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Eliminating barriers to affordable housing development: The case for waiving development charges

22 Feb 2024

Guest Author


Megan Golfetto, Project Coordinator, Women’s Shelters Canada

You’d be hard-pressed to find someone in Canada who hasn’t heard of our country’s severe housing crisis. Between 2011 and 2016, for every new affordable rental unit created, sixteen were lost. With increased demand, limited and dwindling supply, and elusive affordability, the basic human right to housing remains out of reach for many people living in Canada. The creation of more affordable, adequate, and dignified housing has never been so critical.

Affordable housing developers and non-profit housing providers are working hard to meet the housing need, but they often come up against barriers in bringing their projects to fruition.

Municipal-related fees charged to developers, especially non-profit developers, are one such barrier. While it is important that municipalities generate income to support the vitality of the community, the fees charged only add to the many challenges that non-profit housing providers face when trying to build more affordable rental housing.

Municipalities play a crucial role in solving the affordability crisis. One way to encourage affordable housing development is to waive development charges and related fees for affordable housing projects.


What are development charges?

Development charges – also referred to as development cost charges, off-site development levies, or development fees in different jurisdictions – are fees imposed by a municipality when a developer builds on a piece of land within that municipality. The fees are intended to offset the costs that come from the increase in municipal services and infrastructure that are required for the new development. The municipality will use development charges to pay for items such as water, waste management, roads, libraries, parks, schools, or recreation centres that service the new development.


Why waive development charges?

Development charges are costly. They can be upwards of 20% of total capital costs for residential projects, which can make or break a project. For non-profit housing providers, particularly those with charitable status, these charges pose a significant financial burden given that many do not have surplus funds available for projects outside of their regular services and programs. The waiver of development charges and municipal fees lessens the financial burden on non-profits, which not only helps projects reach financial viability but also makes more affordable housing units in the community a reality.

Non-profit affordable housing providers are meeting an important need in communities during this crisis. While the affordability crisis permeates households across the country, students, newcomers, seniors, women and children fleeing violence, 2SLGBTQIA+ folks, people with disabilities, and Black, Indigenous, and racialized communities are the most affected. As a national voice on the issue of violence against women, Women’s Shelters Canada (WSC) has learned of the devastating effects of this housing crisis on women and children fleeing violence from shelter organizations across the country. WSC advocates for more affordable housing for survivors of violence and implores municipalities to demonstrate their commitment to housing people in the greatest need. Development charge waivers are one way to do this, as they encourage the creation of affordable rental housing and support those most at risk of experiencing housing precarity.


Waiver of development charges in practice

Decisionmakers at all three levels of government recognize the importance and effectiveness of development charge waivers in contributing to affordable housing development.

Federally, the Canada Mortgage and Housing Corporation (CMHC) published a resource detailing best practices and strategies for municipalities to boost housing supply and affordability. One of CMHC’s recommendations directs municipalities to review their development fee schedules and focus on including waivers of those fees.

Provincially and territorially, governments also recommend waiving development charges in their affordable housing strategies, programs, and legislation.

  • In May 2023, the Government of British Columbia announced their Homes for People Plan to address the housing crisis. BC commits to eliminating obstacles, reducing development costs, removing red tape, and speeding up approvals so more homes can be built.
  • In July 2023, the Government of Alberta announced their Affordable Housing Partnership Program (AHPP), in alignment with the province’s strategy to improve and expand affordable housing. The program recommends that municipalities contribute to the creation of affordable housing through grants, land contributions, and the waiver of development fees to reduce the barriers that come with developing affordable housing.
  • Under Bill 23: More Homes Built Faster Act, passed in November 2022 to amend the Planning Act (1997), the Government of Ontario exempts affordable housing, non-profit housing, and inclusionary zoning units from development charges, parkland dedication fees, and community benefit charges.
  • In October 2023, the Government of Nova Scotia released Our Homes, Action for Housing and committed to temporarily freeze all municipal permits and development fees for housing projects for two years.

Many urban and rural municipalities across Canada already have bylaws and policies in place to waive development charges and building fees or offer financial incentives to offset development costs for affordable housing projects. The following are some examples.


British Columbia











Note: In 2017,the province of Québec passed the Act respecting land use planning and development that allows municipalities to charge a development fee to building permit applicants which will finance the increase in municipal services. To date, only a few municipalities have introduced bylaws or policies to charge development fees, and some indicate exemptions.


New Brunswick

Note: Municipalities across New Brunswick do not generally charge development fees. While this is excellent news for affordable housing developers and providers, there is still an opportunity for municipalities to waive building permit and planning fees for these projects. The examples below are municipalities that have legislation to reimburse these permit and planning fees for affordable housing projects.


Nova Scotia

Note: After thorough research and consultation with multiple colleagues located in the province, municipalities in Nova Scotia do not have legislation in place to waive development charges. The example provided below is a municipality that waives municipal-related construction fees including construction permits, subdivision approval, discretionary approval, variances, and site plan approvals.


Prince Edward Island


Newfoundland and Labrador


The North


It is clear that there has been an increased uptake of this financial lever in recent years as we become further entrenched in the country’s housing crisis. Federal, provincial, and municipal actors are recognizing the barrier that development charges pose for the creation of affordable rental housing and are actively working to officially waive these fees for projects that meet the housing needs of people across the country.

Canada is in a housing crisis of vast proportions. While all housing development is costly, this is especially true for affordable housing projects built to last. Development fees charged to these types of projects exacerbate what is already a challenging financial feat for non-profit, affordable housing providers. To address this crisis, development charges and municipal fees should be waived for non-profit housing providers and developers that offer affordable rents. Municipalities have a responsibility to formally implement this mechanism in a time when the housing crisis is so dire, especially for groups that are most impacted by housing precarity.


This is a guest blog post from Women’s Shelters Canada.