5 things to watch for in today's 2020 city budget

Ottawa property taxpayers should expect their bills to be capped at a three per cent increase in 2020, but the draft budget being tabled today required more jostling than usual to toe that line.

The treasurer's office has had to move money around so the city can still afford its construction plans for Stage 2 of light rail while staying within that tax cap, which was a campaign promise for Mayor Jim Watson in 2018.

Every year, the City of Ottawa decides on spending worth more than $4 billion: the operations budget now tops $3.6 billion and capital spending runs in the $700 million range.

"I think people will see, once again, a balanced document that looks after both our social and economic needs in the community," said Watson on Tuesday.

The public and many councillors will see a raft of financial figures at a series of meetings Wednesday morning, but certain portions of the budget are already known to be under pressure. 

Transit troubles

The budget will be tabled exactly one month after the training wheels came off and the new light rail corridor took over as the spine of the system. It's been a month marked by malfunctions, delays and replacement bussing. 

The transit commission meeting will be the main event Wednesday, because transportation manager John Manconi and his boss, city manager Steve Kanellakos, are supposed to outline fixes, some of which will surely cost money.

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Many city councillors and transit commissioners are also determined to see the city improve Para Transpo in 2020. Riders often wait hours on the phone to book rides and the city has already promised a new online booking system.

Provincial pressures

Last spring, a budgetary crisis loomed for 2020 after the Ontario government made a number of changes affecting municipalities.

"I think we're in a much better place today... because the province has backtracked, to their credit, on a lot of key items that were going to put a lot of pressure on our budget," said Watson.

But while changes to paramedic and child care funding were called off, the municipality will still have to carry a higher share of the cost of Ottawa Public Health.

Stage 2 spending hole

Another provincial problem relates to the Ford government's decision not to double gas tax revenues, as the Liberals before him had promised.

The city had counted on getting that money when it built the case for Stage 2 of LRT, and expected it would lead to an extra $980 million over 30 years.

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It must fill that hole, which it plans to do using taxes meant for other projects.

Roads and snow

With transit construction expected to take an $9.8 million in property taxes in 2020, the City has had to look elsewhere to close its so-called infrastructure gap and keep maintaining its roads, bridges and multi-use paths.

For the next three years, at least, it plans to make up the lost money using $19 million a year from its $57 million one-time influx of cash from federal gas tax revenues.

Councillors know how much residents complain about the state of roads, so they say it's not a question of putting off the work. 

Clearing snow and ice on-budget is also a perpetual operational problem. The winter maintenance envelope has finished each year since 2012 in a deficit. The city plans to increase that envelope again for 2020, but even that may not be enough.

Construction, insurance costs going up

Finally, other costs are going up faster than expected.

All those new or resurfaced roads and new pipes don't come cheap. The cost of the work is actually rising faster than typical consumer inflation. The city has built the budget assuming construction costs have gone up at least 5.8 per cent.

After the tragic double-decker crash at Westboro Station in January, the city also had to settle for worse terms on its insurance package. It had to dip into reserves to cover the unexpected new rate in 2019, and that rate extends to 2020.