#346 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.

i

I AM A Candidate for Rideau-Rockcliffe*

"something needs to be done".

This time around, inform yourselves, vote differently, vote wisely. Vote for Peter Karwacki for Rideau Rockcliffe.

Campaign Web Page

https://peterkarwacki.blogspot.com/p/peter-karwacki-for-rideau-rockcliffe.html?m=1#

Walking in the footsteps of Tobi Nussbaum

"I wish I had asked more detailed questions and requested clearer answers earlier than I did. I acknowledge this shortcoming in part because I believe we need to build a greater culture of accountability at city hall. "

Tobi Nussbaum

Who do you want to have as your councillor? What did Tobi mean when he said we need a culture of accountability? Here is a description of your councillor’s oversight responsibilities.

This is the summary of City of Ottawa Services that your councillor/ trustee must oversee. The City Must provide (is accountable for) these municipal services including:

1. employment and financial assistance;
2. long-term care; 
3. community services and libraries; 
4. emergency and protective services including police, fire and ambulance; and 
5. transportation, 
6. utilities and public works, including roads, 
7. sewers and wastewater, 
8. drinking water, 
9. waste collection and disposal.

These services are at times described as:

1. General government
2. Protection to persons and property Roads, traffic and parking
3. Transit
4. Environmental services
5. Health services
6. Social and family services
7. Social housing
8. Recreation and cultural services Planning and development

A brief description of each segment follows:

• General government consists of Council, administration, and Ontario Property Assessment.


• Protection consists of police, fire, and other protective services. These groups maintain the safety and security of all citizens by reducing or eliminating loss of life and property, by maintaining law enforcement, and preserving peace and good order.


• Roads, traffic and parking include parking, signs and signals, streetlights and the maintenance of roads and parks of the City.


• Transit services provide local public transportation for citizens. They also include other transportation services such as planning and development.


• Environmental services include water supply and distribution, wastewater treatment, and waste and recycling services. These services provide clean drinking water to residents, collect and treat wastewater, and collect and properly process waste and recycling items.


• Health services include paramedic and health services. Mandated health services promote and maintain health programs that optimize the health of residents. Paramedic services deliver timely and effective care for pre-hospital emergency care, along with medically required inter-hospital transportation.


• Social and family services include social assistance, long-term care, and childcare services. Social assistance services determine, issue, and monitor clients’ eligibility for financial, social, and employment assistance. Long-term care services provide secure and supervised health services for seniors who can no longer live at home. Childcare services provide subsidized childcare spaces and provide funding for wage subsidy, pay equity, and special needs.


• Social housing, with the partnership of 120 community-based agencies, provides a range of services, including housing, emergency shelters, outreach, search, and stabilization to people in the community.


• Recreation and cultural services include parks and recreation, culture, and libraries. Parks and recreation services develop and deliver high-quality recreational programs, and develop and maintain recreation facilities, parks and sports-fields to ensure all residents have the opportunity to enjoy a healthy lifestyle. Culture services invest in local non-profit organizations that deliver services on behalf of the City. Library services provide public library services to the citizens via physical facilities, bookmobile, virtual, and telephone services.


• Planning and development services manage urban development for residential and business interests, as well as infrastructure and parks.


• Non departmental includes equity in earnings of government business enterprise, investment income, shared lottery earnings, and miscellaneous sundry revenue

The city is the sole shareholder of :
Hydro Ottawa Holding Inc. [“Hydro Ottawa”], and the 
Ottawa Community Housing Corporation [“OCHC”], 

The City also provides hydro and housing services to the residents of Ottawa. 
Ottawa Community Lands Development and the Manotick Mill Quarter Community Development were created for the purpose of promoting and undertaking community improvements in the City by managing real property.
Corporations were created for the purpose of promoting and undertaking community improvements in the City by managing real property.


Employee benefits liabilities, property tax assessment appeals, legal claims provisions, landfill closure and post-closure liabilities and liabilities for contaminated sites are estimates.

Costs to settle legal claims, based on available information if likely and reasonably determinable, are reported as an expense

Ottawa is required to provide for closure and post-closure care of solid waste landfill sites.

Ottawa Art Gallery works of art are not recorded in the City’s consolidated financial statements.

