The Town of Tecumseh is facing a multimillion-dollar financial setback after its council effectively turned down crucial federal housing support by refusing to permit widespread fourplex development.
A Costly Decision for the Municipality
By taking no action at a council meeting on Tuesday, January 13, 2026, Tecumseh solidified its position against allowing four housing units 'as-of-right' on residential lots. This inaction triggered the termination of a $3.2 million agreement from the federal Housing Accelerator Fund (HAF). The funds were part of a larger $4.38 million pledge announced in March 2024, which was contingent on the town following through on its submitted action plan.
The council's stance stems from a narrow vote in July 2025, where, after hearing from residents opposed to increased density in low-density neighbourhoods, they rejected the blanket four-unit allowance. This decision was made with the foreknowledge that it could jeopardize the HAF money.
Federal Ultimatum and Lost Opportunities
The Canada Mortgage and Housing Corporation (CMHC) delivered a written ultimatum to the town on December 24, 2025. The letter stated the funding agreement would be terminated unless Tecumseh reversed its July decision and amended its housing plans within 37 days. The council's recent meeting was its final opportunity to 'cure the non-compliance,' an opportunity it declined.
Ward 1 Councillor Alicia Higgison strongly criticized the outcome, stating the town has now forfeited the $3.2 million and likely millions more in future federal investments. She highlighted that eligibility for other major funding streams, such as the Canada Housing Infrastructure Fund, also requires municipalities to permit four-unit developments as-of-right.
"We can't stop people from moving into the town," Higgison said during the council meeting. "We can't just shut the doors — it's our obligation to provide the infrastructure that allows for growth. I'm extremely disappointed in this. I have been disappointed."
Broader Context and Windsor's Parallel
Tecumseh's original action plan to secure HAF funding included nine initiatives, such as amending its Official Plan and zoning bylaws for fourplexes, pre-zoning land along main streets for denser development, and implementing an electronic application system.
The town's situation mirrors a similar conflict in neighbouring Windsor. Ottawa rejected Windsor's application for at least $30 million from the same Housing Accelerator Fund in early 2024 after that city's council also refused to allow four units as-of-right without requiring public hearings or additional approvals.
The debate in Tecumseh underscores the ongoing tension between federal housing intensification goals, which aim to address the national housing crisis, and local municipal control over planning and neighbourhood character. The financial consequence for Tecumseh is now a matter of public record, leaving the town without significant federal support for housing-related infrastructure and development.
