Frustration mounts as Mississauga, Brampton & Caledon fight over funding for growth as PCs push chaotic housing plan

After decades of sprawl-dominated planning that has left their municipalities in a dire financial situation, Brampton Mayor Patrick Brown and Caledon Mayor Annette Groves are scrambling to secure as much funding as they can from the Region of Peel. 

Both say they are prepared to walk out of regional council meetings again if Peel staff and Mississauga councillors at the regional table continue to pursue policies in line with the provincial government’s housing plans. Doug Ford’s PCs have demanded more housing starts to meet their target of 1.5 million new homes by 2031. A key to this plan is reducing the amount municipalities charge to builders for fees that cover the costs of local infrastructure such as roads, water utilities, community centres and essential services. 

But the two mayors are threatening to pull out of future Peel council meetings if a proposed 16-month deferral and 50 percent reduction of charges to developers—being pushed by Mississauga—moves forward. After neglecting their own finances for years, while approving sprawl subdivision growth that has been heavily criticized for failing to pay for itself, both mayors now claim the move to reduce fees for builders would shift the financial burden for local infrastructure onto Peel residents.

The PCs have passed legislation paving the way for reduced fees to builders, known as development charges, or DCs. But while Ford has claimed the loss of municipal revenue will be covered by the provincial government to ensure existing property owners aren’t unfairly burdened with the costs of local infrastructure, there have been few details of how Queen’s Park will make municipalities whole.

In the meantime, Peel’s local leaders are in disagreement about how continued growth across the region should be funded. To some, this might seem like political theatre. But to many in the region, it reflects a growing fear that attempts to boost housing development could come at the cost of financial stability for local municipalities. Brampton and Caledon have for decades approved sprawling subdivisions that do not bring in the type of property tax revenue needed to pay for that sprawl, with utilities, roads and services spread out wide, to far flung places. This type of irresponsible planning does not create the per-hectare density that translates to bountiful tax dollars enjoyed by municipalities that approve far more properties per hectare, and use the exponentially bigger pot of revenues from condos, townhouses and multiplexes to pay for all the local infrastructure they require.   

Brampton resident David Laing knows the pressure created by Brampton’s sprawl model firsthand. With property taxes already topping $9,000, he is worried about how much longer he can afford to live in the city.

“I’m on a fixed income, how long can I afford that? We keep talking about housing prices and building more, but we’re ignoring the rising costs of property taxes and long-term home operation.”

On June 26, tensions rose at the Region of Peel council meeting, just two weeks after Brown and Groves walked out of a meeting in protest of a motion introduced by Mississauga Mayor Carolyn Parrish and seconded by Mississauga and regional Councillor Matt Mahoney (all twelve of Mississauga’s council members also sit on Peel council) seeking to defer development charges (DCs) as part of an effort to accelerate housing development. Mississauga benefits from such development because it not only allows the city to hit growth targets, it can trigger provincial and federal funding for a wide range of infrastructure needs and, most importantly, in the city’s current urban growth phase new housing is much more denser, creating far more revenue per-hectare for Mississauga’s coffers.

For the public, the Mississauga motion could help address the ongoing affordable housing crisis, by motivating builders to construct more stock at a lower cost to them. 

The motion is directly linked to the Province’s controversial Bill 17, officially titled the Protecting Ontario by Building Faster and Smarter Act, which was passed on May 12, and seeks to stimulate home construction through sweeping changes to development charges, building codes and planning frameworks across Ontario.

Bill 17 removes municipal discretion on when development charges must be collected, mandating payment at first occupancy rather than earlier milestones such as the issuance of a building permit, and encourages municipalities to provide incentives and discounts on DCs to spur growth. But the bill does not provide additional funding to cover resulting revenue shortfalls. This has been a point of contention for many municipalities across the province that continue to ask Ford and his PC colleagues where the money for local infrastructure will come from, without the critical DC revenues.

On June 26, Peel council narrowly passed a scaled-down version of Parrish’s original proposal, voting to reduce regional development charges by 50 percent between July 10, 2025, and November 13, 2026, with the goal of lowering upfront costs for developers and accelerating construction.

What changed?

A letter from Municipal Affairs and Housing Minister Rob Flack, addressed to the three mayors and Peel Regional Chair Nando Iannicca, confirmed that the Province would commit $1.3 billion through the Building Ontario Fund to offset revenue losses caused by the development charge reduction.

