The City Treasurer has confirmed that the City will not use the province's tax increment based financing (TIF) for the Lansdowne redevelopment project to benefit from available provincial property tax rebates. This raises doubts over whether the project will be revenue-neutral.

Previously the city has said the project  would be revenue neutral because 75% of the taxes resulting from the development would be used to service the debt. However, the Treasurer's June 24th response to a Councillor's question stated that "The City is not proposing to use Tax Increment Based Financing (TIF) for the Lansdowne Redevelopment Project". This  puts the claim of revenue-neutrality in question.

Each year the City will have to pay about $7 million dollars to service the debt it is incurring on Lansdowne.  Given that the City has been running down its reserves since amalgamation and is continually raising taxes to meet its expenditures, without TIF financing, either the City will need to increase taxes or it will have to cut projects or services in other parts of the city to fund this project on a revenue neutral basis.  "There's no other way to do it" says retired economist Michael Tiger.

"This is a game changer" says Professor Ian Lee of the Sprott School of Business. "All the financial projections are no longer valid. They were using some sophisticated accounting to make it look like the city could have a brand new stadium without paying for it--now it's clear that taxpayers really are paying all the costs.

Bob McKinley  of the Rural Council of Ottawa-Carleton said his members are concerned by this news.  Rural residents of Ottawa do not want to see their taxes increased to subsidize professional sports and downtown commercial development. "We think the City should be spending taxpayers' dollars on other priorities."

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Ian Lee          (613) 222-7722
Michael Tiger (613) 235-3113
Bob McKinley (772) 321-2609