Alberta working with Ottawa on funding for more affordable housing projects

Alberta Premier Danielle Smith speaks at a Calgary Chamber of Commerce event on June 13, 2024. (CTV News)

Alberta is in talks with the federal government about a potential partnership to build more affordable apartments in the province.

Alberta Premier Danielle Smith said Alberta’s housing minister has been working with federal Housing Minister Sean Fraser on possible funding for affordable housing projects while speaking at a Calgary Chamber of Commerce event on Thursday.

“To see if we can find a way to come up with a program, similar to British Columbia, which would allow us to identify projects where we could either put up land, or put up a building, or defer taxes, or underwrite the lending so they can get a lower rate, and then pass on all those savings to the communities that end up doing that attainable or affordable housing,” Smith said during a question-and-answer portion of the event.

The federal government said the potential deal would come as part of the Canada Builds program.

Alberta, like too many provinces across Canada, is facing a shortage of housing options that are affordable for middle-class households,” Fraser said, in a letter to Alberta Housing Minister Jason Nixon, in April.

“The Apartment Construction Loan Program has proven to be effective in stimulating the construction of rentals across the country, including in Alberta.”

The program is available to provinces and territories that move forward with “ambitious housing plans that align with federal efforts to solve the housing crisis.”

Smith said discussions with Ottawa due to Alberta's Bill 18 – legislation requiring schools, health agencies or municipalities to get provincial approval for any deals made with the federal government.

Smith said the bill was proposed due to the “bilateral deals” the federal government made with Alberta municipalities, without involving the province.

Over the past year, several communities, including Calgary and Edmonton, received funding from the federal government to help build more homes.

“But now I have 320 municipalities saying, ‘What about us?’ Including 24 mid-sized cities,” Smith said.

The federal government, however, said the project was in the works long before Bill 18 was tabled.

“We have always been clear, to tackle and overcome the housing crisis all levels of government need to work together. We have never shied away from our willingness to do just that. At the same time, we do not need more red tape that puts up new roadblocks in delivering funding that will help get more homes built. The deal Minister Nixon is referring to is one we’ve been working on well before Bill 18 was tabled, and we are looking forward to announcing more details about it soon," a spokesperson with the office of the Minister of Housing, Infrastructure and Communities said in a statement.

But now, the two parties are pursuing a new partnership that could help more municipalities in Alberta.

“Through this partnership, we can pool our resources to provide low-interest loans to builders for the construction of apartments that will help improve the affordability of housing in Alberta,” Fraser said in the letter.

Canada Builds works by combining federal low-cost loans with provincial and territorial investments to increase the construction of rental homes for the middle class, according to the federal government.

Calgary previously received more than $228 million through the federal government's Housing Accelerator Fund, with the goal of fast-tracking the construction of more than 6,800 housing units in the next three years.

Additionally, Airdrie, Edmonton, Sylvan Lake, Banff, Bow Island, Westlock, Smoky Lake and Duchess received money through the fund.

According to data from the CMHC, there were 45,910 seasonally adjusted total housing starts in Alberta in April.

The Calgary Chamber of Commerce recently called on all levels of government in Canada to work together to address the housing crisis.

The chamber said it would like to see housing starts more than double, from 240,000 to 500,000 annually, to match population demand.