Toronto City Council’s recent decision to permit low-rise sixplexes in nine wards, instead of across the city as initially proposed, could cost it nearly $30 million in federal housing funding.
In a letter to Mayor Olivia Chow, Housing Minister Gregor Robertson expressed his “disappointment” in council’s June 25 vote to limit the multi-unit residential buildings to wards in downtown Toronto, East York, and Scarborough North. The remaining wards have the option to join later.
He said the decision “goes against the level of ambition” that was committed to in Ottawa’s three-year Housing Accelerator Fund (HAF) agreement with the city, which was inked in December 2023.
“The agreement signed between Toronto and Canada laid out an aspirational plan to create new affordable housing. Specifically, Milestone 7.3, aimed to permit residential buildings with up to six dwelling units, which would allow Toronto to issue 11,780 additional permits over the life of the agreement,” Robertson wrote in the letter dated July 21.
Robertson encouraged the city to “revisit” the measures they could implement to restore the “ambitious scope” of the agreement, which earmarked $471.1 million to develop more housing.
The city has already received $235.56 million of that money. Toronto is expecting a third payment in March 2026 and a final payment at the end of that year --so long as it achieves its goal of building 60,980 net new permitted homes by then.
However, in a letter in March by then housing minister Nathaniel Erskine-Smith, the feds threatened to cut 25 per cent of its annual funding payment (or roughly $30 million) if the city failed to follow through on sixplexes across the city, among other objectives.
Robertson doubled down on that threat in his letter to Chow, which has been added to the agenda of this week’s council meeting.
“I will underscore the possibility of reduced funding if the City of Toronto does not present solutions that ensures the spirit of the agreement is met,” he wrote.
In response, Mayor Chow said the city is not only on track to meet, but will exceed its target of building 60,980 new homes over the course of the agreement.
Chow added that approval timelines in Toronto are now over 80 per cent faster compared to the previous five-year average for major zoning approvals. Moreover, she said the city is getting more shovels in the ground than any other city in the country and expanding permissions for more housing.
On the sixplex front, Chow said she added a motion at Wednesday’s council meeting to waive development charges for these multi-unit housing complexes to make them cheaper and easier to build, adding that she supports the move citywide.
“We will keep advancing policies that address the housing crisis. There is much more work to do, and I look forward to continuing to work in partnership on our shared goals,” Chow said.
