Fairness for Ottawa

It is not an exaggeration to say Ottawa is facing a financial crisis. And I want to be clear that it’s a crisis that is not of our own making. Our city shouldn’t have to struggle because of the decisions made far beyond our control. 

I need your help. I need you to join me as I fight for fairness, as I fight for Ottawa’s fair share of federal and provincial funding. 

Fairness for Ottawa

• Full Payment of Back Taxes: The federal government owes us nearly $100 million from the past five years. This is essential to maintain our city’s financial health.

• Fair Share of PILTs: The federal government needs to pay its fair share of property taxes. No more unilateral reductions. They should contribute equitably like any other property owner.

• Commitment to Transit Funding: We need the federal and provincial governments to restore the fair funding model for transit and provide operating dollars to cover our shortfall. Ottawa’s situation is as critical as, if not more so than, other cities.

• Fair Treatment for Ottawa: As the nation’s capital, we deserve the same support as other major cities. It’s time for Ottawa to receive the resources we need to thrive. The resources we deserve.

It’s my job to fight hard on behalf of Ottawa to make sure we get our fair share of federal and provincial funding. 

We’ve done our part, finding tens of millions of dollars in savings and efficiencies without cutting programs and services. But now it’s time for the federal and provincial governments to do their share to support Ottawa. 

Join me in the fight for fairness for Ottawa. Sign the petition.

Announcement Transcript

Good morning, Bonjour.

Aujourd’hui, je tiens à m’adresser directement aux résidents d’Ottawa.

I want to speak directly today to the residents of Ottawa. Our city is facing a historic challenge. And to respond to that historic challenge, I need your help. I need you to join me as I fight for fairness, as I fight for Ottawa’s fair share of federal and provincial funding. 

Joignez-vous à moi pour obtenir l'équité pour Ottawa.

It’s been more than 20 months since I became Mayor of Ottawa. As I said on the day I was sworn in, it’s a tremendous honour to be the mayor of my hometown. 

I love this city. And I’m grateful that every day, I meet residents who also love Ottawa.

I think throughout the time I’ve been mayor, I’ve demonstrated that I take a careful and measured approach to the work. 

I’ve worked hard to build consensus and be collaborative, with my colleagues on city council, with members of the community, and with other levels of government. 

When I’ve advocated to other levels of government on behalf of our city, I’ve done it fairly and respectfully. I don’t thrive on drama or conflict, or negotiating publicly. That’s not my approach.

And my approach has been effective so far.

Et mon approche a été efficace jusqu’à présent.

We’ve successfully negotiated funding from other levels of government in areas such as housing and homelessness, transportation, and public safety. 

We are grateful for the investments the provincial government has made through the Ottawa deal announced in March, and other important funding they’ve provided. 

We’re grateful to the federal government for the Housing Accelerator Fund and other investments they’ve made.

But we still desperately need our fair share in a couple of other critical areas that I will speak about today.

It is not an exaggeration to say Ottawa is facing a financial crisis. 

And I want to be clear that it’s a crisis that is not of our own making.

Je tiens à préciser qu'il s'agit d'une crise qui n’est pas de notre fait.

We’ve been managing our city budget very carefully. In the past two years, working together, our city council has found more than $153 million in savings and efficiencies, without cutting services. 

En travaillant ensemble, notre conseil municipal a trouvé plus de 153 millions de dollars en économies, sans couper les services.

I want to thank my council colleagues for their hard work and collaboration to address our financial challenges.

But while that’s been going on, our city has been uniquely impacted by the decisions of other levels of government.

Every city in Canada faces big challenges. But Ottawa’s challenges are unique among Canadian cities. We are the nation’s capital. We are the second largest city in Ontario. 

As I’ve said many times, Ottawa is geographically larger than Toronto, Montreal, Vancouver, Edmonton, and Calgary combined.

The decisions of the federal government have an enormous impact on our city, more than any other city in the country. 

And because we’re not Toronto, we have historically been overlooked by the provincial government, getting less than our fair share of support. 

As a result, we’re facing a crisis right now. This is a critical juncture for our city’s finances. C’est un moment critique pour les finances de notre ville. I can’t overstate how important this is.

I’m going to walk you through it with a few details.

First, let’s talk about an arcane issue called PILTs. PILTs are payments in lieu of taxes - les paiements tenant lieu d’impôts. 

The federal government owns an enormous amount of real estate in Ottawa. But they don’t pay property taxes. Instead, they give us payments in lieu of taxes, or PILTs, and they’re supposed to be the equivalent of property taxes.

