Four key spending decisions Infrastructure

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This article was published 18/04/2012 (5303 days ago), so information in it may no longer be current.

MAYOR Sam Katz and his inner circle at city council are fuming over a provincial gas-tax hike that will raise $48.6 million in new revenue that won’t flow to the City of Winnipeg.

The 2012 provincial budget calls for a 2.5-cent provincial gas-tax hike to kick in on May 1. Finance Minister Stan Struthers pledged Tuesday to dedicate “every cent we raise” to infrastructure, such as provincial roads and bridges damaged during the 2011 flood.

Katz, who hoped to see Winnipeg become the beneficiary of a new gas tax, expressed disappointment with a budget he described as “doing nothing” to help the city whittle away at an infrastructure deficit estimated in the billions.

“We’re in a crisis situation and nothing is being done. I’m quite surprised and disappointed,” Katz told reporters, flanked by his council budget team — Couns. Justin Swandel (St. Norbert), Scott Fielding (St. James) and Russ Wyatt (Transcona).

Even half the gas-tax hike would allow Winnipeg to finance $400 million worth of infrastructure improvements, Swandel said. Wyatt accused Premier Greg Selinger of “building a socialist paradise here on the Prairies” through a tax hike that would not benefit the province’s largest city.

Instead, the additional gas-tax proceeds will help the province spend $40 million more on its own infrastructure this year, provincial officials say. Budget documents, however, tell a different story – a $75-million decline in total infrastructure spending, from $1.794 billion in 2011 to $1.719 billion this year.

Capital spending in the Infrastructure and Transportation Department alone will drop $99 million, from $749 million last year to $650 million this year. Spending on roads and highways in particular, meanwhile, will drop $9 million, from $589 million to $580 million.

There is no new incremental spending on roads this year, provincial officials confirmed, adding the gas-tax hike would allow existing funding to be spent elsewhere in the budget. City council employed a similar move in 2011, when Katz claimed a frontage-levy hike would fund infrastructure – but cash from road maintenance was moved into other areas of the city budget.

Direct funding for Winnipeg infrastructure, however, will increase $14.5 million in the 2012 provincial budget. All of this cash comes from additional provincial sales tax revenue, provincial officials said.

Katz said he wasn’t impressed with that either, claiming the spending comes with conditions. “Once you have conditions or strings attached, that usually has a negative end result,” the mayor said.

bartley.kives@freepress.mb.ca