WR RELEASES BUDGET FOR 2026

In November, the Region of Waterloo released its 2026 preliminary budget plan, which includes major allocations for local initiatives such as the Ending Veteran Homelessness Initiative and a tree-planting project by the Waterloo Region District School Board (WRDSB).  

The budget lists federal grants among its revenue sources—a sign that recent funding from Ottawa may help support key projects in the region.  

The 2026 budget draft proposes a 4.94 per cent increase in the regional tax levy, which would add around $96 per year to the average homeowner’s bill.  

Meanwhile, the City of Kitchener’s draft budget includes a 2.2 per cent property tax increase, plus utility rate hikes, bringing the total estimated impact for the average household to $117. These increases reflect rising operational costs across housing and homelessness services, transit, infrastructure maintenance and other essential programs.  

In 2025, the region spent $165.2 million on social housing and homelessness initiatives. Across 2024, total spending on affordable housing and homelessness programs reached $245 million, with roughly 23 per cent specifically dedicated to shelters and supportive housing. Without federal and provincial transfers, the Region of Waterloo warns that maintaining current service levels could require even higher taxes or cuts to critical programs.  

“Federal and municipal programs play a critical role in supporting housing and food security locally,” Ke Cao, assistant professor of Strategic Management at Wilfrid Laurier University, said. 

Cao also believes that only the governments can address the crisis we are facing.  

“I teach in business school, and I told my students that the role of government is very important because it handles the business of the whole society,” he said.  

The federal funding announced this year helps relieve some of this financial pressure. The contributions support the Ending Veteran Homelessness Initiative, addressing the gap in local housing services by providing support for veterans, along with other homelessness-response programs.   

This funding helps sustain shelters, outreach teams, and supportive housing while reducing strain on municipal budgets. Additional funds support long-term initiatives such as environmental and infrastructure projects, including the WRDSB’s tree-planting program, which contributes to urban canopy growth and climate resilience.  

According to the preliminary budget, the region plans to increase their spending in 2026 by $11.7 million for housing services and $2.7 million for homelessness-related programs. These increases reflect rising costs for housing and homelessness services, transit, infrastructure and other essential programs. Municipal leaders also welcomed federal contributions, noting that without them, residents would face significantly higher tax burdens and essential services could be reduced.  

“We’re happy to see the $6 billion over 10 years through the Direct Delivery Stream to support regionally significant projects,” Dorothy McCabe, mayor of Waterloo, said.  

In a 2024 public statement, McCabe warned that Waterloo is under structural financial pressure and stressed the need for stable, predictable funding instead of one-time grants to support long-term municipal priorities.   

Advocates, including the Federation of Canadian Municipalities, repeatedly called on Ottawa to expand multi-year funding streams to help municipalities meet growing demands without overburdening residents.  

Federal support combined with municipal budgeting decisions will determine whether services keep pace with community needs or whether tax increases and service pressures continue to rise.   

Although the latest funding provides relief to the Waterloo region community, regional leaders explained that ongoing collaboration between federal, provincial and municipal governments will be essential to sustain programs, stabilize communities and advance long-term priorities such as housing affordability and environmental resilience.  

The Waterloo Region’s annual budget process began on Oct. 22, and regional council plans to review the final 2026 budget on Dec. 16. For more information regarding the preliminary 2026 budgets, visit the Region of Waterloo’s Budget and Financial Statements page. 

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KITCHENER AND WATERLOO RECEIVE FUNDING FOR MEETING HOUSING GOALS

The Ontario government plans to award $16.7 million to Kitchener and Waterloo through the second round of the Building Faster Fund.  

The three-year, $1.2-billion program provides funding for housing and community-related infrastructure in municipalities that meet at least 80 per cent of their provincially designated housing targets. In 2024, the two cities broke ground on nearly 5,000 new homes.  

Kitchener will receive $10.3 million after starting 3,067 units, which is 105 per cent of its target of 2,917. Waterloo will receive $6.4 million for starting 1,722 units, or 129 per cent of its target of 1,333.  

Separately from the Building Faster Fund, the province is also investing through the $4- billion Municipal Housing Infrastructure Program (MHIP), which supports housing-related infrastructure. That includes $11.9 million for Waterloo to support nearly 5,000 new homes, and $19.5 million across the Region of Waterloo for projects tied to more than 14,000 homes.  

“We were very happy to receive the Building Faster Fund,” Dorothy McCabe, mayor of Waterloo, said. “Our staff team and council worked really hard, and we need the money.”  

McCabe said housing targets are set by the province, with Waterloo’s next overarching goal set at 16,000 new units over the next 10 years.  

“There are a lot of costs that go with building new housing,” she said. “This money will go into wastewater pumping stations, new roads—anything that supports housing development.”  

McCabe also called the Building Faster Fund challenging, arguing that it measures municipalities on the wrong things.  

She pointed to Waterloo’s 2023 affordable housing strategy, which highlights a shortage of affordable units across the region.  

“We have a significant project working with Habitat for Humanity that will add about 1,000 new homes that are affordable for our community,” she said.  

Berry Vrabanovic, mayor of Kitchener, also noted that this year’s funding is crucial for building and maintaining infrastructure that supports future housing. These projects include a new fire hall downtown, new pumping stations and improved stormwater management.  

“This funding helps ensure our communities see economic investments, new housing, and jobs that benefit residents in Kitchener and Waterloo,” Vrbanovic said. “These things are important for the growth of our community.”  

Stephen Litt, chief development officer at Vive Development, said development fees should be reduced to encourage more projects to begin construction. He said the federal and provincial governments need to follow through on promises to lower development charges.  

Despite Premier Ford calling on higher levels of government to do more, he said his incentives for municipalities will continue to expand home building in Ontario.  

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