Candidate Questions: Do we rely on property too much?

TLDR: Ottawa needs to stop relying so heavily on property taxes and start diversifying how cities are funded.

Hi all, Spencer Radford, Candidate for Bay Ward here.

One of the biggest things that gets asked of Candidates after they give their platform, is where is the money going to come from. It's easy to say we will have better transit, recreational centres, homes, infrastructure and more. It's much harder to show where that money is actually coming from.

I also recognize that it's easy to say that City Council can just look over the budget. Is there things in the budget that are wasteful, overfunded, or underfunded where we'd have to spend more later? Most likely. But that's not going to hold prices back forever with inflation. Here are some of my thoughts.

PROPERTY TAXES

This is generally where cities get a lot of the funding for their services. I believe property taxes will continue to increase. If we want our city to maintain and improve the services people rely on, they probably have to. However, I don't think that property taxes should be the only way we pay for city services, and it shouldn't be the first place we look.

MUNICIPAL

- I would look into how much revenue we are generating through advertising and sponsorships on City owned property, such as recreation centres, arenas, and transit facilities. Could we do a small amount of advertisements, give naming rights, or look for sponsors who will gain recognition and offset some of the City's costs?

- I'd review the Municipal Accommodation Tax. This recently had an increase from 5% to 6%, with 60% of that increase being put into a tourism reserve. The additional revenue can be used for a broad range of tourism related purposes, and even a small increase can generate millions for the city.

- I'd shorten the timeline for the Vacant Unit Tax to reach 5%. My proposal would keep it at 1% in the first year, increase it to 3% in the second year, and 5% in the third year. The Vacant Unit Tax generally affects people who own properties they choose to leave vacant. I think increasing the rate sooner creates a stronger incentive to put those homes back into use.

- I would bring back up the cost of development charges, unless a study has been done that homes have genuinely become cheaper due to the change. From what I've seen, Ottawa's development charges were already competitive with many other major cities. I'd still like to see a formal comparison before making long term decisions. The money is used to fund key infrastructure, like sewer systems, roads, and more.

PROVINCIAL

- Local businesses and renters shouldn't have to suffer because usable commercial space or rental units are intentionally being left vacant. I'd advocate for the Province to allow municipalities to apply vacancy taxes to commercial, industrial and apartment properties where units sit vacant for extended periods without a legitimate reason. Of course, there should be exemptions for renovations, permits and other valid situations. This could keep land and property owners from holding onto the space for either property prices to increase, or encouraging owners to lower asking rents instead of leaving spaces empty.

- I would push the provincial government to re-allow municipalities to have speed cameras in school and hospital zones. The province should not be deciding if we can use this safety tool in our own communities.

- Another thing I would request from the provincial government is a change to how we make local decisions on council. I'm looking at you Lansdowne. I've heard from many residents, and looked at how the votes were tallied. The rural councillors overwhelmingly voted for Lansdowne, but many of the councillors representing communities that would experience the greatest neighbourhood impacts voted against it. I'd like a double majority system to be permitted for major projects like Lansdowne.

The way it would work is this: Since the City Council would be putting the money towards it, every councillor gets a vote. A majority is needed like normal. However, the councillors who are affected by it should also require a majority. This way Urban councillors cannot affect rural areas in a negative way for their residents, but rural councillors also cannot do the same to Urban areas.

PROVINCIAL AND FEDERAL

Lastly, and this is a big one, cities are changing. Cities' needs are higher, prices are going up, and property taxes are still the main way to pay for a city's main needs. Is the way we fund municipalities still appropriate for the needs we have?

I don't think so, so here's my suggestion. First off, I am not asking for an increase in our income taxes. Those are high enough already and felt by everyone, whether you are paid minimum wage or a doctor's salary. I will propose and advocate seriously to the Federal and Provincial government, asking from support from the Association of Municipalities of Ontario (AMO) and the Federation of Canadian Municipalities (FCM) to advocate for 0.5% of the income tax, 0.25% that goes to the province, and 0.25% that goes to the Federal Government, to instead go to the cities a worker lives in.

Municipalities deserve a fairer share of the revenue collected from the people they serve and, we already determine which province receives your income tax based on where you live. I believe a municipal share could work the same way.

What do you think, and is there another funding idea you'd like to see Ottawa explore?