Jason Kenney, the regional minister for Southern Alberta and minister of Employment and Social Development, made the announcement at the end of a speech to the Calgary Chamber of Commerce.
Ottawa had already set aside $2.8 billion to help after with the expenses Alberta incurred after several communities, most notably Calgary and High River, were hit hard by the flood waters beginning on June 21, 2013.
The federal government pays up to 90 per cent of the costs associated with disasters.
Total damage for the worst natural disaster in Alberta history including insurance claims, is in excess of $6 billion.
Thousands of southern Albertans were forced from their homes and many have still not returned.
Alberta has requested the $500 million advance last fall.
"We transferred the first instalment for flood and disaster relief to the province of Alberta with a $500 million transfer to help cover the costs of flood mitigation, flood relief for the province of Alberta," said Kenney.
"Our government has set aside in the current fiscal framework $2.8 billion for flood recovery costs — a number that could climb higher if the bill goes up," he added.
"This is the largest and earliest support that the federal government has ever given to a province for disaster relief."
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