Communal drinking water and wastewater system municipal consent requirements.

The government is seeking public feedback on proposed legislative changes under the proposed Building Homes and Improving Transportation Infrastructure Act, 2026 and related regulatory changes to further support housing, economic, and infrastructure development, and advance key transportation and transit priorities.

The Ministry of Municipal Affairs and Housing (MMAH) together with the Ministry of the Environment, Conservation and Parks is proposing legislative changes under the proposed the Building Homes and Improving Transportation Act, 2026 to encourage greater adoption of non-municipal communal water and wastewater systems to support new housing development.

If passed, the legislative amendments would be made to section 93 of the Municipal Act, 2001 (MA), to require persons to apply for municipal consent to establish a non-municipal communal drinking water or wastewater system (public utility). The amendments would also create regulation-making authority to set conditions and criteria where, if the public utility meets those conditions and criteria, a municipality would be required to give consent. These future regulations would allow an applicant to make an application for municipal consent for a public utility with greater certainty, knowing that where prescribed criteria and conditions are satisfied, the applicant will receive the municipality’s consent. More specifically, the proposed legislation would require a municipality to provide consent for the proposed system if the municipality is of the opinion that:

• any prescribed criteria or conditions respecting the area in which the public utility would be located are met,
• any plans in respect of the public utility required by the regulations have been provided and meet the prescribed criteria or conditions and include the required content,
• any reserve funds or other financial assurances or instruments in respect of the public utility that are required by the regulations are or will be in place and the funds, assurances and instruments meet the prescribed requirements,
• the public utility, if constructed, maintained or operated in accordance with the application, would meet the relevant prescribed criteria and conditions, and
• the application and public utility satisfy any other requirements, conditions or criteria that may be prescribed.

Where, under the proposed amendments, municipalities would be required to provide consent, municipalities would be able to require certain conditions or limits to be met, as prescribed in regulations, including the requirement to enter into an agreement or impose limits if they are necessary to ensure the safe, sustainable operation of the utility. 

Section 53 of the Safe Drinking Water Act, 2002 (SDWA) currently requires a person to obtain municipal consent to establish a non-municipal residential drinking water system. Section 53 of the SDWA is proposed to be amended to provide that where municipal consent was required to be given under clause 93(2)(b) of the Municipal Act, 2001, it would be deemed to be consent under the SDWA.

If the proposed legislative amendments are passed, they would come into effect upon Royal Assent and regulations would be developed at a later date and will be made available for public feedback.

Analysis of Regulatory Impact:

The proposal outlines proposed legislative amendments to create regulation making authority, with potential for future regulations to be made. As a result, the associated costs to the proposal will be considered if regulations are developed.

Local impacts may vary among impacted municipalities as it is contingent on the development of communal systems in a municipality and their existing fiscal and operational capacity to support and/or take on these systems.