In an effort to encourage more affordable housing projects, Victoria council has approved a new grant program that will offset all of the development cost charges for new below-market rental projects.
Loughton said the federal and provincial governments have the resources to stimulate affordable housing, but the city has only a few levers it can pull to make things happen. According to the report, only 168 below-market rental units have been completed, while the province has set a target of 1,798 by the fall of 2028 for the city.
City staff had initially suggested the new grant program should cover 50 per cent of development cost charges, which would allow it to run for two years and be covered by the funding expected from the Federal Housing Accelerator Fund.A development cost charge is the amount developers pay for required infrastructure upgrades to handle new development. The charges are collected by the city for water, sanitary sewers, drainage, parks and transportation upgrades to service new development.
While some councillors expressed concern about the impact of extending the grant program to cover 100 per cent of development cost charges, only one voted against the program. “I personally have a low level of confidence that this council would want to raise taxes by one per cent in 2026 to maintain this policy,” said Coun. Jeremy Caradonna. “This would essentially spend all of the housing accelerator fund next year and so in 2026 we’d be faced either with not giving a subsidy to DCCs or maintaining the 100 per cent policy, which would mean, if I’ve done my math correctly, a one per cent tax increase.