Provincial funding freeze thaws
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Hey there, time traveller!
This article was published 25/02/2023 (983 days ago), so information in it may no longer be current.
The thaw of a provincial government funding freeze on the municipalities operating grant will see an extra $2.3 million flow into City of Brandon coffers this budget year, although it remains to be seen where that money will be spent.
Brandon Mayor Jeff Fawcett — who was Friday’s press conference in Winnipeg, where Premier Heather Stefanson announced the new, permanent unconditional funding — said the boost in the base for the municipal grant was good news.
It’s not yet known how the city will spend the extra money, Fawcett later told the Sun in a phone interview, although he suggested replenishing reserves drawn down during the funding freeze will be something he, council and city administration will consider.
Brandon Mayor Jeff Fawcett speaks during Premier Heather Stefanson's announcement at a media event in Winnipeg Friday morning that the Manitoba government will be increasing the municipalities operating grant that will see an extra $2.3 million flow into City of Brandon coffers this budget year. (Winnipeg Free Press)
“It isn’t, sort of, ‘free money,” Fawcett said of the additional municipal funds. “It is compensating for money that should have probably been there for years and it is in particular our reserves that had paid for that. So, you know, that will definitely have to be part of our conversation.”
Intended to help municipalities handle increased costs due to inflation, the 27 per cent boost in funding amounts to $47 million overall for Manitoba municipalities for the 2023 fiscal year, increasing the overall municipal grant to $217 million from $170 million.
“The funding today will become a permanent part of the unconditional operating base funding for future years,” said Municipal Relations Minister Andrew Smith, who was also present for the announcement. “Our government has committed to taking steps to modernize the calculation of municipal operating grants as we recognize the varied and unique needs of municipalities facing greater financial challenges now and well into the future.”
The announcement ends a seven-year freeze on unconditional grants to municipalities. The Association of Manitoba Municipalities had called for an end to the freeze, arguing that pressure from inflation would mean municipalities would be forced to raise taxes or cut services, and the NDP had vowed to lift the freeze if elected.
“As a government, we recognize municipalities and communities across our province are facing significant pressures that impact their ability to deliver important projects and services that Manitobans rely and depend on,” Stefanson said. “We are a government that listens, we are a government that takes action, and we know that more help is needed right now.”
Smaller municipalities of 5,000 and less and those in northern Manitoba will receive a new base grant of $25,000, Stefanson added, with new funds starting to be released in the coming weeks.
AMM president Kam Blight applauded the extra unconditional funding, as inflation has taken a toll on the budgets of municipalities, which aren’t permitted to run deficits. The new money will help municipalities respond to financial pressures, offset operating losses due to the pandemic, and allow them to continue to provide services.
In an interview following the announcement, Blight told the Sun that the increase in municipal funding is a “massive step in the right direction.” Municipalities have had to do more with less, due in part to the downloading of services from higher levels of government, he said, and the new money helps offset the lack of funding during the freeze while helping municipalities grow.
Now, he said, the association wants to work with the province to establish a funding model that will provide municipalities with stable funding.
“We’re going to have to have a conversation about indexing, and a built-in escalator going forward because municipalities need to have that long-term predictable funding in place so they can properly plan, accordingly,” Blight said.
Funding needs to be based on more than population, he said, and the future of funding will be one of the subjects discussed when the association meets with the Department of Municipal Relations next week.
Fawcett said he will be part of discussions with Blight, Winnipeg Mayor Scott Gillingham and the department surrounding the new funding.
» ihitchen@brandonsun.com