City faces $10-M cash crunch

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This article was published 08/04/2009 (6402 days ago), so information in it may no longer be current.

Winnipeg will receive about a tenth of the extra revenue Mayor Sam Katz expected from the Doer government this year, leaving a $10-million hole in the city budget, civic number-crunchers suggest.

On March 25, when the NDP government tabled its spending plan for the year, Winnipeg’s mayor and finance chairman, Coun. Justin Swandel, hoped the province would hand Winnipeg $15 million in additional funding, above and beyond previously announced grants and programs.

The city wanted another $3.6 million as part of an ambulance-funding deal and also asked for as much as $11.5 million in a separate request for new funding.

Both figures were factored into Winnipeg’s $785-million operating budget, with the understanding any shortfall from the province would be offset by finding “efficiencies” in the public service — political jargon for cuts.

On provincial budget day, Katz said city officials were still trying to determine what the 2009 provincial budget meant for Winnipeg. Two weeks later, the total amount of additional revenue heading Winnipeg’s way appears to be $1.55 million, according to a summary provided by Winnipeg chief financial officer Mike Ruta.

Increased provincial speeding fines should allow the city to earn $800,000 in additional traffic-enforcement revenue this year, while the province’s new electronic waste recycling enhancement could generate $750,000, Ruta said in a statement.

Before the provincial budget was tabled, the mayor hinted the province would come through with the extra money requested. This week, his office declined to comment.

Swandel also declined to comment.

But Transcona Coun. Russ Wyatt, another member of the mayor’s cabinet, called the provincial budget a disappointment for every municipality in Manitoba.

“If this budget has any message, it says playing nice guy with the province is not working. Maybe there has to be a different strategy,” said Wyatt, who also suggested Katz has made it easy for the province to ignore Winnipeg’s request for more money.

“It doesn’t help that we’re freezing our (property) taxes and cutting business taxes while we’re saying we have an infrastructure crisis,” he said, referring to the mayor’s priorities within Winnipeg’s operating budget. “If this was a crisis, we’d be looking at all sources of revenue.”

The Doer government, however, maintains it has done more heavy lifting on the municipal front than Winnipeg this year, as $10.1 million of the additional $17.6 million the city plans to spend on services in 2009 comes from the province, spokesman Jonathan Hildebrand said in a statement.

“In a tough economy, we increased funding to the city of Winnipeg by 5.2 per cent this year,” he said.

Katz has said repeatedly he’s been assured there is enough room for cuts in the public service to cover off what now appears to be a $10-million gap between the city’s expectations for additional revenue and the province’s budget-day contribution.

Those cuts won’t be easy to make, charged St. Boniface Coun. Dan Vandal, who voted against the operating budget on the grounds it amounted to wishful thinking.

“As the year unfolds, I think the city will have to scramble to meet its (financial) commitments,” he said. “What that means in terms of cutbacks, nobody’s really sure right now.”

bartley.kives@freepress.mb.ca