
Under the first intake of the $1.22 billion Housing-Enabling Water Systems Fund, the province is investing $970 million in 54 water infrastructure projects across 60 municipalities that will help enable the construction of approximately 500,000 new homes.
Ontario is also providing $400 million in funding to municipalities under the Housing-Enabling Core Servicing stream of the Municipal Housing Infrastructure Program to build, maintain and repair core assets such as municipal roads, bridges and culverts that will enable the construction of new homes.

Quotes

“Our government has been making significant investments in housing-enabling infrastructure so that as interest rates start to come down, municipalities have enough serviced land to build the family-sized homes their communities need. Through our $3-billion plan to get water and wastewater infrastructure in the ground, we are untangling a mess created by the previous government and getting more homes built faster.”

– Paul Calandra
Minister of Municipal Affairs and Housing

“This new provincial financing program for housing-enabling water systems complements existing investments in municipal water systems, providing a new tool for municipalities of all sizes to build essential infrastructure. Investing in drinking water, stormwater and wastewater infrastructure lays a path to progress towards Ontario’s ambitious housing targets.”

– Robin Jones
AMO President and Mayor of Westport

“The OSWCA welcomes the Ontario government’s investment of up to $1 billion in housing-enabling infrastructure. This funding will provide an additional boost to help municipalities continue to build their water, wastewater, and stormwater capacities to support growing populations, maintain their assets in a state of good repair, and build new homes for thousands of families.”

– Stephanie Bellotto
Manager of Government Relations and Communications, Ontario Sewer and Watermain Construction Association (OSWCA)

“We’re pleased to see the Ontario government’s continued commitment to investing in critical infrastructure to support housing growth. This innovative approach, expanding access to credit for municipalities for water infrastructure, will help communities grow and modernize their systems to meet Ontario’s long-term housing and economic needs.”

– Nadia Todorova
Executive Director, Residential and Civil Construction Alliance of Ontario (RCCAO)

“OHBA applauds the Ontario government’s announcement to offer new financing options for water infrastructure that supports new housing. The Housing-Enabling Water Infrastructure (HEWI) lending stream should prove crucial to developing the supportive infrastructure necessary to build more homes and combat the housing crisis in Ontario.”

– Scott Andison
CEO, Ontario Home Builders Association

Additional Resources

2024 Ontario Economic Outlook and Fiscal Review: Building Ontario for You

Infrastructure Ontario Loan Program

Housing-Enabling Water Systems Fund

Municipal Housing Infrastructure Program

Ontario Investing $1 Billion to Help Municipalities Build More Homes

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