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Tax freeze on the rocks
Councillors endorse 5% increase
Jean-François Bertrand, The Ottawa Citizen
Published: Tuesday, August 28, 2007
Councillors on a city committee yesterday endorsed a property tax increase of five per cent.
The long-range financial planning committee recommended directing staff to create a draft budget that builds in a 1.4-per-cent tax increase for inflation. The committee also endorsed a two-per-cent capital levy to pay for the renewal and maintenance of infrastructure. Police are also seeking additional funds representing a 1.6-per-cent tax increase, bringing the total to five per cent.
The committee struck down a proposal by Councillor Glenn Brooks that would have started budget considerations with a zero-per-cent increase.
Mayor Larry O'Brien's oft-repeated election vow that zero means zero, isn't dead yet, he said yesterday, as this is still early in the budget process.
"What we might have seen is the death of certain councillors' will to see zero," said Mr. O'Brien. Yet, he noted the difference between zero and 1.4 per cent was about $14 million -- a small amount in a $2 billion budget.
The subcommittee's recommendation has to be approved by the corporate services and economic development committee, where there will be other discussions, said the mayor. After that, it goes to council.
"There is lots of room for the battle to continue," Mr. O'Brien said.
That battle is on the operating side of the budget -- expenses that recur every year, such as salaries and the costs of running programs -- where the mayor says he is still very much committed to a zero-per-cent increase.
However, on the capital side -- one-time expenses, such as building a new road or repairing an existing one -- the mayor proposed a two-per-cent, one-time levy to invest in infrastructure that will crumble if it is not renewed. The mayor said this depended on the federal and provincial governments matching the $20 million the city would raise.
Just last week, Mr. O'Brien voted against such a proposal put forward by Councillor Peter Hume.
"This is a significant change of policy for me," the mayor said yesterday. "But the health and safety of our citizens must be ensured and the cost of doing nothing is a price I am not willing to pay."
While the mayor makes this levy for a new "Restoration Ottawa Fund" conditional on matching funds, Councillor Eli El-Chantiry's motion, adopted yesterday, makes the levy for 2008 independent of support from the upper tiers.
Mr. Hume's original plan was to get $20 million in 2008, $40 million in 2009 and then $60 million in 2010 from the ratepayers to fix Ottawa's aging infrastructure.
The mayor said during a break that he was "short of furious" that subcommittee councillors weren't as keen as he was to consider a zero budget.
Mr. Hume reacted afterwards, saying the mayor should know that in politics one has to build coalitions to get things done.
"You can't get furious," he said. "This should be like water off a duck's back."
Councillors balked at a zero-increase operating budget, remembering the service cuts of the 2004 budget, most of which were reinstated the following year.
"We didn't have the political strength to sustain these cuts," said Mr. Hume. "History teaches us that zero is unrealistic and that it creates unrealistic expectations."
Mr. Brooks argued that starting with a zero-per-cent increase and a list of what needs to be cut to get there is the best approach.
"We should be able to show clearly that 'zero won't work because of this, this and this.' People want to be told," he said, adding that council should at least try for zero, even if it's a starting point that is very brief.
© The Ottawa Citizen 2007
Councillors endorse 5% increase
Jean-François Bertrand, The Ottawa Citizen
Published: Tuesday, August 28, 2007
Councillors on a city committee yesterday endorsed a property tax increase of five per cent.
The long-range financial planning committee recommended directing staff to create a draft budget that builds in a 1.4-per-cent tax increase for inflation. The committee also endorsed a two-per-cent capital levy to pay for the renewal and maintenance of infrastructure. Police are also seeking additional funds representing a 1.6-per-cent tax increase, bringing the total to five per cent.
The committee struck down a proposal by Councillor Glenn Brooks that would have started budget considerations with a zero-per-cent increase.
Mayor Larry O'Brien's oft-repeated election vow that zero means zero, isn't dead yet, he said yesterday, as this is still early in the budget process.
"What we might have seen is the death of certain councillors' will to see zero," said Mr. O'Brien. Yet, he noted the difference between zero and 1.4 per cent was about $14 million -- a small amount in a $2 billion budget.
The subcommittee's recommendation has to be approved by the corporate services and economic development committee, where there will be other discussions, said the mayor. After that, it goes to council.
"There is lots of room for the battle to continue," Mr. O'Brien said.
That battle is on the operating side of the budget -- expenses that recur every year, such as salaries and the costs of running programs -- where the mayor says he is still very much committed to a zero-per-cent increase.
However, on the capital side -- one-time expenses, such as building a new road or repairing an existing one -- the mayor proposed a two-per-cent, one-time levy to invest in infrastructure that will crumble if it is not renewed. The mayor said this depended on the federal and provincial governments matching the $20 million the city would raise.
Just last week, Mr. O'Brien voted against such a proposal put forward by Councillor Peter Hume.
"This is a significant change of policy for me," the mayor said yesterday. "But the health and safety of our citizens must be ensured and the cost of doing nothing is a price I am not willing to pay."
While the mayor makes this levy for a new "Restoration Ottawa Fund" conditional on matching funds, Councillor Eli El-Chantiry's motion, adopted yesterday, makes the levy for 2008 independent of support from the upper tiers.
Mr. Hume's original plan was to get $20 million in 2008, $40 million in 2009 and then $60 million in 2010 from the ratepayers to fix Ottawa's aging infrastructure.
The mayor said during a break that he was "short of furious" that subcommittee councillors weren't as keen as he was to consider a zero budget.
Mr. Hume reacted afterwards, saying the mayor should know that in politics one has to build coalitions to get things done.
"You can't get furious," he said. "This should be like water off a duck's back."
Councillors balked at a zero-increase operating budget, remembering the service cuts of the 2004 budget, most of which were reinstated the following year.
"We didn't have the political strength to sustain these cuts," said Mr. Hume. "History teaches us that zero is unrealistic and that it creates unrealistic expectations."
Mr. Brooks argued that starting with a zero-per-cent increase and a list of what needs to be cut to get there is the best approach.
"We should be able to show clearly that 'zero won't work because of this, this and this.' People want to be told," he said, adding that council should at least try for zero, even if it's a starting point that is very brief.
© The Ottawa Citizen 2007
