almost a year ago, as council prepares to approve city’s 2024 budgetMayor Mark Sutcliffe warned that the next one would be much more difficult.

Residents will soon have a clearer idea of ​​how much stricter it will be and who will foot the bill, when city staff present their proposed 2025 budget on Wednesday.

Will the pain fall on public transport users? Or the taxpayers? Or will the city continue to wait for other levels of government to come to the rescue?

Wednesday’s draft will provide the best guidance to staff on how the council should weigh those questions as it prepares for a final vote next month.

How do we get here?

The 2024 budget amounted to about $5.8 billion of combined operating and capital expenditures.

As always, inflationary pressures on wages, fuel and electricity will drive up those costs. But the city also faces revenue challenges. Mayor Mark Sutcliffe has been complaining for months about declining federal transfer payments, arguing that the federal government is not compensating the city for what it should if it had to pay property taxes.

But the toughest challenge – and the biggest unknown in Wednesday’s budget proposal – is how to fill a $120 million hole in the transit budget.

Ridership is still far below what the system needs to break even, especially in the face of rising rail costs. Worse yet, most of the lost passengers were downtown travelers, who tended to purchase more expensive adult passes.

Passengers who stay are more likely to be students or seniors, who pay less.

What does it mean for property tax bills?

If this were a normal budget year without a huge transportation deficit, the outlines of the answer to that question would already be clear. Councilors would set budget directions, indicating exactly what kind of tax increases they were willing to endure.

They did just that this fall.setting a target of 2.9 percent, but only for the police and citywide levies.

What does that mean? Take a look at your property tax bill and you’ll notice that it’s actually made up of separate charges. One funds most city services, another funds the police. A 2.9 per cent increase in both would add about $100 to the property tax bill for the average home in urban Ottawa.

But yet another tax transits the funds, and the council gave staff only a vaguer idea of ​​where they want it to be set.

Remember that $120 million hole? If the city covered it using only the transit tax on property tax bills, a 37 percent increase would be needed.

That would add about $333 further to that average property tax bill.

But that won’t happen, right?

Almost certainly not. Council asked staff to play with a half-dozen “levers” to make up for the traffic shortfall. The traffic tax is just one of them.

Another is based on a wish: that Mayor Mark Sutcliffe Justice for Ottawa The campaign will convince the feds and the province to contribute money.

The other options are less pleasant. They include rate increases, service cuts, changes to rate discounts and deferred capital projects.

Relying solely on fees would require a 75 percent increase. That would raise the cash fare for a single ride above $6.70.

Councilors have called that prospect unrealistic and unpalatable, as has the all-tax option, making it more likely that staff will return with a combination that keeps all the levers in what the city treasurer has called ” a reasonable level.”

What else should we be on the lookout for?

The city’s budget covers much more than transportation, of course, and Wednesday’s draft will reveal how staff plans to meet the council’s other priorities with only the slightest financial wiggle room.

A 2.9 percent tax increase will raise only $62 million for city services, while an expanded tax base for new housing will generate about $31 million more. Staff will also look for efficiencies, having raised about $153 million over the past two years.

But with such a tight margin and rising inflationary costs, how much will be left to fund new action on climate change or affordable housing (both priorities the council has repeatedly committed to) or to maintain aging infrastructure that councilors are worried about? Have they complained repeatedly?

While the council will have the final say next month, Wednesday’s draft will be the first attempt to find an answer.