Executive summary

LRFP III provides information the new Council will need when working with residents to develop a new Corporate Plan that will identify priority programs and services. This will lead the way to developing a multi-year budget that will allow the City to deliver on its priorities. This important debate will shape the City's future over the next term-of-Council while moving towards long-term financial sustainability. The LRFP will be updated at the end of Council's four-year term or earlier, if there are significant changes in the City's financial situation.

Provincial programs should not be on the property tax bill:

• Request provincial funding for provincially mandated programs that live up to cost-sharing agreements.
• Lobby the Province to remove social programs from the property tax bill.
• Work with the Province to align program accountability and responsibility with funding responsibility.
• Request the Province to allow provincially mandated programs to be shown separately on the tax bill.
• Use increases in provincial program funding to reduce taxes, not to enhance the level of service provided.

Fix funding inequities in provincial grant allocations for social services:

• Provide detailed input for the Provincial-Municipal Fiscal and Service Delivery Review being conducted over the next 18 months.
• Lobby the Province to provide Ottawa with the same level of grant allocation for social programs as are provided to Toronto.

Fix the re-assessment and tax systems to restore fairness:

• Work with the Province on the review of MPAC over the next two years to reduce the frequency of re-assessments and allow municipalities to phase in changes.
• Request provincial changes to the tax system to give more tax policy discretion to councils to reduce the negative impact of capping and tax shifting.
• Request the Province to either remove education taxes from the property tax bill or establish the amount to be collected rather than the education tax rate.

Better manage compensation and the cost of purchased goods and services:

• Work with large municipalities across Ontario on the collective bargaining task force to share experience, strategy and information on settlements between the municipalities.
• Work in partnership with the City's unions with the goal of keeping compensation increases at or below CPI.
• Continue to review performance and processes to become more efficient and cost-effective.
• Continue to obtain the best price for purchased services and supplies through the use of competitive tendering, forward contracting and purchasing consortiums.
• Continue to minimize the amount of goods purchased through conservation and reduction guidelines and policies.
• Maintain appropriate operating reserves for programs with expenditures that can vary significantly from year to year to smooth the budgetary impact.

Ensure City services respond to changing and growing needs:

• Use the City Corporate Planning process for priority setting to determine which services will be maintained or enhanced and which strategic capital initiatives will be undertaken.
• Include the costs of population and infrastructure growth in the budget.
• Require requests for operational service enhancements to include a business case identifying the additional revenue required and whether other services can be reduced or eliminated to pay for it.
• Take demographic changes into account when prioritizing and developing new City programs or services.
• Incorporate the equivalent of a 1% tax increase to go toward contributions to the strategic initiative category of the capital budget.
• Fund additional debt for growth-related projects from non-tax sources of revenue.
• Request that the Province change the development charge legislation so that all costs of growth are paid from development charges.

Explore new revenue sources:

• Increase current user fees by the percentage increase in the cost of providing the service to maintain the existing tax-to-user-fee ratio.
• Ensure that user fee increases do not reduce the number of people using those services.
• Move towards implementing new user fees for programs or services when specific users can be identified.
• Define a target tax-to-user-fee ratio for major service areas for Council approval.
• Request the Province to provide access to other forms of revenue.

Ensure infrastructure projects are adequately funded:

• Increase contributions to the capital budget at the rate of increase in the Infrastructure Construction Price Index, as set by Statistics Canada, to ensure the City's contribution to capital is not eroded by inflation.
• Set infrastructure renewal as the priority for capital funding by increasing contributions to the capital budget.
• Continue to minimize the amount of debt used for infrastructure renewal and set the amount of tax-supported debt to a fixed percentage of the total tax bill.
• Maintain a minimum tax-supported reserve balance of $50 million to ensure emergency repairs can be managed.
• Work with the Province to identify new sources of revenue to fund capital renewal and rehabilitation in the new Municipal Act.
• Request that the Province both maintain and enhance current renewal subsidy programs.
• Given Ottawa's uniquely rural and urban geography, work with the Province to ensure that Ottawa has access to rural infrastructure programs and other future rural programs.
• Investigate new technologies that reduce maintenance requirements or extend the life of a capital asset.
• Introduce programs that reduce consumption, thereby increasing the life of the existing assets and reducing the need to expand to accommodate growth, (e.g., increasing the modal split, smart meters for water consumption).
• Set the amount of tax-supported debt to a fixed percentage of total taxes.

Better deal with expenses incurred today but paid for in the future:

• Report tangible capital assets in the 2009 financial statements and increase contributions to the capital budget each year by the amount that new tangible capital assets add to the depreciation expense.
• Incorporate a landfill liability charge into the garbage fee.
• Defer the post-closure costs for landfills by extending the life of landfills through increased diversion rates.
• Develop a strategy to fund, over time, post-employment or retirement employee benefits liabilities.