Dear Winnipeg

A Fun Blog About Infrastructure and Municipal Finance

Street Trees Don’t Cost Money, They Make Money!

Dear Winnipeg,

How are things? Busy, I bet. Dealing with budgets, and delegations and whatnot.

As it turns out, that’s why I decided to write to you today. I saw you in the news!

The paper reported that you’ve decided to cut your urban forestry budget by 36%, but I just knew that had to be wrong! After all these conversations we’ve been having, surely you’ve started doing the math before making investment decisions now?

[Nope, you’re just like my kids. I fear I’ll be repeating “Put your boots on, you’ll miss the school bus” for the rest of my life.]

All right, you asked for this. Let’s do it.

Here is a block of a street in my greater neighbourhood of Elmwood with trees, oddly named Poplar Ave (even though those are elms):

Poplar Avenue with trees

Lovely, isn’t it? Fir sure.

[Hehe, tree pun. I’m such a dad.]

Now, here’s a block literally three streets over. Exact same neighbourhood, same type and age of houses, just no trees:

Union Ave W, treeless

Stark, eh? I hear someone saw the ghost of Elvis here.

But if you know me at all, you should realize that there’s WAY more to this exercise than aesthetics. There’s math! [Don’t worry, it’s easy math.]

  • Average assessed value of the houses on Poplar Ave: $208,026
  • Average assessed value of the houses on Union Ave W: $170,554

It looks like the houses on Poplar pay 22% more property tax than their neighbours on Union, despite being virtually identical in every way, except for the presence of street trees!! That works out to about $219/year in extra revenue to you, per house.

So what if you planted a tree in front of every house on Union Ave?

A 6′ sapling will run you about $315, with an extra $200 for care in the first 2 (all-important) years. Plus GST. For a total of $540.75 per tree.

Now you won’t get the entire $219 in property tax value in the first year… the tree has to grow first. So the value you’ll get will increase gradually every year.

As an example, a silver maple can grow to be 50′ to 80′ tall at maturity. But it’ll already reach 26′ tall after 10 years. That should be enough to realize a good portion of your investment.

Let’s say we go from $0 in year 1 gradually to the full $219 in year 10, that works out to a return of $1,204.50 over the 10 years, which is a 22.3% annual return on your initial investment of $540.75.

A pretty kick-ash return I would say. [Boom!]

Here’s the bonus: that tree will keep on giving every year after that. Just spewing extra cash at you, all the while cleaning the air, cooling the city in the summer, making the city look nicer, and, here’s a big one: soaking up rainwater!!

The city of Campbell River BC estimates each and every one of their trees soaks up 3,785 liters of rain annually. Think of the savings to your sewer system! And that’s just gravy on top of the increased tax revenue! [Not actual gravy, that would be gross.]

You talk of Kenaston expansions and Chief Peguis extensions at over a billion dollars, and you can’t find a measly $2.6 million, less than a quarter percent of your annual budget, for this? No wonder you’re insolvent.

Trees are low-cost, low-risk, and high return. Is this not the investment you’ve been pine-ing for? [Don’t worry, there’s more coming!]

The alternative you’ve chosen is to spruce up some roads, which will increase neighbouring property values by… $0. Plus you’re letting trees you used to have die out, thus REDUCING your existing tax base. That’s really bad yews. [It’s a tree, look it up.]

And look, I don’t want to be a jerk, but your preliminary budget document even says this in regards to your bad financial situation (emphasis mine):

New long-term growth revenue sources will be required in the future to address the growing structural deficit

2019 Winnipeg Preliminary Operating and Capital Budgets Presentation

“Growth revenue sources”! Amigo, it’s like you’re literally talking about trees. And yet…

I agree that it would be great if you could invest fully in ALL your infrastructure (like a proper city is supposed to), but you’re in a really bad place right now, so until you get out of this mess, you’ll have to make some hard choices.

But hard choices doesn’t mean dumb choices. Don’t axe the investments that offer a positive ROI (like trees) while keeping the money-losers (like roads). Do the math, already!

When you do, the answer will be obvious: stop investing in suburban Ponzi schemes, and keep investing in street trees.

I promise you’ll be the most poplar city in Canada! [And another one!]

Ok, I’ll leaf you for now. [Couldn’t resist.]

Hugs and kisses,

Elmwood Guy