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Budget sustainability challenges underscore need for new funding ideas: Lorenc

Winnipeg’s 2020 and long-term budget plans show that current revenue sources and cost-sharing agreements with the province cannot meet the city’s infrastructure investment needs, MHCA President Chris Lorenc said.

Lorenc presented the MHCA’s response to the budget plans for the local and regional street renewal program at the Infrastructure Renewal and Public Works Committee Thursday. The city presented its 2020 operating and capital budget March 6.

Against 2019’s five-year forecasts, the new budget shows cuts for local street repairs in all years, and for the regional program in later years.

“We recognize the city has a difficult job, especially as the provincial government has elected not to renew five-year road funding agreements with Winnipeg, as was the well-established practice in the past,” Lorenc told the committee. “We appreciate the effort that went into stable funding, through the borrowed $20 million for local streets this year, but this is not sustainable.”

The street repair program cuts are also due to the fact the city now funds bridge work out of the revenues raised by the 2% annual property tax that, until 2019, was dedicated expressly to local and regional roads. “We cautioned the city after the 2019 budget that it had to understand the impacts and preferably establish a stand-alone investment program with which to address bridge needs, and that has become apparent in the preliminary budget numbers.”

The water and sewer renewals budgets will also fall, but due to competitive pricing from the industry, there will be more line lengths renewed, on average, in the next five years.

Lorenc said the answer lies in pressing the province to rework the access municipalities have to revenues and re-visit the scope and purpose of cost-sharing formulas for major infrastructure projects. Historically, the share among the three levels of government has been equal thirds. In recent infrastructure agreements, the federal government has hiked its share.

Last year, the federal government dramatically hiked transfers sent to municipalities from the gas-tax revenues — $44 million for Winnipeg alone – and the MHCA has called for this doubling of the transfers to become permanent.

The MHCA will present its budget views to the Executive Policy Committee March 20 and speak before City Council March 25.