Winnipeg mayor says 9.4% property tax increase possible as provincial funding dispute continues

With less than 48 hours until the City of Winnipeg tables its 2019 budget, a financial fracas with Manitoba's provincial government continues unabated.

The funding feud could mean a significant rise in property taxes for Winnipeg residents, the city's mayor warned Wednesday.

Brian Bowman has previously said the city needs more clarity on the province's funding intentions, and that the city is still waiting on millions of dollars in promised provincial funding for 2018 city projects.

He said Wednesday that the city's budget — which will be tabled at an executive policy committee meeting Friday — could feature a property tax increase as high as 9.43 per cent, as a result of a $40-million gap left by promised provincial funding that hasn't yet been delivered.

That's 7.1 per cent above the 2.33 per cent property tax hike the mayor promised during his election campaign — a pledge he said could be kept as long as there were no incremental funding cuts from the province. 

"There have been," Bowman said Wednesday.

Hike taxes, cut projects or add debt: Bowman

He told reporters the "significant shortfall" in funding from the province, specifically for capital spending for roads, has left the city with three options — hike property tax rates, cut planned infrastructure projects or add debt to cover the shortfall.

"All of which are terrible choices to have to make, and we will be providing clarity on how we are reacting to that new reality of provincial funding levels in the context of our balanced budget on Friday," Bowman said.

Bowman would not reveal which of the three options his administration has chosen, saying the preliminary budget has been finalized and the province does know which choice city council will debate.

A tweet from Progressive Conservative Finance Minister Scott Fielding Wednesday morning once again took a swipe at city political leaders.

Winnipeg, the former city councillor said in his tweet, is the "most generously funded major municipality in Canada." The city, he said, "doesn't have a revenue problem. It has a spending problem."

Bowman declined to  react to Fielding's accusation.

'This is anything but clear'

A 2.33 per cent property tax hike would raise an additional $13.7 million for the city next year. A 9.43 per cent hike would raise $55.2 million.

Winnipeg's mayor also decried a lack of clarity on funding the province was supposed to provide for capital projects in last year's budget — a dispute that has played out over the last few weeks with pointed words from both municipal and provincial political leaders.

"This is anything but clear," Bowman said.

"It has gotten much worse to get clarity on the capital side. Just look at the fact that we are debating the 2018 year right now, hours before we table the 2019 budget."

In a gesture of conciliation, Bowman did say the provincial government has been forthcoming and direct about its support for Winnipeg's operational expenditures.

Earlier this month, Premier Brian Pallister tweeted for calm in the relationship between the two governments.

"I call upon all parties to rise above it and work together constructively," Pallister said in his tweet.

CBC News has asked for an interview with Finance Minister Scott Fielding.