Reading the letter aloud, Iannicca noted he received the letter just over an hour before the meeting:

“With the changing economic climate, there is a greater need to get shovels in the ground to build more homes in Ontario. This is why the Province is increasing its historic investment in housing-enabling infrastructure by adding $400 million in immediate funding to the Housing-Enabling Water System Fund and $175 million to the Municipal Housing Infrastructure Program, for a total of nearly $2.3 billion over four years across both initiatives,” Flack wrote.

“To facilitate this initiative, provincial support such as the new Ontario Fund can help address the region's $1.3 billion capital needs for water and wastewater servicing. We also expect the federal government to play an important role in supporting the region’s growth through their proposed new $6 billion infrastructure program.”

“Our expectation is that there will be no deferral or cancellation of this plan. Servicing water infrastructure investment is needed to support identified growth areas as they occur. As we work towards implementation of the MSC, taken together these programs and actions will help unlock much-needed housing focused on high-growth, shovel-ready projects in the development pipeline in Brampton, Caledon, and Mississauga, including greenfield housing in Caledon, intensification in Mississauga, and a combination of both in Brampton.”

Is $1.3 billion enough?

“No,” Environmental Defence’s program manager of land use and Ontario environment, Phil Pothen said. “That amount is not sufficient to cover the lost revenue from reduced development charges, so it’s not a complete solution. There would need to be new revenue sources.”

He noted Toronto’s more modest, targeted exemptions are a better model, but Peel’s $1.3 billion, combined with the federal $6 billion program, still wouldn’t cover all costs, as much of that funding is for unrelated projects.

All three mayors welcomed the provincial support, but to manage risk, the new motion included a review clause: if the Province does not commit to funding the resulting infrastructure deficit by October 17, 2025, Council would have the option to terminate the discounts.

It’s a lesson learnt from experience. In February 2023, the Region of Peel made it clear in council chambers that it does not have the funds to support Doug Ford’s housing targets under Bill 23, with staff estimating that the infrastructure for 250,000 new homes will cost $20.4 billion by 2031, and were uncertain about whether the provincial government will provide the necessary funding to help municipalities meet their mandated targets.

Pothen says, regardless of provincial support, even if the Province covers startup costs, the municipality will still carry the long-term costs of servicing development. 

“Towns like Caledon and Brampton already lack the density to cost-effectively support further greenfield development. They can’t afford more sprawl, which is bad for them in the long term,” he explained, adding that building housing within existing neighbourhoods offers more sustainable, environmental, and social benefits, such as supporting local shops, restaurants, and transit within walking distance.

Brampton councillors Navjit Kaur Brar and Gurpartap Singh Toor voted against the motion.

“We're all working in the same direction. We want to be good partners and figure out if we can do the DCs, but I don’t believe this Province when they tell you one thing and then flip-flop on it; they have the best record of doing that,” Toor said.

“So until we talk to them in the fall and actually have a check in our hands, until we see the money hit the bank, that’s when I will feel confident to move forward in this direction, and in a much more thought-out way. This is too random. I’m 100 percent not supporting this.”

Pothen cautioned that while development is essential to addressing the housing shortage, not all development delivers the same value.

“Development is good for addressing the housing shortage, when it’s focused on the most efficient kinds of development, like multifamily, midrise, and multiplex housing in existing neighbourhoods and built-up areas,” Pothen told The Pointer.

He pointed to Toronto’s exemption of multiplex housing from development charges as an example of how cities can shift incentives away from sprawl and toward more affordable, sustainable options.

During the federal election campaign, the Liberal Party pledged to cut development charges for multifamily housing by 50 percent nationwide.

(Liberal Party of Canada)

“We also supported the use of development charges in Mississauga because it’s fully built up, so development there is mostly infill. This approach incentivizes a shift from sprawling single-family homes to more productive, lower-cost housing options, leading to more homes overall,” he said. 

“But subsidizing development charges on greenfield development in Caledon only fuels sprawl.”  

Parrish first introduced the motion on June 12, arguing it aligns with the new provincial framework by deferring the collection of DCs for all multi-unit residential projects until first occupancy, provided building permits for foundations are issued by November 2026. The motion authorized staff to negotiate deferral agreements with developers and directed a future report on the possibility of reducing those charges by 25 to 50 percent.

