In spite of pandemic, City of Winnipeg balances preliminary 2021 budget thanks to federal cash

The City of Winnipeg's 2021 preliminary budget is a document laden with COVID-19-related expenses and revenue shortfalls, but a generous dollop of federal cash will soften some of the blow in the short term, and ensure the city's books are balanced.

Property taxes face a predictable 2.33 per cent increase, dedicated to road improvements and transit, as per Mayor Brian Bowman's pledge when he won his second term in 2018.

Bowman was blunt about the reality of preparing a budget under the current circumstances.

"If you want a challenge, try balancing a budget in the middle of a global pandemic," he told reporters Friday just before the documents were tabled.

The tax hike meanshomeowners will pay on average approximately $42 more in 2021, and the city estimates it will spend $152 million on road repairs and upgrades.

There are funds set aside for improvements to library and recreation facilities, and for the city's urban forest enhancement program.

The COVID-19 pandemic has created an estimated shortfall of $61million for the citythis coming yearmostly from losses in Winnipeg Transit andpermit revenues,decreased facility use, and increased costs for personal protective equipment and sanitizing supplies.

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However, those losses and costs areoffset by a $74.5 million dose of funding from Ottawa's Federal Safe Restart program.

That is split into $42.2 million for COVID-19 operating costs and $32.3 million to cover losses from decreased ridership onpublic transit.

Some of that cash will cover anticipated losses of $7.7 million for the Winnipeg Parking Authority, due tolower revenues.

Helpfor small business, non-profits

The budget has targeted some money to help businesses withstand the financial blows created by the pandemic.

The city has set aside $3 millionfor aCOVID-19 economic support grant program to assist small businesses and not-for-profit organizations that have suffered a revenue decline.

The city plans to extend the timeline before penalties kick in onlate payments of property and business taxes. As well, the preliminary budget proposes increasing thesmall business tax credit thresholdfrom $35,700 to $44,200. As many as 1,000 businesses may benefit andwouldn't pay any tax, the city says.

Councillors may also each geta $40,000 one-time ward allocationfrom the federal restartfunding for a "wellness support" grant program to address physical, mental, emotional and spiritual distress caused by the pandemic.

Finance chair Coun. Scott Gillingham(St. James) acknowledged the federal government played a huge part in how the budget was set this year.

"It would have been very, very difficult," to balance the budget, as required by provincial legislation, without the federal money, he said.

"Could it have been done? Possibly. But it would have put us in a very difficultIwould say precarious position going into 2021, still facing a pandemic."

The citywould have been obliged to drawdeeply from itsfiscal stabilization fund, Gillingham said.

Police service asked to find savings

Most city departments, such as the Winnipeg Fire Paramedic Service, will see modest increases in funding.

The police service, though, is being tapped to find $15 million in savings over the next three years to make up half of the $30 million the city had hoped to save byreducingin police pensions a reduction that an arbitrator ruledbreached the police union's collective bargaining agreement.

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Bowman says work has gone on in collaboration with police Chief Danny Smythto find those savings.

"Our chief has said these are achievable over the next three years, and obviously they will have to find it within the service," Bowman said.

The budget proposes the city purchase five fewer transit buses than planned, andreduce bus service by six per cent from regular service levels in2021. It's not expected at this point that that reduction willresultin any staff layoffs.

To help balance the books, the city is expectingtoborrow just over $15 million for 28 capital projects instead of using cash, and will do the same for $2.8million in Winnipeg Transit expenses.

The budget also says the city will see$12 million insavings from a recently negotiated collective agreement with theWinnipegAssociation of Public Service Officers, and hopes to finda further $16.3 millionin future labour settlements.