Winnipeg's crusading mayor, Glen Murray, has unveiled a radical new plan to cut property taxes in half and raise money with new fees for everything from calling police to buying liquor.
The plan would shift the tax burden from people and businesses who own property to those who use services, and would also freeze recreation fees, reduce transit fares by 50 per cent and see businesses pay about 34 per cent less in taxes.
The proposal includes the city taking a share of provincial and federal taxes and requires approval from both levels of government.
It would give Winnipeg revenues that municipalities across the country would like to have as they seek what they call a "new deal" for cities.
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Other cities will be watching the progress of the Winnipeg plan as it goes through a public consultation process this fall, said Yves Ducharme, president of the Federation of Canadian Municipalities.
"It will set an example to be followed," Mr. Ducharme said. "The FCM is right now trying to convince the other layers of government to participate in a 'new deal' like this, so we will be watching closely."
Mr. Murray unveiled the proposal Monday. It will be vetted at six community meetings and through Internet consultations before the city seeks approval from the province next year.
The proposal assumes that the city will receive 5 cents a litre of the existing federal gas tax, which municipalities have asked for -- but not yet received -- from Ottawa.
If the plan passes those hurdles, Winnipeg would collect an extra $120-million every year from dozens of new revenue sources. Citizens would pay a new municipal sales tax, fuel levy, liquor tax, hotel tax, garbage fee, frontage levy, higher rates for natural gas and electricity, and even a telephone fee for 911 service.
Most importantly, the city would be able to make desperately needed investments in public infrastructure such as streets, sewers, and bridges, said Connie Walker, strategic planning manager for Winnipeg.
Another aim of the city planners is to restructure the tax system to support policy goals such as avoiding urban sprawl and encouraging transit use, Ms. Walker said, pointing to the planned decreases in transit fares and increases in gas taxes.
"We looked at, 'How do you use tax tools to create the community you really want?' " she said. "There's been lots of discussion about a new deal for cities but nobody has tried to show what it would really look like."
Adrienne Batra, provincial director of the Canadian Taxpayers Federation-Manitoba, said the city should be fighting to take a greater share of the money it needs from the federal government, rather than inventing a dizzying array of new taxes and levies.
"We're going to get nickel-and-dimed to death," Ms. Batra said. "There's no question that we're facing an infrastructure gap, but there are other models that could work. . . . This is a bitter pill to swallow."
The city's tax plan would also circumvent the provincial taxpayers' protection legislation, Ms. Batra said, because the province would need a referendum to raise taxes but no such rules apply to municipalities.
Manitoba Premier Gary Doer has reserved judgment about the city's plan.
He told The Winnipeg Free Press on Thursday that the city hasn't yet made any formal proposal to the province: "They won't talk to us until they've made their case to the people of Winnipeg," he said.
A spokeswoman for the Premier confirmed yesterday that although the province has agreed to let the city go ahead with its public consultations, Mr. Doer has not yet endorsed the plan.
But Mr. Ducharme said his group of mayors is already pushing for other premiers to emulate the open-mindedness shown so far by Mr. Doer.
"We will all use this as an example for our own provincial governments," Mr. Ducharme said.
"We will focus on the openness shown by the province of Manitoba."
In other provinces, Mr. Ducharme said, mayors are having difficulty persuading the other levels of government to share a larger slice of their taxes.
He has begun a tour of Canada to highlight cities' needs, beginning with Vancouver yesterday.
Walking around Vancouver's decaying Downtown Eastside clearly illustrates the need to assist cities, Mr. Ducharme said, because municipal property taxes are no longer enough to pay for the growing needs in urban areas.
"When you look at the needs here for affordable housing, for community centres, it is not a question of will. It is a question of economic capacity."
