City staff recommending 3% tax hike for 2022

Ottawa City Hall

City staff are calling for a three per cent property tax hike for 2022, according to proposed draft budget directions that will be tabled at next week’s finance and economic development committee meeting.

If approved, the increase would see the average urban homeowner’s tax bill jump $119 to $4,086, while the average rural resident’s property tax tab would rise $91 to $3,363. The average commercial property owner’s tax bill would increase $242 to $8,312.

The report submitted by chief financial officer Wendy Stephanson says the city is still expected to feel the financial impact of COVID-19 in a number of areas in 2022, particularly transit and recreational services. 

The city says it’s expecting continued reductions in revenue from airport payments in lieu of taxes as well as transit fares, recreational programs and parking fees and fines.

In addition, the report says extra funding may be required for expenditures such as “enhanced cleaning, personal protective equipment and staffing costs for increase in health, safety and service delivery standards.”

Staff are recommending the transit levy be increased by no more than 4.5 per cent, including a $5-million boost in the contribution to capital to replace the cancelled provincial gas tax hike. The report calls for the city-wide levy, which makes up the largest portion of the tax bill, to rise by 2.6 per cent, while the police levy is recommended to increase by three per cent.

The federal and provincial governments helped cover gaps in funding due to a COVID-fuelled loss in transit and service revenues in 2020 and 2021, but the report says the city “is not anticipating funding from senior levels of government” next year.

“Staff will prepare mitigation measures that could include the use of city reserves, possible reductions in service levels and various additional mitigation measures for consideration by council.” the report states.

Staff are proposing that the city’s draft 2022 budget be tabled at a special council meeting on Nov. 3, with approval slated for the regular council meeting of Dec. 8.