That's a big IOU

City of Ottawa Liabilities:
The $1 Billion Jump in 2025 Most Residents Missed

On-balance-sheet obligations climbed 13% in a single year. Here’s the full picture — ranked by dollar value — plus the off-balance-sheet commitments that rarely make the headlines.

Published July 27, 2026 · Based on the City of Ottawa’s audited Consolidated Financial Statements for the year ended December 31, 2025

Most Ottawa residents see their property-tax bill, transit fare, or water rate and move on. Very few open the City’s annual consolidated financial statements. Those statements, presented to Audit Committee in June 2026, reveal a striking fact: total liabilities jumped from $7.93 billion at the end of 2024 to $8.98 billion at the end of 2025 — an increase of roughly $1.05 billion, or 13%, in just one year.

Key takeaway: Net debt (liabilities minus financial assets) rose from $4.11 billion to $4.86 billion. While tangible capital assets still far exceed these obligations, the speed of growth in 2025 was markedly faster than the previous year.

1. Total Liabilities & Net Debt Growth

The chart below shows the sharp step-up in both total liabilities and net debt between 2024 and 2025.

Total Liabilities vs Net Debt (2024–2025)

Source: City of Ottawa Consolidated Statement of Financial Position (dollars in billions)

2. On-Balance-Sheet Liabilities Ranked by Dollar Value (Dec 31, 2025)

All figures below are in millions of dollars. Comparative 2024 values are shown for context.

2025 Liability Breakdown (Largest to Smallest)

Values in $ millions

Rank	Liability	2025 ($M)	2024 ($M)	Change
1	Net long-term debt	3,687	3,371	+316
2	Deferred revenue	1,868	1,613	+255
3	Accounts payable & accrued liabilities	1,575	1,229	+346
4	Employee future benefits & pension agreements	856	802	+54
5	Mortgages payable (mainly OCHC)	637	543	+95
6	Public-private partnership (P3) liability	129	136	–7
7	Asset retirement obligations	87	83	+3
8	Other liabilities	67	74	–7
9	Capital lease obligations	50	58	–8
10	Contaminated sites	22	22	0
	Total Liabilities	8,978	7,931	+1,047

Composition of 2025 Liabilities

Net long-term debt remains the single largest component at 41%

What drove the biggest increases?

• Accounts payable (+$346 M) — Timing of payments and higher operational accruals.
• Net long-term debt (+$316 M) — New issues of ~$488 M (including sustainable debentures and a Canada Infrastructure Bank loan for zero-emission buses) offset by ~$155 M in principal repayments.
• Deferred revenue (+$255 M) — Government funding for housing and childcare received but not yet spent.
• Mortgages payable (+$95 M) — Continued Ottawa Community Housing construction and repair loans.
• Employee future benefits (+$54 M) — Plan amendments for Ottawa Police Services and higher WSIB costs related to certain cancers.

3. Off-Balance-Sheet Commitments & Contingencies

These items do not appear as liabilities on the statement of financial position but represent real future claims on City resources:

Major Off-Balance-Sheet Items (Approximate Totals)

Capital works commitments are multi-year; largest portion falls in 2026

• Future capital works commitments — Approximately $1.67 billion (largest near-term tranche ~$1.46 billion in 2026).
• Loan guarantees — ~$157 million authorized, of which ~$104 million was outstanding.
• Operating lease commitments — Roughly $71 million over the coming years.
• Stage 2 LRT remaining construction & long-term maintenance — Significant residual construction costs plus multi-decade service payments.
• Other — Hydro Ottawa service contracts, ice-rental P3 arrangements, joint-facility commitments (Ādisōke), Lansdowne revitalization agreements, and various legal contingencies.

4. Context & Why It Matters

Debt-service ratios remain comfortably below both provincial limits (25% of own-source revenue) and the City’s stricter internal targets. The overall accumulated surplus rose to about $20.5 billion, supported by strong growth in tangible capital assets (~$25.2 billion). New debt largely funded infrastructure that will serve residents for decades.

Nevertheless, a one-year increase of more than $1 billion in recorded liabilities — plus roughly $1.7 billion in near-term capital commitments — is material. It raises future principal and interest costs, increases sensitivity to interest-rate changes, and underscores the importance of aligning capital plans with sustainable revenue sources (taxes, rates, development charges, and senior-government transfers).

The 2024 increase in total liabilities had been a more modest $198 million. The 2025 jump was more than five times larger. That acceleration is the part most residents have not yet fully appreciated.

Sources

City of Ottawa Consolidated Financial Statements for the year ended December 31, 2025 (presented to Audit Committee, June 19, 2026) and related notes on contingencies, commitments and contractual obligations.

This post is an independent analysis based on publicly available audited financial statements. Figures are rounded for readability. Always refer to the official statements for precise amounts and full disclosures.