When Ontario introduced major changes to the fees developers pay towns and cities when they build new homes, the government faced immediate backlash from municipalities. The new rules, introduced under Bill 23, were criticized for potentially costing cities millions and leading to significant property tax increases for residents. In response to the criticism, Ontario Premier Doug Ford and then-housing minister Steve Clark launched audits of select cities to investigate the impacts of Bill 23. Audits were announced for Brampton, Caledon, Mississauga, Newmarket, Toronto, and the Region of Peel, with the purpose of ensuring that cities would be made “whole” if losses were discovered.
The audits began in the summer of 2023, and the first half, which involved a financial analysis of the impacts of Bill 23, was completed in the fall. However, without sharing the results of the audits, the government abruptly cancelled them. A spokesperson for the housing minister stated that one reason for cancelling the audits was to improve relationships with municipalities. Despite the cancellation, the details of what the audits found remain undisclosed, with municipalities not being shown the findings before they were terminated.
In early 2024, Housing Minister Paul Calandra explained that the audits were cancelled, ostensibly due to the fact that some of them were linked to the Region of Peel, which was undergoing dissolution. Calandra also mentioned that as the government was reviewing Bill 23 and Bill 109, there was no point in continuing the audits. The cancellation of the audits raised concerns among municipal leaders, as they were left in the dark about the findings and the potential impacts on their cities.
In response to the uproar from municipalities, the government made changes to its housing legislation, with the latest proposed law in April aimed at addressing some of the concerns raised by towns and cities. The revised legislation reverses certain elements of Bill 23, including phasing in municipal development charges and shifting some costs back to developers. While the changes do not entirely address all the financial impacts cities were worried about, they are seen as a step in the right direction by municipal leaders.
Although the changes in the latest housing bill were informed by municipal feedback, some municipalities feel that they have not been fully “made whole” through the revisions. While the government’s efforts to address concerns have been acknowledged, there are still lingering financial impacts that some cities feel have not been adequately addressed. At Queen’s Park, officials have emphasized the importance of working collaboratively with municipalities and addressing their financial needs, but some municipal leaders remain cautious and are advocating for further support from the provincial government.