Groves said she worries the motion “pits one developer against another”.

“We have a lot of Greenfield development happening in Caledon. We have to build 67,000 housing units by 2051, that’s been mandated to us, and we’re trying to figure out how to do this,” she said during the regional meeting on June 12.

Critics say the motion could attract more developers to Caledon, boosting housing construction in a market currently dominated by just a few players, including Brookfield Residential, Solmar, and Digram Developments, the latter of which has faced scrutiny after the Town drew from its securities for incomplete subdivision work.

During the June 12 meeting, Brown proposed an amendment to Parrish’s motion that would have limited the 50 percent development charge reduction to “purpose-built rental” housing only, which was defeated in a 13–12 vote.

On June 29, Brampton resident Azad Goyat, director of the Brampton Home Providers Association, an advocacy group opposing the city’s Residential Rental Licensing (RRL) pilot program, organized a protest outside Brampton City Hall against the rising cost of living in the city. 

Goyat told The Pointer that property owners are already facing a “sky-high 8.4 percent increase” on their 2025 tax bills, following the Region of Peel’s recently approved budget, which includes a 5.5 percent tax hike.

“But did we get the services? No. In fact, everything’s been cut in the recent budget…minor variance application fees have increased close to 1,600 percent; before, it was $720, now it’s $11,949, and you’ll be surprised to know that Mississauga is charging $800 for that application,” Goyat said, expressing frustration.

“Mayor Brown has ruined this city.” 

Framing it as a “money-generating motion,” Parrish, who has been seeking a landmark political win and has been known for her bold moves, said the incentives are critical to reviving a stagnant housing market.

“In 2024, Mississauga completed building permits for 600 units. In the first six months of 2025, due to the changes we brought in, we had 7,978 units in process, either in zoning or building permit application. And we're expecting to double this if the motion today passes,” she said during the June 12 regional meeting.

In January, the City of Mississauga approved a motion from Parrish that implemented a 50 percent DC cut for residential units and a 100 percent cut for family-sized rentals.

In a letter to the regional council, Parrish noted that the DC incentives are working and requested the region to match them.

(Region of Peel)

Parrish argued the Region isn’t “losing” money by deferring DCs if no applications are coming in to begin with. “100 percent of nothing is still nothing,” she said, emphasizing that builders told her a 50 percent reduction in DCs was the key to making projects financially viable. 

“Our staff in Mississauga have made it clear that development activity is drying up. Instead of receiving nothing, we expect to collect about $100,000 in development charges soon. We’re also on track to meet the provincial target of 10,000 new units, earning us around $3 million,” she said, noting the temporary nature of the proposal. 

“And it’s only until November 13, 2026. It’s not indefinite. At that point, there will be a new election, and we can reassess.”

When the Province first introduced the legislation, she told The Pointer that “much of the Building Faster and Smarter Act is so far very vague.”

Region of Peel’s chief financial officer, Davinder Valeri, warned council on June 12 that Bill 17’s indefinite deferral model strips municipalities of the flexibility to manage DC timing. Now, charges will only be collected at occupancy, not at building permit issuance.

That change, she said, has serious fiscal consequences.

“When we talk about our physical responsibility as a region, the discount puts on the table a huge number, $406 million…We need to find a way to fund that, and then the deferral also puts us in an ocean where we're cash-strapped,” Valeri warned.

Peel’s DC reserve fund was already in the red by $228 million at the end of 2024. Even before Bill 17, the region relied heavily on debt to fund its capital program. With DC deferrals now baked into the system, residential development charge revenues are expected to plummet through 2027, normalizing only by 2028. 

The result: a projected $569 million deficit in the reserve fund, in addition to existing forecasted debt.

“Without an alternative funding source, this is not sustainable and threatens our AAA credit rating. The deficit could grow to over $1 billion by 2030,” Valeri warned, highlighting the need for federal and provincial funding.

She noted that to reduce financial risk, the region will have to raise property taxes and utility rates or delay growth-related capital projects. 

This means an immediate tax increase of 1.5 percent or about $43 per household annually, and a 45 percent hike in utility rates, amounting to approximately $462 per household. If spread over 30 years, those increases could be reduced to 0.24 percent on property tax and 7.4 percent on utility bills, but they would still add up over time.

The second option, deferring capital projects, would directly contradict the Province’s goal to build more homes, faster.

