Ontario Construction News staff writer
The City of Hamilton is set to receive up to $572 million from the Ontario and federal governments to support housing-enabling infrastructure after committing to eliminate development charges on all residential development for three years.
The funding, announced through the Development Charge Reduction Program, would support infrastructure projects across Hamilton while the city eliminates residential development charges from March 30, 2026, to March 31, 2029.
The complete removal of the charges is estimated to reduce the cost of building a new home by up to $100,442, according to the governments.
Combined with expanded HST relief of up to $130,000 on eligible new homes, the measures could reduce the cost of a new home in Hamilton by more than $230,000.
Dani Gabriele, chair of the West End Home Builders’ Association, said the announcement addresses both the cost of construction and the need for infrastructure to support growth.
“Today’s announcement tackles both sides of that challenge: lowering the cost of building while investing in the roads, water and wastewater infrastructure needed to support new communities,” Gabriele said.
“As a local builder, I know what a difference that can make in determining whether homes get built. This is a meaningful investment in Hamilton’s future and in the people and families who want to call this community home.”
Hamilton estimates that construction cost savings from the development charge reduction, combined with investment in housing-enabling infrastructure, could unlock more than 31,000 new homes.
The proposed $572-million investment would support a range of road, water and wastewater projects, including:
- Widening and reconstructing Barton Street from Fruitland Road to Fifty Road into a five-lane, multi-modal arterial road;
- Reconstructing Lewis Road from Highway 8 to Barton Street to an urban-standard, multi-modal collector road;
- Widening Rymal Road from Glancaster Road to Upper Paradise Road and from Upper James Street to Dartnall Road into a five-lane urban arterial corridor;
- Widening and reconstructing Garner Road from Wilson Street to Glancaster Road in Ancaster into a five-lane urban arterial corridor;
- Expanding the Woodward water and wastewater treatment plant; and
- Upgrading the capacity of the Greenhill Water Pumping Station.
Mayor Andrea Horwath called the announcement a historic investment in the city’s future.
“This is a historic investment in Hamilton’s future and one I have worked hard as Mayor to make happen,” Horwath said. “It represents the single largest investment in roads, water and wastewater infrastructure in our city’s history.”
She said Hamilton needs both more housing and the infrastructure required to support growing communities.
“By eliminating residential development charges for three years and investing in the infrastructure our growing communities need, we can get shovels in the ground, increase housing supply and reduce costs for people looking to call Hamilton home,” she said.
The funding is part of a broader agreement announced in March 2026 under which Ontario and the federal government committed a combined $8.8 billion over 10 years for infrastructure investments in the province. Canada’s share is to flow through the Build Communities Strong Fund.
Ontario and the federal government also agreed to remove the full HST on new homes from April 1, 2026, to March 31, 2027, providing savings of up to $130,000 for eligible homebuyers.
Rob Flack, Ontario’s Minister of Municipal Affairs and Housing, said the Development Charge Reduction Program is intended to help municipalities fund the infrastructure needed to accommodate growth while reducing barriers to home construction.
“Across Ontario, there is a need for critical infrastructure and housing of all types to support our fast-growing communities,” Flack said. “That is why our government continues to deliver programs like the Development Charge Reduction Program alongside our federal partners.”
Scott Andison, CEO of the Ontario Home Builders’ Association, said development charges have become one of the largest upfront costs associated with building new housing.
“This is exactly the kind of action Ontario’s housing market needs,” Andison said. “Development charges have become one of the largest upfront costs of building a new home and reducing them while investing directly in the infrastructure needed to support growth is a much more sustainable approach.”
Andison said Hamilton’s participation in the program could improve project viability, affordability and the ability to move more housing projects into construction.
The elimination of development charges will take effect following approval by Hamilton City Council and must remain in place for three years.
The funding is also subject to the signing of a Canada-Ontario Build Communities Strong Fund agreement, further due diligence by both governments and a transfer payment agreement between Ontario and the City of Hamilton.
Municipalities participating in the Development Charge Reduction Program must contribute at least 10 per cent of eligible project costs and comply with other program requirements.
