Property taxes are set to increase as the city plans to spend more money to fix bumpy roads and pay for the rising cost of emergency services.
This afternoon, Mayor Sam Katz tabled the 2013 capital and operating budgets, which include a 3.87 per cent property tax hike. One per cent of the property taxes will be dedicated to fixing local streets, lanes and sidewalks, which will generate an additional $4.5-million. This is the second straight year Winnipeg will see property taxes rise to offset the rising cost of city services.
The operating budget calls for $920 million in spending on all city services, from policing to insect control to snow removal. This year's budget represents a $28 million spending increase over the 2012 budget, primarily due to the rising cost of emergency services.
Together, the police and fire-paramedic budgets increased $31 million alone. The two departments now account for $406 million in spending, or 44 per cent of the operating budget.
The average home will see property taxes rise $57.
Winnipeg also plans to find $13 million in savings by delaying filling vacant positions, and reduce grants to non-profit groups by $358,000.
At the same time, the city will spend $722,000 to create a policy and communications office for council's executive policy committee. Councillors' discretionary ward budgets are also set to rise from $74,000 to $114,000.
Mayor Sam Katz said Winnipeg still has the lowest municipal taxes in the country, and other major cities in Canada have seen their taxes rise anywhere from 38 to 64 per cent in the last decade. Katz said the cost of emergency services is the biggest portion of the city's budget, admitting the growing cost is not sustainable. He said the city has already called for an operational review of the Winnipeg Police Service to make sure the city is getting "bang for their buck" and doing everything possible to make sure citizens are safe.
He said he would rather have a share of other growth revenues - such as the gas tax - than raise taxes, but right now the city can only use property taxes as a way to generate additional funds.
"From my point of view, Winnipeg has been a rare island compared to the rest of the Canadian cities for where we've been on property taxes," Katz said.
Finance chairman Coun. Russ Wyatt said the plan is to increase property taxes one per cent a year in coming years and devote the revenue to fix local streets. Wyatt said the city currently has no access to other sources of growth revenues to pay for its infrastructure deficit, and this is a way Winnipeg will be able to fix more roads.
Coun. Jenny Gerbasi (Fort Rouge) said she think it's wrong for councillors to be spending additional money on themselves at a time when grants have been cut to non-profit groups and Wiinnipeggers are being asked to pay more on their tax bill.
"It's kind of a slap in the face to people that are getting all these cost increases at the same time," Gerbasi said.
Coun. Paula Havixbeck (Charleswood-Tuxedo) said she does not support a tax increase, noting the rise in councillor's ward budgets and the new policy office totals $1.3 million alone.
"I think the citizens of Winnipeg don't deserve a tax increase, and I'm going to do everything in my power to find improved savings or cost-cutting that don't impact services," she said.
Winnipeg will also spend $375 million this year on capital projects. The city will spend $6 million on library renewal, $1.1 million to complete the design of the second leg of the Southwest Transitway, $7.3 million for the first of the city's new recycling centres and $10 million to ease traffic congestion in the Polo Park area.
Winnipeg plans to delay upgrades to its largest sewage-treatment plant for another year.
The $7 million the city initially planned to spend on a water park will be spent to rebuild the East Elmwood Community Centre and on recreation in other city wards.