Fees and user charges relate to transit fares; utility charges; water, wastewater, and solid waste; licensing fees; fees for use of various programming; and fees imposed based on specific activities. Revenue is recognized when the activity is performed or when the services are rendered.



The “city” activities of all committees of Council and the following boards, Business Improvement Areas [“BIAs”] and entities:

1. The Police Services Board
2. The Ottawa Public Library Board The Ottawa Board of Health
3. The Ottawa Community Housing Corporation
4. Manotick Mill Quarter Community Development Corporation
5. Ottawa Community Lands Developmen Corporation
6. The Bank Street BIA
7. The Westboro Village BIA
8. The Sparks Street BIA
9. The Somerset Street Chinatown BIA The Glebe BIA
10. The Heart of Orleans BIA
11. The Carp Road Corridor BIA The Carp Village BIA
12. The Vanier BIA
13. The Manotick BIA
14. The Sparks Street Mall Authority The Somerset Village BIA
15. The Preston Street BIA
16. The Byward Market BIA
17. The Downtown Rideau BIA
18. The Barrhaven BIA
19. The Wellington West BIA
20. The Kanata North BIA
21. The Bells Corners BIA
22. The Kanata Central BIA

All interfund assets, liabilities, revenue and expenses need to be eliminated.

Hydro Ottawa and its business enterprise’s accounting policies are not adjusted to conform to those of the City, and inter-organizational transactions and balances are not eliminated.

Other comprehensive income or loss of the enterprise is recorded directly to the City’s accumulated surplus and net debt.


School boards

The taxation, other revenue, expenses, assets and liabilities of school boards are separate and the City does not control or have any involvement in the operations of school boards.


Note: from the Ottawa Citizen "the lack of urban representation on arguably the most important council committee: the Watson-chaired finance and economic development committee. That’s the committee tasked with major policy oversight for things such as LRT planning, corporate finance and real estate. Not a single downtown-area councillor will sit on the finance committee if the proposed membership passes at council meeting Wednesday. In fact, of the 11 proposed members of the finance committee to sit with Watson, nine members are either rural or suburban councillors."

#428 Dividend? Infrastructure not LRT

Ward 13 · Infrastructure Accountability

Ottawa Finds $22 Million a Year. It Should Say So, In Writing.

Hydro Ottawa hands the City a dividend every June. It lands in general revenue, gets used for whatever council needs that year, and nothing on paper stops it from quietly absorbing LRT-related debt service. It should be earmarked, in a council-approved policy, for core infrastructure renewal — and explicitly walled off from the P3/LRT liability line.

$22.1M

2026 Hydro dividend

$0

Earmarked for core infrastructure

$1.23B

City's own stated funding gap

Every June, Hydro Ottawa's board walks into council chambers, presents its annual report, and hands the City a cheque. It's treated as good news — and on its own terms, it is. But look at what happens to that money after the handshake, and the story changes from "the utility is healthy" to "the City has a discretionary slush fund with no name on it."

---

01 — The mechanismWhat the dividend policy actually says

Hydro Ottawa Holding Inc. is a private company, 100% owned by the City of Ottawa, created when the province forced municipal electricity utilities to incorporate under the Electricity Act, 1998. As sole shareholder, council sets the dividend policy. Since 2006, that policy has directed Hydro Ottawa to pay the City 60% of net income or $14 million, whichever is greater — and in 2016, council locked in a guaranteed floor of $20 million a year starting in 2017, specifically so budget staff could plan around a predictable number rather than a number that moves with storm damage and commodity prices.

It has worked, in the narrow sense that it delivers cash reliably. Cumulative dividends passed roughly $369 million by the end of 2023. The 2025 payment was $22.3 million; the 2026 payment, presented at the June 2026 Annual General Meeting, is $22.1 million.

The dividend has been a reliable annual transfer for two decades

hydro ottawa → city of ottawa, selected years, $ millions

Sources: CBC News (2016); Hydro Ottawa 2022 & 2023 AGM reports to Council; Hydro Ottawa Group June 2026 AGM release.

The direction of travel is up, not down — and that's the point of this piece. It's not a rounding error. It's a growing, dependable stream, and right now it has no destination written into policy beyond "general revenue."