People often ask me what has surprised me since I became mayor. The situation with our PILTs is more than a surprise, it’s a shock.

Si vous payez des impôts fonciers, vous ne décidez pas combien vous payez. Vous ne décidez pas combien vaut votre propriété.

Imagine if I told you, as a property taxpayer, that you could decide how much you wanted to pay every year. 

Rather than have an independent valuation of your property, you could just choose your own valuation. Rather than have the tax rate set by the city, you could pick it yourself. 

Wouldn’t that be a great deal?

Well, that’s exactly what the federal government gets to do. We don’t send them a bill and they pay it, the way you do. 

They decide how much their property is worth, what property class it belongs to, what tax rate they pay, all on their own. So if they want to pay less, they pay less. 

And they do pay less, much less than they should.

To put it in perspective, eight years ago, they were paying $194 million a year in PILTs. Now they’re paying $164 million. 

Does that make any sense to you? Almost every single residential and commercial property owner in Ottawa has seen their property taxes go up during those five years. 

Tout le monde paie plus de taxes foncières. Mais le gouvernement fédéral paie moins.

Everyone is paying more in property taxes. But the federal government is paying less. Because unlike you, they get to decide how much they pay.

We did the math on what they should be paying us today. And it’s $95 million dollars more than they actually are paying. 

That amounts to a tax increase of about 5% that residents are paying because the federal government isn’t paying as much as it used to or as much as it should.

For decades now, through successive governments representing different parties, the federal government and its many agencies have simply stopped paying their fair share of taxes, or payments in lieu of taxes, in Ottawa. 

And when they don’t pay their fair share, guess who makes up the difference? It’s you, the local taxpayer, who has to pay what the federal government won’t. 

Through dozens and dozens of small decisions, the federal government has shifted an enormous burden from itself to you, the local taxpayer.

Vous devez payer plus pour les transports, pour la police, les pompiers et les paramédics. 

You have to pay more for transit. You have to pay more for police, fire and paramedics. 

You have to pay more for infrastructure. You have to pay more for roads. You have to pay more for everything. All because the federal government isn’t paying enough.

That is just not fair. Imagine if you didn’t pay your taxes to the federal government. They’d come after you hard. 

But when the federal government doesn’t pay its fair share, we don’t have any recourse. We send them a bill, they unilaterally decide to pay less. We complain, they refuse to do anything about it.

The amazing thing is how many different ways the federal government finds to pay less. They’re really quite good at it. Let me give you a few examples:

The National Capital Commission decided in 2013 to exempt themselves from paying PILTs on properties that had environmental protection zoning. That has cost us $20 million so far.

Speaking of the NCC, even when they are the landlord to a commercial tenant who pays full rent, they still arbitrarily decide how much they will pay us. 

Le locataire paie son loyer au taux du marché. Mais la CCN paie elle-même moins d’impôts et ne suit pas les mêmes règles que les autres propriétaires. 

The tenant pays market rates for rent, including their share of the local taxes. But the NCC still pays less for its taxes and doesn’t follow the same rules as other property owners.

So they’re not passing on their reduced costs to their tenants.

And by the way, this is the same NCC that charges the City of Ottawa full price for every little transaction we have with them. If we need an easement, they charge us what’s called “highest and best use” for that sliver of land.

For the LRT that passes through LeBreton flats the NCC charged us for every square metre of land as though there would be a 20-story office tower on it. We didn’t get to pay whatever we wanted. 

Nous n’avons pas eu le choix de payer ce que nous voulions. We had to pay full price: $52.6 million dollars. Meanwhile, the NCC refuses to pay their full share of taxes on LeBreton Flats.

When a commercial property owner has an aging building with declining revenues, it will invest in the building to improve it. 

The federal government doesn’t have to worry about its bottom line, so often its aging buildings just decline and decline. Think of 24 Sussex Drive or the National Defence Headquarters.

Or look at the Jackson Building at the corner of Bank and Slater right in the heart of our downtown. 

The Federal government reduced their payment of taxes unilaterally in 2017 due to the poor condition of the building and they’ve let it sit vacant ever since.

That’s $261 thousand dollars a year in taxes we’re not collecting. Over 8 years, that adds up to $2.1 million for one building alone. 

No private sector owner would abandon a building for that long. They couldn’t afford to let it sit without any income. 

And then a few years ago, in the midst of a global pandemic, the provincial government decided to lighten the burden on Ontario small businesses. They dropped the education portion of property taxes. And the federal government and some of its agencies said thank you very much and started paying us less yet again. 

