Fuel prices lift rate, more costs still to cover

City property taxes inched higher than forecast yesterday, but there will be more budget debates today before the rate is set in stone.



After a hectic day of budget deliberations that started with a proposal for a 7.7 per cent increase, council opted not to raise taxes to cover this winter’s massive snow removal costs, but said rising diesel prices forced it to add 0.2 per cent to an already announced increase of 4.9 per cent.



That’s a minimum tax hike of 5.1 per cent in 2008 that could rise higher once parking rates are finalized today. (See related story, page 3).

But that was still lower than the 7.7 per cent hike that was on the table after treasurer Marian Simulik recommended a 2.3 per cent increase to cover a projected snow removal shortfall, plus the diesel increase, and an additional 0.4 increase to cover a parking revenue shortfall.

An expected 0.1 per cent savings following an administrative review would have brought the total increase to 7.7.

Simulik urged the snow levy because Ottawa does not have snow removal money budgeted past March, and still has next November and December to pay for this year.

But facing a large increase, council voted for a "wait and see" approach, noting that snow removal figures were projections and the bill has yet to be tallied.

"There are all sorts of other things that happen throughout the year," said Coun. Rick Chiarelli. "I don’t see the wisdom in sporadic panic."

Mayor Larry O’Brien said he’d have preferred to reopen the budget process to find savings, rather than pin hopes on a mild winter.

"The most prudent decisions weren’t made on behalf of the citizens of Ottawa," he said. "I’m disappointed we didn’t … take the necessary steps to fully account for all the funding deficit."

Council agreed to the fuel increase. The 2008 budget had assumed an average cost of 86 cents per litre for diesel, but Ottawa is locked into a six-month contract at $1.07 per litre.



  • The deficit will be mitigated by money coming from Hydro Ottawa’s sale of Telecom Ottawa. As the lone shareholder , the city gets a 60 per cent share of the profit, or up to $14 million.