Months of bitter debate between Ontario Housing Minister Paul Calandra and his federal counterpart have officially ended after they struck a deal to give the province $357 million to help build nearly thousands of rent-assisted affordable housing units.
Calandra and federal Housing Minister Sean Fraser have been going back and forth for two months over how many new affordable housing units would get built in the province using federal dollars, according to the terms of a 2018 bilateral agreement.
Fraser accused Calandra of dragging his feet and not getting shovels in the ground fast enough, while Calandra said Fraser was obstinate in the face of a housing market that had fundamentally changed since the two sides signed the $5.8-billion National Housing Strategy deal nearly six years ago.
On Tuesday, however, all that frustration faded as the two men announced a new deal — less than a month after it seemed dead in the water.
"Canada and Ontario recognize that our collaboration is imperative to solving the housing crisis. That is why we are pleased to share that an agreement has been reached on a revised action plan from Ontario that will unlock $357 million of federal funding under the National Housing Strategy," the two housing ministers said in a joint statement.
"Solving the housing crisis requires a Team Canada approach. We will continue to work together, along with our municipal partners, to make sure the people of Ontario have the homes they need," the statement said.
In 2018, Ontario agreed to take federal cash to build 19,660 social housing units by 2028. Fraser repeatedly said the province was nowhere near achieving its targets and hadn't provided a credible plan to get there by the end of the deal.
That's all changed thanks to the province's new "action plan" submitted last week.
The plan — which isn't yet public — commits Ontario to building at least 8,644 new affordable units by March 31, 2025. That leaves about 11,000 units to be built by 2028, which will be dealt with in another plan due at the end of the year.
Calandra's successful plan also promised to direct more money to new projects, "more robust data and insights" into which projects get money, more specific supply targets, and more.
"The new agreement puts them on par with most of the provinces as to where they are right now. This puts Ontario in a place where they're going to be able to achieve the obligations that they agreed to at the outset," Fraser told reporters on Tuesday morning.
Ontario's original plan — which kick-started the dispute — showed the province had only built six per cent of the promised units. Calandra later provided a revised road map to get to 28 per cent of the target.
On March 31, Fraser gave Calandra's second plan his "conditional approval" but said it still lacked ambition.
"By way of comparison, other provinces and territories are projecting to reach at least 66 per cent or more of their goal over the same time period. A dramatic improvement to the action plan, and more progress is required to demonstrate that Ontario will meet its target by the end of the agreement," Fraser wrote in a letter to Calandra.
By April 30, Fraser had had enough.
"Since our last exchange of letters, I have come to understand that a conditional approval was not acceptable to you and that Ontario is unwilling to provide further details as to how it will meet the target it agreed to," Fraser wrote.
At that time, he announced the money would go directly to Ontario's 47 service managers, such as regional governments or municipalities, the institutions responsible for actually building homes.
During the entire ordeal — up to Tuesday's breakthrough — Calandra said the federal government was being unreasonable and not considering progress made through other programs.
If Ottawa were to count affordable units built with money from other programs, “Ontario’s progress hits nearly 60 per cent of the 19,660 number,” Calandra said in a letter.
Fraser’s position also didn’t consider “some major factors that should be taken into account,” Calandra said.
Since the agreement was signed in 2018, “the economic landscape has shifted drastically with the rising costs of building materials, supply chain disruptions, gaps in the labour market, and most of all, higher interest rates.”
Ontario’s social housing stock is also the oldest in the country, Calandra said, which is why his government has prioritized repairs over building new units. Focusing on building new stock at the expense of existing units “would amount to gross negligence on our part.”