---

02 — The gapWhere that stream disappears into

Hydro Ottawa's own language on this is consistent, year after year: the dividend "will be used by the City to fund municipal programs and services." That's it. That's the entire earmark. It is, by design, fungible — the same undifferentiated pool that funds the police budget, transit operations, road resurfacing, and debt service on every capital project council has ever approved, including the ones I've already documented running over budget or piling up as off-balance-sheet risk.

Hydro dividend — $22.1M/yr → General Revenue Fund (undifferentiated)

↳ could offset any budget line, including P3/LRT debt service

↳ could offset any budget line, including transit operating shortfalls

Meanwhile, the City's own Long Range Financial Plan work has already put a number on the problem this money could be solving. Council's June 2026 infrastructure and transit motion explicitly names a $1.23 billion funding gap for maintaining and renewing City infrastructure — a separate, narrower figure from the $10.6–10.8 billion ten-year infrastructure gap I've written about previously, but pointing at the same underlying problem: the basics (roads, facilities, water and sewer renewal) are underfunded, on the record, by the City's own staff.

One year's dividend, next to the gap it could be chipping away at

log scale — the bars are not proportional to pixel height below $100M; see labelled values

Sources: City of Ottawa, "Council approves City joining federal clean-fuel program" (June 2026 council motion coverage); Peter Karwacki, "Ottawa Doesn't Have $419 Million Lying Around..." liabilities series (10-year gap).

Let's be honest about scale: even fully earmarked, $22 million doesn't close a billion-dollar gap. That's not the argument. The argument is that a growing, guaranteed, publicly-owned revenue stream is currently doing the least accountable thing money can do at City Hall — disappearing into "general revenue" — when it could be doing the most accountable thing: showing up, every year, as a named line against a named backlog.

---

03 — The exception that proves the ruleCouncil already knows how to do this — for climate, not for infrastructure broadly

Here's what makes the current setup frustrating rather than just imperfect: council has already built the mechanism once. In the same June 2026 motion that named the $1.23 billion gap, council directed staff to create a new reserve fund for climate-related infrastructure capital projects, funded in part by "a portion of revenues from the annual Hydro Ottawa dividend."

What this proves

Council does not need new legal authority, a provincial ask, or a charter change to earmark dividend revenue. It already voted to do exactly that — for one category of spending. The precedent exists. It's just scoped narrowly to climate projects, and it's "a portion of," not all of, the dividend.

That's a good start on a program that should be the default, not a one-off carve-out attached to a single climate motion. If a portion of the dividend can be walled off for climate infrastructure by council motion, the rest of it can be walled off for core infrastructure renewal — roads, water and sewer mains, facilities — the same way, by the same mechanism, this term.

---

04 — Why "not LRT" has to be explicitThe P3/LRT liability is exactly the kind of hole this money would otherwise fall into

This is the part that needs to be written into the policy in plain language, not left to budget-season discretion. I've already documented that the City's off-balance-sheet P3/LRT liability line was the fastest-growing item in the consolidated financial statements — up $135.8 million in a single year, the smallest line item but the fastest mover. I've documented the East Extension's repeated timeline slippage. I've documented the St-Laurent tunnel's still-unrepaired structural risk. None of that is a reason to send utility dividend revenue chasing after it.

General revenue is fungible by definition. Without an explicit exclusion, a dollar of Hydro dividend that nominally goes toward "infrastructure" can simply free up a dollar of tax levy that then flows to LRT debt service, transit operating shortfalls, or Lansdowne 2.0's $16.4–17.4 million a year in debt servicing — and nobody outside the budget office would ever be able to tell the difference. An earmark that doesn't name what it excludes isn't really an earmark.

What "earmarked, not LRT" should mean in the policy text

A dedicated Infrastructure Renewal Reserve, funded by the full annual Hydro Ottawa dividend, with an explicit clause excluding its use for P3/LRT debt service, Lansdowne 2.0 debt service, or any transit capital cost overrun — reported publicly, dollar-for-dollar, against the $1.23 billion gap each budget cycle.

