Winnipeggers should brace for ‘pain’ after province terminates funding agreement: Bowman

Hey there, time traveller!
This article was published 26/05/2017 (3085 days ago), so information in it may no longer be current.

Mayor Brian Bowman predicted Winnipeg residents can expect a range of service cuts or reduction in infrastructure spending as a result of the Pallister government’s decision to unilaterally alter its funding arrangements with municipalities.

Bowman told reporters Winnipeggers can expect “pain” because of the province’s decision to terminate the longstanding 50/50 cost-sharing agreement on transit operational costs and to end the sharing of PST revenue.

“What’s increasingly clear to me is that there is going to be some pain for Winnipeg’s infrastructure and Winnipeg taxpayers, the question is how much,” Bowman said. “When I talk about pain, will it impact our roads budget — possibly. Will it impact other investments that we’re making? Possibly. Will it impact the ongoing collective bargaining process? Quite possibly. Is it putting additional pressure on those discussions? Absolutely.”

Municipal leaders across the province share Bowman’s concern about the impact the changes to the funding arrangement will have on their budgets.

The Association of Manitoba Municipalities said it has written to the province to express its concerns about future infrastructure funding.

“Obviously, we’d like to see guarantees for provincial funding (in legislation),” said AMM president Chris Goertzen.

However, the Pallister government’s commitment to reducing the PST by the end of its first term in office complicates matters, he said.

Right now, municipalities are guaranteed one-seventh of provincial sales tax revenue from the eight per cent PST. They don’t want to see that funding level decrease if the PST is reduced to seven per cent, as promised by the Progressive Conservative government.

Goertzen said he can understand why the province wants to give itself more flexibility.

“(But) we’re going to be watching this carefully, and we certainly have expressed concerns that we don’t want to see funding reduced for municipalities,” he said.

The provincial funding changes were buried in a 68-page provincial omnibus bill introduced Thursday afternoon.

But Goertzen said the AMM was not caught unawares. He said bureaucrats gave AMM a heads up about the government’s intentions shortly after the provincial budget was introduced in April. He said there is good communication between his organization and the province.

Despite assurances from the province funding this year won’t be changed from 2016, Bowman said civic officials are still trying to determine exactly how much funds city hall will be receiving.

Bowman said the province unleashed a great deal of uncertainty with its last-minute decision to end the 50/50 cost-sharing of transit operational costs, adding no one knows if that will affect this year’s operations or 2018.

Coun. Marty Morantz, chairman of council’s public works committee, said Winnipeg’s transit service could be dramatically altered in myriad ways as a result of the provincial government.

“Ending the 50/50 transit agreement is a game-changer,” Morantz (Charleswood-Tuxedo-Whyte Ridge) said. “Will if affect the service we provide? Will we have to provide more mill rate support? Will we have to look at fares?”

Morantz said while the city understands the province’s financial situation, that should not become a problem for residents.

“I don’t think those (provincial) budgets should be balanced by downloading expense onto the citizens of Winnipeg,” Morantz said.

Bowman said it’s hoped municipalities will get their proportionate share of the $500 million Ottawa is providing to the province through its Building Canada Fund, adding Winnipeg’s share could offset any losses from the end of the PST agreement.

“If we can’t get that clarity, we’ll have to have assumptions built into our budget, which will have pain for taxpayers,” Bowman said, adding the “pain” will not extend to unusually high property taxes. “We’re talking about pain. The question right now for us is it a little or a lot.”

Goertzen said the future of transit funding “is a concern for many of our municipalities.” While only a few Manitoba municipalities operate transit systems, many receive provincial funding for Handi-Transit services.

“We want to see continued partnership with the provincial government. So, we’re going to be watching that very closely. And we have expressed our concerns with regards to that,” he said.

Brandon Mayor Rick Chrest said he doesn’t have “a lot of details” about the province’s transit funding plans.

“We will be very anxious to work with the province and to work with the minister (Eileen Clarke, minister of indigenous and municipal relations) on this to come up with a solution that can work for both levels (of government),” he said. “Transit is an extremely important (component), especially to larger communities.”

Meanwhile, the veiled manner in which the province released its planned municipal funding changes is at odds with past promises made by Premier Brian Pallister, Winnipeg political scientist Paul Thomas says.

Pallister, while in opposition, promised Manitoba, under the PCs, would become the most improved province when it came to transparency and accountability, he said.

“If that’s the case, you would make less use of omnibus bills that don’t give full disclosure or easy accessible disclosure of what’s coming,” Thomas said.

aldo.santin@freepress.mb.ca

larry.kusch@freepress.mb.ca