On June 1st, 2026, Prime Minister Mark Carney announced in Nepean the launch of the $8.8 billion Canada-Ontario Municipal Development Charge Reduction Program that will encourage municipalities to slashing development charges and lower the cost of homebuilding.
The Prime Minister was joined at a building site operated by Caivan, a local homebuilding company in his riding, by Minister of Housing Gregor Robertson, Ontario Housing Minister Rob Flack, and Ontario Finance Minister Peter Bethlenfalvy.
The program, under the larger Build Canada Homes’ umbrella, will remove 13 per cent HST on new homes in Ontario that are valued up to $1 million. It was first announced in late March, with the fund officially opened to applicants on Monday.
Under the agreement, municipalities that reduce development charges by at least 30 per cent will gain access to the new $8.8-billion infrastructure fund over the next 10 years. The program would also reduce development charges up to 50 per cent for three years, as Ontario is one of the most rapidly growing hubs for housing development.
In March 2026, Ontario and Canada agreed to a cost-matched structure for infrastructure investments in Ontario, with Canada’s share of the funding flowing through the Build Communities Strong Fund’s Provincial and Territorial stream, pending an agreement under this Fund. The Build Communities Strong Fund was launched by the federal government earlier this year to accelerate infrastructure projects across the country to reduce costs.
Of 444 municipalities in Ontario, more than 200 currently levy development charges. The Development Charge Reduction Program is an application-based program, with municipal contributions set at 10% of project costs at a minimum.
The federal government will deliver their cost-matched portion of the funding for the DCRP under the Build Communities Strong Fund, for which Ontario will enter into a bilateral funding agreement.
Applications are now open, with more information available here. Funding through the Canada-Ontario Partnership to Build will also be made available for rural, small and northern municipalities, with more details to be announced at a later date.