That alone has cost us about $45 million over the past three years. If they keep doing it, that could be another $140 million over the next 10 years. 

Si la situation persiste, cela nous coûtera 140 millions de dollars supplémentaires au cours des 10 prochaines années.

We reached out to the federal government over and over again to ask them to fix this. Nothing happened. So we had to turn to our last resort. 

We went to court to get our fair share. Alors, le gouvernement fédéral se bat contre nous. So we’re paying for lawyers and they’re paying for lawyers just to squabble over this issue.

On this issue, I have to admit I’m extremely frustrated. The idea that we have to go to court on an issue of essential fairness is simply unbelievable and unacceptable.

The Prime Minister or a member of his cabinet could do the right thing and fix this.

As if all of that wasn’t bad enough, the federal government is about to move out of a bunch of buildings in Ottawa. 

They’re planning to reduce their footprint by as much as 50 per cent. According to the most recent federal budget, that will save the federal government billions of dollars in the years ahead. 

But those savings will come at a cost to local taxpayers in Ottawa.

Look how long it takes the federal government to act with properties like LeBreton Flats. The buildings they abandon will sit empty for years and we’ll lose millions in tax revenues. 

Even if they only reduce their footprint by five buildings a year, that will cost us about $70 to $90 million over the next 10 years. 

That cost will be paid by everyone from first-time homebuyers to seniors on fixed incomes. 

I have been clear with local MPs. I’ve been clear with the Prime Minister. I believe the federal government has an obligation to the City of Ottawa. 

An obligation to the nation’s capital. Une obligation en tant que principal employeur d'Ottawa. An obligation as the largest property owner in Ottawa. 

An obligation as the largest user of municipal services. An obligation to pay their fair share.

We need this fixed or we’re in big trouble. It’s simply unfair to local taxpayers that the federal government is sticking them with the bill. 

And this is only half of what I need to talk to you about today. The other issue is public transit.

Transit is another area where Ottawa has been uniquely disadvantaged. Other cities including Toronto and Vancouver have recently sounded the alarm that their transit systems are unsustainable. 

But our situation is much worse. Once again, we are unique. Ottawa has been shortchanged by both our federal and provincial partners, much more than most other cities.

We are in a transit crisis. Nous vivons une crise du transport en commun. Our long-range financial plan has a $9-billion hole in it. It’s nice to dream of building more light rail. 

But we don’t even have the money we need to operate our existing system. Mais nous n’avons même pas l’argent nécessaire pour faire fonctionner notre réseau actuel. 

If we don’t get the help we need, it won’t even make financial sense to open Phase 2 of light rail. We’d be better off, from a financial perspective, not to open and run the system. 

Nous avons construit notre système de transport en commun autour des fonctionnaires publics. 

The number one reason for our transit crisis is that, as the national capital, we built our public transit system around public servants. 

And because they aren’t going to the office every day, we’ve lost our best customer. So we are way behind other cities in passenger ridership. 

As of this year, the number of trips by downtown office workers alone has declined by 38%. That is costing us $36 million a year in lost fare revenue.

Je tiens à préciser que je n'ai jamais demandé au gouvernement fédéral de modifier le nombre de jours de travail des fonctionnaires. 

I want to be clear: I have never asked the federal government to change the number of days public servants go to the office. 

That’s between them and their employees. But I am asking the federal government to acknowledge the impact of their decisions on our city. 

Decisions have consequences. And right now the consequences are being felt by Ottawa taxpayers.

Our current projections show it will take almost 10 years to get to pre-pandemic levels of passenger ridership. 

But of course we weren’t expecting transit ridership in 2034 to be at 2019 levels. We were expecting it to be much higher than that. 

We have to stop comparing ridership to 2019 and start comparing it to what we expected it to be. 

It will take decades to catch up to the forecast ridership we counted on when we built light rail.

When you lose your number one customer, when passenger traffic drops enormously, there is no easy solution to that.

But it’s about much more than just passenger traffic. 

We built our light rail system expecting each level of government to pay 33% of the cost. I

It was supposed to be one-third, one-third, one-third. Chacun devait donc en payer un tiers.

Now, even that isn’t anywhere near the deal that other cities get. Many transit projects in Toronto are paid entirely by the provincial government, and others are split between the province and the federal government. 

The city of Toronto and other cities in the GTA don’t pay any of the capital costs for many of their transit projects. Ils ne paient aucun des coûts d’investissement pour un bon nombre de ses projets de transport en commun.

