Ottawa’s Mayor, Mark Sutcliffe, has issued a warning about the financial state of OC Transpo, the city’s public transit system, stating it is in a more critical condition than he had initially anticipated during his mayoral campaign. The crux of Sutcliffe’s campaign was revolving around solutions to rectify the public transit issues that the city faced, primarily the Light Rail Transit (LRT) complications and the decline in ridership due to the COVID-19 pandemic.
City Councillors were given a strategic overview of the transit system’s long-term plan, revealing an alarming projection of $6.6 billion in budget strains over the next 25 years. More than half of these pressures are attributed to decreasing ridership. This foreseen crisis puts potential growth like the third stage of LRT expansion to areas Kanata, Barrhaven, and Stittsville at risk, despite Mayor Sutcliffe’s conviction that it will materialize in due time.
The councillors were informed about the financial challenges plaguing Stage 3. It is currently beyond the city’s financial capacity and would require total funding from the senior levels of government, who have yet to pledge any form of monetary support. The annual operating cost of Stage 3 is estimated at a hefty $64 million, with an anticipated increase in ridership by a mere 2%, generating approximated revenue of around $5 million each year. Additional savings from bus route replacements are expected to be negligible.
The original plan to kickstart the construction of Stage 3 depended on the completion of the delayed Stage 2. Based on the state of financial affairs, it’s anticipated that the city could postpone Stage 3 until there are signs of financial stability. The options range from proceeding with parts of the project, switching it with a rapid bus transit system entirely, or aborting the project entirely.
Despite the technical briefing’s outcomes, Sutcliffe maintains his stance that Stage 3 remains crucial to the city’s long-term transit plan. He expressed confidence that Phase 3 would come to fruition for residents in Barrhaven, Stittsville, and Kanata, considering the city’s projected population growth over the next quarter-century.
Till now, the city hasn’t entered any agreements with other government bodies or private industry concerning Stage 3, thus any alterations to the fate of Ottawa’s light rail system won’t evoke financial penalties, as stated by deputy treasurer Isabelle Jasmin.
Mayor Sutcliffe admitted that Stage 3 may be unaffordable in the current situation but remained hopeful that the city can rectify OC Transpo’s financial status in the coming decade.
Sutcliffe remains unwavering in his belief that the city’s 2024 budget will retain the cap transit levy increase at 2.5%, and he is exploring alternative solutions that don’t require its increment.
Urging for support from the federal and provincial governments, Sutcliffe noted a $39-million deficit in OC Transpo’s 2023 budget which officials hoped would be supplemented by upper tiers of government. A notion that has yet to be fulfilled, as additional funding failed to materialize in federal and provincial budgets for the current year.
In his quest for external support, Sutcliffe declares that Ottawa deserves special consideration due to its status as the nation’s capital. National government decisions have gravely affected the city’s transit ridership and the future of downtown. He also emphasized the need for a more equitable funding approach from the provincial government, citing the discrepancies between what Ottawa and other cities like Toronto receive for transit operations, routine maintenance, and lifecycle funding.
Provincial Premier Doug Ford had previously stated none provincial support would be directed towards Stage 3 of the LRT until problems with Stage 1 were resolved.
