Winnipeg, MB – The City of Winnipeg's second quarter Financial Status Report for 2019 is forecasting a projected deficit in the tax-supported operating budget (General Revenue Fund) of $7.7 million, as at June 30, 2019. The City of Winnipeg's second quarterly financial update will be presented at the meeting of the Standing Policy Committee on Finance on September 9, 2019.
This recent projected deficit marks an improvement of $2.1 million since the first quarter projection, which cited a $9.8 million projected deficit as at March 31, 2019. The Public Service anticipates that the projected deficit will continue to decrease over the remainder of the year, based on anticipated financial improvements, as well as through continued efforts to control expenses without impacting the delivery of core services. Based on the last several years, it is common for the second quarter forecast to report a projected deficit which is then eliminated by the end of the year.
“While there is still a projected deficit as of the second quarter financial forecast, the City remains on the right track to balance throughout the course of this fiscal year,” said Councillor Scott Gillingham, Chair of the Standing Policy Committee on Finance. “Trends in recent years show that a projected deficit of this size can be greatly reduced or eliminated with responsible fiscal management through the remaining quarters.”
A major factor contributing to the current forecasted deficit figure include significant over expenditure by the Public Works Department related to snow removal and ice control. During the year, $46.2 million is expected to be spent on these operations, resulting in a projected over expenditure of $11.4 million. The over expenditures are the result of above average snow accumulation during February 2019, which saw the most snowfall in the month of February in Winnipeg in 30 years.
Discussions with Shared Health regarding funding for 2019 are ongoing and the second quarter forecast has assumed a funding model where EMS costs are fully recovered from Shared Health.
Separate from the General Revenue Fund deficit of $7.7 million, the Transit System is forecasting a year-end operating surplus of $3.4 million. This forecast is mainly the result of savings related to diesel fuel expenses attributable to lower than budgeted market prices, and savings incurred on salaries and benefits which are in part the result of an ATU ban on voluntary overtime. The ban on voluntary overtime is forecasted to result in approximately $400,000 of savings.
The City’s financial update is publicly available through the Decision Making Information System (DMIS).