Investing in Regional Diversification Guidelines


Structural adjustments and the impact of the recession continue to challenge many southern Ontario communities, including increased competition to attract businesses; a need to explore opportunities for economic diversification and/or transition; and a lack of incentives to collaborate.

To help these communities leverage their economic strengths and unique assets to take advantage of emerging opportunities, the Federal Economic Development Agency for Southern Ontario (FedDev Ontario) has supported projects by businesses and not-for-profit organizations that contribute to diversifying the regional economy and attracting investment. The Agency will continue its efforts in this area by working with on-the-ground stakeholders and organizations to encourage communities to work collaboratively in identifying their assets and challenges, and to identify projects that create new economic opportunities—particularly those that are conducive to the longer-term economic sustainability of the community.


FedDev Ontario will provide funding to eligible projects that:

  • Enhance business attraction, investment and employment opportunities in southern Ontario regions and communities;
  • Strengthen regional businesses and clusters with the goal of economic diversification and sustainability;
  • Develop and expand collaborative efforts to strengthen regional assets and competitiveness; and
  • Improve the economic circumstances of communities facing distress.Footnote 1


I. Eligible Applicants

Incorporated not-for-profit organizations located in southern Ontario, whose mandate includes economic development, are eligible to apply under this initiative for projects that have spillover/value-chain development potential, leading to enhanced opportunities for growth.

Note: Normally, not-for-profit organizations will be limited to one approval under this initiative. Incomplete applications cannot be assessed and considered for funding. Funding under this initiative is for costs incurred by the not-for-profit organization only; no transfer of funds to for-profit project participants will be permitted.

All projects must be completed by December 31, 2018.

II. Eligible Activities

The initiative will support activities of eligible not-for-profit organizations to undertake activities to diversify the economic base and have a regional or sub-regional impact by working with private sector and other community stakeholders to develop assets, such as:

  • Diversification of Economic Assets (capacity building)
    • Industry/sector cluster development and expansion
    • Human capital retention and attraction
    • Implementation of community/regional action plans
  • Business Infrastructure
    • Business incubators
    • Supply chain analysis and development

III. Eligible Costs

Eligible costs may include:

  • Labour
  • Expertise
  • Non-capital
  • Capital

All costs must be reasonable and directly related to eligible activities.

IV. Ineligible and/or Unsupported Costs

Any costs determined not reasonable and/or not directly related to the eligible project activities are not eligible.

Costs incurred prior to the eligibility date as defined in the FedDev Ontario Contribution Agreement will not be supported, including any cost incurred after December 31, 2018.

Any cost that is ineligible under the Agency's terms and conditions and program policies will not be supported, including the acquisition of land and buildings.

Ineligible costs also include any publicly-owned fixed capital assets in Canada primarily for public use or benefit.


Priority may be given to communities facing economic distress (see notes section for additional information).


Eligible Applicants will be considered for a non-repayable contribution to a maximum of $20 million per project for up to one-half (50 percent) of eligible costs. The remaining 50 percent of eligible costs must be provided by the recipient as a cash contribution. Up to 10 percent of the contribution to not-for-profits can be allocated to support outreach and project administration costs.

FedDev Ontario support is not intended to replace or duplicate funding available from other funding sources, including private-sector and/or government programs.

Disbursement of Funding

If a project receives approval, a contribution agreement (contract) will be negotiated and executed. Funding will be disbursed based on the percentage approved funding for eligible costs incurred.

To receive funding, approved recipients must submit claims forms that summarize eligible costs incurred and paid in a period. Generally, these periods will be of a duration of no more than once a month and no less than twice a year.

Application Process

This is a continuous intake, two-phased application process. In Phase I of the process, Applicants complete and submit a "Statement of Intent" that provides a high-level overview of their organization, the proposed project, and its impacts and benefits. Upon written confirmation from FedDev Ontario that the Application can proceed to Phase II, Applicants will be asked to submit a full application.

Prior to submitting a Statement of Intent, potential Applicants are strongly encouraged to contact the Agency at 1-866-593-5505 for help with your application and to discuss other Government programs that may be applicable to your opportunity.

To be considered for funding, Applicants are expected to provide:

  • Evidence of (normally) at least 50 percent cash commitment to and available for the project with significant investment from private, provincial and/or municipal sectors;
  • A sustainable business model;
  • A description of how the project will meet the objectives and eligibility criteria of the initiative;
  • Unencumbered rights to use the background intellectual property required for the project;
  • Appropriate organization and project management and technical skills;
  • Evidence of the project's cost estimates;
  • Compliance with all previous agreements with Government funding agencies; and
  • Capacity to account for and execute the project successfully in a timely manner.

Phase 1 (Statement of Intent)

To be considered for funding the Statement of Intent must:

  • Confirm that the Applicant is a Canadian incorporated not-for-profit organization, located in southern Ontario;
  • Provide a brief overview of the organization, its mandate, membership (if appropriate);
  • Describe related/affiliated parties;
  • Demonstrate a track record of operation;
  • Provide a summary of the proposed project, its anticipated impacts on the communities/region, and its impacts in relation to program objectives;
  • Provide a summary of the proposed costs and financing (including status of financing)
  • Demonstrate the capacity to undertake the proposed project; and
  • Demonstrate the need for FedDev Ontario funding and its incremental impact on the project in terms of scope, location, and timing.

Phase 2 (Full Application)

If selected to proceed to Phase II (full application), the Applicant will be asked to provide additional detail and substantiation of the Phase I information, including:

  • Substantiation of the proposed opportunity and projected impacts;
  • Financial projections and underlying assumptions;
  • The project description and implementation plan and schedule;
  • Substantiation of project cost estimates;
  • Substantiation of ownership/control of any assets required for the project (intellectual property, land/building for example);
  • Analysis of project risks and mitigation strategies;
  • Compliance with all relevant statutes, regulations and other funding agreements; and
  • Other information as required.

Application Review

FedDev Ontario will review applications as they are received. Funding will be made available as of April 1, 2014. All project activities must be completed by December 31, 2018. All applications will be screened initially for completeness. Incomplete applications cannot be assessed and considered for funding.

Complete applications are those that include all prescribed documentation containing all information needed to complete the review. Information should be accurate, verifiable, relevant and consistent. Incomplete applications cannot be assessed and considered for funding.

FedDev Ontario reserves the right to modify these guidelines at any time without notice and may waive certain requirements on an exceptional basis.

Reporting Requirements

Recipients must submit to FedDev Ontario, reports of project expenditures and completion of deliverables, including achievement of performance indicators identified in contribution agreements.

Contact Us

For more information on FedDev Ontario's Investing in Regional Diversification initiative, please email us or call 1-866-593-5505.


Footnote 1

Using standardized data collected by Statistics Canada, FedDev Ontario has established a methodology to determine if a community is in distress.

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