Gravenhurst seeks $4.7M in provincial funding for growth related projects

Gravenhurst could cut residential development charges by up to 30 per cent for three years if the town receives provincial infrastructure funding

Gravenhurst Council approved participation in a program that could reduce residential development charges in exchange for provincial infrastructure funding during the September 15, 2026, meeting.

Staff reported that the Town applied to Ontario's Development Charge Reduction Program, which provides funding for growth-related infrastructure to municipalities that commit to reducing residential development charges by at least 30% for a minimum of three years.

They indicated that the Town requested just under $4.7 million toward five projects with a combined cost of approximately $16 million.

According to the staff report, the projects include road rehabilitation and improvements on James Street, Loon Lake Road and Peninsula Road; a sidewalk along Bethune Drive from Bishop Street to Winewood Avenue; replacement of docks at the Muskoka Wharf; a new playground at Muskoka Bay Park; and the rebuilding of Fire Station 2 in Kilworthy.

Under the program, municipalities are required to contribute at least 10% of the development-charge-eligible portion of each funded project.

Council approved delegating authority to the Chief Administrative Officer and Director of Financial Services/Treasurer to negotiate and execute a transfer payment agreement with the province if funding is offered.

If an agreement is reached, residential development charges will be discounted by 30% from the Town's full rates for a three-year period ending March 30, 2029.

Because Gravenhurst's development charge rates are still being phased in, the effective reduction from 2026 rates would range from 17% to 23%, depending on the type of residential unit. For example, the 2026 charge for a single, semi-detached or duplex unit would fall from $9,221 to $7,272.

Staff forecasts 382 new residential units during the three-year discount period. Based on that estimate, the reduction would result in approximately $926,000 less in development charge revenue.

Staff analyzed the financial impact against the potential provincial funding. If only some of the smaller projects receive funding, the Town could face a shortfall requiring funding from taxation or another source. However, funding for the Fire Station 2 rebuild alone, or for all five projects, would exceed the estimated development charge revenue reduction.

The province will determine which, if any, of Gravenhurst's five submitted projects receive funding.

Manager of Revenue and Deputy Treasurer, Rob Risilius, indicated that during information sessions the province encouraged municipalities that have already acted on development charges to apply for the program. He added, “Gravenhurst has already made that commitment to the development community.”