Property tax or not a property tax — that is the question

Opinion

Hey there, time traveller!
This article was published 02/03/2015 (3342 days ago), so information in it may no longer be current.

After mere months in office, Winnipeg’s rookie mayor is playing semantic games like a pro when it comes to what is and isn’t a property tax.

On Tuesday, Brian Bowman tabled a city budget that calls for a 2.3 per cent hike in the total pool of taxes collected from city properties in 2015. This move will generate $11.7 million worth of revenue for the cash-strapped city.

On the surface, that might seem right in line with Bowman’s 2014 campaign promise to limit property tax hikes to the rate of inflation. But that’s not the only property-related tax the city collects.

Also in this year’s budget is a plan to raise an additional $6.7 million by boosting frontage levies, which also show up on your property tax bill. Together, the combined $18.4 million is equal to the revenue generated by a 3.6 per cent property tax hike — which is above the rate-of-inflation limit promised by Winnipeg’s mayor.

This left Bowman performing linguistic contortions moments after tabling his first budget as mayor.

“We had very difficult choices to make,” the mayor said outside his office, asserting voters can take comfort from the dual hike because the frontage levies are also increasing at a rate in line with inflation.

That may be true. The problem is, most property owners don’t distinguish between municipal property taxes and frontage levies, not to mention provincial education taxes. All they see is the dollar amount owing on the bottom of the bill.

Bowman, however, declined to agree with the common-sense assertion a tax on property is a property tax.

“I’ll leave that for Winnipeggers to decide,” he said. “The fact is, we’re being very open and transparent about what we’re proposing here.”

For a mayor who spent much of his campaign beating up on other candidates for practising “old-style politics,” this is disappointing.

The first Brian Bowman city budget is actually a lot like the last Sam Katz city budget: A few minor cuts to city services, more spending on road renewals and a series of fee hikes for everything from the use of city cemeteries to city lawyers.

There’s also a very Katz-like raid of a crucial pot of rainy-day cash. The city plans to extract $9.2 million from its financial stabilization reserve and use that money to prop up the operating budget. There will still be $74 million sitting in the kitty in the event the city suffers from an economic or natural disaster, but this is still the sort of maneuver that makes conservative financial managers cringe.

Given the unpleasant task of delivering a budget with tax hikes and a reserve drawdown, Bowman and rookie finance chair Marty Morantz (Charleswood-Tuxedo) took great pains on Tuesday to complain about the awful state of the city’s finances after they took office.

The implication is it was Katz who neglected the city’s infrastructure, thanks to 14 years of tax freezes. Bowman and Morantz insisted they’re turning the ship around and pointed to increased spending on road renewals as evidence.

Inconveniently for them, it was actually Katz and former council finance chair Russ Wyatt (Transcona) who deserve credit for the road-renewal increase, which flows from their previous-term decisions to raise property taxes and dedicate the proceeds to infrastructure.

It’s completely disingenuous for Winnipeg’s new mayor to imply the previous one failed at fiscal management without praising his predecessor for what he did right.

Nonetheless, there’s no reason to beat up Bowman and Morantz for their first budget, which actually has some elegant components. Specifically, a series of future incremental tax hikes may actually solve the thorny issue of finding $20 million every year, beginning in 2020, to pay for the Southwest Transitway.

Nonetheless, it’s not cool, as Bowman might say, to trash the actions of politicians past while making some of the very same moves yourself. Bowman desired the mayor’s job for years and cannot credibly feign ignorance about the state of the city’s finances.

Those books have been open for anyone to see. Not reading them — or pretending not to read them — is no excuse for dancing around a campaign promise.

bartley.kives@freepress.mb.ca