City budget calls for 2.45% tax increase

Ottawa mayor Jim Watson said the city's 2011 budgetwill include a 2.45 per cent tax hike for urban residential and commercial properties and 2.4 per cent for rural properties, slightly below the original target of a 2.5 per cent cap.

The tax increases will mean an average hike of $75 for urban residential properties, $60 for rural properties and $111 for commercial properties.

The total tax-supported 2011 budget is $2.4 billion in operating spending and $622 million in new capital spending.

Watson said in delivering the budget to council Wednesday that without $44 million in reductions, taxpayers would have faced a 6.5 per cent property tax hike.

Among the cuts mentioned during Watson's speech to council was a cut in discretionary spending of $300,000, a reduction in printed versions of city recreation guides for savings of $400,000 and a reduction in the city's reliance on outside legal services and consultants, resulting in a saving of $1 million.

Watson also said council would lead by example, with salaries frozen for the mayor and councillors. The mayor's office budget was also cut by 10 per cent.

Transit hike setat 2.5 per cent

The budget sets OC Transpo's operating budget at $392 million and $310 in new capital authority.

Watson said changes to increase bus and O-Train capacity and changes to routing to put more of an emphasis on express routes will result on transit savings of $7.2 million this year and $22 million in 2012. The city also plans to add 74 new drivers to reduce overtime costs.

The budget also restricts OC Transpo fare increases to 2.5 per cent and also expands free transit for seniors to includeMonday and Friday after noon, in addition to free transit on Wednesday.

Earlier Ottawa's police services boardtabled a budget in line with Watson's budget target, with a net operating budget of $236.9 million, a net increase of $9 million or 3.9 per cent over 2010.

Police budget falls in line with targets

But they say with an estimated assessment growth of $4 million, the increase to the police tax rate is $5 million, or 2.5 per cent.

Watson has promised to cap this year's property tax increase at 2.5 per cent as part of his campaign promise to bring more fiscal responsibility to city council, and had asked city staff and police to work towards that cap.

Last year's council approved a budget that included a 3.77 per cent tax hike for residential properties, a 7.5 per cent increase in transit fares and a nearly 10 per cent increase in water and sewer rates.

Within that budget council approved an increase of 5.6 per cent to the net police budget, and previous years had seen police budget increases come in at over 10 per cent from previous years.

Police said to keep costs down police cut $6.1 million from an earlier proposal. Police said they would not be making any new hires in 2011 and would review eight capital projects already planned, including retro-fits to all three stations.