---

05 — The askFour things council can do without asking anyone's permission

1. Convert the dividend policy from a revenue target into a renewal fund. Amend the shareholder declaration so the full annual dividend flows to a named Infrastructure Renewal Reserve, not general revenue, by default.
2. Write the LRT exclusion into the policy text. Explicitly bar the reserve from being drawn on for P3/LRT debt service, Lansdowne 2.0 debt service, or transit capital overruns — the same discipline already applied, informally, to the climate carve-out.
3. Extend the June 2026 precedent citywide. The climate infrastructure reserve fund already proves council can do this. Use the identical mechanism for the core renewal backlog instead of inventing a new process.
4. Report it against the $1.23 billion gap, every budget cycle. One page, public, showing what the reserve took in, what it spent, and how much of the stated gap it closed that year — the same transparency standard I've asked for on the liabilities file generally.

None of this requires the OEB, the province, or a new tax. It requires council deciding that a City-owned company's profits should be visibly rebuilding the City that owns it — not quietly patching whatever budget line is short that December.

---

• City to get guaranteed $20M a year from Hydro Ottawa after policy change approved
  CBC News · Kate Porter · June 22, 2016
• Why does Hydro Ottawa pay the City of Ottawa a dividend?
  Hydro Ottawa · corporate FAQ
• Hydro Ottawa presents 2022 Annual Report to City Council
  Hydro Ottawa Group newsroom · Oct. 25, 2023
• Hydro Ottawa presents 2023 Annual Report to City Council
  Hydro Ottawa Group / CNW · June 25, 2024
• Past progress, future powered: Hydro Ottawa highlights record 2025 investments and launches 2026-2030 Strategic Direction
  Hydro Ottawa Group / CNW · June 24, 2026
• Powering the Capital: Hydro Ottawa Group Reports on Big Investments and Bigger Demand
  Ottawa Life Magazine · June 27, 2025
• Council approves City joining federal clean-fuel program
  City of Ottawa newsroom · June 2026 — source of the $1.23B gap figure and the climate infrastructure reserve motion
• Ottawa approves $1.2-billion infrastructure funding plan, transit investments and housing measures
  Ontario Construction News · July 2, 2026

Peter Karwacki is a candidate for Ward 13 (Rideau-Rockcliffe) in Ottawa's October 2026 municipal election. PMP-certified, trained data analyst, 13 years at IBM and Cognos.

#434 Rideau-Rockcliffe top ten list

The next ten big things

Ottawa & Ward 13 (Rideau‑Rockcliffe) – 2026 to 2030

📅 18 August 2026 ✍️ Peter Karwacki 🏷️ Ottawa • Ward 13 • Policy • Future

Based on current events and emerging trends, here are the ten biggest issues that will shape Ottawa and my ward, Rideau‑Rockcliffe, over the next four years. From transit shutdowns to housing pressures, infrastructure debt to climate adaptation – these are the challenges and opportunities that demand our attention.

🏙️ Ottawa & Rideau‑Rockcliffe – change is coming

1. 🚇 St‑Laurent LRT station shutdown & transit reliability

A major crisis for Ward 13: the St‑Laurent LRT station must close for extensive repairs. The tunnel, originally built for buses in the 1980s, suffers from severe structural decay – corroded metal framing and crumbling concrete.

• Impact: 11–13 months of repairs, including 5–6 weeks of a full, dual‑track closure that will halt service in both directions.
• Timeline: Design targeted for December 2027, construction finishing no earlier than December 2029.
• Context: A blow to the “Transit‑Oriented Development” zone, where thousands of new housing units were approved based on the promise of reliable rapid transit. Refer to my artical on this project

2. 🏠 Housing & homelessness crisis

Affordability and homelessness remain the top concerns for Ottawa residents – and Ward 13 is no exception.

• Hotel expense: In 2025, the city spent $29.3 million housing over 660 families in hotels – an expense that “buys nothing that lasts”.
• Waitlist: Over 16,000 households are on the social housing waiting list (end of 2025). The city aims for 5,000 new affordable units by 2030 but has built only 466 in the first three years.

3. 💰 Crushing fiscal pressures & the infrastructure gap

The new mayor and council inherit a city with daunting financial liabilities.

• Off‑the‑books liabilities: An infrastructure gap in the “double digits of billions”, plus an OMERS pension shortfall not fully reflected on the city’s balance sheet.
• Lansdowne 2.0 debt: The $418.8 million redevelopment carries a debt load of over $16 million a year, despite promises of no taxpayer risk.
• Runaway transit costs: LRT expansion is driving costs beyond what the city “didn’t fully anticipate and can’t handle”.

