Alberta government balks at conditions for new federal housing and infrastructure funding

The Alberta and federal governments are at odds over conditions attached to some new federal housing programs.

As Prime Minister Justin Trudeau and Deputy Prime Minister Chrystia Freeland travel the country to announce nuggets in the April 16 federal budget designed to increase affordable housing, Alberta cabinet ministers are balking at some of the strings attached to secure that funding.

"This is another example of the federal government's long history of ignoring the province's jurisdiction and playing politics with important issues like housing," Alberta Seniors, Community and Social Services Minister Jason Nixon said in a statement Wednesday.

Nixon alleges Ottawa has been cherry-picking investments in locations where the federal Liberals could retain or gain seats, rather than distributing it equitably across Canada.

In a virtual news conference on Wednesday, Nixon reiterated the provincial government's intention to table legislation preventing the feds from signing any agreements with municipalities without the province at the table. A similar law exists in Quebec.

Among the money the federal government has dedicated to tackling an affordable housing crisis across the country is a $6-billion Canada Housing Infrastructure Fund.

Municipalities could use the money to build or upgrade water, wastewater, stormwater and waste collection infrastructure in new or redeveloped neighbourhoods.

For provinces to access $5 billion of that money for municipalities, they must meet five criteria, including adopting upcoming changes to the national building code to create "accessible, affordable and climate-friendly housing options," according to a federal government news release.

Provinces must also require municipalities to allow construction of multi-unit housing, such as fourplexes, on residentially zoned land, and freeze development charges for three years in larger cities.

The provinces and territories must reach funding agreements with Ottawa by Jan. 1, 2025, to access the funding.

The federal government is also encouraging provinces and territories to ink matching agreements akin to the B.C. Builds program, which sees both levels of government pitch in for rental housing construction projects.

Freeland promoted the Canada Builds program at a news conference Wednesday in an Edmonton affordable housing complex funded by a federal apartment construction loan program.

At that news conference, Edmonton Mayor Amarjeet Sohi said he supports the federal government "challenging municipalities to remove the barriers to housing."

Nixon doesn't see it that way.

He accused the federal government of foisting more climate change policies onto the province by requiring adherence to a new national building code.

Nixon has not said whether his government's misgivings would prevent Alberta from accepting the federal funding.

The Ontario government is also pushing back, with Premier Doug Ford saying he won't demand all municipalities green-light proposed fourplexes.

At a news conference Wednesday in Toronto, Trudeau said the federal government will work directly with interested municipalities if provinces won't co-operate.

"But it is always easier if you can do it province wide, because then you affect everyone with the same level of ambition," he said of municipalities that are aggressively pursuing density.

Freeland said she is optimistic the provinces can find common ground with Ottawa to address the housing crisis, and pointed to child care deals struck with each province and territory as a success story.

The barriers to building

Watching the rollout of federal programs with interest is Scott Fash, CEO of the Building Industry and Land Development Association (BILD) of Alberta.

Fash says requiring the province to mandate that builders adhere to a new building code they have yet to see is frustrating, because the proposed changes could add tens of thousands of dollars to the cost of building each new unit.

The federal policies that have most successfully stimulated rental housing construction are eliminating the GST on select projects and a Canada Mortgage and Housing Corporation lending program that allows borrowing for up to 40 years, Fash said.

He said some of the biggest barriers to rapidly building new housing are wait times for permitting, and uneven application of rules within municipalities by employees. The province could potentially lower those hurdles with legislation, Fash said.

Broadly allowing secondary suites would be the quickest way to increase density, he said.

Nadine Chalifoux, chair of the Edmonton Coalition on Housing and Homelessness, says programs that make it more affordable for developers to build rental housing are key. Without tempering those costs, developers are passing the higher costs onto renters, she said.

As rents become less affordable, more people are pushed into housing instability and homelessness, she said.

"We can either see housing and homelessness change and become improved and less of a crisis, or we can see it go the other way real fast, becoming an epidemic," she said.