The City of Toronto has partnered with the federal and Ontario governments to implement the Development Charges Reduction Program (DCRP) to improve the financial feasibility of new residential development.

Eligible projects can receive a 40 per cent to 60 per cent reduction in development charges (DCs), potentially reducing building costs significantly and helping more housing projects move forward.

What is the DCRP?

DCs help fund infrastructure and services required to support new growth. Through the DCRP, Toronto is reducing the DC burden on eligible residential projects.

The program is supported by approximately $1.5 billion in federal and provincial funding for growth-related infrastructure, including roads, transit, and water and wastewater infrastructure.

Reductions in Cost

The City has communicated that it is targeting reductions of up to 60 per cent across a range of residential development types, with the discount weighted towards multi-bedroom units and one-bedroom units receiving a cut closer to 40 per cent.

For example, the current DC for a two-bedroom condo is approximately $80,690, compared with approximately $32,276 under the reduced rate – a potential reduction of nearly $48,414 per unit.

A Streamlined Program

The City indicates that the DCRP will have no separate application process and no overall program cap.

Eligible projects can receive the applicable reduction by meeting the established program requirements. Under the proposal, the reduced rates would not be indexed annually from 2027 to 2029.

Program Timeline

The City has set March 30, 2026, as the retroactive start date for permit eligibility and August 2029 as the program’s current end date.

A project may qualify if it received its first building permit on or after March 30, 2026, subject to the program’s other requirements. The program also requires an above-grade building permit. The project must obtain that permit by August 2029 or within 24 months of the first building permit, whichever is later.

Projects currently progressing through approvals and permitting should account for these deadlines.

For questions or clarification, contact the City of Toronto team overseeing the DC by-law review at DCreview@toronto.ca