Lansdowne Would be a 1% Property Tax Increase for Everyone in Ottawa

The AG's report should be a wake up call for Council. Or will they hit the snooze button?

The Escapade electronic music festival at Lansdowne.

Lansdowne was back in the news last week. Ottawa’s Auditor General submitted her first agile audit of Lansdowne 2.0 last week.

The audit shows that Lansdowne will cost significantly more than advertised and has a very uncertain revenue stream.

For taxpayers, the audit report was concerning.

For City Council, we’ll see next week whether they share that concern.

What the AG found

The AG reported that:

1. The City is not following its own costing guidelines, and as a result, is underreporting the construction costs of Lansdowne 2.0 by $74 million. Total project cost should be $493 million, not the $419 million the City has been saying.

2. There is considerable risk in the financial projections, which could significantly reduce the revenues available to the City to pay down debt. For example, RedBlacks revenue projections are far beyond what the team has been able to achieve in recent years. And the RedBlacks owners have only committed to keeping the team in Ottawa until 2032. There is a material risk that the CFL franchise could fold, as has happened twice before in Ottawa.

1% property tax increase

$493 million in construction costs amount to about $20 million a year in debt servicing for 30 years. That $20 million is equivalent to a 1% property tax increase for all residents and businesses in Ottawa.

Lansdowne will produce no significant revenue for at least a decade. It is possible that after a decade or two there will be some revenue to cover a share of that debt servicing. But if Lansdowne 2.0 turns out anything like the original Lansdowne proposal, taxpayers can expect to see only a small amount of what we were promised.

The best case scenario is that we all shoulder a 1% tax increase now, and maybe we get some of that back in the future. Maybe it’s only our kids who see any significant return.

Material change

When this Council first looked at Lansdowne 2.0 in November, they gave a green light to continue advancing the project. But staff were also directed to come back to Council with updates if there were any material changes.

On July 10, we’ll find out if the majority of Council thinks the auditor’s findings are material or not.

We’ll find out if Council believes that taxpayers deserve a second look at costs and projections.

Or if Council would rather ignore the findings of the AG and steamroll ahead with the project, regardless of financial outlook.

Public interest or OSEG’s interests

It’s a fair question to ask if this Council, and this Mayor in particular, is more interested in protecting the public interest or pleasing the Lansdowne partner, the Ottawa Sports and Entertainment Group.

If the priority is the public interest, Council would listen to the AG’s concerns and ask staff to come forward now with updated costing and financial projections.

If the priority is OSEG, Council will downplay the AG’s concerns and continue to press forward without allowing further scrutiny.

Pressing forward would mean that the file would largely go quiet until the end of 2025, at which point Council would see updated cost projections and go straight into a final vote on the project. No time for due diligence around that costing. No updates to the “optimistic” financial projections.

Let the public decide

If on July 10 Council chooses to press forward, those looking out for the public interest will have few options left other than to demand a referendum on Lansdowne.

Other Canadian cities have held referenda on major investments in sports facilities, including Calgary bidding for the 2026 Winter Olympics, Montreal West building a new sports complex in 2023, Victoria expanding a swimming facility in 2024, and Langford, B.C. expanding its soccer stadium in 2024.

Do you think we should call on the City to hold a referendum on spending about $500 million to renovate a sports stadium?

Truth in advertising

I’m skeptical that the public would approve Lansdowne 2.0 if they understood it to be a 1% tax increase, with the hope that we might get some of that money back in the decades to come.

It’s time for Council to be honest with the public about Lansdowne.

Or do as other Canadian cities have done and give residents a voice in deciding whether our tax dollars should be spent on upgrading sports stadiums.