Katz defends increase for frontage levies

Hey there, time traveller!
This article was published 10/03/2011 (5400 days ago), so information in it may no longer be current.

Mayor Sam Katz defended the city’s plan to hike frontage levies amid mounting criticism he misled the public by implying the fees will allow increased spending on city roads and sidewalks this year.

Katz initially touted the plan to raise levies by $1.20 a frontage foot, or 47 per cent, as a way to bolster infrastructure repair. On Monday, he said the levy will generate $14.4 million specifically dedicated to infrastructure and not the “bottomless pit known as general revenue” and that the public doesn’t mind paying for something if they know where their money is going.

Opposition councillors say the problem is Katz wasn’t upfront about where all the road maintenance money is going. Couns. Jenny Gerbasi (Fort Rouge) and Russ Wyatt (Transcona) said it is technically true the $14.4 million in levies is slated for the road-maintenance budget, but the problem is the city is simultaneously redirecting $15.1 million from the existing road-maintenance budget to its general revenue stream.

That means the city is actually cutting the road-maintenance budget, not increasing it.

Katz said the other monies coming out of the budget “are addressing other issues that the City of Winnipeg is facing,” and he doesn’t think anyone ever said anything about additional spending on infrastructure.

Katz said the bottom line is the city has identified a source of revenue solely for infrastructure — something it’s never had before — and 100 per cent of the frontage levies will be directed toward the city’s $3.8-billion infrastructure deficit.

“It’s allocated and dedicated to infrastructure, period. Exclamation point,” Katz said, following Wednesday morning’s executive policy committee meeting.

Aside from an additional $4.1 million devoted to public works, the 2011 budget document does not demonstrate additional infrastructure spending. Acting chief administrative officer Mike Ruta told the Free Press earlier this week the higher frontage levies won’t actually boost the amount of money spent on roadwork this year.

“He did give people that impression,” Gerbasi said. “You could argue we’ve cut the road maintenance budget. It’s a little bit manipulative.”

Gerbasi and Wyatt both said a three per cent property tax hike would have been a more upfront and fair way of raising the same amount of money as the frontage levy. They say the frontage levy is a flat tax and a property tax would have been more equitable to all homeowners, since it takes into account the value of the home.

“It gives everyone the impression we’re spending more money on infrastructure and streets based on the levy,” Wyatt said. “If you’re going to increase the tax, then increase the service that’s being provided.”

jen.skerritt@freepress.mb.ca

What was said:

 

‘These monies are specifically dedicated to infrastructure. They’re not going into the bottomless pit known as general revenue. The public doesn’t mind paying for something if they know where it’s going’

 

— Mayor Sam Katz on March 7

 

‘It’s allocated and dedicated to infrastructure, period. Exclamation point’

 

— Katz on March 9