To freeze or not to freeze: that is the question

Winnipeg politicians will soon decide whether to continue the property-tax freeze for a 15th consecutive year.

Council finance chairman Scott Fielding (St. James) said officials have started to review whether it’s possible to maintain the property-tax freeze for the 2012 operating budget, the blueprint that outlines spending on all city programs, including police, pest control and snow removal. Fielding said it will be a challenge to continue the long-standing tax freeze, but there is a possibility the city may be able to transfer a surplus from the 2011 budget in an attempt to stave off a hike.

The latest city financial report at the end of October forecast a $600,000 surplus by the end of 2011, due in part to additional permit revenue and savings from its summer street program and corporate expenses. Fielding said it’s possible the city picked up additional surplus money in November and December, though officials will not have the year-end total until late January.

“It is going to be challenging to maintain a property-tax freeze,” Fielding said.

Last year, Winnipeg’s operating budget increased by $30 million from the previous year due to the rising cost of police and emergency services. About 40 per cent of Winnipeg’s $847.4-million operating budget in 2011 was devoted to police and fire paramedic services.

The city hiked property frontage levies to cover the cost of increased program spending.

Coun. Jenny Gerbasi (Fort Rouge) said only members of council’s executive policy committee are involved in operating budget discussions and she does not know how big of a funding gap the city faces. She said Winnipeg is coping with the cost of hiring additional police officers, pension benefits and paying down debt.

Gerbasi said cities such as Calgary have imposed modest property tax increases every year to generate revenue, while Winnipeg has frozen it for so long programs are “starving.” She said it’s possible the city is looking at raising fees — such as the frontage levy — like it did last year to avoid a tax increase. Gerbasi said she and other members of council worry executive policy committee may consider selling city-owned assets such as golf courses to generate revenue.

“A lot of us are very concerned about it,” Gerbasi said.

http://www.winnipegfreepress.com/local/to-freeze-or-not-to-freeze-that-is-the-question-136645423.html

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City brochure ‘misleading,’ Wyatt says

City council’s most vociferous infrastructure critic is accusing the city of continuing to mislead homeowners about the purpose of this year’s frontage-levy hike — this time, using a routine mailout.

“This is very misleading,” Transcona Coun. Russ Wyatt said.

Every spring, the City of Winnipeg mails out a property-tax brochure to every homeowner in an effort to explain property tax bills.

This year’s brochure includes a paragraph about frontage levies, which council voted to hike to $3.75 per frontage foot from $2.55 per frontage foot. It was the first boost to the frontage levy in 10 years.

“This levy is used for upgrading, repair, replacement and maintenance of the city’s street and sidewalk infrastructure,” reads the brochure.

What the brochure does not say is the 2011 operating budget includes less funding for street and sidewalk renewals. While the frontage-levy hike will add $14.4 million to the road-repair budget, the council-approved spending plan calls for a $15.1-million reduction in property tax funding for the same repairs.

In March, when the budget was tabled, Mayor Sam Katz and finance chairman Scott Fielding (St. James) claimed the levy hike would pay for more repairs. But Winnipeg chief financial officer Mike Ruta confirmed that was not the case.

Opposition councillors lambasted Katz and Fielding for claiming to increase road renewals while spending less on them.

Wyatt renewed that charge on Monday, claiming the pamphlet is at best, misleading, and at worst, an abuse of a routine mailout.

“If you read it at face value, it looks like the money going to infrastructure is going up. Ratepayers wouldn’t be blamed for making that assumption, but the fact is, it’s going down,” Wyatt said.

“Residents should be aware this is not an increase for the sake of funding the streets. It was an increase so Sam Katz could balance the budget. It was a tax increase through the back door,” Wyatt added.

City assessor Nelson Karpa rejected the assertion his department’s pamphlet is inaccurate. The statement in the brochure is not serving any political ends, he suggested in a statement.

“The brochure that is enclosed with the realty tax bill always has been to provide information relevant to the tax bill,” Karpa said. “The brochure is not intended to address issues related to the City of Winnipeg operating budget.”

Wyatt, however, claimed the civic administration is being used to propagate a political message.

“This is not the first time this has happened and probably won’t be the last. The public service is no doubt following orders from their political master, being the mayor,” Wyatt said.

Katz’s office said it stands by the administration’s insistence the brochure is
accurate.

http://www.winnipegfreepress.com/local/city-brochure-misleading-wyatt-says-122854004.html

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Winnipeg council passes operating budget, rejects property tax increase



Winnipeg city councilors spent most of Tuesday morning debating what taxes and fees should be hiked to fix crumbling roads and fund sports programs. In the end, council passed the $847 million 2011 operating budget by a vote of ten to six, meaning that the proposed 47 per cent frontage levy hike on front yards and an increase in recreational fees for hockey and swimming are going ahead as proposed.

“I think what we did was the right thing – we’re moving in the right direction,” said Mayor Sam Katz, “We have serious issues to address, and I think that’s exactly what we’re doing with this operating budget.”

Transcona Councillor Russ Wyatt had introduced a motion to cancel the two measures, and replace them with a general property tax bump of 3.75 per cent, a move that he said would raise $15 million.

