Ottawa Tourism says the province's $3.4 million cut to their budget is "significant" and will force them to modify their programs in the upcoming year.

Michael Crockatt, the president of Ottawa Tourism, said it's 15 per cent of the organization's budget.

"There's a few things, for sure that, we will have to defer to future years," Crockatt said.

"There's a lot of things that we have to consider in terms of our overall structure, cost structure and and the programs that we're putting in place. There's something that we intended to do this year and we just won't be able to do."

Crockatt said he wouldn't comment on possible job losses, but said the organization will be putting off a planned logo redesign.

He said the provincial funding also paid for Ottawa Tourism's work promoting and developing destinations in the United Counties of Prescott-Russell, which will no longer be part of its core mandate.

It's now getting no money from the province.

Change in focus?

The majority of the organization's funding comes from within Ottawa — 73 per cent from the municipal accommodation tax and the rest from a combination of municipal grants and other private partnerships.

"Our expectation was there might be some cutbacks; we were surprised there were actually cutouts, meaning a 100 per cent cut," said Steve Ball, president of the Ottawa-Gatineau Hotel Association.

Ball said Ottawa Tourism will need to review its spending so it focuses on municipal priorities, since that's where the majority of the organizations funding will come from.

He said perhaps spending to promote the provincially-owned Shaw Centre might need to be reviewed along other items.

"It's a pay-as-you-play world, if it's primarily municipally-driven, we'll focus on municipal expenditures first."

Ottawa Tourism is leading the effort to bring La Machine and other popular 2017 events back to the capital. The organization says some of its new projects are on hold as a result of provincial funding cuts. (Matthew Kupfer/CBC)

Ball said he understands the province is trying to tame a $15 billion deficit. He said the local tourism industry is looking forward to Ontario's new tourism strategy.

Tourism Toronto also lost $9.5 miilion in funding in the same round of cuts as Ottawa, leading the opposition NDP to call the decision "short-sighted" because investing in tourism makes the province money.