Municipalities in Ontario can now apply for funding through the new Development Charge Reduction Program (DCRP), part of the up to $8.8 billion Canada-Ontario Partnership to Build announced earlier this year. Applications for the program opened on June 1, 2026 and are intended to provide federal and provincial funding for housing-enhancing infrastructure in municipalities that reduce housing fees by 30 to 50% or more and sustain those reductions for at least three years. The application deadline is June 19th.
“The Development Fee Reduction Program will make a life-changing difference for families in communities across Ontario by reducing the cost of new homes by tens of thousands of dollars,” said Rob Flack, Ontario Minister of Municipal Affairs and Housing. “Along with the HST relief announced in the Ontario Budget 2026, this program will make homes more affordable across the province.”
Municipalities that have an active building tax statute as of March 30, 2026 can apply for funding to support housing-related infrastructure, including roads, transportation, water and wastewater systems. The program would cover up to 90% of eligible project costs, with municipalities contributing at least 10%. Applications will be assessed on the basis of the proposed reduction in construction costs, the number of housing units benefiting from the relief and the municipality’s financial contribution, with priority given to projects that provide additional housing supply.
“As global economic and trade uncertainty continues to put pressure on hard-working Ontarians, our government is providing real relief by reducing the cost of building homes through the Development Fee Reduction Program,” said Ontario Finance Minister Peter Bethlenfalvy. “With up to $8.8 billion in state and federal funding, this investment will accelerate housing construction and improve affordability, while helping local governments provide critical housing infrastructure in our growing communities.”
Toronto skyline, image by Fanoftoronto, UrbanToronto Forum contributor
The DCRP follows the Canada-Ontario Partnership to Build, announced on March 30, 2026, which committed up to $8.8 billion over 10 years for infrastructure investments to support housing growth. The framework is intended to offset some of the financial impact of development fee reductions, with the federal contribution flowing through the provincial and territorial stream of the Build Communities Strong Fund, subject to a bilateral agreement with Ontario.
“Together we are building Ontario and Canada strong,” said Gregor Robertson, Federal Minister of Housing and Infrastructure and Minister Responsible for Canada’s Pacific Economic Development. “This joint partnership with Ontario will accelerate housing construction by reducing upfront costs and investing in housing-enhancing infrastructure projects – creating strong, resilient communities that increase housing supply and promote economic opportunity.”
The program will be rolled out alongside other measures under the partnership, including the expanded HST rebate for new homes. The province said DCRP application deadlines are aligned with the expanded rebate program, which would allow savings of up to $130,000 on eligible new homes.
“Our government is taking measures to make housing more affordable and easier to build,” said Federal Finance Minister François-Philippe Champagne. “By working with Ontario to reduce development costs and invest in critical infrastructure, we are helping reduce upfront costs and build more homes, faster.”
Communities have until June 19, 10 a.m. ET to apply. More than 200 of Ontario’s 444 municipalities currently charge development fees. Further details on infrastructure funding for rural, small and northern communities are expected at a later date.
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