Canada Housing Infrastructure Fund (CHIF) – Provincial/Territorial Delivery Stream

About the Canada Housing Infrastructure Fund

Purpose of the Canada Housing Infrastructure Fund

Canada announced in Budget 2024, the Canada Housing Infrastructure Fund (CHIF) would be established through Housing, Infrastructure, Communities Canada (HICC).  The $6 billion federal fund broken out into two delivery streams: Direct Delivery ($1billion over 8 years) and Provincial/Territorial (PT) ($5 billion over 10 years). The fund aims to accelerate new construction, rehabilitation and expansion of housing-enabling drinking water, wastewater, stormwater and solid waste infrastructure, directly supporting the creation of new housing supply and improved densification.

Provincial/ Territorial Delivery Stream

The Province of Prince Edward Island will receive $86.2 million over the next 10 years and be administered by the province.

Key Project Considerations

Primary consideration will be the amount of new housing supply and densification or affordability that projects enable.

How does the PT Delivery Stream work?

The CHIF Provincial stream is a merit-based contribution funding program, requiring the support of the province prior to review by HICC. The selection of projects will be based on meeting program eligibility criteria, provincial support for the project and availability of funding.

Eligibility requirements

Who can apply to the Provincial Stream?

The following applicants are eligible under the CHIF Provincial Stream:

• The Province or crown corporations;
• A municipal or regional government;
• A municipal public-sector body that is established by or under provincial statute or by regulation or is wholly owned by a province, municipal or regional government, including , but not limited to:
  • Municipally owned corporations 
  • Any other form of local governance that exists outside of municipality description (ie: local service districts);
• An incorporated not-for-profit organization;
• A private sector, for-profit organization, if it is working in collaboration with an eligible public sector entity, as described above, or with an eligible Indigenous applicant;
• An indigenous applicant

Who is ineligible to apply to the Provincial Stream?

• Private sector, for-profit bodies that are not partnering with an eligible public sector entity or an eligible Indigenous applicant;
• Individual and private citizens; and
• Federal entities, including federal Crown corporations

Partnerships

For-profit bodies that are not partnering with an eligible public sector entity or an eligible Indigenous applicant would not be eligible.  In order for a for-profit applicant to be eligible, they would have to identify one lead eligible applicant.  The lead applicant will enter into the funding agreement with the province and will be responsible for implementation of the project. For more information, please contact the Infrastructure Secretariat.

What types of projects are eligible for funding?

Eligible infrastructure projects must meet all applicable program requirements and support CHIF's objectives and expected outcomes. Eligible projects under CHIF are tied to enabling housing supply. For a project to be eligible, applicants must demonstrate in their application that there is a housing need, or that growth is expected in the community where the project will take place.

Eligible projects must also support increased capacity of municipal infrastructure related to drinking water, wastewater, stormwater, or solid waste management, as outlined below.

Capital infrastructure projects include new construction, rehabilitation or expansion projects that result in tangible infrastructure, including hybrid and natural infrastructure, for the following systems:

• Drinking water systems, including drinking water treatment facilities, storage assets, pump stations, local and transmission pipes, and natural infrastructure;
• Wastewater systems, including wastewater storage and treatment facilities, lagoon systems, pump/lift stations, sanitary force mains and sewer pipes, combined sewer pipes and natural infrastructure;
• Stormwater systems, including stormwater drainage pump stations, management facilities, pipes and natural infrastructure;
• Solid waste management systems, including landfills, organic waste processing, waste sorting, and thermal treatment.

Planning projects primarily consist of studies, plans or design work. For a planning project to be eligible for funding, it must support a future capital project that would be considered eligible under CHIF and align with its objectives.  The Province will also reserve the right to provide the opportunity for their project to move through the planning phase before committing to a capital project.

Eligibility Checklist

Before starting an application, applicants should first ensure that they have the authority to create an application for their organization. Applicants should also confirm that their project meets each of the minimum eligibility requirements listed below.

Projects not meeting the criteria below will be deemed ineligible:

• The applicant is an eligible recipient for CHIF;
• The applicant owns or will own the asset(s), or the applicant has or will have secured all necessary rights and interest in the asset(s);
• The project is for planning, new construction, rehabilitation or expansion of drinking water, wastewater, stormwater or solid waste infrastructure that is primarily for public use or benefit;
• The project will increase system capacity or efficiency to enable increased housing supply or to address a housing need;
• The project meets housing conditions, if applicable;
• All requested eligible costs and expenditures will be in accordance with CHIF program guidance and are direct and necessary for the successful implementation of an eligible project
• The project will be substantially completed no later than March 31, 2033

Housing Conditions

Zoning for four (4) units as-of-right

Municipalities in the province with populations of 30,000 and above (per the 2021 Census of Population) are required to implement zoning for four units as-of-right (4AOR) in order to receive CHIF funding. This is required to allow for more “missing middle” housing types (e.g., duplexes and multiplexes). Municipalities may submit an application based on a commitment to implement zoning changes to allow 4AOR and may receive conditional approval. Projects will not receive funding until applicable zoning requirements are in place and have been fully implemented.

