City of Winnipeg preliminary 2021 Balanced Budget Update tabled at Executive Policy Committee
Budget update sticks to the plan adopted in March and focuses the City’s response to the global pandemic while making important investments in community services and infrastructure renewal
Released: 2:04 p.m.
Winnipeg, MB – Today, the preliminary 2021 Balanced Budget Update for the City of Winnipeg was tabled at a special Executive Policy Committee (EPC) meeting. The 2021 City of Winnipeg Budget will update the historic multi-year balanced budget adopted earlier this year.
“When Council adopted the 2020-2023 multi-year balanced budget earlier this year, the challenges due to the global pandemic were just starting,” said Mayor Brian Bowman. “The pandemic continues to have a tremendous impact on residents, businesses, organizations, and government. The preliminary 2021 Balanced Budget Update sticks to the plan adopted in March and prioritizes the pandemic-related challenges faced by the City while making significant investments into community services and infrastructure renewal that will help power our economy.”
The total tax-supported budget shortfall to be addressed in the preliminary 2021 Balanced Budget Update is $83.6 million over the next three years:
|Net Transit shortfall due to COVID-19||$28.5 million|
|Other costs due to COVID-19||$14.0 million|
|Additional costs||$10.4 million|
|Winnipeg Police Pension Plan shortfall||$30.7 million|
The preliminary 2021 Balanced Budget Update includes the following measures to fully offset the $83.6 million budget shortfall noted above, and keep the 2021-2023 tax-supported budgets in balance:
|Leverage provincial capital commitment to invest in City capital projects||$30 million|
|Replace cash to capital with external debt||$10 million|
|Savings from a recently negotiated collective agreement with the Winnipeg Association of Public Service Officers (WAPSO)||$12 million|
|Adjustment to the estimated amounts for future labor settlements||$16.3 million|
|Projected savings in the Winnipeg Police Service budget to be determined by the Winnipeg Police Service||$15.3 million|
“The City is better positioned today than many other cities as a result of the difficult decisions made during the multi-year balanced budget process adopted earlier this year,” said Scott Gillingham, Chairperson of the Standing Policy Committee on Finance. “The preliminary 2021 Balanced Budget Update provides a prudent plan for financial stability as the City continues its response to the ongoing global pandemic.”
The preliminary 2021 Balanced Budget Update includes Winnipeg’s share of the federal Safe Restart Agreement of $42.2 million for COVID-19 operating costs, and $32.3 million for transit, allocated as follows:
- $31.3 million to keep the 2020 budget in balance by reversing some of the levers in the COVID-19 Crisis Cash Flow Management Strategy, and replace lost parking revenue resulting from the pandemic
- $32.3 million to offset 2020 operating losses in transit
- $7.6 million to ease the burden of the pandemic
- $3.3 million to support affordable housing and our economy
The preliminary 2021 Balanced Budget Update outlines the City’s response to the COVID-19 pandemic in three main ways:
- Keeping People Safe – approximately $4.0 million investment from General City Revenues including:
- Purchase of personal protective equipment for our front-line workers as well as additional cleaning, sanitizing, and related supplies in Winnipeg Transit, Community Services, Winnipeg Police Service, and other departments to help keep employees and users of City facilities and vehicles safe.
- Easing the economic, social and emotional burden of the pandemic - $7.6 million from the federal Safe Restart Agreement funding:
- $3.8 million to extend the property and business tax deferral program in 2021
- $3 million to support a grant program for small businesses and not-for-profits that are required by the provincial government to temporarily cease operations or close their physical locations to the public as a result of the pandemic
- $600,000 to provide grants to community organizations in support of initiatives for our residents to connect with one another in ways permitted under provincial public health orders
- $250,000 to support counselling and other supports for our paramedics and firefighters to help cope with the trauma and emotional stress of the pandemic
- Supporting affordable housing and our economy - $3.3 million from the federal Safe Restart Agreement funding:
- $2 million to provide grants to developers of affordable housing; these funds, together with others such as tax increment financing (subject to Council approval), will leverage funds from the Canada Mortgage and Housing Corporation to support construction of affordable housing in Winnipeg
- $750,000 to support additional planning staff with a focus on growing the assessment base by supporting residential permit volume increases, added focus on the pre-application process, and reviewing existing and/or develop secondary plans to guide new development
- $500,000 to re-establish the Office of Economic Development (OED) within the City of Winnipeg, to support local businesses doing business with the City during and after the economic recovery. The OED will work with external stakeholders and will complement the work of Economic Development Winnipeg to support new, major economic development opportunities and will help prioritize infrastructure investments that support economic growth
Community Services was identified in public engagement for the budget as Winnipeggers' number one budget priority. Council listened and opted not to close City facilities, as had been recommended in last year’s multi-year balanced budget process. The preliminary 2021 Balanced Budget Update includes millions of dollars in investments toward the facilities residents depend on. The Recreation and Libraries Investments Plan includes $50 million for multi-use indoor pool building renewal projects, recreation centres and their maintenance, as well as arena projects and library projects.
The preliminary 2021 Balanced Budget Update proposes a six-year, $2.3 billion capital investment plan to renew existing City assets and build new assets that will be required as our city grows towards one million people. Investments in capital infrastructure are one of the most important tools available to government in support of businesses and jobs for local residents, especially during times of uncertainty. This will include investments in road renewals, Winnipeg Transit buses, the Combined Sewer Overflow Mitigation Program, a Water Meter Renewal Program, and the protection and enhancement of our tree canopy.
It is estimated that the proposed six-year $2.3 billion capital investment plan will boost GDP by over $1 billion in Manitoba and across Canada, create over 10,000 person years of employment while generating incremental tax revenue to the provincial government of $111 million, and $139.2 million to the federal government.
The preliminary 2021 Balanced Budget Update invests a historic $152.2 million into road renewals which represents a $21.9 million increase from the $130.3 million in 2020. This level of projected investment for 2021 would result in approximately 140 lane kilometers of road and back lane renewals, which is approximately the distance from Winnipeg to Falcon Lake. This is part of a larger, 6-year investment of $864.1 million in road renewals, and represents close to 40 percent of the City’s entire capital campaign. The 6-year, $864.1 million investment into road renewals would result in approximately 800 lane kilometers of road and back lane renewals, which is approximately the distance from Winnipeg to Thompson
The preliminary 2021 Balanced Budget Update continues to cap property tax increases at 2.33 percent per year for the next three years, with the entire increase dedicated to investment in Winnipeg’s infrastructure requirements. This means the average homeowner will pay an additional $42.34 on their property taxes in 2021.
The Small Business Tax Credit threshold has increased from $35,700 to $44,200, which eliminates this tax for almost 1,000 more businesses, saving them an average of $1,926.12 annually. Approximately 55 percent of all Winnipeg businesses will now receive a full credit of their business taxes in 2021. The business tax rate will remain frozen at 4.84 percent for 2021.
The Winnipeg Police Service budget will increase by approximately 2 percent annually before capital expenditures, from $294.5 million in 2020 to $312.4 million in 2023.
The protection and enhancement of our tree canopy will benefit from $29.2 million in capital investment over the next 6 years.
“The preliminary 2021 Balanced Budget Update strikes the right balance to manage our way through the uncertainty of the COVID-19 pandemic while presenting a sustainable fiscal blueprint to support a growing city,” said Bowman.
The preliminary 2021 Operating and Capital Budget Updates will be discussed at Standing Policy Committee and Winnipeg Police Board meetings over the next two weeks, with Council voting on the preliminary 2021 Operating and Capital Budget Updates at a special meeting of Council on December 16, 2020.