The City of Ottawa’s deficit may look bad, but staff say it’s not as bad as they thought.
The city closed 2015 with a massive $42-million shortfall on the books. Of that, $25.9 million stems from property tax supported programs, while water and wastewater operations are another $15.9 million in the red.
The reasons include: heavy snowfalls early in the year, higher-than-expected arbitrated settlements for 2014 and 2015, additional Workers Safety and Insurance Board costs with the provincially mandated addition of six work-related cancers, and unachievable revenue targets in areas like sponsorship.
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However, “the actual results are significantly better than projected with a $20.6 million improvement over the forecasted deficit,” reads a staff report that’s going before a finance and economic development committee on Tuesday.
Thanks to a spending and hiring freeze, a warmer end to the winter season and higher revenues in some departments, staff were able to cut the anticipated $46.5-million deficit.
But, as water consumption levels continue to come up short, the rate-supported shortfall came in higher than the anticipated $10 million.
City staff are recommending that several reserve funds cover last year’s shortfall. The decision will be up to the finance committee and council.
That should do the trick, said Ottawa Mayor Jim Watson.
“We’re on target for another deficit-free budget in 2016.”
This article originally appeared on metronews.ca on Feb. 24