4. 🚔 Public safety & policing challenges

Crime and public safety are rising concerns, with notable increases in certain offenses.

• Property crime: Ottawa police reported a 28% increase in property crimes in 2026 compared to the previous year.
• Clearance rates: The robbery clearance rate in Ward 13 was cut in half in one year – from 42.4% to 20.0% – highlighting capacity issues.
• Police budget deficit: The Ottawa Police Service is projected to face a deficit of at least $20 million in 2026.

5. 🌳 Climate change adaptation

The city has launched “Climate Ready Ottawa”, a new five‑year action plan (2026–2030) to prepare for climate impacts.

• Focus: Protecting people, infrastructure, and essential services from flooding, extreme heat, and severe weather.
• Investment: Seven priority programs will guide investments in flood resilience, cooling amenities, and extreme weather preparedness.

6. 📉 Economic uncertainty & slow growth

Ottawa’s economy faces short‑term pressures with modest growth expectations.

• GDP: The Ottawa‑Gatineau region’s real GDP is projected to increase by only 1.4% in 2026.
• Job losses: Recent data shows Ottawa “experienced the largest employment loss”. However, emerging opportunities exist in defence, cybersecurity, and semiconductors.

7. 🏛️ New council dynamics & governance

The 2026 municipal election brings a new mayor and many new councillors – a chance for significant change.

• Key question: Will the new council move beyond political theatre and focus on structural fixes like accountability, oversight, and the vast infrastructure deficit?
• Ward‑level impact: Councillor Rawlson King often finds himself on the losing side of key votes as part of a progressive minority – this dynamic will shape Ward 13’s influence and priorities.

8. 🌉 Major interprovincial bridge construction

Work on the bridges connecting Ottawa and Gatineau will cause major traffic disruptions.

• Macdonald‑Cartier Bridge: Work started in June 2026 and will continue into 2027.
• Alexandra Bridge replacement: Construction on this 120‑year‑old bridge is expected to begin in 2028.
• New “sixth” bridge: The NCC has approved design principles, but construction remains years away – final design targeted for 2029.

9. 🚸 Ward 13 road safety improvements

Several road safety projects funded by the province will be implemented in Ward 13.

• Projects: Traffic calming measures – speed display signs, thermoplastic markings, and speed bumps – on St. Laurent Blvd., Crichton St., Queen Mary St., and Donald St.
• Deadline: All projects must be completed by March 31, 2028.

10. 🏗️ Intensified development & gentrification pressures

Ward 13 – with its mix of affluent and working‑class neighbourhoods – will face intense development pressure.

• Push for density: More moderate‑income and supportive housing units are sought, but balanced against concerns over renovictions and gentrification.
• Recent approvals: A nearly 1,770‑unit, six‑tower development was approved near the St‑Laurent station in 2025 – a clear sign of the scale of change to come.

---

Looking ahead – These ten issues are deeply interconnected. The decisions made by the new city council over the next four years will be critical in determining how Ottawa and Ward 13 navigate this period of significant change. From transit reliability to housing affordability, fiscal discipline to climate resilience, there is no shortage of work ahead. But with the right focus and accountability, we can build a more sustainable and inclusive future.

Originally published on peterkarwacki.blogspot.com · Based on current events and future trends as of August 2026.

#Ottawa #Ward13 #RideauRockcliffe #MunicipalPolitics #Infrastructure #Housing #Climate

Civic Accountability Dossier · Ward 13

Ten Forces That Will
Shape Ottawa Before
the Next Election

A four-year outlook grounded in current budgets, staff reports, and the trend lines already in motion — independent of who wins in October.

Peter Karwacki / PMP · Data Analyst / peterkarwacki.blogspot.com

Every campaign promises a vision. Fewer point to the forces already moving whether or not any candidate touches them. Here are the ten that will define Ottawa's next term — with the ones landing hardest on Ward 13 flagged below.

01Economy

The federal workforce keeps shrinking

The National Capital Region's federal headcount has already dropped by thousands in a single year, with Ottawa posting the steepest job losses of any Ontario city. This is the economic current under nearly everything else on this list — tax base, transit ridership, housing demand, downtown vacancy.

