WINNIPEG, MB - July 18, 2012 - Redistributing tax dollars offers a solution to the municipal infrastructure crisis, said Mayor Sam Katz today in a video presentation to the Government of Canada’s infrastructure roundtable.
The Hon. Denis Lebel (Minister of Transport, Infrastructure and Communities) and the Hon. Steven Fletcher (Minister of State, Transport) are holding roundtable meetings across Canada with municipal representatives and community and business leaders to discuss the development of a new long-term infrastructure plan for Canada.
In his presentation, the Mayor thanked the Government of Canada for consulting with municipal leaders about the crumbling roads, rusting bridges, broken water-mains and worn-out community facilities affecting Canada’s families and all sectors of the economy.
At current funding levels, the City of Winnipeg’s infrastructure deficit is projected to reach $7.4 billion by 2018.
“The City of Winnipeg is in dire need of a predictable, sustainable revenue source for infrastructure renewal,” said Mayor Katz. “If we give up and don’t address the problem, we’ll dig ourselves into such a big hole that our great, great, great, grandchildren won’t get out of it.”
While the Building Canada Fund continues to support important projects such as the Winnipeg Convention Centre and the widening of Plessis Road, Mayor Katz said a dedicated federal revenue source is needed to allow municipalities to take a comprehensive, long-term approach to infrastructure renewal.
“If we received revenue directly from the Government of Canada, we could use this revenue source to negotiate immediate access to substantial dollars at a low rate of interest, which would allow us to plan for the next decade and beyond, making real headway on the infrastructure deficit,” said Mayor Katz.
For every $10 million of dedicated long-term infrastructure revenue, the City is able to leverage $148 million in borrowings, taking advantage of today’s low interest rates.
A dedicated long-term revenue source would also give municipalities the flexibility to allocate dollars to the areas of greatest need within their own communities, eliminating the need to identify renewal projects that fit national criteria.
Instead of raising taxes or creating new ones, Mayor Katz called for a redistribution of the existing tax pie. “Citizens all across Canada call on municipal politicians every day to fix the problems that they see around them, yet it’s the municipal governments that have the smallest piece of the tax pie.”
For every tax dollar collected in Winnipeg, 65 cents ultimately flows to the provincial government, 27 cents to the federal government and eight cents to the municipal government. Mayor Katz said a doubling of the municipal share, to 16 cents on every dollar, would provide the City of Winnipeg with an additional $800 million annually to tackle its infrastructure deficit and take on new infrastructure projects.
The City of Winnipeg has previously sought long-term infrastructure funding solutions from the Province of Manitoba, including a PST rebate, a portion of the motor vehicle registration fee, or a percentage of the land transfer tax, with no success.