Council approves 2026 budget directions

Council today approved the Proposed 2026 budget directions, timeline and consultations process.

Council approved direction for staff to draft a budget which limits the property-tax increase to no more than 3.75 per cent, including increases:

• Up to 2.9 per cent for Ottawa Public Health and the Ottawa Public Library
• Between 2.9 and 6.5 per cent for the Ottawa Police Service
• Between 3 and 15 per cent for Transit Services, and a transit fare increase between 2.5 and 7.5 per cent
• A cap of on the total number of Full Time Equivalent positions at the City

The Draft Operating and Capital Budget will be tabled at City Council on Wednesday, November 12. Each Standing Committee will meet in November or early December to consider their parts of Draft Budget 2026. Residents, businesses and community groups are encouraged to share their thoughts through various engagement opportunities, and can visit Engage Ottawa to learn more. Council will vote on the final budget on Wednesday, December 10.

Council receives update on the 2025 budget

Staff updated Council on the 2025 Tax, Transit and Rate Supported Programs Operating and Capital Budget. The overall deficit for the first two quarters is $7.5 million. The tax-supported and transit-supported results show a combined deficit of $16.3 million, driven by higher winter operations costs as well as by a $6.6 million deficit, which is due to higher Transit Services costs, delayed project implementation costs and lower than expected fare revenues. The second quarter rate-supported results show an $8.8 million surplus due to cost savings from position vacancies and higher than expected water consumption revenues. The year-end forecast projects a deficit of nearly $37.3 million. The City is seeking $36 million in transit funding from other levels of government to help cover that deficit.

Last year, the City updated its reserve policy to include a one-time mitigation measure of $36 million in the Tax Stabilization Reserve fund. Those funds may be needed if no funding is received from other levels of government.

Council enhances process for evaluating traffic signals, all-way stops at rural intersections 

Council received the results of a review of the processes for determining whether traffic signals or all-way stops are needed at rural intersections. Approved process changes will ensure greater consideration is given to the rural context. The enhanced process for evaluating traffic signals will include requiring speed studies and adjusting data collection periods to account for the fact that rural peak periods differ from urban ones because commuting distances are typically longer and departure times are often earlier in the morning.

The enhanced process for assessing all-way stops will be updated to ensure there is specific criteria to assess intersections in cases where two collector roads intersect or where a local road and a collector road intersect.

Council approves proposal for a new Affordable Rental Housing property tax subclass

Council adopted the new Affordable Rental Housing property tax subclass for multi-residential and new multi-residential classes for the 2026 taxation year. This will allow the City to provide property-tax relief of up to 35 per cent for qualifying affordable rental housing units. The Municipal Property Assessment Corporation (MPAC) will identify qualifying properties based on provincial criteria. Through the 2026 Tax Policy report, Council will then be able to set rates discounted by up to 35 per cent. The new subclass represents another tool to increase Ottawa's affordable housing.

Council approves Affordable Housing Community Improvement Plan (AHCIP) grant applications Council also approved two AHCIP applications, requesting Tax Increment Equivalent Grants (TIEG) totaling approximately $9.3 million over 20 years. TIEGs are a financial incentive where a developer gets back part of the increased property taxes their project generates, helping offset the loss in operational revenue from the affordable units. These grants will support the delivery of 73 new affordable rental units across two developments, one at 299 City Centre Avenue and the other at 375 Codd’s Road

• Agenda