The "Design District" under construction in March 2024. The three condo towers will have 931 housing units. Construction began in 2023 Credit: Joey Coleman

Hamilton Mayor Andrea Horwath may soon regret her endorsement of the Ontario government’s Building Faster Fund bonus funding criteria come this time next year.

The City of Hamilton was lucky in 2023 because the bonus funding criteria is something City Hall cannot control – new housing starts, aka pouring of foundations.

In 2023, foundations for 4,142 new housing units were poured in Hamilton. Hamilton was one of only 19 municipalities with enough new foundations to meet the provincial housing start target.

Burlington and Mississauga, among many, were not so lucky. Despite each approving thousands of new housing units for construction, developers did not start enough projects for those cities to meet targets.

Hamilton is expected to receive around $12-million in bonus funding. Meanwhile, both Burlington and Mississauga will receive nothing, $0.

Hamilton Mayor Andrea Horwath wrote on February 23, 2024:

“I’m thrilled to announce that the City of Hamilton has not only met but exceeded our 2023 housing target. Working collaboratively with our local development industry and community stakeholders, and thanks to the hard work of City staff and Council, there were 4,142 new homes, including long-term care beds, built in Hamilton last year, which is 120% of the provincial housing target.

Hamilton is among just 19 Ontario municipalities with housing targets who have met or exceeded their annual target and as such is eligible for increased funding under the Province’s Building Faster Fund.

It’s clear that Hamilton is doing its part to get more homes built faster. I am grateful to Council
and staff for their commitment to meeting and exceeding our provincial housing target.”

A few large projects began construction in 2023. The three new towers being built condos at 41-61 Wilson Street in Downtown Hamilton counted for 931 new housing units alone.

2024 is not looking as strong for Hamilton, with national housing starts decreasing. The Canadian Mortgage and Housing Corporation states new construction starts were down ten percent in January 2024 compared to December 2023.

Building Faster Fund Measures Construction Starts, Not Municipal Approvals

The Building Faster Fund rewards municipalities for new housing construction starts – a measure that is outside the control of municipalities.

Municipal councils can approve zoning and change official plans to enable more housing and intensification, but they do not construct housing.

It should be no surprise many municipalities are highlighting this flaw.

Burlington Mayor Marianne Meed Ward summarized the problem well in a letter to the provincial government:

“The criteria by which cities are judged, namely foundations poured, is inappropriate and inaccurate,” Meed Ward wrote, adding housing construction “is outside the municipality’s control. The City of Burlington does not pour foundations nor are we in the business of building houses. We issue permits so that houses can be built.”

Burlington has 4,256 approved units of housing that are not yet under construction.

Mississauga’s letter echoes these points.

“Mississauga has been clear that cities must be measured on factors they can influence and is encouraging the government to re-think housing starts as a way to measure our progress,” reads the Mississauga letter.

“We’re losing out on funding despite all of the work we’ve undertaken to grow our City including streamlining our development and building permit approval processes and expanding housing permissions.”

Mississauga only had 3,470 housing starts in 2023, despite approving over 31,000 new housing units during the past three years and having over 12,000 units under construction.

Hamilton Already Lagging in 2024, What Happens If There’s No Bonus Money in 2025?

Unless federally determined economic conditions change, namely interest rates, the City of Hamilton will not meet the 2024 target.

Mayor Horwath chose to endorse the formula, what will she say in 2025 when it works against us?