City of Winnipeg on track to post $5.4M year-end deficit

The City of Winnipeg is heading toward a $5.4-million year-end deficit, according to the financial data for the first six months of 2016.

As of June 30, the city is projecting a $5.4-million shortfall on its $1-billion operating budget, according to the second-quarter financial status report, which comes before council's finance committee on Thursday.

The report states the deficit is the combined result of projected deficits from the Winnipeg Police Service, Winnipeg Fire Paramedic Service and the planning, property and development department, offset by projected surpluses in assessment and taxation and other city departments.

• Winnipeg Police Board requests $3.7M from city to cover pension liability

The police service projected deficit is $6.5 million, mainly because of an unfunded pension liability and a decrease in photo-radar revenue. The fire-paramedic service deficit is projected to be $1.3 million, mainly because of overtime costs. The planning, property and development's projected shortfall is $2.3 million, partly because of decreased lease revenue from city-owned buildings.

Assessment and taxation, on the other hand, is projecting a $2.4 million surplus, partly because it now expects to collect more payments in lieu of taxes from the Canadian Museum for Human Rights.

Deficit projections based on June 30 financial data rarely hold, as city belt-tightening toward the end of the fiscal year typically results in surpluses by Dec. 31. The city has posted only one actual deficit in the past five years.

 That took place in 2013, when the city wound up $1.8-million in the red.

City to curtail loan guarantees

The City of Winnipeg is considering a new loan-guarantee policy that would offer far less leeway in deciding who may benefit from the city's financial backing.

On Wednesday, city council's executive policy committee will consider a plan to abolish the city's existing loan-guarantee policy, which dates back to 1992.

In its place would be a new, far more restrictive policy.

For starters, the city will only consider loan-guarantee requests from city partners such as recreational organizations or quasi-governmental agencies such as CentreVenture or the Winnipeg Convention Centre.

Only non-profit organizations would be eligible from now on, meaning private developers can no longer seek the city's help in the form of loan guarantees. Those organizations must also offer services to all Winnipeggers, regardless of their ethnicity, religion or sexual orientation.

The new policy also calls for the loan guarantee to be attached to a capital project and cover no more than half of the project's cost. Loan guarantees under $1 million will no longer be considered, as the assumption is organizations seeking smaller guarantees should be able to cover that sum themselves.

The policy also calls for capping the total amount of city loan guarantees at a level equal to the city's financial stabilization reserve, a rainy-day fund the city maintains to cover unforeseen financial setbacks.

Red River Ex expansion plan

The Red River Exhibition is asking city hall to endorse a major expansion that may take 10 to 30 years to complete.

On Tuesday, city council's Riel community committee will consider a plan to endorse a planning framework for Exhibition-owned land at the western edge of the city, abutting the boundary with Headingley.

The plan calls for the Ex "to expand upon its agricultural and entertainment roots to become a destination event and entertainment area where the agricultural industry is promoted, business thrives, guests are entertained," according to a report set to come before the committee.

The non-profit Red River Exhibition Association says it "intends to establish a mix of commercial, agricultural, entertainment, business, manufacturing, recreational and tourism development" on the land.