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The Canada Mortgage and Housing Corporation (CMHC) has written to the City of Calgary to provide clarity on how council’s upcoming decision to repeal citywide rezoning could impact federal housing funds.
It comes as the city’s Infrastructure and Planning Committee meeting was presented a report Wednesday that said CMHC “may deem” the City of Calgary to be non-compliant with the Housing Accelerator Fund (HAF) Contribution Agreement if city council fully repeals citywide rezoning.
Calgary was awarded $251.3 million, including top-ups, from the federal Housing Accelerator Fund, with $122.9 million allocated so far. The next instalment of the fund is set for the end of March 2026.
In the statement sent to city administration and councillors, obtained by Global News, CMHC said Calgary agreed it “would eliminate exclusionary zoning city-wide,” and enable a variety of missing middle housing types.
“In order to remain compliant with the agreement, any updated zoning must not reintroduce exclusionary (single family only) zoning, allow for at least four units on a lot across the city without additional approvals, and must not reintroduce approval processes or other barriers that slow down development,” CMHC said in its note to the city.
CMHC said it looks forward to working with Calgary on “options to achieve this” in the coming weeks.
Calgary city council is set to hold a public hearing March 23 on whether it should repeal citywide rezoning, but the issue has created an ongoing back and forth about whether the city’s federal housing funding would be affected by the decision.
City councillors are interpreting CMHC’s statement differently, with Ward 4 Coun. DJ Kelly saying he believes Calgary’s HAF funding will be terminated if citywide rezoning is fully repealed.
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“Throughout this entire process we’ve been waiting to hear back from the federal government about what their take is on it,” Ward 4 Coun. DJ Kelly said.
“Planning decisions need to be made for planning reasons, but that being said, we as a council need to sit down and figure out what that answer really means for us.”
Ward 13 Coun. Dan McLean, however, said he doesn’t think the funding will be impacted if council moves ahead with repealing the policy.
“Nowhere in that agreement does it say that the funding is tied to exclusionary zoning or four units as a right. It doesn’t say that anywhere in there, in my interpretation of the agreement,” McLean told reporters Wednesday.
In its report to committee, city administration highlighted two initiatives in the agreement that CMHC could interpret as the city no longer satisfying if citywide rezoning is repealed, including “undertake city-initiated redesignations to streamline approvals to increase housing supply,” as well as “undertake land use bylaw amendments to promote missing middle land use districts.”
Calgary Mayor Jeromy Farkas recently returned from a trip to Ontario where he met with federal officials and CMHC, seeking clarity on the future of the funding.
Farkas said he received reassurances the federal government wants to work with Calgary to build housing, as the city has led the country in housing starts over the last three years.
“Obviously, the federal government would like to see much more density, much more zoning applied across cities from coast to coast to coast,” Farkas said. “But the local context really matters, and also the written words of the agreement really matter.”
During the election, Farkas ran on a platform to repeal and replace citywide rezoning. Although a replacement plan hasn’t been unveiled, Farkas told reporters it is part of the ongoing discussions.
“The worst case scenario is that council goes back to the way things were without any type of replacement plan or approach in terms of how we’re going to build the housing,” Farkas said. “The worst case scenario will never materialize here.”
As it stands, the motion to repeal citywide rezoning directs city administration to revert the city’s land-use bylaw to what it was prior to the previous city council approving citywide rezoning, but would exclude properties that had development permits approved prior to the motion or any currently under review in the permit process.
City administration said the implications to federal funding won’t be fully known until after council decides on whether to repeal citywide, but the report to councillors outlined $861 million in funds that could be impacted across multiple streams.
Ward 10 Coun. Andre Chabot, who drafted the motion to repeal citywide rezoning, said administration is “risk averse” when it comes to a potential “loss in revenue.”
“The way I look at it is, it’s not money we have so it’s not money we’ve lost,” Chabot told reporters. “It’s money we could have and so let’s work with our federal counterparts to see what we can get while still delivering what Calgarians expect from us.”
Committee went behind closed doors for nearly two hours Wednesday to discuss the impacts and the recent communication from CMHC.
© 2026 Global News, a division of Corus Entertainment Inc.
