The Chilaw Housing Project was funded by the Government of Sri Lanka to provide housing facilities to low income sanitary labor workers in the Chilaw Urban Council who lived in the heart of the town center. This land was about 80 perch in extent and adjoined to the bus stand and along the Chilaw-Kurunegala main road. They have been occupied since long period of time in this vulnerble property was owned by the Chilaw Urban Council. Limited living spaces, lack of light and ventilation were very common features in these housing units. Further, in the rainy reasons, they were faced many difficultied with flooding and health diseases.

The project was impleneted during the year 2013 to 2014 December to relocate the segment of people to provide standard shelter for living at a cost of Rs. 60.540 million to construct 60 houses located at Nariyagodella in the Maikkulama village. The site was nearly 05 Acres in extent was owned by the Land Reform Commission (LRC).

The Chilwa Housing Project was impleneted with the view to provide permanent shelter and uplift the living standard of people in the selected settlement and mitigating vulnerabilities through an integrated programme of improvement of urban settlements including physical, environment and socio-economic development for the residential zone of the city while liberating the prime land for urban re-development purposes. The project objectives are aligned to the national development strategy of the government to address the social, economic and ethnic aspirations of such communities.

Construction of new houses was initially proposed to implement as a participatory mechanism and owner driven approach with the assistance of Urban Settlement Development Authority (USDA) and the Urban Council (UC). However, due to lack of beneficiary and UC participation, only USDA constructed the houses through local constractors. Local contractors constructed the houses whilst the USDA provide the materials, financial and technical assistance. 6.5 perches of land was given to the beneficiaries. Also USDA was undertaken the responsibility of providing necessary off-site infrastructure for the housing scheme. Each housing unit has 2 bed rooms, living rrom, bath room, toilet, and 2 verandahs in 550 sq. ft. and the per unit cost is Rs. 900,000/-. The selection of beneficiaries were jointly done by the UC and USDA. The beneficiaries are liable to repay the cost incurred with an annual interest rate of 3.72% on an installment basis over a period of 20 years.