The Canada Mortgage and Housing Corporation (CMHC) has terminated its funding agreement with the City of Red Deer amounting to $12 million due to the city’s failure to comply with essential grant conditions. This decision was made after the city was found to be non-compliant with a mandatory requirement for the second phase of the Housing Accelerator Fund (HAF) agreement signed in February 2025. As a result, the agreement will be officially cancelled on January 16, 2026.
Red Deer has already received an initial installment of $3 million from the agreement, with a portion of it allocated towards public engagement activities. The funding was contingent on a condition that required a blanket zoning change to permit up to four units per residential lot without the need for public consultation or rezoning. However, after public feedback expressed concerns about this condition, city council rejected the requirement.
Housing and Infrastructure Minister Gregor Robertson stated that the federal government is collaborating with the City of Red Deer to determine the next course of action. Despite the setback, Red Deer Mayor Cindy Jefferies remains optimistic about reaching a compromise with Ottawa. She emphasized the importance of creating a revised agreement that aligns with the city’s preferences regarding zoning regulations.
In response to the CMHC’s warning of non-compliance and the potential repayment of the initial funding, city council passed a motion to continue discussions with the federal government rather than immediately returning the funds. The council aims to engage in dialogue with the minister to explore the possibility of amending the agreement.
The CMHC highlighted the competitiveness of the HAF application process, with numerous applications submitted and agreements signed. The organization noted that only the most ambitious proposals were successful, and funds from terminated agreements will be reallocated to other communities. Jefferies expressed hope that Red Deer will have the opportunity to amend its application for consideration by the CMHC, emphasizing the city’s housing needs and its willingness to collaborate for a successful outcome.
