2018 PRELIMINARY BUDGETS RESPOND TO THE FISCAL CHALLENGES OF TODAY WHILE BUILDING A STRONGER CITY FOR TOMORROW
Preliminary Budgets Represent One of the Lowest Rates of Budgeted Expenditure Growth in the City’s History, Are Balanced Without Any Draw on Financial Stabilization Reserve
WINNIPEG – The 2018 preliminary operating and capital budgets tabled at a special Executive Policy Committee meeting are balanced without any draw on the financial stabilization reserve and respond to the fiscal challenges of today by limiting expenditure increases to one of the lowest levels in the history of the city while continuing to build and prepare the city for steady population growth into the future Mayor Brian Bowman announced today.
“Demands on this year’s budget were incredibly high,” said Mayor Brian Bowman. “But the reality is we encountered significant revenue challenges during the last year. At the same time, the city continues to be squeezed by increasing infrastructure demands that come with being a growing city while grappling with the need to rebuild and repair many city assets that fell into disrepair following years of neglect.”
“I do believe, however, the preliminary 2018 budgets strike the right balance between responding to the fiscal challenges of today while continuing to invest in key services and infrastructure that will build and prepare Winnipeg for strong and steady population growth projected into the future,” said Mayor Bowman.
Mayor Bowman emphasized that at the start of the 2018 budget process the city was facing an $89 million deficit in the tax-supported operating budget. Mayor Bowman said over the course of the last year, a lot of input from citizens and collaborative work with stakeholder groups, Councillors, and the public service has resulted in the tabling of a preliminary budget that is balanced without any draw on the financial stabilization reserve.
Mayor Bowman said balancing the 2018 budgets was more challenging than previous years because of the Province of Manitoba’s decision to eliminate two key programs including the 50/50 transit funding agreement and the Building Manitoba Fund which provided stable, predictable, and growth oriented funding for Winnipeg.
Barring a decision by the provincial government to restore the 50/50 transit funding agreement, transit fares for all riders will increase by an additional $0.20 above the annual five cent inflationary increase, for a total fare increase of $0.25 effective January 1, 2018. Service level reductions are also proposed on 23 routes across the city beginning in June, 2018.
To help manage the fiscal challenges the city is currently facing, the 2018 preliminary operating budget limits operating expenditure increases to 1.2 percent, one of the lowest rates of budgeted growth in tax-supported spending in the history of Winnipeg. It also includes $3.4 million of efficiency savings in the form of an additional vacancy management target for a total of $21.9 million that will be shared by all tax-supported departments, special operating agencies, but excluding the Fire and Police departments.
No new fees are proposed in the 2018 budget, the frontage levy is not increased, and the water and sewer dividend rate remains unchanged. No increase is proposed to recycling fees in 2018 beyond inflation.
Property tax increases are limited to 2.33 percent, and the entire increase is dedicated to addressing Winnipeg’s infrastructure requirements.
Two percent of the proposed 2.33 percent property tax increase is dedicated to rebuilding and repairing regional and local roads, and 0.33 percent of the proposed increase is dedicated toward the completion of the Southwest Rapid Transitway. This increase means the average homeowner will pay an additional $39 in municipal property taxes in 2018.
Mayor Bowman said the 2018 budget proposes to increase investment in road renewal to a record level of $116 million in 2018.
“This is the highest annual level of investment in road renewal in Winnipeg’s history,” said Mayor Bowman. “I know that fixing our roads continues to be a top priority for many Winnipeggers, and this level of investment reflects how much of a priority this is for residents across our city.”
To continue powering the economy and reduce the burden on small businesses, the preliminary budget proposes to reduce the business tax from 5.25 percent to 5.14 percent and increase the business tax threshold from $32,220 to $33,300 in 2018.
“Since this Council took office, we have reduced the business tax rate from 5.7 percent to 5.14 percent representing a 9.8% decrease since 2014,” said Mayor Bowman.
Mayor Bowman highlighted how collective agreements negotiated and ratified throughout the last year between the city and its major unions contributed significantly in managing the overall level of expenditure growth in 2018, totaling almost $21 million annually in 2018.
“I want to thank all of our valued city employees for their efforts in helping negotiate agreements that are not only fair to employees, but also more affordable to taxpayers and ultimately more sustainable over the long term,” said Mayor Bowman.
The 2018 preliminary budget proposes to invest a total of $292 million in the
Police Service which reflects an increase of approximately $3.5 million or 1.2 percent from last year’s budget. This increase is in-line with the rate of inflation and consistent with the level of increase recommended in the Winnipeg Police Board Strategic Plan. The proposed operating budgets also provide $193.5 million to be invested in the Fire Paramedic Service in 2018 including additional resources to purchase new firefighting equipment and maintain existing fire halls.
The preliminary budgets propose a record capital investment of $4.6 million to address the backlog of elm tree removals in 2018 which is the most important step in limiting the spread of DED. In 2018, the total capital investment in the Urban Forest Enhancement Program, including DED removal and the Reforestation Improvement program will increase from $2.1 million to $7.1 million. With a further investment of $11.6 million in the operating budget for tree planting, pruning and additional DED control measures, we will invest a total of $18.7 million in maintaining and enhancing Winnipeg’s tree canopy in 2018.
Mayor Bowman said investing in active transportation not only supports active healthy lifestyles, it is also essential to supporting a modern and growing city. The 2018 preliminary budgets propose a total investment of $17.3 million in new active transportation infrastructure, a record level of investment representing an increase of $4.1 million or 31% from $13.2 million in 2017.
The 2018 preliminary budgets also propose new and ongoing investments to build complete neighbourhoods, strengthen community amenities, as well as review the governance structure at City Hall including:
- $175,000 to support a review of the city’s current governance framework;
- $150,000 to continue the Community Homeless Assistance Program (CHAT);
- Fourth year of a 5 year annual commitment of $150,000 towards the United Way’s Plan to End Homelessness;
- $10.8 million of operating support for the Assiniboine Park Conservancy and a further capital grant of $5.1 million to support their on-going infrastructure renewal efforts;
- Third year of a five year annual commitment of $1 million to the Winnipeg Art Gallery Inuit Art Centre;
- $1.25 million to support the Indigenous Youth Strategy, consistent with 2017; and
- A continued investment of over $43 million in grant support to many different organizations, museums, and community centres.
“Moving into the final year of this Council’s mandate, I believe City Hall is on a better track today than it was three years ago,” said Mayor Bowman. “We have made significant progress toward making City Hall more open and transparent, more accessible and responsive, and we have strengthened our sense of pride in our city. Despite our current fiscal challenges, I believe the 2018 preliminary budgets continue this momentum and continue to respond to the needs of a growing, thriving city.”