The city’s finance and economic development committee on Tuesday unanimously supported a plan for the 2020 municipal budget that would once again see the average property tax bill for an urban home in the city of Ottawa go up by three per cent, or an extra $109.
The proposed three per cent increase includes a two per cent increase to the city-wide tax levy, a three per cent increase to the Ottawa Police Services levy and a 6.4 per cent increase to the transit levy.
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Mayor Jim Watson — who pledged to keep the yearly tax increase between two and three per cent during his election campaign last fall — told reporters he believes the three per cent increase for 2020 is “a reasonable compromise” given multiple pressures on the city’s coffers.
“We have to balance the needs of all of the groups that come and want us to invest in various programs with ensuring that the city remains affordable,” he told reporters.
“There will be some people that will push for more spending and others that will want us to curb our spending, and I think it’s a reasonable compromise given the fact that we are a growing city and we have some pressures that have been given to us by the provincial government, as well as construction inflation.”
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Changes at the provincial level to public health, childcare services and long-term care funding have put a $13.8-million pressure on the City of Ottawa, according to a report prepared by the deputy city treasurer and submitted to the committee.
Another financial pressure city staff had to account for in drafting a plan for the 2020 budget was the Ontario’s government cancellation of a previously-promised increase to municipalities’ shares of provincial gas taxes.
Under that original promise, made by the former Liberal government, the City of Ottawa would have seen its share doubled over several years.
To make up for the loss, Ottawa’s deputy city treasurer, Isabelle Jasmin, recommended increasing the city’s transit levy by 6.4 per cent in 2020, which includes “a $9.8 million increase to the contribution to capital to replace the cancelled provincial gas tax increase.”
“2020 will continue to be a transition year for Transit Services as it relates to the launch of the Confederation Line in 2019,” Jasmin’s report said.
“The projected 2020 expenditure increases include full year impacts related to transition related costs, in addition to labour contract settlements, legislative changes to the Canada Pension Plan, estimated inflationary increases on contracts, purchased services, and significant impacts related to the forecasted increases in fuel pricing”
After the committee meeting, councillor and transit commission chair Allan Hubley was asked for his message to taxpayers in light of the proposed increase to the transit levy, which will follow a 2.5-per cent increase to transit fares on Oct. 1, 2019.
“If we don’t make investments in the system, we can’t make improvements, so it’s a trade-off,” Hubley told reporters. “If people don’t want to add any more money or keep it frozen forever at this price, what’s going to happen? The system will decline over time because we’re not putting anything into it.
“As you heard today, we’re trying to get more money into the system so we can provide a much more dependable system so that those complaints from the riders decrease. That’s our goal here. That’s what we want to do.”
The city is still getting a one-time boost in federal gas tax revenues totalling $57 million over the next three years. Jasmin’s report recommended allocating that money towards “local roads, bridges and active transportation.”
The current budget 2020 plan would have city departments, including Ottawa Public Health and the Ottawa Public Library, keep any increase in spending to two per cent. It would also see the average water, wastewater and stormwater bill increase by 5.2 per cent overall.
The 2020 budget plan will go to council on Wednesday for approval, after which councillors will lead two months of public consultations on the 2020 budget.
Departmental draft budgets for 2020 are scheduled to be tabled on Nov. 6, 2019, then sent to committees and boards for review.
The city has set Dec. 11 as the date for council to deliberate and adopt the budget.
If the current plan doesn’t change significantly, owners of urban properties will see an average tax bill of $3,672 in 2020.
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