02Budget

A dedicated infrastructure levy gets seriously considered

Staff have floated a new property tax levy to chip away at a repair backlog that current plans only partly cover, against an annual funding gap that could approach $230 million. Expect this fight to define at least one budget cycle.

03Transit

LRT reliability stays unresolved, not fixed

Wheel-bearing failures, single-car service, and a fleet still catching up to demand keep transit as one of the most contested files at City Hall — regardless of who's making the case for it.

04Ward 13

Ward 13 File

The St-Laurent tunnel moves from warning to construction

Years after engineers flagged an urgent structural risk, funding and tendering are finally catching up. Bus-bridging, construction disruption, and public pressure on the station sitting inside Ward 13 will land on whoever holds this seat.

05Housing

Delivery keeps missing its own targets

Announced housing partnerships continue to move slower than the units they promise, while the count of residents in chronic homelessness keeps climbing — a trend now colliding with a new wave of federal layoffs.

06Finance

Lansdowne 2.0's financing gets its first real test

With its anchor tenant gone, the "no taxpayer risk" promise that carried the project through council faces its first genuine stress test just as a new term begins.

07Governance

Strong-mayor powers get used — or visibly restrained

How the next mayor wields (or limits) provincially granted strong-mayor authority will shape how much real oversight individual councillors retain, Ward 13's included.

08Oversight

Police board accountability keeps surfacing

Auditor findings on reporting accuracy and budget tracking at the Police Services Board point to a structural gap, not a one-term issue — one the next council inherits either way.

09Ward 13

Ward 13 File

Flooding keeps finding the same streets

West Rockcliffe and Manor Park's combined-sewer legacy makes them structurally exposed to storm-driven flooding that's now recurring rather than exceptional — a hard infrastructure fact no election changes on its own.

10Technology

Municipal AI adoption outruns municipal AI governance

City departments are already using AI tools faster than council has built disclosure or audit standards for them — a genuinely new-term problem, not a legacy one.

Compiled from current City of Ottawa staff reports, Auditor General findings, and public budget documents. Full sourcing and ongoing tracking at peterkarwacki.blogspot.com.

Filed · Aug 2026

#347 Ottawa's Hidden Garden

Ottawa’s Hidden Liabilities

When off-balance-sheet commitments for the library, LRT, Lansdowne, flooding infrastructure and the new hospital are folded in, the picture is no longer rosy.

July 27, 2026 · Analysis based on the City of Ottawa’s 2025 Consolidated Financial Statements and subsequent project updates through mid-2026

At December 31, 2025 the City reported $8.98 billion in total liabilities and $4.86 billion in net debt. Those figures already rose more than $1 billion in a single year. But they capture only what public-sector accounting rules require to be recognized today.

Large contractual construction commitments, multi-decade P3 maintenance obligations, approved-but-not-yet-issued debt, and high-profile political asks sit largely or entirely off the balance sheet. When those are brought into view, the true claim on future tax and rate revenues looks substantially heavier.

The core point: The accumulated surplus of ~$20.5 billion is real — but it is locked inside roads, pipes, rails and buildings. Cash and future revenue capacity are what service the debt and the commitments. Off-balance-sheet items compete for exactly that capacity.

1. On-Balance vs. Off-Balance Reality

Reported Liabilities vs. Approximate Additional Commitments

Off-balance estimate aggregates remaining capital-works commitments (~$1.7 B), residual Stage 2 LRT construction & long-term maintenance tails, Lansdowne debt still to be issued, Ādisōke residual, hospital ask, and known climate/flood resilience pressures. Long-term P3 service payments stretch decades and are only partially captured.

2. The Five Projects That Matter Most

Ādisōke Central Library

Original budget concept ~$175 million. By early 2026 the approved figure sat near $334 million. A further $18.5 million request (City share $11.5 million, largely new debt) pushed the total toward $352–353 million. Construction is ~85 % complete but the schedule has not stabilized; latest indications point to December 2026 with no firm public opening date.

Once open, new operating costs (staffing, facility operations, programming) will hit the annual budget. Those ongoing costs and any further overruns remain largely off-balance today.

Ādisōke Cost Escalation

Original concept → current approved trajectory (City + federal shares combined)

Transit – Stage 2 LRT

The program has grown past $5 billion. Trillium Line is in service and its P3 liability (~$129 million) is now on the books, to be repaid over 27 years at a high effective rate. Confederation Line east and west extensions still carry hundreds of millions in remaining construction commitments that the City must settle upon substantial completion.

