Mayor Mark Sutcliffe defends his 'Fairness for Ottawa' campaign

Mayor Mark Sutcliffe talks transit CTV's Austin Lee sits down with Ottawa Mayor Mark Sutcliffe to discuss the financial challenges facing OC Transpo.

Ottawa mayor’s "Fairness for Ottawa" campaign continues, as the city seeks more funding from all levels of government.

Mayor Mark Sutcliffe sat with CTV News Ottawa's Austin Lee Saturday to talk about his campaign, and why the capital is asking higher levels of government for more funding rather than hiking taxes.

Why hasn't city council raised property taxes in line with other Canadian cities?

Sutcliffe said raising taxes to match other Canadian cities is not fair for the capital's residents. He says they've already been paying their fair share of OC Transpo and the cost of all municipal services. However, the federal and the provincial governments have been giving Ottawa less money than other cities, he adds.

"And because of that, a burden has been transferred already to the property taxpayers in Ottawa," he said. "I don't want to add to that with nine per cent property tax increases. That wouldn't be fair to them."

Sutcliffe notes that keeping property taxes low is what the people of Ottawa want, citing that was his promise when he ran for mayor.

He adds that the city's finances are in good shape, as the city operated efficiently while finding savings amounting to a $153 million. That surplus saved every household in Ottawa $400, he added.

What are the federal government's payments in lieu of property taxes (PILT)?

Sutcliffe says it's not a secret that the federal government owns many properties in Ottawa. He says the government owns half of the capital's downtown core.

He explains where the gap is when it comes to the government's buildings and their property taxes:

"They are supposed to pay us an amount that is equivalent to what the property tax would be if it was owned privately," he explained.

However, he says, the government is not paying the equivalent amount, citing that it's been paying much less – year-by-year.

"They've been saving money by paying the city of Ottawa less, and they've been shifting that burden to local taxpayers," he added.

City staff say there's been a $99.2 million shortfall over the past five years, and that could grow to over a $252 million -- $445 million over the next 10 years, unless the federal government changes the funding formula, leaving local taxpayers to fill the gaps.

"They used to pay us a $194 million a year, they're now paying a $164 million a year. Everybody else's taxes have gone up during that period, theirs have gone down, because they get to decide how much they pay. And it's simply not fair," Sutcliffe said.

According to the government's website, PILT "are equitable in comparison to those made by other property owners."

Payments are calculated according to the rates and values that would apply to federal property if it were taxable, and the government receives equal access to services provided to private property owners by the host municipality, reads the website.

What's next if higher levels of government do not respond?

Sutcliffe says in the worst-case scenario – if they don't get help from the government -- they will be looking at raising property taxes, raising transit fares, potentially cutting service and reducing the free services and the discounts the city offers for its seniors and students.

"We'll have to look at some combinations of those things. There won't be one thing or another," he said.

Premier of Ontario Doug Ford said, the day after Sutcliffe made the announcement in August, the provincial government is open to help, if the federal government steps in, the mayor says.

"I've been having regular discussions with members of the federal government," he said.

Without funding from higher level of government, OC Transpo is facing a possible $130 million to $150 million deficit each year over the next five years. Something the organization says it's preparing for with five scenarios to address the shortfall and it could mean a property tax hike of seven per cent next year for homeowners in the city.

On Wednesday, council voted unanimously to support a motion directing the mayor and city manager to continue to fight for more federal and provincial money.

Other Canadian cities have faced similar tax hikes in 2024, including Toronto: 9.5 per cent, Vancouver: 7.5 per cent, Edmonton: 8.9 per cent and Calgary: 7.8 per cent.

With files from CTV News Ottawa's Austin Lee and Josh Pringle