Winnipeg Free Press - PRINT EDITION

Call referendum on infrastructure tax

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Mayor Sam Katz didn't have much by way of news to tell Winnipeggers in his state of the city address before the Chamber of Commerce Friday, so he did a lot of recapping of what's been done. The most obvious, outstanding item, however, is yawning before us ever wider as the spring thaw has its way with streets, lanes and sidewalks, opening crevices and potholes.

They are but the most evident symptom of the city's multibillion-dollar infrastructure deficit, which grows each year. The mayor noted the city, in its budget, dedicated one per cent of the 3.87 per cent property-tax hike to street renewal and would do that annually from now on. Streets are but a slice of the capital renewals required.

For years, Mr. Katz and various economic and industry groups have called for the provincial government to dedicate a stream of revenue -- one percentage point of the provincial sales tax -- to the infrastructure deficit. The Selinger government has refused, but has added more cash to transfers.

A one percentage point hike to the PST would raise $262 million a year, which would go some way to fixing the rotting or crumbling buildings, roads, pipes and playgrounds in Manitoba, estimated now at $11 billion. Mr. Katz has said he would support raising the PST, if it was confirmed in a referendum.

A referendum would meet the conditions for a tax increase laid out in the province's balanced-budget legislation. The NDP is fond of repeating it was not elected to raise taxes, but that is semantics given its hikes to fees and expansion of the items that are taxes. A referendum that supports hiking the PST would lift some of the responsibility from the province's shoulders for the decision.

A dedicated tax would need careful definition of the purposes for which the revenues could be used. There is no shortage of justified causes, meaning all levels of government could agree on a prescribed list.

The provincial budget next month is not going to meet the demands of municipalities and industry groups that understand most intimately the connection between good roads, well-maintained sewer and water systems and strong recreational facilities, and prosperous, healthy communities.

It is a good time, however, for Finance Minister Stan Struthers to send a signal his government has heard and recognizes the validity of this extraordinary measure. Mr. Struthers should commit to launching discussions with Manitoba's mayors and citizens on increasing the sales tax to dig out of the infrastructure holes.

Editorials are the consensus view of the Winnipeg Free Press’ editorial board, comprising Catherine Mitchell, David O’Brien, Shannon Sampert, and Paul Samyn.

Republished from the Winnipeg Free Press print edition March 11, 2013 A6

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