Far larger are the multi-decade maintenance, lifecycle and availability payments for the combined Stage 1 + Stage 2 system. These cash obligations stretch 27–30 years and are only partially recognized as liabilities today. Contingency top-ups for oversight, claims and delays continue.

Public Works – Flooding & Stormwater Resilience

The July 1, 2026 extreme rainfall (thousands of basement floods) exposed capacity and deferred-maintenance gaps. Climate Ready Ottawa and the rate-supported Long-Range Financial Plan already allocate hundreds of millions to drainage, retrofits, flood-plain mapping and resilience work.

Replacement value of the broader water/wastewater/stormwater network has been cited in the tens of billions. Immediate response costs plus the capital upgrades that will follow post-event reviews are only beginning to crystallize. These are classic “known unknowns” that will appear as future debt or rate increases.

Lansdowne 2.0

Total project cost is framed at approximately $419 million. The City presents a “net cost to taxpayers” of roughly $131 million, but the financing plan includes ~$331 million in new debt to be issued later (servicing beginning in the 2030s), plus reserves, debt premiums, Municipal Accommodation Tax increases and partnership cash flows.

Until the debt is issued and construction is complete, the bulk remains an off-balance-sheet commitment. Auditor-general commentary has flagged thin contingency, tariff risk, and revenue assumptions.

Lansdowne 2.0 – Total Cost vs Net Taxpayer Cost vs Debt Still to Be Issued

New Civic Campus – The Ottawa Hospital

The City was asked in 2022 for a local contribution of up to $150 million as part of an estimated ~$700 million local share (original total project ~$2.8 billion). Staff are to bring funding options before the end of the current council term.

As of mid-2026 the main hospital design, final cost and schedule are still being finalized. The parking garage is advancing; the hospital itself is widely expected to slip well into the 2030s. Cost-escalation risk has been publicly noted. This $150 million (or higher) ask is not yet a recorded liability — it is a known, high-profile expectation that will compete with every other capital priority.

3. Putting the Pieces Together

Major Off-Balance & Near-Term Pressures (Illustrative Scale)

Orders of magnitude only. Long-term LRT maintenance tails and full stormwater replacement needs are larger still and extend over decades.

What “folding them in” means in practice:
• Remaining capital-works commitments already total ~$1.7 billion (heavily weighted to 2026).
• Stage 2 residual construction + multi-decade maintenance payments add hundreds of millions to low billions over time.
• Lansdowne debt of ~$331 million is still to be issued.
• Ādisōke residual City share and future operating costs continue to rise.
• The hospital ask of up to $150 million remains outstanding.
• Climate and flood-resilience capital will keep growing after the 2026 event.

None of this is secret. The contractual commitments appear in the notes to the financial statements. Project updates go to committee. What is missing from day-to-day discussion is the cumulative effect: a growing stack of claims on the same limited pool of future tax, rate and development-charge revenue.

Debt-service ratios remain within formal limits today. The accumulated surplus is large. Yet the speed of on-balance growth in 2025, combined with the scale of still-unrecognized or only partially recognized obligations, means the margin for error is thinner than the headline balance-sheet numbers suggest.

The rosy narrative rests on assets that cannot easily be turned into cash and on the assumption that revenues will keep rising fast enough to service everything that has already been promised. Off-balance-sheet commitments test that assumption hardest.

Sources

City of Ottawa Consolidated Financial Statements year ended 31 December 2025 (Audit Committee, June 2026); subsequent Finance & Corporate Services and related committee reports on Ādisōke, Stage 2 LRT, Lansdowne 2.0, Climate Ready Ottawa / stormwater programs, and the Civic Campus local-share request; public project updates through July 2026.

This is an independent analysis. Figures are rounded and drawn from publicly available documents. Long-term P3 maintenance totals and full infrastructure replacement needs are larger than the illustrative bars shown and extend over decades. Always consult the official statements and project reports for precise amounts and disclosures.

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Note:

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"something needs to be done".

This time around, inform yourselves, vote differently, vote wisely. Vote for Peter Karwacki for Rideau Rockcliffe.

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