TORONTO -- Ontario is considering revising its tallies of how many homes are built in cities and towns across the province, after some complained that undercounting has cost them millions in provincial funding.

As Premier Doug Ford's government attempts to get 1.5 million homes built by 2031 it has assigned annual housing targets to 50 municipalities and promised extra funding to those who exceed or get close to them.

To qualify for money under the Building Faster Fund, which can be spent on housing-enabling infrastructure, municipalities need to have hit at least 80 per cent of their target of housing starts as calculated by the Canada Mortgage and Housing Corporation.

But the Ontario's Big City Mayors group says there are discrepancies between the CMHC data and their own internal counts, and for four municipalities that were close to qualifying for funding it meant losing out on $23.3 million.

The town of Oakville has records of 2,701 housing starts in 2023, but the CMHC reported 1,752, which put the Greater Toronto Area municipality at 76 per cent of the province's target and it therefore narrowly missed qualifying for Building Faster Fund money.

"We have building inspectors who inspect every poured foundation," Oakville Mayor Rob Burton said.

"We keep records of those inspections: address, description, date, the whole deal. So CMHC has offered many stories over the last six months that have changed from time to time about how they do it and my submission is they're not doing it right when our documented evidence is there to contradict them."

The town of Ajax says CMHC missed counting 324 units in an apartment building. While the CMHC acknowledged the error and said it would include the units in the 2024 counts, it still means the town just missed out on qualifying for $4 million through the building fund, a spokesperson said.

The CMHC said in a statement that its tracking involves site visits and it stands by the data.

"We work with all municipalities on an ongoing basis to produce the most accurate and objective data based on our methodology," the federal Crown corporation wrote.

"All data is verified prior to monthly publication to ensure that no revisions or retroactive changes are needed afterwards."

Municipal Affairs and Housing Minister Paul Calandra's office said this week that the government is discussing with the CMHC how to improve data and is working with the Association of Municipalities of Ontario to evaluate the concerns and "determine if there is a need for revisions or remedies."

Calandra acknowledged at a legislative committee hearing earlier this month that at the same time the province was engaged in a dispute with the federal government over how it was counting affordable homes built in Ontario, he was hearing concerns from municipalities about the province's own tracking of their housing progress.

"We should be able to better track not only across municipalities, not only affordable housing, but as we've heard through some of the criticism of the BFF funding and how CMHC tracks shovels in the ground, I think we also have to do a better job of how do we accumulate that data from our municipal partners," he said.

"We don't have a tool right now that allows me to go in and say, 'This is what you're actually doing,' and I think our municipal partners would like that as well."

Ontario has not yet met any of its annual targets toward its goal of 1.5 million homes, though it came very close last year after it started counting long-term care beds.

Calandra has previously said he is considering counting student residences and retirement homes, and the big city mayors are asking him to confirm if that will happen, and if transitional housing will count.

The housing starts data discrepancies are just the latest concern from municipalities with the province's system for tracking and rewarding housing progress. They say housing starts shouldn't be the metric at all, no matter how the CMHC counts them.

Municipalities have asked Calandra to base their eligibility for the fund instead on how many building permits they issue, rather than on the number of housing starts. Once the permit is issued, developers may not start construction because of high interest rates, supply-chain issues or labour shortages, the big city mayors say.

"We are all committed to getting shovels in the ground, but we need to recognize what municipalities do and that's issue permits -- the industry puts shovels in the ground, and there's very legitimate reasons why they're having trouble doing that," said Marianne Meed Ward, mayor of Burlington, Ont., and chair of the big city mayors' group.

"But so long as the ministry is using the CMHC data, it really needs to be accurate."

So far in 2024 in Burlington, CMHC data shows 67 housing starts, putting the city at just three per cent of its 2024 target, halfway through the year.

In Guelph, which did receive $4.68 million under the Building Faster Fund for meeting 2023 targets, the mayor suggested that the premise for the fund was flawed, not only in that it judges municipalities for factors out of their control, but also that it penalizes ones that need more help building housing.

"It is a little bit of an oxymoron to me to hear, 'We want to try to help with housing starts, and to unlock housing you need housing infrastructure,' but then those communities aren't given the money from the province for the housing infrastructure," Cam Guthrie said.

"It feels off to me. And I'm the one that got the money."

Ford has said that the government will take any unused funds from the $1.2-billion, three-year Building Faster Fund and put them in a different fund for housing-enabling infrastructure that all municipalities can apply for, but Meed Ward said that hasn't happened yet.

This report by The Canadian Press was first published June 21, 2024.