Political experts doubt province would hand over portion of PST to cash-strapped City of Winnipeg
CBC
Mayoral candidate Glen Murray's plan to fix Winnipeg's finances hangs on the provincial government offering the city more money — an old idea that's failed locally and in much of the country.
If elected, Murray will face the reality that governments aren't usually keen to relinquish hundreds of millions of dollars to another level of government, said Jino Distasio, an urban geography professor at the University of Winnipeg.
"Giving up a piece of the tax base back to municipalities, whether it's Winnipeg or any other municipality, is just too hard to swallow for a lot of our provincial governments right now," Distasio said.
"And let's face it, they're not doing fiscally all that well either."
In Manitoba, the Progressive Conservatives were ushered into power in 2016, in part to rein in spending, and municipalities have first-hand experience with that.
The province offered no-strings-attached funding, which municipalities appreciated, but that pool of money has remained stagnant ever since, even as the inflation rate soared. In the capital city, the annual operating grant from the province has remained at $121.2 million, although it's been supplemented with other funding for specific projects.
Rather than campaigning for a larger grant, Murray is asking for the Manitoba government to keep that money and instead carve out one percentage point of its seven per cent provincial sales tax, which amounted to $341 million in the last fiscal year, to fund Winnipeg's coffers. He made the announcement last week.
Murray — one of the leading candidates in the mayoral race, polls suggest — told the recent televised debate his plan would allow the city to freeze property taxes.
His idea is actually an old one. Past mayors, including Sam Katz and Murray himself during his 1998-2004 tenure, tried and failed to get a slice of the PST. Other Canadian mayors have also floated the idea to little success.
Paul Thomas, a professor emeritus of political studies at the University of Manitoba, isn't confident Murray will change minds on Broadway.
"He would have to be hugely successful in attracting financial support from other orders of government to get his wish," Thomas said, adding the city has a sizable infrastructure deficit that was worsened by 14 years of frozen property taxes.
Nearly 20 years ago, Murray, as Winnipeg's mayor, pushed for new revenue-sharing agreements between cities and provinces, which including a share of the PST.
The New Deal, as it was called, was spurned in his own backyard, Thomas said.
"When [former NDP premier] Gary Doer was faced with a detailed plan for diversifying the revenues of the City of Winnipeg, he said, 'Don't ask us for the money. If you need it, raise your own taxes. We have to pay for health care, education and social services, and the city has to compete against those provincial priorities.'"
