Ottawa's three economic development agencies have laid off staff and are operating with deficits in their efforts to accommodate the city's budget cuts.

Budget decisions made in March reduced funding to the Ottawa Life Sciences Council by 23 per cent and to the Ottawa Centre for Research and Innovation by 18 per cent.

The Ottawa Tourism and Convention Authority was hit with a 24-per-cent funding decrease.

Ken Lawless, president and CEO of the Ottawa Life Sciences Council, said the funding his organization receives from the city goes directly toward paying staff.

After the loss of $66,000 to his budget, Lawless had no choice but to lay off three of his seven employees.

"You can imagine what that does to our capabilities," said Lawless. "It has an impact on our ability to deliver core programs and make investments."

The decrease in staff has made it difficult for Lawless' team to respond to opportunities and reduces its ability to leverage funds for the industry's benefit, Lawless said.

The cuts have also had an impact on the organization's reputation abroad. Lawless said he was bombarded with phone calls from various groups worldwide that were worried his council would not be able to fulfill its contractual obligations.

These relationships take years to build and Lawless said the message city hall sent was that it does not believe in the council's business.

"On the world stage, we have to be cognizant of that. The impacts are rippling."

And it is not just the $66,000 Lawless is missing. His organization leverages those funds four to one.

"Small amounts of money, when leveraged as high as we do, have a big impact."

Ottawa's tourism authority was handed the task of dealing with a 24-per-cent reduction in funding and a declaration from city hall that, in 2005, the city would no longer be funding the organization at all.

The city would like hoteliers to fund the tourism authority through a voluntary destination marketing fee.

Tourism authority president Jacques Burelle has said his organization will close if the city makes good on its word to cut off funding and if the hoteliers refuse to help out.

In the meantime, he said, the funding cut has caused the tourism authority to run on a deficit for this fiscal year.

"We had planned for a 10-per-cent cut and figured we could absorb that. The other 14 per cent cut we had no option, (so) we chose to run a deficit for now," said Burelle.

"We hope to recoup funds from the destination marketing fee (to make up the difference at the end of the year)."

The authority's board approved the short-term deficit of $165,000 to $175,000 in April.

The Ottawa Centre for Research and Innovation prepared for its 2004 budget with the expectation of a 10-per-cent funding cut, said OCRI president Jeffrey Dale.

However, an additional eight per cent was withdrawn as well, which meant Dale and his team had to come up with new cost-cutting measures to their original budget.

"We made reductions mostly to administration. Our lease was also up so we are moving in a couple of months.

"That will provide us with savings right from the start."

Construction is currently underway at 2625 Queensview Dr. to prepare for OCRI's move, however, a firm moving date has not been set.

Some projects were also reorganized to make up for the lack of funds, Dale said.

For example, the Entrepreneurship Centre has had many of its services moved online, including having clients use online tools instead of individual consultations.

The centre has been open Wednesday evenings, but that will soon come to an end.

The decreased funds also means OCRI has to be careful how it uses its global marketing dollars, said Dale.

"We're going to have to be very careful. We meet with a lot of trade delegations and we'll have to be selective which ones we'll work with (for cost reasons)."

Despite having to strategize on how to do more with less, Dale is confident the future holds the promise of funding from the federal Liberal party and other levels of government that have made verbal pledges to help communities.

"All in all, OCRI has been able to adjust (to the) budget reductions from the city. We are confident that, after the federal election, we will see federal programs that will work with community partners."