Calgary council risks losing $63.7M federal housing fund over zoning dispute

Calgary is at risk of losing $63.7 million in federal housing funding over a zoning policy conflict between city council and the provincial government.

The Housing Accelerator Fund, meant to reward cities for removing housing development barriers, has delivered three payments totalling $192.4 million since 2024. The fourth and final instalment of $63.7 million hinges on a deadline of October 27, when the federal government requires replacement zoning that allows a minimum of four housing units on a significant majority of lots within the city.

The catch: Calgary repealed its blanket rezoning policy earlier this year, and council hasn't yet settled on a replacement that meets federal requirements. Ward 2 Councillor Jennifer Wyness said the city remains "in limbo" on whether it will receive the money at all.

"We still haven't got the fourth payment for the housing strategy, and we're about to find out if we will even get the federal government providing us the fourth HAF payment because we repealed blanket rezoning," Wyness said.

The tension reflects competing pressures: the federal government is using housing funding to incentivize density, while the provincial government has made its own municipal demands that diverge from Ottawa's conditions. Ward 9 Councillor Harrison Clark described the situation as "unprecedented," with the city potentially caught between two levels of government with conflicting expectations.

"We're sort of in an unprecedented scenario with a provincial government making unique municipal requests of us, and now we potentially lose our HAF funding, and they're not going to give us any money," Clark said.

Mayor Jeromy Farkas pushed back against the idea that the city must bend to either government's wishes. "I and the council that I lead are going to do right by Calgarians and make sure that our housing approach reflects the needs and the local context of Calgarians and does not bend over backwards to appease either a prime minister or a premier," he said.

The Canada Mortgage and Housing Corporation said it reviews municipal reports annually before making funding decisions. Calgary's agreement review is set for the October 27 deadline. If the city misses it, housing projects contingent on the federal funding could face delays or cancellation.