New programs support housing development costs

CANADA, June 13 - Over $25 million in new financial support programs will help build the infrastructure needed for approximately 700 new construction-ready residential lots. 

The Municipal Infrastructure Fund administered through the Federation of PEI Municipalities will provide a non-repayable grant, up to a maximum of $300,000, to developers creating lots and subdivisions within municipalities in rural PEI with central services (water and/or sewer). The funding will support the extension of existing municipal central water and wastewater

systems, public roads and sidewalks so that more land within the municipality is available for housing. 

Developers creating two to five lots can receive $10,000 per lot, while those developing six to 10 lots can receive $12,000 per lot and those creating 11-20 lots can receive $15,000 per lot.

Developments approved for the Municipal Infrastructure Fund may also receive financing support through the Subdivision Development Financing Program. Qualified developers and landowners are eligible for financing at a rate of 2% for a term of five years, covering up to 90% of the costs associated with developing and subdividing vacant land into individual residential lots. This includes professional fees for surveying and subdividing land and costs associated with infrastructure construction. 

Additionally, the Government of Prince Edward Island is launching the Building Acceleration Grant to assist with road infrastructure for pre-existing lots already approved for development. Developers or landowners can receive up to 50% of the total cost of a development, to a maximum of $25,000 per lot.

Quotes: 

“To meet the goals of our provincial housing strategy, we need a variety of housing options – from single family homes to high density apartments. The high costs of borrowing and servicing lots have sidelined many potential housing developments or have made the price of home ownership too high. By removing the burden of these additional financial costs to development, more attainable housing options will be created that meet the needs of current and future residents and support the continued strength of our communities.”

-    Hon. Rob Lantz, Minister of Housing, Land and Communities

“We know that getting our housing supply to the levels we need today and into the future requires collaboration between government, municipalities and private developers. The financial supports being offered are important investments not just into our economy through job creation, but they are also direct investments into supporting our residents across the Island."

-    Hon. Gilles Arsenault, Minister of Economic Development, Innovation and Trade

“We are pleased to partner with the provincial government on an infrastructure fund that will help reduce housing costs and limit sprawl through development inside rural municipal service centres. By subsidizing infrastructure, the fund will make home ownership a possibility for more Islanders.”
-    Bruce MacDougall, Federation of PEI Municipalities President 

Media contacts:
April Gallant
Senior Communications Officer 
Housing, Land and Communities 
Government of Prince Edward Island
aldgallant@gov.pe.ca 

Vicki Tse
Senior Communications Officer 
Economic Development, Innovation and Trade
Government of Prince Edward Island 
vickitse@gov.pe.ca

Lori Mayne
Communications and Member Services Officer 
Federation of PEI Municipalities
lmayne@fpeim.ca

Backgrounder: 

Municipal Infrastructure Fund

The Municipal Infrastructure Fund supports the extension of existing municipal central water or wastewater services, public roads, and sidewalks, so more property is available to develop housing. The fund will also help increase the population in rural service centres.

Developers (including municipal governments, private corporations, and non-profits) are eligible if their land will be serviced by connecting to an existing municipal central wastewater or water system in a town or rural municipality outside the capital area and the City of Summerside.

Funding supports the extension of existing municipal central water and wastewater systems, public roads and sidewalks. 

A grant of $10,000-$15,000 per lot (based on the number of lots being developed), to a maximum of $300,000, is available.
In addition, recipients of the Municipal Infrastructure Fund may be eligible for financing under the Subdivision Development Financing Program. 

Subdivision Development Financing Program

The Subdivision Development Financing Program is a financing support pilot program that will help qualified developers offset infrastructure costs for long-term residential housing developments. This program will support projects funded through the Municipal Infrastructure Fund.

The Subdivision Development Financing Program will provide qualified developers and landowners with access to 2% financing on up to 90% of eligible project costs associated with subdividing and developing vacant land into individual residential lots for sale.

This financing will be provided for a term of 5 years and amortized over a 25-year period. If there is outstanding debt at the end of the 5-year term, there will be an option to renew the loan at Finance PEI’s prevailing interest rate at the time of maturity.

Eligible costs will include, but are not limited to:

• Professional fees for surveying and subdividing land into individual residential lots.
• Costs associated with the construction of roads, sidewalks, and water and/or sewer service for connection to an existing public road and eligible central municipal water and/or sewer system.

Building Acceleration Grant

Development projects requiring new or upgraded roadway access may be eligible for provincial funding for roadway preparation (excluding paving). The Building Acceleration Grant will provide up to $25,000 per eligible project (Maximum 50% of the total development cost). 

Projects must meet the following criteria:

• Applicant is the property owner;
• Property is not connected to centralized or municipal water and sewer; and
• Roadway access to the property does not exist or needs to be upgraded.  (paving is not included).
• The property must have been owned by the applicant for at least one year prior to application.
• The program will only be available for developments for year-round residency.

Additional Resources: 

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