The Eglinton Crosstown light rail project in Toronto is costing about $14.5 billion. How much are Toronto residents contributing to that through their municipal taxes? Zero.

The Hurontario light rail project in Mississauga and Brampton will cost $4.6 billion. How much are Mississauga and Brampton residents contributing through their municipal taxes? Zero.

The Hamilton light rail project will cost $3.4 billion. How much are Hamilton residents contributing to that through their municipal taxes? Zero.

You might think, well those projects are regional transit. The GO Train, for example, is considered regional transit, not local transit.

Well because of the size of our city, our local transit is regional transit. Remember, Ottawa is four and a half times the size of Toronto. 

People continue to be amazed when I tell them that. For example, the distance between downtown Ottawa and the Trim Road Station that will be the eastern stop of Phase 2 is roughly the same as the distance from downtown Toronto to the middle of Mississauga.

But we don’t get regional transit paid for by the province of Ontario. We simply don’t get the same deal as Toronto or Hamilton or Mississauga or Brampton.

And here’s the great thing for Toronto and Hamilton and Mississauga and Brampton: when costs rise for their projects, as they inevitably do, the province has to pay the difference, because it’s a provincial project. 

When there are legal claims because of cost overruns in COVID, for example, like the claims we’ve been dealing with recently, the city of Toronto doesn’t have to ask other levels of government for help because the claims go directly to those other levels of government. Les réclamations vont directement à ces autres ordres de gouvernement.

In Ottawa, unlike Toronto, we have to pay one-third of the initial cost. And when the costs go up, we pay all of the overruns. 

So the result is that it doesn’t even end up as one-third, one-third, one-third. Ottawa is paying an additional $1.6 billion in costs related to light rail. 

Our partners aren’t paying any of that. So now, our local taxpayers are on the hook for 56% of the cost of Phase 2. 

And the federal and provincial governments are each paying about 22%.

Here’s what makes it especially unfair. It’s not just that Toronto residents aren’t paying for those projects through their municipal taxes, it’s that Ottawa residents are paying for Toronto projects through their provincial taxes. Les résidents d'Ottawa paient pour les projets de Toronto à travers leurs impôts provinciaux.

Think about the provincial taxes you pay to the Ontario government. Over the last few years, from your provincial taxes, about $5,250 has gone to transit projects in the Greater Toronto Area. That’s your money going to Toronto. 

How much of your provincial taxes have gone to transit projects in Ottawa? About $285. So for every dollar of your provincial taxes that pays for a transit project in Ottawa, $18 goes to a project in Toronto. 

That’s just not fair. This is another great example of how Ottawa doesn’t get a fair deal.

So here’s the bottom line with our transit system. 

We have an operating shortfall of $140 million a year for the next three or four years. Nous avons un déficit de 140 millions de dollars par année pour les trois ou quatre prochaines années.

That puts us in an absolutely impossible situation. There are no easy answers to a problem like that. Without getting our fair share, without getting help from the other levels of government, it’s going to be very painful. 

We’ll have to raise taxes and transit fares enormously, or we’ll have to cut service dramatically, either transit service itself, or other services so we can pay for transit.

Just to put it in perspective, we are looking at a 37% increase to the transit levy to cover that operating shortfall.

The federal government just announced a new transit funding program. You might think that means help is on the way. 

But the problem is that funding is almost entirely for new projects. 

We can’t afford to build new projects because we can’t afford to operate the system we have now. 

It’s like the federal government is offering to help us build an expansion on our house but we can’t afford the utility bills on the house we have now. 

Our residents invested in light rail in good faith. Ils ont investi de bonne foi. We did that with the expectation that it would continue to be used by federal employees. 

We did that with the expectation that every level of government would pay its share. If only we could have the same deal as Toronto, where their projects and their maintenance costs and their cost overruns are all covered by the other levels of government.

Je ne peux pas, en toute conscience, continuer de regarder l’administration provinciale bâtir le transport en commun à Toronto sans apporter sa juste part à Ottawa. 

I can’t in good conscience continue to watch the province build transit in Toronto and not contribute its fair share to Ottawa. 

I can’t in good conscience continue to see the federal government’s decisions destroy the business model for transit in Ottawa and not ask for help. 

I can’t in good conscience ask the residents of Ottawa to pay for more transit projects when we can’t even afford to operate the transit system we have now.

