Municipalities Get One Per Cent Of PST In Provincial Budget

Manitoba’s municip alities have achieved their long-term goal of receiving a fixed share of the provincial sales tax for infrastructure projects – sort of.

The provincial government is promising legislation requiring one point of the seven per cent tax be invested each year in municipal infrastructure and transit.

The promise is in Finance Minister Rosann Wowchuk’s 2011-12 provincial budget brought down last week.

The budget also contains new money to bring municipalities up to the one per cent level for the current year.

As a result, municipal grants will total $239 million this year, equal to one point of the provincial sales tax, according to the province.

But the $103 million in new funding comes on top of existing programs, so the final figure for 2011- 12 isn’t exactly the one per cent which the province says it is, said Doug Dobrowolski, Association of Manitoba Municipalities president.

“There is some new money but mostly not,” Dobrowolski said after Wowchuk delivered her budget in the legislature April 12.

“We were asking for a total one per cent, not rolled in with a bunch of other things we have now.”

However, the announcement is still significant because it recognizes that municipalities need “growth revenue” to pay for their services, Dobrowolski added.

Revenue from the sales tax increases as the economy expands. The revenue is projected to grow over the next few years as Manitoba recovers from the recession. That means municipalities’ revenue from their share of the tax will grow each year, too, he said.

“It’s a start. Maybe now we can start discussions on other growth revenue that we need to sustain municipalities and their infrastructure renewal.”

AMM says Manitoba’s municipalities need $11 billion just to fix or upgrade their roads, bridges, sewers and water utilities. That works out to roughly $10,000 for every citizen in the province.

AMM is launching a strategy to lobby politicians during the Oct. 4 provincial election campaign for long-term municipal infrastructure funding.

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