The Rural Economic Development Program: Making Ontario’s Rural Communities Locally and Globally Competitive

Ontario’s economy is shifting to the global stage. This puts its rural areas in a challenging position. Local municipalities must now create an environment where many businesses could flourish. This is important as a diverse and robust economy helps them compete against urban areas in Canada and beyond.

And yet, the situation raises some questions. Is the infrastructure in rural Ontario strong enough for the changing times? Do they have the workforce and skills to sustain a more advanced economy?

Rural Ontario has specific needs that could vary from one community to another. For instance, one place may need better roads. Another could use an internet connection with high speed. Others may have an aging labor force and would benefit more from the addition of younger workers.

It would seem that there is no blanket solution to a challenge this diverse. Still, Ontario’s Rural Economic Development or RED program comes close. The RED program offers a flexible approach to economic development in rural Ontario.

What is the Rural Economic Development Program?

The RED program is a cost-sharing grant. It is designed to promote growth and development in Canada’s rural communities. It is tailor-made to meet the distinctive needs of Canadians living in remote areas.

This rural economic program can be accessed in two ways. One is the Economic Diversification and Competitiveness Stream. The other is the Strategic Economic Infrastructure Stream.

Stream 1 – EDCS

The presence of various economic sectors is vital for rural Ontario to be competitive. It is a sign that the communities are healthy enough for businesses to thrive. This, in turn, will attract more investors and skilled workers, turning into a productive economic cycle. This is the ideal scenario that the RED program is aiming for.

  • Entrepreneurship or Business Succession

Projects that support business start-ups and succession are eligible for the program. This includes coaching, mentorship, tours, introduction to retiring business owners, and similar activities.

  • Growing and Retaining the Business

Support is given to local and regional business owners to promote economic growth. This will create jobs and encourage workers and their families to stay within the communities.

  • Upkeep of Downtown Areas

Projects involved in creating and implementing development plans for traditional town centers in rural communities are entitled to financial support through the RED program.

  • Bringing in and Keeping Young Workers and Immigrants

The Rural Economic Development program supports employee-pooling, improvement of work conditions, and destination marketing. These and similar activities are designed to attract and retain people to rural communities.

  • Using Technology and Innovation to the Fullest

Digital capability and IT are essential for businesses to thrive in an advanced economy. The RED offers financial support for digital training and connectivity improvement. These are projects that help companies use technology to the fullest

Stream 2 – SEIS

This economic development program stream supports projects that promote economic development and investment in Ontario’s rural communities.

  • Saving Cultural, Heritage, and Tourist Spots

Projects involved in repairing historic buildings, tourist spots, and other attractions are eligible. These projects generate interest from investors.

  • The Repair of Community Streets and Landscapes

This RED stream supports minor capital projects that improve rural Ontario’s common areas. This includes repairing road signs, improving landscapes, and putting up Wi-Fi in public places.

  • The Repair of Vacant and Seldom-Used Buildings

Abandoned and rarely used buildings can hurt a community’s ability to attract investments. The RED program’s SEI stream is committed to supporting redevelopment projects. This includes efforts to revive vacant or seldom-used facilities.

Municipalities and groups with projects that qualify for the RED program will get funds. This fund can be used for project management. This includes fees for legal, engineering, accounting, and other professional services. The program also offers funds that can be used as minor capital. Buying of project-related software, training, and additional project-related costs are also eligible.

RED Program Funding Details

Applicants who wish to apply for the Rural Economic Development Fund must identify a preferred program stream. The EDC stream offers a provincial fund to cover 50% of eligible project costs, up to a maximum of $150,000. The SEI stream can cover 30% of qualified expenses up to a maximum of $250,000.

The computation of the cost-share funding would depend on the total amount of eligible costs as written in the application. Qualified applicants must sign a contribution agreement with the Government of Ontario. They must also accept joint responsibility for funded projects.

Projects that are already getting other provincial funds are not eligible for the RED program. However, additional grant funding from the federal government is allowed. The combined government funding must be not more than 90% of the total eligible costs.

Projects lasting several years are allowed. Their costs must be claimed each year and the total computed. The project must also demonstrate its positive impact on the community’s economy within the first year of implementation.

All projects approved under the Rural Economic Development program must be completed. The timing is indicated in the contribution agreement.

Who Are Eligible for the Grant?

Municipalities, nonprofits, local organizations, and local services boards with projects aligned to the RED program’s goals are eligible to apply for funding.

Interested parties must apply at the They must also ask the authority to enter a contribution agreement. They must comply with the contribution agreement after the project is approved and join in any audits that may come after.

The RED program prefers projects with several applicants. They will identify a lead applicant, but the other applicants would still be responsible for the project. The lead applicant and co-applicants must all enter into the contribution agreement.

The Ontario Government is always looking for new ways to improve its rural communities’ quality of life.

If you want to learn about the RED program and other Ontario Government grant opportunities, call us now at EVAMAX.


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