OTTAWA – Jim Watson announced today that, if he is re-elected, he would set a tax goal of between 2 and 3 percent annually throughout the next term of Council. Mayor Watson highlighted the need to improve our roads and infrastructure, operational uncertainties, and the need for flexibility as the basis for this proposed tax goal.
The winter seasons of 2017 and 2018 produced over 90 freeze and thaw cycles, resulting in considerable impacts to the state of our roads. As a result, at the end of 2017, Mayor Watson brought forward motions to Council directing that a year-end surplus and unanticipated Hydro Ottawa dividends be directed to road resurfacing and pothole repairs, work that took place this spring and summer.
Over the last year, Mayor Watson has personally knocked on more than 10,000 doors to hear from residents. The condition of our roads and municipal infrastructure consistently comes up as a priority across the city. If he is re-elected, Jim Watson will focus significantly on delivering more infrastructure renewal projects – including roads, sidewalks, paths, culverts and bridges – in all parts of the city.
‘’I have heard from residents, and I believe they are prepared to contribute more in order to have better roads and infrastructure,’’ said Jim Watson. ‘’There are also many unknown costs related to the upcoming legalization of marijuana and a pending budget from a new provincial government. We need the fiscal breathing room to react and adapt the City’s budget accordingly.’’
Given that the cost of delivering municipal services increases at an annual rate of about 2 percent, any funds generated over and above this level can address unexpected pressures or be invested in the renewal of roads and other infrastructure. The flexibility provided by a 2 to 3 percent tax goal for 2019 could generate an additional $10.3 million compared to 2018.
If 20 percent of those funds are required to address unexpected costs or losses of revenue, $8 million would be left to invest in infrastructure renewal.
These additional funds would increase the City’s annual investments in infrastructure and roads from $128.9 million in 2018, to $136.9 million in 2019. This translates into an additional investment of $80 million towards infrastructure renewal over the course of the next mandate. At this compounding rate of investment, the existing $60-million infrastructure funding gap would be eliminated within seven years, while adding no new debt to tackle this challenge.
Increasing the tax goal from 2 to 3 percent represents an increase of $36 on the average property tax bill (based on the average assessment of $404,000).
Jim Watson will also continue working closely with the Province of Ontario and the Government of Canada to highlight the importance of these investments and to seek their continued support for our roads and core infrastructure needs, as they craft future rounds of infrastructure investments. That said, the Province of Ontario has stated its intention to focus on deficit reduction over the course of the coming years, and the costs related to cannabis legalization are still unclear. As a municipality that benefits from numerous sources of provincial and federal funding, we must be cognizant of this reality, and consequently approach the 2019 budget as a year of transition for planning purposes.
When Mayor Watson was elected in 2010, the national capital’s unemployment rate stood at 7.9 percent. Today, our economy is thriving. Unemployment is close to 4 percent – its lowest rate in three decades, and we are seeing job creation in all parts of our city. Businesses and residents are investing with confidence in their future and in the future of our city.