Federal/Provincial Requirements and Reporting

In order to be considered eligible, and as a condition of funding, applicants must attest to their intention to meet applicable federal requirements of CHIF for their projects. Measures taken to comply with requirements will be validated prior to signing an agreement with the province or through project reporting (as applicable). The federal requirements that may apply to projects are outlined below.

Greenhouse Gas Mitigation

CHIF's greenhouse gas (GHG) mitigation approach focuses on areas where the most significant GHG emissions reductions are possible by addressing operational emissions from wastewater treatment infrastructure, supporting solid waste projects with reduced methane emissions, supporting the use of low-carbon construction materials, and reporting on GHG emissions mitigation actions and reductions.

If project assets include mechanical wastewater treatment plants, applicable solid waste projects (including landfills, organic waste processing or thermal treatment) or anaerobic lagoons, the project may be subject to GHG mitigation reporting requirements. Additionally, projects that meet the threshold for low-carbon construction material requirements will need to commit to using low-carbon concrete and reporting on the GHG emissions from ready-mix concrete.

Climate Resilience

Climate resilience requirements support federal commitments, including those in the National Adaptation Strategy, to build climate-resilient communities by investing in low-carbon, resilient infrastructure and by reducing risks to the asset and community. Meeting resilience requirements is a two-phased process:

Phase 1 - Climate Hazard Identification and Hazard Treatment Attestation: Completed during the application process, this requires the identification of climate hazards that could have an impact on the asset (based on best available climate data) and an attestation to commit to implementing climate adaptation measures, also referred to as treatment measures, to lessen the effects of the identified risks; and

Phase 2 - Hazard Treatment Reporting: Submitted during reporting for the projects that receive funding, this phase includes reporting details on treatment measures identified during project planning and design for implementing during construction. It also requires the identification of climate design data used to determine appropriate treatment and adaptation measures.

If climate hazards are identified as having the potential to impact a project, applicants are required to attest that they will implement appropriate treatment measures to lessen the impact of these climate risks and use future climate design data, or the best available data to inform their approach. Committing to these measures is a requirement for projects to be considered for funding.

Environmental Assessment

Applicants must complete a questionnaire as part of the project application to assist  HICC in determining whether the project has federal environmental or impact assessment requirements under the Impact Assessment Act (IAA), modern treaties or northern regulatory regimes. Under the IAA, designated projects may be subject to a federal impact assessment.  If the applicant is successful with their application, they will be informed of any such requirements. No construction can start, and no funding can flow until environmental assessment requirements are met.

Indigenous Consultation

Applicants must complete a questionnaire as part of the application process of project review to help HICC and the province determine whether the project requires consultation with Indigenous peoples. The Government of Canada has a duty to consult and, where appropriate, accommodate Indigenous peoples when it contemplates a decision or activity that might adversely impact Aboriginal or treaty rights. If the applicant is successful with their application, they will be informed of any such requirement. No construction can start, and no funding can flow until Indigenous consultation requirements are met. While the duty to consult rests with the Crown, HICC asks selected applicants to carry out certain procedural aspects of consultation, where appropriate. 

Project Reporting

For successful projects, all funding recipients must report to the province on the various commitments for data and information throughout the life of the project. The terms of reporting requirements will be set out in project funding agreements. These may include progress reports, risk management plan and a final report that include information on project status, updated financial and risk information, along with validation of results data.

Application Assessment 

Under the CHIF Provincial delivery stream, projects that meet all mandatory eligibility criteria will be further assessed and scored against merit criteria in the following areas:

Project rationale: Applications that clearly demonstrate how the project aligns with CHIF program objectives and is the most appropriate technical and viable solution to address the community's housing and infrastructure needs will increase the merit of the project.

Housing needs addressed: Applications are expected to demonstrate that projects will directly enable housing supply and will be scored against the following sub-criteria for this section.

• Housing need: the extent that the project would support communities with a housing need which may be demonstrated by the proportion of the community living in core housing need, the availability of housing supply versus demand, and the number of additional units required to support near-term population growth.
• Number of housing units enabled: the proportion of additional housing units enabled as part of the project.
• Project supports known housing development: projects which demonstrate that infrastructure investment will remove barriers and enable a known housing development may be prioritized.
• Densification: the extent that the project would enable increased density in areas already serviced by municipal infrastructure.
• Housing affordability: the extent to which the project would enable affordable housing units.

Infrastructure needs addressed: Applicants are expected to demonstrate that projects will address the community's infrastructure needs and provide infrastructure services to the community. They will be scored against the following sub-criteria for this section.