“The money has to come from somewhere in that sense,” said Transcona councillor, Russ Wyatt.

Wyatt and others blasted the Mayor and his cabinet, arguing the frontage levy hike is merely backfilling money taken out of the road and bridges budget, and that the rec fee increases will hurt low-income families.

“$65 million in recreation facilities, we are still subsidizing it by almost 50 per cent, so it’s nowhere near cost-recovery, it’s something reasonable,” Katz pointed out.

Wyatt’s motion failed by an 11 to five vote.

http://www.globalwinnipeg.com/Winnipeg+council+passes+operating+budget+rejects+property+increase/4485345/story.html

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Councillor to push for property-tax increase





A Winnipeg city councillor will table a last-minute motion Tuesday asking that proposed increases to user fees and frontage levies be axed in favor of a property-tax hike.

Coun. Russ Wyatt (Transcona) said Monday that he will present the motion in council chambers on the day city council meets to debate the $847 million operating budget.

Wyatt is one of six councillors who has voiced opposition to budget proposals to hike user fees across the board for recreational facilities and raise the frontage levy by 47 per cent.

Instead, Wyatt is proposing raising property taxes by 3.75 per cent after being frozen for the past 13 years.

He said doing that would be more transparent for taxpayers.

“I think it’s crucial that we do not do this shell game with the citizens of Winnipeg in terms of putting money into the frontage levies and taking it out the back door to balance the budget, I think we should be up front,” he said.

The increases currently being proposed will hit working families too hard, Wyatt told CBC News.

http://www.cbc.ca/news/canada/manitoba/story/2011/03/21/man-wyatt-increase-property-tax.html

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Winnipeg residents to face frontage levy increase, not property tax hike






Winnipeg City Council has rejected a motion by Transcona representative Russ Wyatt to cancel the 47% frontage levy increase in this year’s operating budget.

Wyatt was also proposing to do away with several recreational fee hikes.

The motion was defeated by a 11 to 5 vote.

He was instead calling for a 3.75% property tax hike he says would raise $15 million.

The City is proposing to raise the “street renewal frontage levy” for the first time since 2001 by $1.20, a 47% hike. That means a 50-foot front yard would cost that homeowner about $60 a year and generate an additional $14.4 million.

Wyatt called property tax “far more progressive” than the frontage levy arguing it’s based on a home’s value rather than the width of a front yard.

Council then passed the $847 million operating budget by a 10 to 6 margin.

http://www.globalwinnipeg.com/Winnipeg+residents+face+frontage+levy+increase+property+hike/4484614/story.html

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Tax increase better option: Vandal





St. Boniface Coun. Dan Vandal said lifting Winnipeg’s 14-year property tax freeze would have been a better way to generate revenue than raising frontage levies.

Vandal, a member of council’s executive policy committee, said councillors spent hours talking about the city’s financial challenges during recent operating budget meetings, and everything — including a possible property tax hike — was on the table. Vandal said he will support the decision to raise frontage levies, but thinks a property tax increase is a better option.

Vandal said a property tax increase is based on the value of a home, so homeowners whose properties are worth more, pay more. By comparison, a frontage levy is a flat rate.

“It doesn’t take into account the value of the property, that’s why I think a property tax increase would have been better,” Vandal said, following Tuesday morning’s public works committee meeting.

On Monday, Mayor Sam Katz tabled the city’s 2011 preliminary operating budget, which is the spending blueprint for $847.4 million worth of city programs, from policing to pest control to pool maintenance. The budget includes plans to generate $14.4 million by raising the city’s frontage levy by $1.20 a frontage foot, or 47 per cent. A homeowner with an average-sized 50-foot lot will pay an additional $60 this year.

Frontage levies may be used to pay for water and sewer upgrades, road and sidewalk repairs or improving street lighting.

http://www.winnipegfreepress.com/breakingnews/Tax-increase-better-option-Vandel-117587979.html

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Katz hints tax freeze to stay





MAYOR Sam Katz hinted Winnipeg’s long-standing property tax freeze would continue for another year just days before the city releases its annual operating budget.

Katz is set to table the city’s 2011 operating budget on Monday and said his goal is to keep taxes frozen this year. However, he said it’s becoming more difficult to balance increased spending on city services with limited revenues, noting this year’s spending blueprint was his “most challenging” to date.

Katz did not explicitly say there would be no property tax hike this year, but said it’s his goal not to lift the freeze.

“I don’t think it would be realistic to think property taxes are going to be frozen forever,” Katz said on Friday. “The goal for this year is to basically keep the taxes frozen.”

The $800-million-plus budget will outline the city’s spending on policing, emergency services, insect control and other programs. Last year, city spending increased by about $30 million, the bulk of which went toward salaries and benefits.

Last year’s budget was $817.7 million, up from $787.2 million in 2009.

This year’s increase could be even higher, as the city heads into multiple rounds of labour negotiations to determine the wages and benefits of more than half of all city employees. Katz said bargaining can “most definitely” impact the operating budget, and Winnipeg could be looking at an extra $20 million to $30 million when negotiations are complete.