Adding to this financial pressure is a proposal to reduce development charges by 50 percent for residential construction. If implemented until 2029, the Region could be looking at roughly $100 million in annual revenue shortfalls.

Combined, the proposed deferral and discount measures could force a 2.6 percent property tax increase and a 76 percent spike in utility rates if the Region were to collect the needed funds directly. 

Even if spread out, Valeri warns the cumulative cost would be significant, especially with the Region already grappling with the financial impacts of Bill 23, now “compounded” by Bill 17.

After the motion passed, Mayor Parrish thanked her fellow mayors and Minister of Housing and Municipal Affairs Robert Flack for their efforts and support. On June 26, the regional council also directed staff to collaborate with stakeholders, including BILD, to explore ways to pass development charge savings on to homebuyers.

(Carolyn Parrish/X)

Groves echoed Valeri’s concerns, noting “the 50 percent DC reduction scares” her. 

“I don’t want this to fall on the backs of Caledon taxpayers… If by October we don’t have written, concrete financial commitments, I will walk out,” she said.

Brown said he would walk out alongside her if that happens.

The region will now be applying for federal funding through the Canada Housing Infrastructure Fund to help ease financial pressures, and regional staff will consult with the Ministry of Municipal Affairs and Housing about a proposed Peel utility model and report back by fall 2026.

A letter from the Minister of Municipal Affairs and Housing, read aloud during the meeting, confirmed Peel had already received nearly $41 million in infrastructure funding and would be first in line to pilot the Province’s upcoming Public Utility Model, a new financing mechanism to support water and wastewater infrastructure in fast-growing municipalities.

(Protect Ontario by Building Faster and Smarter Act, 2025 technical briefing)

The amended motion signals a rare moment of unity among Peel’s three municipalities as they prepare to pilot a high-stakes, incentive-based development model. But councillors made it clear: unless Queen’s Park follows through with hard commitments this fall, the deal is off the table.

Environmental Defence’s Phil Pothen warned that what’s happening risks making the housing crisis worse, not better.

“It’s important to remember that the housing crisis wasn’t caused by high interest rates or recent economic uncertainty, those are recent, temporary issues. The real problem was the inefficient use of a fully employed construction workforce on sprawling development, which is exactly what this temporary subsidy encourages in northern Peel,” Pothen said.

He believes “extending the 50 percent development charge reduction broadly is a mistake,” and should be instead narrowly focused on infill and multifamily development, as the federal government recommends.

Contrary to claims made by some industry stakeholders, who supported DC charge reduction and deferral during the meeting, high development charges haven’t been the main barrier to housing supply. 

“Development charges on greenfield development have often been too low to cover the real costs. Low-density greenfield development places a heavy burden on municipalities because it requires extensive infrastructure per person, which development charges didn’t fully cover before,” he clarified.

“Development charges only covered startup costs, not the ongoing expenses of maintaining infrastructure like roads and sidewalks in sprawling areas with too few people to share the costs efficiently.”

Pothen says the industry’s support for across-the-board subsidies is “partly a political compromise,” they want to ensure all types of development benefit. 

“The same lobby groups represent both infill and greenfield developers, so it’s easier for them to push for subsidies that cover everyone. While some infill developers honestly argue for targeted subsidies, the broader lobby uses political convenience to mask the different interests.”

One of the biggest concerns raised is who will pay for the gap left by the DC cuts. For Pothen, the answer—for now—is simple: taxpayers.

“This decision publicly subsidizes private development. We think publicly subsidizing private greenfield development is a bad idea. But subsidizing infill development can yield long-term returns by making neighbourhoods more economically sustainable through higher density, which increases tax revenues to support municipal services,” he noted.

“Adding residents through new greenfield development, however, adds long-term costs without enough taxpayers to support them, making it a drain on municipal finances. So, it makes sense to subsidize infill development in the short term, but subsidizing greenfield development is counterproductive.”

To address the structural problems in housing development, municipalities need more than funding; they need planning reform.

“It’s crucial that Brampton and Caledon adopt the same as-of-right permissions for infill development that Toronto already has. Toronto allows six-story buildings on every residential major street, and it has legalized mid-rise developments. Mississauga and Caledon haven’t done this yet, though it would make a big difference,” Pothen said.

“Development charges are a distraction from these basic zoning and planning changes that municipalities need to make.”

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