We want to build more public transit. We want to extend light rail to Kanata, Stittsville, and Barrhaven. We want to build more bus rapid transit.

But that goal is currently out of reach because of the broken funding model for transit in Ottawa.

So even though it’s not my style, I’m going public with this message. I have to be honest with the people of Ottawa. 

And I need your help to get the attention of other levels of government. We must fight for Ottawa’s fair share. And I can’t do that alone. We must do it together.

We are the capital city of Canada. 

Do we want the capital of Canada to have to cut services by hundreds of millions of dollars over the next 10 years? 

Do we want the capital of Canada to debate whether to open the next phase of its light rail system because it can’t afford to operate it? Would that happen in Paris or London or Washington?

We are facing serious consequences because of these two critical issues. We didn’t create this crisis. We’ve managed our money very carefully. We acted in good faith and we need our partners to do the same.

This is an issue of fairness, pure and simple. C’est une question d’équité, pure et simple.  

It’s an issue of other levels of government who have more power and more resources and who simply must do the right thing to help us through this crisis. 

So here’s what we need from the federal and provincial governments:

One, we need the federal government to pay its back taxes. Nous avons besoin que le gouvernement fédéral paie ses arriérés d’impôts. 

If they were to pay what they owe us for the past five years, that alone would be close to $100 million.

Two, stop shifting the burden of paying for municipal services from the federal government to local taxpayers. Commencez à payer votre juste part d'impôts fonciers. 

Start paying your fair share of property taxes instead of cutting yourself a deal at every opportunity and asking local taxpayers to make up the shortfall. 

No more unilateral decisions to lower the bill. Just pay your taxes like any other resident or business.

Three, as our downtown faces unprecedented and historic changes, we need a guarantee from the federal government that they will keep the payments in lieu of taxes at the level that they should be paying now, no matter how many properties they close. 

Four, we need to get our fair share of transit funding and we need the other levels of government to recognize that Ottawa’s challenges are unique. 

Restore the one-third, one-third, one-third funding model at a minimum. Les contribuables d’Ottawa ne devraient pas payer 56 % du coût d’investissement. 

Ottawa taxpayers shouldn’t be paying 56% of the capital cost for transit when Toronto is paying next to nothing.

Five, give us the operating dollars we need to cover the $140-million shortfall for at least the next three years to help us recover from the loss in ridership and so that we can build a sustainable transit system for Canada’s capital for the next 20 years. 

I know you don’t typically provide operating dollars. But the provincial government did for Toronto. And Ottawa’s situation is just as critical, if not more so.

These are not unreasonable requests. Il ne s'agit pas de demandes excessives.It’s a very simple path forward that will allow the federal and provincial governments to help us when we need it most. 

Our city council is united about the urgency and necessity of this appeal.

So on behalf of my council colleagues, I’m appealing today to our leaders and representatives at both levels. 

Despite everything that has happened, despite all I’ve learned since I became mayor, I’m still an optimist. 

I still believe that our political leaders care about Ottawa and want to do the right thing. 

So to the prime minister, the finance minister, all the members of the federal cabinet, and to all our local MPs. 

To the premier and his provincial cabinet, to the local MPPs. I’m asking you to help Ottawa through this crisis. 

I’m appealing to your sense of fairness. I believe you will do the right thing to help the people we were all elected to serve. Je crois que vous ferez ce qu'il faut pour aider les gens pour lesquels nous avons tous été élus.

Je fais aussi appel à chaque résident d’Ottawa. J’ai besoin de votre aide. I’m also appealing to every single Ottawa resident. 

I need your help. I need you to join my fight for fairness. 

There are federal and provincial elections coming up, and once those campaigns begin it will be hard to get anything done. 

So we need to act quickly before we run out of time. I need you to join me in demanding that Ottawa gets the help we need, that we get our fair share. 

I’m launching this campaign today and I’ll be asking for your support in the days ahead.

Otherwise, together we will be facing some historically tough decisions for the 2025 budget.

C'est notre plus grand défi actuellement. This is our greatest challenge right now and I’m prepared to do everything I can to resolve it. 

But I can’t do it alone. I need your help.

It's time for the federal and provincial governments to recognize the scope of the crisis in our city. And to recognize that we didn’t create this mess.

It’s time for them to step up for Canada’s capital city.

It’s time for us to start getting the same resources as Toronto and other cities.

It’s time for the federal and provincial governments to do the right thing.

Il est temps que les gouvernements fédéral et provincial fassent ce qu’il faut.

It's time for Ottawa to get our fair share.