Ottawa reduces Toronto housing funding, cancels Red Deer agreement

Ottawa is cancelling Red Deer’s housing deal and cutting funding for Toronto and Vaughan after the cities failed to meet commitments under the Housing Accelerator Fund.

The federal government is cancelling Red Deer’s Housing Accelerator Fund agreement and reducing funding for Toronto and Vaughan after finding the cities failed to meet key commitments under the program.

In an update released Friday, the federal government said Red Deer was found to be non-compliant with a mandatory requirement tied to the second round of funding under the Housing Accelerator Fund (HAF).

As a result, the city’s agreement will be cancelled effective Jan. 16, 2026.

Red Deer signed its HAF agreement in February 2025, but federal officials said commitments under the program were not met by the required deadline.

Toronto and Vaughan will see funding reductions after also being found non-compliant with their agreements.

Toronto, which signed its HAF agreement in 2023, will have its funding reduced by $10 million after failing to fully meet one of its commitments under the deal.

Vaughan, which also signed on to the program in 2023, will see its HAF funding reduced by $7.4 million, with the federal government citing several unmet commitments.

The Housing Accelerator Fund is designed to boost housing supply by encouraging municipalities to cut red tape, reform zoning rules and speed up approvals in exchange for federal funding and housing growth targets.