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Ontario will fund municipal water infrastructure projects through $200 m Water Systems Fund

  • Ontario will fund municipal water infrastructure projects through $200 m Water Systems Fund
  • The Ontario Housing-Enabling Water Systems Fund will help municipalities repair, rehabilitate and expand critical drinking water, wastewater and stormwater infrastructure.
  • The program will provide funding for core water infrastructure, including wastewater assets, drinking water assets, and stormwater assets.

About the entity

Government of Ontario
The Ontario Government works to serve the public interest and uphold the public trust by providing Ministers with objective advice and expert guidance.

The Housing-Enabling Water Systems Fund will help municipalities repair, rehabilitate and expand critical drinking water, wastewater and stormwater infrastructure. We are investing CAD 200 million (about USD 148 million) over three years.

Projects funded through the program will aim to unlock more housing opportunities, support the province’s growing population, protect communities, and enhance economic growth. 

All municipalities that own water, waste and stormwater infrastructure are eligible to apply. Joint projects between multiple eligible applicants are encouraged, where each co-applicant contributes financially to the project. As part of the assessment process, additional consideration will be given to joint projects that enable housing development. Each single municipality is allowed to submit one application. If a municipality chooses to submit a joint application with another municipality, the submission would be counted as their single application. Indigenous projects are ineligible to apply as standalone projects. However, municipalities are encouraged to submit projects that benefit Indigenous communities. Privately-owned drinking water systems (for example, year-round, non-municipal residential systems) are not eligible for this program.

To be eligible for funding, projects must focus on either the rehabilitation and repair, reconstruction, or expansion of water infrastructure. Projects can be stand-alone or a component of a larger project.

To meet the outcomes of the program, eligible projects should:

  • enable growth and housing development
  • increase access to clean drinking water
  • increase treatment and/or management of wastewater and stormwater

The program will provide funding for core water infrastructure, including:

wastewater assets, for example: lagoon systems, pump stations, lift station, linear assets, treatment plants, storage tanks, collection systems;

drinking water assets, for example: treatment plants, reservoirs, local pipes, including the distribution system watermain and the municipal portion of service lines, pump stations

stormwater assets, for example: management facilities, linear assets, including conveyance piping, ditches and culverts.

To be eligible for funding, projects must: include a capital component and may also include pre-construction planning and design work; enable housing development, have a clear start and end date; start no later than September 30, 2024, and must be completed by March 31, 2027; be in the process of, or completed, the design and planning phase; meet all relevant provincial regulatory requirements.

All costs associated with preparing the application are ineligible for funding and should not be included in the scope or financials of the application. Projects that have started construction will not be eligible. Additional eligibility and project conditions can be found in the Housing-Enabling Water Systems Fund program guidelines. These guidelines are also available through the application on Transfer Payment Ontario (TPON).

Projects will be evaluated based on the following criteria: technical merit (including impact on housing and water systems); project readiness; financial capacity and need; critical public health and safety impact. Priority will be given to those projects that are more advanced in planning and design (for example, Stage 4 of Environmental Assessment).

Projects will be assessed and prioritized based on: program requirements; applicant eligibility; application completeness; assessment criteria; the overall demand of funds in the program. Additional consideration will be given to cross-municipal joint projects with highest impact.

Projects will be cost shared between municipalities and the province. The province would fund a maximum of 73% (up to $35 million) of eligible project costs, and the municipality would be required to fund all remaining (a minimum of 27%) eligible project costs.

For joint applications, the primary applicant can apply for up to $35 million in provincial contribution on total eligible costs, times the number of applicants. For example, a joint project with three eligible co-applicants can submit a project with a combined provincial contribution of up to $105 million ($35 million multiplied by three eligible applicants equals $105 million).

For projects submitted by a municipality that benefit Indigenous communities, the provincial contribution of funding does not multiply as these are not considered joint applications.

Municipalities may combine (stack) other federal and municipal funding to fund the 27% minimum recipient contribution. Municipalities are responsible for determining if federal funding can be used towards the project being submitted to the province. Provincial stacking will not be permitted, with the exception of funding received from the Building Faster Fund (BFF) and the Ontario Community Infrastructure Fund (OCIF).

Applications are now open. The deadline to apply is 11:59 p.m. (EST) on April 19, 2024. Learn more about how to apply.

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