City of Ottawa pauses grants to developers who de-contaminate sites

Ottawa city council has pressed pause on a 15-year-old program that gives grants to developers who clean up and rebuild on sites that are contaminated or have derelict buildings, such as former factories or gas stations.

Since the program began in 2007, the City of Ottawa has handed out well over $100 million to applicants who have asked the city to help cover costs when they remediate brownfields, as they're called. 

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Mayor Mark Sutcliffe campaigned in the fall election on a promise to eliminate both the brownfields program, and other future community improvement plans.

Ottawa now has several community improvement plans. The idea is the city foregoes several years of increased taxes if a property is upgraded and redeveloped in specific areas the city wants to revitalize.

For instance, one plan provides tax breaks for new development in much of Orléans while another targets the area around the Ottawa International Airport. The Montreal Road community improvement plan came under fire in 2021 for providing a large tax break for a proposed Porsche dealership. 

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On Wednesday, city council decided to press pause on new applications for brownfield grants. It will also cancel a procurement in the private sector related to a new affordable housing community improvement plan it's drafting. 

Instead, it will wait to see what comes of a staff review of all the programs, which is due in late spring. 

After the meeting, Sutcliffe told reporters that Ottawa has to be sure it's not subsidizing development unnecessarily, especially given the financial pressures the city faces. 

"I think the objective of the review that's going to be conducted is to understand to what extent these programs are actually incentivizing new development that would not occur otherwise."

City losing fees elsewhere

Capital ward Coun. Shawn Menard shared those same concerns, and put forward the motion that was seconded by the mayor. Menard has long felt the program needed to be reviewed.

"There's more of a reason now though, because of the reduction to public funds that we're seeing from the province … for development charges," he said.

The City of Ottawa estimates it could lose out on $26 million a year by having to waive fees under the More Homes Built Faster Act passed by the Ontario government last month.

At council on Wednesday, Stittsville Coun. Glen Gower pointed out that city staff have consistently advised the tax breaks are a good investment, and asked that consultants with an outside perspective weigh in on the review. 

Orléans South-Navan Coun. Catherine Kitts, meanwhile, was glad that the nascent community improvement plan in Orléans would still be able to accept applications for the time being.  East-end councillors are keen on what it might do to boost economic development there. 

Meanwhile, Coun. Stéphanie Plante was concerned about the brownfield grant application for a development by Main and Main in her Rideau-Vanier ward that is in the queue. She convinced council in a tight 13 to 11 vote to allow existing brownfield applications on Montreal Road to proceed.