Should local taxpayers foot $150-million bill for new hospital? Mayoral hopefuls weigh in

The city’s incoming council will answer one of the biggest financial questions in its history: Are local taxpayers responsible for paying $150 million for the new campus of The Ottawa Hospital?

It’s been a lingering issue since at least 2022, when the hospital asked the City of Ottawa to contribute $150 million toward the $2.8-billion cost of its new Civic campus, which was, staff said at the time, the biggest request for city funding ever received.

The province is providing $2.1 billion of the overall cost, but the current funding formula for new health-care infrastructure in Ontario means the hospital must come up with the remaining 25 per cent locally. That works out to $700 million.

Besides its request to the city, the hospital has few options to fund the rest of its own contribution. It has set up an Ottawa Hospital Foundation campaign with a lofty fundraising target of $500 million and also expects to receive $50 million through a retail revenue campaign.

They hope the city will pay for the rest, but the question about whether local residents will contribute $150 million through their property taxes has so far bounced through two terms of council.

When the hospital first made its request in 2022, councillors of the day directed staff to report back with options on how the city could fund the municipal portion, if at all. That report was supposed to come back by the third quarter of 2023.

Now, almost five years since the initial request, city hall staff confirmed the report is still not done, and a timeline for completing it is not available. Cyril Rogers, the city’s chief financial officer and general manager of finance and corporate services, said staff were still working on it.

“While timing of this report is not yet confirmed, staff will be reporting back to council when the options review and analysis are complete,” Rogers said.

The bureaucratic delays are unrelated to the relatively slow progress being made on the hospital project itself. Construction of the parking garage on the new site near Dow’s Lake began in 2023, and, while site preparations are underway for hospital buildings, construction has yet to begin.

But, according to the hospital, the pace should soon pick up. An update this past week revealed the design of the new campus was finally done, and updated construction timelines and project costs were being finalized with “construction partners, the Ministry of Health, and Infrastructure Ontario.”

“In the coming months, construction contracts will be issued, and the public will see much more construction activity on the site,” said Michaela Schreiter, a spokesperson for the hospital.

“We’re looking forward to sharing the details soon.”

This means a decision on the municipal contribution will soon be back on the table and will be left up to whoever is elected on Oct. 26. One of the city’s four mayoral frontrunners will head that council, and each of them agreed that the new hospital campus was sorely needed and that it needed to get built — sooner than later.

Mark Sutcliffe, who’s hoping to be elected to a second term in office, says that he’s been a strong advocate for a new hospital in Ottawa and that it’s critical to the ongoing health and well-being of the people who live here.

He said while health care is a provincial responsibility, he would be committed to working with The Ottawa Hospital to “facilitate construction and help with infrastructure to support its integration into the local community.”

He didn’t explicitly say which way he’d vote on the funding issue when it came back to the council chamber.

“The city’s budget priority is for municipal services. At this time, no final request with detailed pro forma and costing information has been made,” he said. “When one is received, it will be considered in that context.”

Jeff Leiper, a three-term city councillor and Sutcliffe’s closest challenger for the mayoralty in 2026, agreed the new hospital campus was vital to the city’s health and overall economy. He said he was committed to the city doing its part in making sure the hospital got built.

“But health care is the province’s job,” Leiper said.

Leiper was on council when the hospital first made its $150-million request in 2022. Council at the time approved the report — the one still being worked on by staff — recommending they look into where the money could be found. The motion passed with a 15-8 vote, but Leiper was among those who voted against it.

“Ottawa families already pay for this hospital through their income taxes, and the local-share rule asks them to pay again on their property tax bill,” he said.

“That’s why I’ll meet as much of our share as we can through the roads, servicing and transit connections the hospital needs, so taxpayers aren’t paying twice.”

Mayoral candidate Alex Lawson, a homebuilder by trade, said the city had been “stuck” for decades with paying for “more than their fair share of the bill when it comes to responsibilities that fall under other levels of government.”

The hospital is critical infrastructure, Lawson said, but the $150-million request would need more scrutiny before he would vote to approve it.

“The hospital needs to get built. We are already going to be spending a lot of money on transportation infrastructure surrounding this site,” he said.

“I’m not going to write a cheque for $150 million without knowing what goes on the memo line.”

He said once he was elected, he’d review the details of the proposal and “be able to provide a more fulsome answer about where the money is going and for what.”

Mayoral candidate Neil Saravanamuttoo, a career economist, agreed the project must proceed either way. Public health care is essential, he said, and Ottawa needs the expanded hospital capacity to address issues facing the health sector. But he pointed out, as did the others, that “funding health care is the province’s responsibility,” not the city’s.

“Ottawa already faces an $11-billion infrastructure deficit and local governments cannot be expected to continue absorbing costs downloaded by higher levels of government,” he said.

Saravanamuttoo called on the province to properly fund health care so municipalities weren’t faced with such significant financial requests.

“We need a better deal for municipalities and the province must take responsibility for funding health care,” he said.

The new campus has been in the works since 2007, when The Ottawa Hospital created a steering committee that concluded the current Civic campus was too old and would be too difficult and expensive to rebuild. When construction began in 2023, they hoped the new hospital site would be complete, and open to the public, by 2028.

An updated timeline on the hospital’s completion is expected in the coming months.