First announced in the David Peterson government's 1987 throne speech,[1] the NOHFC's creation was included in the 1988 provincial budget,[2] and the enabling legislation was given royal assent on June 7, 1988.
[8] In 1990, the NOHFC gave a $5 million grant to the Algoma Central Railway,[9] which opposition Progressive Conservative leader Mike Harris alleged was a "down payment" on a secret deal to have the provincial government take over ownership and operation of the troubled company.
[12] In 1995, the Auditor General of Ontario's annual report criticized the NOHFC for not having sufficient monitoring programs in place to ensure that its investments were actually achieving their job creation goals.
[19] In this era, the NOHFC began to receive criticism for expanding its service area to include the Muskoka District, a region outside the traditional boundaries of Northern Ontario.
[20] This decision was made by then-finance minister Ernie Eves, who was the MPP for Parry Sound—Muskoka at the time,[20] and was later reversed by Greg Sorbara in the 2004 provincial budget.