Ottawa and Ontario are investing $1 billion in infrastructure for municipalities that do not levy development charges, potentially opening new land for residential, mixed-use and commercial development in smaller Ontario markets.

The new Non-Development Charge Municipalities Stream will fund roads, bridges, water systems and other infrastructure needed to support housing growth. Applications open Oct. 29.

For developers, the funding could help service land that is currently difficult to build on while allowing municipalities to retain their zero-development-charge advantage.

The program will “help municipalities deliver more homes, modernize aging infrastructure and build stronger communities,” Ontario Acting Infrastructure Minister Todd McCarthy said.

Cities like Kenora, near the Ontario-Manitoba border, do not levy development charges. It specifically is planning infrastructure extensions to support housing growth and has identified sewer and water upgrades among projects requiring government funding. Kenora is also working on a 115-acre development expected to include about 500 homes, a new hospital and a long-term-care facility.

Dryden also does not levy development charges and is seeking a developer for the first 10 acres of Van Horne Landing, a waterfront site envisioned for residential and commercial uses. Servicing work in the area is already aimed at supporting housing and broader development.

Ontario Rural Affairs Minister Lisa Thompson said the funding would help municipalities “clear backlogs, upgrade water systems and expand critical roads.”

Neither Kenora nor Dryden has yet been awarded funding through the new stream.