City of Ottawa expecting to end 2022 in the red

The city of Ottawa is projecting a $12.2 million budget deficit this year, as a number of factors contribute to the city expecting to end the year in the red.

The finance and economic development committee will receive an update on the city’s year-end budget forecast during a meeting on Nov. 1. The current FEDCO members will participate in the meeting, since the new council is not sworn in until Nov. 14.

Staff say the overall year-end forecast for the tax-supported programs is a projected deficit of $9.89 million, with a $2.4 million deficit in water and sewer rates. An estimated $65 million in COVID-19 related costs during the pandemic will be offset by $60.5 million in funding from the upper levels of government.

The report doesn’t provide one clear reason for the multi-million dollar deficit forecast in the two budgets; instead, it outlines expected deficits and surpluses in several departments.

The Public Works Department is projecting an $11.5 million deficit, mainly due to the May 21 derecho storm, while the Emergency and Protective Services Department is projecting a deficit of $1.8 million due to multiple emergencies and events this year and higher than anticipated fleet repairs.

A non-departmental deficit of $13 million is expected, due in part to lower Red Light Camera and Rideau Carleton Raceway revenues, and costs related to the LRT provincial inquiry.

Surpluses are expected in recreation, cultural and facility services, finance services department, Innovative Client Service Centres and election spending.

City officials anticipate the federal government will cover the city’s $2.1 million costs associated with the ‘Freedom Convoy’, while the Ontario Ministry of Health is expected to cover the $3.2 million cost of the COVID-19 vaccination campaign.

The city of Ottawa posted a $7.5 million surplus in the tax-supported programs and a $6.1 million deficit in water and sewer rates during the first six months of the year.

SNOW CLEARING

The city of Ottawa posted a $2.7 million surplus in the snow-clearing budget in the first half of the year.

Staff say lower winter maintenance costs were due to below average snowfall in the January to March period, requiring less snow removal and salt/material usage.

PHOTO RADAR REVENUE

The Traffic Services department posted a $1.8 million deficit in the first half of the year due to fewer photo radar tickets for speeding.

Staff say it was mainly due to “lower processing capacity for existing Automated Speed Enforcement infractions and the delay in the implementation of additional ASE cameras due to supply chain issues with the resultant loss of revenues which are partly offset by lower expenditures.”

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