• Infrastructure capacity: extent to which access to, or capacity of, housing-enabling infrastructure is a barrier to enabling increased housing supply or density.
• Infrastructure benefits: extent to which a project provides an improvement in housing-enabling infrastructure services. This includes improvements in health and safety, such as increasing the level of wastewater treatment or resolving frequent or active drinking water advisories.

Benefits to the environment and community: Projects that support the advancement of federal priorities will receive a higher score. Assessors will consider benefits such as mitigation of GHG emissions, natural infrastructure integration, and addressing the needs of underserved and equity-deserving groups.

Priority and readiness: Given the nature of the program, applications that demonstrate a high level of project readiness may be prioritized. Assessors will also consider factors, such as timelines, status of permitting, budget class estimates, risk level, and other indicators that the project would be ready to implement in the near future.

Risk Assessment Consideration: Applicants will be evaluated on their capacity, plans to add additional capacity to manage the project, past history of executing projects, ability to manage cost overruns, and quality of risk management plan. A detailed risk management plan that will highlight known and potential unknown risks, their significance to impact the project and appropriate mitigation steps to help address potential risks will be important.

Project Finances

Federal Contribution Limits

The maximum federal cost share that CHIF may contribute toward a project is based on recipient type:

• Up to 40% of total eligible expenditures for the following entities in the provinces: municipal or regional governments, public sector bodies, and not-for-profit organizations.
• Up to 50% of total eligible expenditures for municipal or regional governments with a population of 30,000 and under.
• Up to 100% of total eligible expenditures for Indigenous recipients;
• Up to 25% of total eligible expenditures for private sector for-profit bodies.

Federal Contribution Stacking Limits

Total funding from all levels of government (including municipal, provincial, territorial and federal) cannot exceed 100% of total project costs, and total federal government funding cannot exceed 100% of total eligible project costs under this program.

Applicants are responsible for considering HICC funding program eligibility criteria and funding limits, as project costs cannot be duplicated across multiple programs and the lowest stacking limits of other programs may apply to the project.

Canada Infrastructure Bank

The Canada Infrastructure Bank (CIB) complements funding options available under CHIF.  CIB eligible projects typically have total costs over $100m and can collaborate with CHIF funding to support projects eligible for both low-cost CIB financing and CHIF funding.

Provincial Contribution Limits

The maximum provincial cost share that the Province may contribute toward a project is based on recipient type:

• Up to 33.33% of total eligible expenditures for any municipal and regional governments

Provincial Contribution Stacking Limits

No other provincial government funding will be eligible to support an application under CHIF.

Cost Overruns are the responsibility of the applicant.

Budgeting Information

A detailed budget must be submitted as part of the provincial application process by completing the financial budget template. All applicants must demonstrate that their share of funding has been secured, and that a plan is in place to cover any cost overruns beyond budgeted contingencies.

What costs are eligible?

Eligible costs are those considered by HICC to be direct and necessary for the successful implementation of an eligible project. Eligible expenditures for contribution funding under CHIF's direct delivery stream are as follows:

• costs that are incurred after project approval and before March 31, 2033;
• capital costs, construction costs, design and planning costs, cost for professionals, technical personnel, consultants and contractors specifically engaged for the purpose of the project;
• for natural infrastructure only, land acquisition;
• costs of environmental assessments, monitoring and follow-up activities, as required by the Impact Assessment Act or equivalent legislation;
• costs associated with a public announcement and official ceremony or required temporary or permanent signage that includes the cost of creating and posting signage;
• costs for the purpose of Indigenous consultation or engagement activities;
• other costs that are considered direct and necessary for the successful implementation of the project and that are approved in advance by HICC.

What costs are ineligible?

The following costs are ineligible under CHIF:

• Project costs incurred prior to project approval, except for expenditures associated with meeting federal requirements related to environmental assessments and Indigenous consultation and, where appropriate, accommodation;
• Costs incurred for cancelled projects;
• Costs for leasing land, buildings and other facilities; costs for leasing equipment other than equipment directly related to the construction of the project; real estate fees and related costs;
• Recipient employee and overhead costs, except:
  • those for the purpose of Indigenous consultation and engagement activities; and
  • incremental costs related to the recipient's employees, if approved in writing by Canada
• Costs associated with on-going operating expenses and regularly scheduled maintenance work;
• Financing charges, legal fees, mediation or alternative dispute resolution fees, collateral on mortgage financing, and loan interest payments, including those related to easements (e.g., surveys), except for:
  • legal fees incurred by Indigenous recipients, excluding those related to litigation or to the purchase of real property (land or building).
  • legal fees incurred by Indigenous peoples whose rights may be affected by project activities funded by the program and that are reasonable, as determined by Canada.
  • construction finance costs incurred for public-private partnership projects.
• Any goods and services costs which are received through donations or in kind;
• Provincial sales tax, goods and services tax, and harmonized sales tax for which the recipient is eligible for a rebate, and any other costs eligible for rebates;
• Costs related to furnishings and non-fixed assets, unless approved by Canada
• All capital costs, including site preparation and construction costs, until HICC has confirmed that environmental assessment, other applicable federal environmental legislation and Indigenous consultation and accommodation obligations have been met and continue to be met;
• Land acquisition costs not directly linked to the development of natural infrastructure;
• Cost overruns, which are the responsibility of the applicant.

