‘We’re stuck’: Toronto mayor calls for aid as rent-subsidy freeze nears six months

As Toronto’s homeless shelters burst at the seams — with hundreds turned away daily, overflowing into parks, ravines and overpasses — city hall officials say they’ve now gone nearly six months without funding for a sorely-needed rental subsidy that helps put a stable roof over people’s heads. 
The program, jointly funded by the provincial and federal governments, is seen as a lifeline in cities facing an expanding homelessness crisis. Called the Canada-Ontario Housing Benefit, it offers recipients an allowance to bring down the cost of a private rental, instead of waiting on public, rent-geared-to-income housing — with Toronto’s wait-list now nearly 90,000 households long. 
It’s a program that has helped free up emergency shelter beds as demand has soared. According to city statistics, 3,297 households were enrolled in the benefit program in 2023-24, out of 6,418 enrolled since its launch in 2020. 
However, the program has been on hold since March, when funds meant to last until April ran dry. A public disagreement between Ottawa and Queen’s Park over housing targets then erupted, threatening to cut off hundreds of millions of dollars that the federal government had previously earmarked for Ontario — including money expected to go toward the rental subsidy program for this year. While a deal was reached in late May, Toronto mayor Olivia Chow said she still isn’t sure when the money will turn up, nor how much they’ll be working with as the pressures of winter draw closer. 
“That’s six months — half a year — that we aren’t able to house people out from shelter, out from the streets, into permanent housing,” Chow lamented in an interview, decrying what she described as a “typical” back-and-forth between the two governments.
“They are listening,” she cautioned. But it has felt as if each one was expecting the other to make a move first, Chow said. “And then, the funds don’t flow.” 
It’s a problem that Canada’s housing minister, Sean Fraser, previously vowed to rectify. In April, the Star asked in an interview how long cities could be left waiting on funding for the subsidy.
“This is not going to sit on anyone’s desk for months,” Fraser said nearly five months ago. “This is going to be dealt with very, very soon.”
Fraser’s office, in early August, again said they would have an update “soon,” but did not respond to subsequent inquiries in late August and early September. Last month, the province said households already enrolled in the program have continued receiving aid, but did not respond to repeated inquiries about funding to assist further households. (A source in Ontario housing minister Paul Calandra’s office, who was not authorized to speak publicly, confirmed the matter was still being worked out behind the scenes.)
There have been signals that news may finally come in late September, Chow said, noting her office had spoken with their provincial counterparts several times in the past month. 
Meanwhile, homelessness in Toronto has continued to swell, with the mayor pointing to a dense encampment in Kensington Market’s Bellevue Square Park. “We can’t move them unless there’s a place for them to go,” Chow said. “If our shelters are full, there’s no place for them to go, and we’re stuck.”
As of July, Toronto’s shelters were turning away around 236 people a day. “We don’t know at this point what we’ll do in the winter,” Chow said, noting one plan underway to increase shelter availability involves leasing houses on the private market to be operated by non-profits as refugee shelters. (Chow’s office did not provide a specific timeline for those opening.) 
An end to the rental subsidy impasse feels “so close,” Chow said. “Everybody agrees the need is there. Everybody agrees it’s a good program.”
But as the program freeze drags on into its sixth month, Chow noted that it also wasn’t the first time the city had spent its subsidy money dry. Last year, Toronto used up its entire annual allocation within weeks, having initially received $9.5 million versus the $12.3 million allocated the previous year. The province blamed the lower number on increased rent costs for already enrolled households; the funding was later topped up to allow Toronto to continue offering rental aid. 
Cities like Toronto needed more stability and, ideally, a program that grows with inflation, Chow said.
Asked if the city would consider upping its own financial contributions, she pointed to Toronto’s wobbly finances. “The problem is we’re staring at a billion-dollar shortfall,” she said. “What are we not doing if we put that money into a housing benefit?”
For now, the clock ticks on, with Chow noting months have now gone by since the feds and the province agreed to their deal. Since then, “there’s silence.”