Ontario Construction News staff writer
The City of Guelph is set to receive as much as $48.3 million in federal and provincial funding aimed at improving water and wastewater infrastructure, following a commitment to lower development charges by 30 percent for all housing types over the next three years.
This funding, provided through the Development Charge Reduction Program, is designed to back infrastructure needed for new housing developments. The reductions in development charges will take effect from March 30, 2026, and last until March 31, 2029.
The allocation of funds is contingent upon a Canada-Ontario agreement under the Build Communities Strong Fund, along with further evaluations by both governments and a transfer payment agreement between Ontario and the city.
The planned infrastructure enhancements include upgrades to the biosolids facility at the city’s Water Resource Recovery Centre, a new treated-water booster pumping station at Verney Booster Pumping Station, and related watermain infrastructure.
This funding will also facilitate the construction of a new Clythe Water Treatment Plant, booster pumping station, storage facility, as well as essential water and wastewater servicing infrastructure to promote regional growth.
The city anticipates that these development charge reductions and investments in housing-supportive infrastructure could pave the way for around 27,675 new homes.
The reductions are expected to cut down on the cost of building a new home in Guelph by up to $21,623. When combined with expanded harmonized sales tax relief on qualifying new homes, potential savings could reach up to $151,623 per home according to provincial estimates.
In March 2026, Ontario and the federal government agreed on providing a total of $8.8 billion over ten years for infrastructure investments across the province through a cost-matched funding setup. The federal share will be distributed via the Build Communities Strong Fund.
Both governments have also committed to full HST relief on eligible newly purchased homes between April 1, 2026, and March 31, 2027-resulting in savings of up to $130,000.
“Guelph is committing to reduce development charges by 30 percent to help encourage housing development, and this federal and provincial investment helps fund the vital water and wastewater infrastructure needed to support those new homes,” Mayor Cam Guthrie said.
Rob Flack, Ontario’s minister of municipal affairs and housing stated that reducing development charges along with HST relief aims at decreasing housing costs while making homeownership more attainable.
Dominique O’Rourke, MP for Guelph noted that this funding would contribute towards lowering costs for new homes while also supporting necessary growth-related infrastructure.
The Development Charge Reduction Program forms part of the Canada-Ontario Partnership initiative aimed at building communities. It allocates funds over ten years toward projects that enable housing while prioritizing municipalities that implement at least a 30 percent reduction in development charges for all residential types over three years.
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