Winnipeggers face increased taxes, fees in Gillingham’s tough first budget New mayor confronts reality of city’s deteriorating infrastructure, critical service deficiencies in spending blueprint By: Chris Kitching and Danielle Da Silva Posted: 2:12 PM CST Wednesday, Feb. 8, 2023 Last Modified: 6:30 PM CST Wednesday, Feb. 8, 2023 Updates

Winnipeg property owners are facing higher tax bills and fees as Mayor Scott Gillingham’s first budget targets crumbling infrastructure and includes measures to improve critical services such as Winnipeg Transit and 311.

The average single-family homeowner will pay an extra $142 though the 3.5 per cent property tax hike and one-time frontage levy increase of $1.50 per foot in the proposed 2023 budget, which was tabled Wednesday.

“It maps out a targeted approach to reinvesting in city services and to begin replenishing the financial stabilization reserve fund,” said Gillingham, referring to the city’s rainy-day fund almost completely drained to cover a record operating deficit fuelled by the COVID-19 pandemic and record snow-clearing costs.

There were few surprises in the spending blueprint, which follows through on some of the promises Gillingham made during last fall’s civic election, including the tax and levy hikes, and a transit security team.

It aims to recover from significant revenue shortfalls from the pandemic, while making modest spending increases.

As in recent years, two per cent of the property tax hike will go toward road renewal and 0.33 per cent for the Southwest Rapid Transitway, for a total of $15 million.

The remaining 1.17 per cent will collect almost $8 million to restore transit service to 100 per cent, hire more 311 staff to speed up response times, add safe spaces for homeless and at-risk people and regrow the disease-ravaged tree canopy.

Some of the money will go toward downtown safety efforts and neighbourhood action teams, that will fill potholes and do other jobs.

The frontage levy increase — from $5.45 to $6.95 per foot — will raise almost $18 million for road upgrades, active transportation and initial planning and design for the expansion of Chief Peguis Trail and widening of Kenaston Boulevard.

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It is equivalent to a 2.6 per cent tax hike.

The total budget for roads is about $156 million.

“The public, I believe, will see noticeable improvements in the coming year because of the investments we are making in this budget, and I believe that it sets us up well for the next multi-year budget,” said Gillingham.

The city is also budgeting for a $1.9 million increase in business tax revenue while maintaining the rate at 4.84 per cent. The small-business tax threshold, meanwhile, is increasing from $44,220 to $47,500.

The preliminary tax-supported operating budget for city services is nearly $1.3 billion, representing a 7.3 per cent increase — or $87.7 million — over 2022 and above inflation.

The capital budget is almost $567 million.

“It maps out a targeted approach to reinvesting in city services and to begin replenishing the financial stabilization reserve fund.”–Mayor Scott Gillingham

To account for the increased spending while maintaining a balanced tax-supported budget, as required under provincial law, the city is proposing new and increased fees and $10.4 million in cost savings, including staff cuts and continuing the long-standing practice of not filling some vacant positions.

Increases to fees will be capped at 3.2 per cent.

Gord Delbridge, president of CUPE Local 500, which represents about 5,000 city workers, said a plan to keep some positions vacant will put additional stress on staff and service delivery.

“We see cuts in community services, primarily (positions in) libraries and recreation services, and that’s a concern for Winnipeggers,” he said.

Gillingham said he expects to release more details soon on the transit security team, which is being set up with an initial $5 million in funding.

The team will work in partnership with police and community groups, and have arrest powers, said the mayor, adding he doesn’t team members being armed.

Chris Scott, president of ATU Local 1505, which represents bus drivers, said he expects union members will cautiously welcome the news.

“I believe this is just the first step, it’s not the answer,” he said. “This will help get the force up and running with all the requirements they need to do their job effectively, but we also need to get the commitment of ongoing funding to keep the force going and, if necessary, expand it.”

Overall transit spending is increasing by $26 million to $238 million. Services levels will be restored to pre-pandemic levels later this year, said finance chair Coun. Jeff Browaty (North Kildonan).

The city is also allocating at least $100,000 for Millennium Library security measures prompted by the fatal stabbing of Tyree Cayer, 28, in December.

An annual police spending increase of $6 million to $326 million is below inflation, while the city is allocating $226 million to the Winnipeg Fire Paramedic Service (a $5 million increase).

A total of $36 million has been set aside for snow removal and ice control.

Coun. Ross Eadie (Mynarski) was hoping a bigger chunk of revenue from the property tax and frontage levy increases would go toward services.

“I’m just impressed they decided the four-year budget will replenish the (rainy-day) fund, instead of major cuts to services,” he said.

Gage Haubrich, the Canadian Taxpayers Federation’s Prairie director, expressed concern over the 2022 operating deficit and the budget’s tax and levy increases.

“That’s especially going to be a problem with inflation rising and the already heavy tax burden that Winnipeggers already face,” he said.

Kate Kehler, executive director of the Social Planning Council of Winnipeg, was disappointed the budget didn’t contain significantly more money for poverty reduction, noting the large proportion dedicated to policing.

“If we want to actually solve the problems, we have to invest far more in the front end,” she said.

“I’m just impressed they decided the four-year budget will replenish the (rainy-day) fund, instead of major cuts to services.”–Coun. Ross Eadie

In capital spending, $88 million is being set aside in 2023 for a new North End bus garage, plus $15 million to begin work on a nutrient removal plan at the North End Sewage Treatment Plant.

The city will also study how to prolong the life of the 111-year-old Arlington Bridge.

More than $12 million announced for the city’s 150th anniversary next year includes the restoration of the former archives building and design work on the East of the Red RecPlex in Transcona.

The budget also proposes the first step toward topping up the rainy-day fund, which has dropped to $5.3 million, by diverting $15 million from water utility revenues.

The fund held about $100 million before the pandemic, but the city had to dip into it to cover losses and costs associated with COVID-19 and snow-clearing overruns. It is being used to help cover a $83 million operating deficit in 2022.

The fund should contain more than $70 million, based on the minimum mandated by council (six per cent of the annual operating budget).

Council will vote on the budget on March 22, after it goes before various city committees.

— with files from Malak Abas

chris.kitching@freepress.mb.ca

danielle.dasilva@freepress.mb.ca

Danielle Da Silva
Reporter

Danielle Da Silva is a general assignment reporter.

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