The city is proposing to cover its pandemic losses without imposing steep service cuts by borrowing more money and taking a one-year break from devoting most new tax dollars to roads.

The city is proposing to cover its pandemic losses without imposing steep service cuts by borrowing more money and taking a one-year break from devoting most new tax dollars to roads.

Revenue raised by two percentage points of this year’s 2.33 per cent property tax hike will support general city spending this year, if the city’s preliminary operating budget, released Friday, is approved.

The draft $1.19-billion operating budget is poised to devote $12.6 million of tax-hike revenues to general coffers, departing from a previous pledge to dedicate that cash to road renewal.

The rest of the property tax revenue will continue to fund rapid transit.

That’s one of several measures the city says are needed to balance the COVID-stricken municipal budget. The city will also draw $10 million from its financial stabilization reserve rainy-day fund, order police to find $6.1 million of savings over the next two years and replace $5.4 million set for capital projects with debt.

MIKAELA MACKENZIE / WINNIPEG FREE PRESS



Finance chair Scott Gillingham and mayor Brian Bowman present the preliminary budget to the media at City Hall in Winnipeg on Friday, Nov. 26, 2021. For Joyanne story.

Winnipeg Free Press 2021.

MIKAELA MACKENZIE / WINNIPEG FREE PRESS Finance chair Scott Gillingham and mayor Brian Bowman present the preliminary budget to the media at City Hall in Winnipeg on Friday, Nov. 26, 2021. For Joyanne story. Winnipeg Free Press 2021.

"The pandemic hit and, quite frankly, we’re in an emergency and because we’re in an emergency, our revenues… have really been hit hard," said Coun. Scott Gillingham, the city’s finance chairperson.

The balanced-budget update erases a previously expected $43.5-million shortfall over the next two years of the 2020-2023 multi-year budget. That included $30.2 million in lost revenues and extra costs due to COVID-19 that aren’t already offset by other savings.

Winnipeg Transit was originally expected to fall $26.4 million short, since the city predicts ridership will hover between 60 and 75 per cent of pre-pandemic levels next year.

A six per cent service reduction for Winnipeg Transit will be repeated in 2022, echoing the cut this year.

The city expects to increase spending to renew local and regional roads to $164.7 million in 2022, up from $152 million this year, by replacing tax revenue for roads with federal gas-tax funds. That will include $2.2 million for active-transportation projects.

The city says those changes will allow it to avoid new fees and frontage-fee increases. A proposed 2.33 per cent property tax hike means the average homeowner will pay $43 more in 2022, if the budget is approved.

JESSICA LEE / WINNIPEG FREE PRESS FILES Mayor Brian Bowman is pictured at a recent press conference. The city is poised to cover its pandemic losses with more borrowing and a one-year break from devoting most new tax dollars to roads, while avoiding steep service cuts.</p></p>

JESSICA LEE / WINNIPEG FREE PRESS FILES Mayor Brian Bowman is pictured at a recent press conference. The city is poised to cover its pandemic losses with more borrowing and a one-year break from devoting most new tax dollars to roads, while avoiding steep service cuts.

"Winnipeggers, they’re being stretched and they’re being hit by this pandemic, so any additional burden on them by way of property taxes is not something that I would support," said Mayor Brian Bowman.

The non-pandemic losses include increased police pension-fund costs and the price to treat the National Day for Truth and Reconciliation as a staff holiday.

The city plans to spend $20 million on COVID-19 response and recovery efforts, including $10 million to accommodate social distancing in parks, add splash pads and enhance active transportation. Another $10 million will cover economic-development efforts that focus on downtown revitalization, though the specific projects have yet to be determined.

The budget also proposes to spend about $2 million to support outreach to vulnerable Winnipeggers, such as those experiencing homelessness, operate public washrooms downtown and add staff to handle housing funding.

"Our revenues on the operating budget are really being decimated…. (But) we still found a way to provide over $2 million in supports for vulnerable Winnipeggers and to respond to some very urgent needs in our communities," said Bowman.

The budget also proposes that the city continue to waive temporary patio fees through March 2023, while "use of street and special event" permit fees would be waived for block parties and street festivals throughout 2022.

The preliminary budget could change before council casts a final vote on Dec. 15.

Joyanne.pursaga@freepress.mb.ca

Twitter: @joyanne_pursaga

Joyanne Pursaga

Joyanne Pursaga
Reporter

Born and raised in Winnipeg, Joyanne loves to tell the stories of this city, especially when politics is involved. Joyanne became the city hall reporter for the Winnipeg Free Press in early 2020.