Prince Edward County (PEC) is in the midst of a housing affordability crisis. Home prices have more than doubled since 2015, and rental vacancies are extremely limited. Many residents—particularly young families, essential workers, and seniors—are finding themselves priced out of the community. In response, the County has taken bold action to address the problem. However, this raises critical questions about jurisdiction, fiscal responsibility, and the long-term sustainability of municipal intervention.
The housing shortage is more than a statistical issue. Waitlists for subsidized housing can stretch beyond eight years. Tourism-driven demand, short-term rentals, and limited new rental construction have only exacerbated supply pressures. Employers struggle to retain staff who can’t afford to live locally, affecting economic stability across the region.
Is Housing a Municipal Responsibility?
No—housing is principally a provincial jurisdiction, both constitutionally and statutorily:
- Under Section 92(13) of the Constitution Act, 1867, “property and civil rights” fall under exclusive provincial jurisdiction. Housing policy, by nature, is included in this.
- The Housing Services Act, 2011 (Ontario) sets out the legislative framework for housing and homelessness programs. It explicitly assigns service system management roles to Consolidated Municipal Service Managers (CMSMs)—typically upper-tier municipalities or designated single-tier cities—not small municipalities like PEC.
- The Municipal Act, 2001 (s. 11(1)) confirms that municipalities have only those powers conferred upon them by the Province, including limited authority over housing and social services when delegated.
In PEC’s case, it is Hastings County that serves as the designated CMSM. Yet due to the depth of the local crisis, Prince Edward County Council created the Prince Edward County Affordable Housing Corporation (PECAHC) in 2018—a not-for-profit Municipal Services Corporation—as a stopgap to catalyze local solutions.
What Has PEC Done—And At What Cost?
PECAHC is currently advancing two mixed-income rental developments, with approximately 36 units planned across two municipally owned sites. These projects include 1- to 3-bedroom townhomes with rents geared to income—generally no more than 30% of household earnings.
After a failed application to the federal Housing Accelerator Fund, PEC Council approved a $5 million loan in March 2024 to keep the projects alive. Land contributions, waived development fees, and in-kind administrative support have also been pledged.
This local funding comes despite PEC’s own asset management plan showing that over 30% of roads remain in poor condition, and major infrastructure—bridges, culverts, and water systems—require significant reinvestment. These are areas where municipalities have clear fiduciary duties, as outlined in the Municipal Act and the County’s own long-term capital plans.
Diverting Property Taxes: A Source of Friction
Property taxes are the primary source of municipal revenue. These funds are meant to support core services—roads, water, emergency services, and facility maintenance. According to the County’s 2022 Asset Management Plan, more than 30% of local roads remain in poor condition. Key infrastructure like culverts and bridges are aging faster than they’re being repaired.
Residents are beginning to question why scarce tax dollars are being diverted to a policy area squarely in provincial hands. “We’re paying some of the highest tax rates in Ontario,” one long-time resident noted, “and yet we can’t drive down a rural road without dodging potholes.”
There’s a growing call for Council to return to core mandates and apply pressure on Queen’s Park to fulfill its statutory obligations. Critics argue that by taking on provincial roles, PEC is not only stretching its limited fiscal capacity but also relieving the Province of its responsibilities, setting a precedent that undermines municipal autonomy and financial discipline.
Forward Path: Advocacy, Not Absorption
While PEC’s actions reflect compassion and urgency, the long-term solution must be sustained advocacy to higher levels of government. Housing should not become a permanent municipal burden. The County’s efforts have delivered a modest number of units at considerable local expense—underscoring the need for structural funding reform, not stopgap solutions.
In summary, PEC’s leadership on housing has been bold, but it also highlights the limits of municipal capacity. Without robust provincial and federal partnerships, the County risks undermining its financial health while failing to fully solve the problem it stepped in to fix.
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