At the same time, Katz said Winnipeg has added more police, cadets and a new helicopter to its public safety arsenal. Compounding matters is the threat of a spring flood, which provincial forecasters say has a one-in-10 chance of reaching 1997 levels.

“Trying to find the balance between it all is not an easy task, because you know the revenues are not even growing as fast as inflation is,” Katz said. “So you know, there are challenges but I think we’ve come up with some very good ideas to move this forward.”

The mayor has remained tight-lipped on how Winnipeg will strike this balance, but the city will have access to an additional $5.3 million from settling the dispute over municipal gas and electricity taxes with Manitoba Hydro.

This year’s annual operating budget will be tabled later than usual, amid speculation the mayor was waiting for a report from the Infrastructure Funding Council, a task force struck last year to look at options for generating revenues to repair Winnipeg’s infrastructure backlog. The council was to examine internal and external revenue sources, including user fees, property tax, fuel tax and income tax.

Katz said he’s “disappointed” the report wasn’t available before the operating budget was tabled, but expects it will be released sometime this.

For the past two years, the city has relied on disputed money to balance its operating budget. In 2010, the city banked on a contentious $10.6 million from Manitoba Hydro, and only wound up receiving half of that — too late to avoid incurring an on-paper deficit for the year.

The city also used one-time transfers to balance the 2010 operating budget.

In 2009, the city relied on $11.5 million in undefined “new funding” from the province, which it did not receive, but still managed to balance its budget.

http://www.winnipegfreepress.com/breakingnews/Katz-hints-tax-freeze-to-stay–117456613.html

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Strike vote not a factor: mayor ??

WINNIPEG’S spending plan for 2011 won’t be revealed until early March — but not because of the ongoing labour dispute with the city’s largest union, Mayor Sam Katz said.

Katz told reporters Wednesday he plans to table the city’s operating budget on or around March 5, which is later than usual but well within the time frame required for council to debate the spending blueprint, which must be passed before the end of March.

The operating budget outlines the city’s spending on all programs, from policing to health inspections.

It has ballooned by tens of millions of dollars per year in recent years, primarily because of increasing wages and benefits.

As a result, the city has offered its largest union, the Canadian Union of Public Employees Local 500, a wage freeze for the first two years of a four-year contract, both sides have confirmed. This has led to a Friday strike vote.

The outcome of that vote, however, will not affect the operating budget, Katz told reporters Wednesday.

“This is no different than snow removal,” said the mayor, referring to volatile budget line items that require the city to find more money at the end of the year, if necessary.

Katz also said the budget will not be affected by a pending report from a Chris Lorenc-led infrastructure council the mayor struck in 2010.

If that committee recommends a property-tax hike, he is not bound to heed them, Katz said.

“Whatever recommendations come forward, (they’re) not going to happen overnight,” the mayor said.

The city has frozen the pool of property taxes collected from existing Winnipeg properties since 1998. Katz has pledged to do what he can to avoid a rate hike this year, but has not ruled out ending the freeze.

http://www.winnipegfreepress.com/local/Strike-vote-not-a-factor-mayor–116396059.html

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Katz leaves door open a crack to possibility of property-tax increase

Winnipeg Mayor Sam Katz said he still hopes to deliver another a property-tax freeze this year but continued to leave the door open a crack for the first hike since the late ’90s.

Speaking to reporters after an executive policy committee meeting, Katz repeated his 2010 election campaign pledge to make a property-tax increase a last resort when he and his colleagues develop the 2011 operating budget.

But the mayor also continued to describe a tax freeze as a goal, as opposed to a certainty.

The City of Winnipeg balanced its last two operating budgets without increasing property taxes through methods that included one-time transfers from other accounts, the elimination of middle-management positions and also by expecting to settle disputes with the province over ambulance funding and Manitoba Hydro taxes.

Pulling off the same trick this year will be difficult considering the rising cost of police, firefighter and other salaries. Every one of the city’s unions is either renegotiating its collective bargaining agreement or about to do so later this year.

The city’s operating budget will be tabled in February. The city’s capital budget, which covers infrastructure improvements and equipment purchases, will likely be tabled at the end of next week, Katz said.

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Property-tax freeze expected in next month city’s budget unveiling

Mayor Sam Katz and city council finance chairman Scott Fielding plan to unveil the city’s operating budget in mid-February, the mayor’s office says.

Katz and Fielding are expected to unveil an operating budget that includes the city’s 13th straight property-tax freeze. Raising taxes during an election year would be unlikely, despite the fact inflationary increases in salaries and fluctuating fuel costs continue place pressure on city finances.

The city expects to post a $5.2-million surplus on its 2009 operating budget of $785.3 million. The 2010 budget is expected to be higher.

Before the budget is tabled, the city is inviting the public to take part in round-table discussions next week at the Winnipeg Convention Centre.

Sessions are planned for Wednesday, Jan. 27 from 6 to 8 p.m. and Thursday, Jan. 28 from 7 to 9 p.m. You may pre-register at budget@winnipeg.ca or 986-4242.

Walk-ins are also welcome, the city says.

http://www.winnipegfreepress.com/local/breakingnews/Property-tax-freeze-expected-in-citys-budget-82396027.html

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