Environmental assessment and Indigenous engagement and consultation costs

If the applicant expects the project to have environmental assessment or Indigenous consultation requirements, or plans to engage with Indigenous peoples, potential related costs must be included in the project budget. Subject to project approval, these costs may be retroactively eligible up to two years prior to project approval, but no earlier than September 10, 2024.

• Environmental assessment costs: Include costs for environmental assessments, monitoring, and follow-up activities as required by the IAA, modern treaties, or northern regulatory regimes. For projects on federal lands, plan for a potential environmental effects determination (Section 82 of the IAA) and include forecasted costs in the project budget.
• Indigenous engagement and consultation costs: Costs may include providing ceremonial offerings, organizing meetings, and distributing project information to Indigenous community members. Costs may also cover funding for Indigenous peoples to participate in activities that involve a review of the project (e.g., costs associated with attending meetings, providing feedback on documents, and conducting separate studies on archaeological, health or socioeconomic interests). The total costs will depend on the number of consultation activities required based on the nature of the project and the number of communities or organizations that need to be consulted. Costs may vary from one region to another. 

Secured funding shares

All funding shares must be secured at the time of application. This will require not-for-profit and partner-for-profit applicants to provide a bank note confirming available funding to cover the applicants’ share. 

For municipalities, a financial health check will be completed, in collaboration with Municipal Affairs based on the latest required audited financial statements.

Claims Process

CHIF is a claims-based funding program.  This requires successful applicants to incur eligible costs and submit a claim to the province, with the appropriate supporting documentation, before funds would be reimbursed back to the client.

Insurance Costs

The Province’s Office of Risk Management has strict insurance requirements for projects funded or administered by the province.  All successful applicants must ensure that the “Government of Prince Edward Island” is added to all insurance policies as “Additional Insured”.  This not only applies to the Ultimate Recipient’s policies but also applies to all contractors working on the project.  It is advised that this insurance requirement become part of the tender documents for any successful project and these costs be considered at time of application.  No claims will be reimbursed until the proper insurance documentation is received by the Infrastructure Secretariat staff.

Non-competitive procurement

All contracts must be awarded in a way that is fair, transparent, competitive and consistent with value-for-money principles. In addition, when applicable, contracts must be awarded in accordance with the Canadian Free Trade Agreement and international trade agreements.

When non-competitive contracts are necessary for the implementation of a project, and they are above the specified thresholds, HICC's approval of the contract as an eligible expenditure is required for the expense to be considered eligible, and therefore payable, under CHIF.

No additional approval is required for non-competitive contracts that have an estimated value below $40,000 for construction or goods contracts, or $100,000 for service contracts. 

The Minister of Housing, Infrastructure and Communities may approve funding for CHIF projects involving non-competitive contracts that:

• are for less than $500,000; or
• are with a public sector entity; or
• can only be performed by one person or entity; or
• are with an Indigenous recipient; or
• are with an Indigenous organization or governing body and there is a benefit to an Indigenous community; or
• addresses a state of emergency that has been declared.

For applicants seeking a non-competitive procurement process outside of the Minister's delegation, HICC will need to seek approval from the Treasury Board of Canada. Obtaining Treasury Board approval may take several months and will require strong rationale for the non-competitive procurement process, as well as more complex and in-depth information requirements.

Additional Information

Supporting Documentation

Applicants may be required to submit additional documents to support their application:

• A Keyhole Markup Language (KML) file showing the location of proposed project activities is required with each application. 
• Council/Band/Board of directors’ resolution in support of application submission
• Detailed budget breakdown, highlighting individual components that make up the cost estimate, indication of quality of cost estimate 
• Risk management plan identifying potential risks associated with the project and through the course of the project life cycle, including highlighting measures to minimize, alleviate, or address the risk associated with the project.
• Proof of secured funding for not-for-profit and partnering for-profit applicants
• While not required, other documents may be included to support an application. Examples include a housing needs assessment to substantiate a community's housing need or an engineering report that confirms the project as the best option to meet the infrastructure need.
• Letters of support may also be required under certain circumstances, such as to confirm an eligible partner's role in the project.

Application submission must be sent to CPEI-INFRASTRUCTURE@gov.pe.ca.