Dear Winnipeg

A Fun Blog About Infrastructure and Municipal Finance
It’s Like Deja Vu All Over Again, Again

It’s Like Deja Vu All Over Again, Again

Dear Winnipeg,

This December marked 5 years since I started Dear Winnipeg, and the letter you’re reading is the 100th published here. If you were to read it all from the beginning, it would take you nearly 10 hours to read all 145,159 words, depending on how fast you read.

Coincidentally, this year also marked the 30th anniversary of Groundhog Day. The movie, not the tradition of letting a rodent be a weathercaster for a day.

I got to thinking about the Bill Murray classic after a pair of city-related announcements this past week.

Difficult decisions

The first was a press release by the City meant to prepare the public of upcoming 2024-2027 budget challenges.

“This is a challenging budget year and so people should expect that difficult decisions are going to have to be made.”

— Mayor Scott Gillingham, at a presser outside his office on December 6th, 2023

Here’s the thing about writing “a fun blog about infrastructure and municipal finance” for five years. It requires paying close attention to the goings on at City Hall, which means reading a lot of reports, keeping tabs on what’s being said in the media, digging deeper into certain planning, transportation or finance topics, in addition to doing a lot of research into past City reports and media coverage, in order to have the necessary context to be able distill often complex issues into fun (ish), useful (ish), short (ish) articles that anyone can enjoy. It takes an average of 6 to 8 hours to research and write each and every one of these letters. So, all told, I’ve probably spent at least 600 hours putting together the content you’ve been able to read in just under ten.

That’s why certain things now give me déjà vu. Like the words “difficult decisions” in the context of the municipal budget.

Scene from the movie Groundhog Day, with the caption 'Didn't we do this yesterday?'

Now, the official reasons we’re being given for why this budget will be particularly challenging are inflation, increased labour costs, and lingering effects of the COVID-19 pandemic.

But regardless of the reasons du jour, you might also feel like me, that we’ve somehow been here before. And if you did, you’d be right.

Here’s the Mayor and Councillor Jeff Browaty, the Finance Committee chair, last year at budget time:

“We embark on this year’s balanced budget update fully aware of the challenges and tough choices that lie ahead.”

— Mayor and Finance chair in the 2023 budget update preamble

Oh sure, you could argue that inflation and the pandemic impacted last year’s budget too. Ok, here’s the Mayor pre-pandemic, when he was Finance chair:

“Difficult decisions were made to balance the budget.”

— Councillor Scott Gillingham, Finance Committee chair on March 6th, 2020

But as those of you who are long-time readers already know, this pre-dates ol’ Scotty.

Here’s Mayor Brian Bowman in 2017 talking about “difficult decisions” for the budget, when the blame was being laid on the Province cutting funding.

And here’s Mayor Sam Katz in 2013.

Some will note that these all came after the more than decade-long property tax freeze first championed in 1998 under Mayor Glen Murray. Sure, that tax freeze didn’t help things, but it’s not where our financial woes began. After all, here’s a budget motion by Mayor Susan Thompson in 1996, acknowledging the “difficult decisions proposed”.

Murray’s tax freeze was a response to Winnipeggers’ property tax burden, which at the time was seen as too high.

But Council had been having issues keeping our financial heads above water even before that.

In 1993, according to that year’s March 22nd edition of the Winnipeg Free Press, we had the second highest property taxes in the country and spent 15 cents of every dollar we raised to pay interest on our debt, despite having having some of the most efficient municipal services in Canada, spending less per capita on services than most cities its size, and having slashed infrastructure renewal spending to only $7 million (which is about $13 million today, when adjusted for inflation).

That we had the second highest property taxes in the country was already an improvement. We’d been number one for a long time.

As I’ve written before, we’d already been struggling to balance the budget since the mid-1960s.

It’s worth noting that in 1968, the City was in charge of income assistance (“welfare”) payments and education, both of which are provincial responsibilities today.

But even if things have been bad financially for at least six decades, it wasn’t always this way. Take a look at this collection of quotes from a 1946 Winnipeg Free Press article, when the City had approved a 10% increase to the mill rate:

A good City budget? Increasing service levels? No call for a redistribution of the tax burden? Hard to believe we’re talking about the same city.

In 1946, we decided what services we wanted and then we decided what tax rate we needed to get us there. Like you do when you have money.

These days, we do the reverse: we look at how much money we can raise through taxes, then we decide how many services that will buy us. Like you do when you’re broke. Brian Pincott has a great piece touching on this topic on his new Substack, which I highly recommend you subscribe to.

Clearly, there was a time when City finances were good. But since then, even with a growing population, and a growing tax base, we’ve continued to find ourselves with fewer financial means each passing budget year.

When will Council finally acknowledge that something is amiss in our current approach to growth and City finances? When you lose money on every transaction, you don’t make it up with volume.

Downtown catalysts

Which takes us to the second announcement we heard this past week: the partnership that was signed between True North Real Estate, who aim to redevelop downtown’s Portage Place mall, and the Southern Chiefs Organization, who aim to redevelop the old nearby Bay building.

Now, to be fair, I have no issues with either group attempting these projects, as I think their intentions are good. And this is certainly better than the last attempt at redeveloping Portage Place. Plus, it’s great to see an Indigenous-led initiative with the Southern Chiefs Organization, where economic gains can actually go where they historically haven’t. Also, I’m glad to see a local developer involved with True North. Being from here, they can be more sensitive to local context, not to mention that they have a fair amount of skin in the game. They need downtown to be successful in order to protect the massive investment they’ve already made into developing True North Square.

That said, I simply can’t help but laugh at their claim that this partnership will be the “catalyst to revitalize downtown Winnipeg“.

I’ve written before about the ridiculous idea that “if only we just build this one mega-project, then downtown will be saved!”. Because these types of claims have been made for projects going back to the 1960s, including:

  • True North Square (2015)
  • Manitoba Hydro Place (2009)
  • Canada Life Centre (2004)
  • 201 Portage (1990)
  • The original Portage Place (1987)
  • The Forks (1987)
  • 360 Main (1978)
  • Convention Centre (1975)
  • Manitoba Centennial Centre (1968-1970)
  • Civic Centre (1963)

At the time of construction, each of these was touted as somehow being the catalyst for downtown rejuvenation.

“For decades the city has tried to redevelop downtown with mega-projects such as Portage Place, Place Promenade, the Hydro Tower and SHED development, all of which led to the demolition of numerous square blocks of small, older, side-street buildings where small, independent businesses like this would call home.”

— Local historian Chris Cassidy on the closure of the Wagon Wheel restaurant in 2012

How many “catalysts” do we need before we admit to ourselves that our current approach to reviving downtown is not working? When will we learn that it’s not the big projects that catalyze the little ones, but that it’s the little ones that make the big ones possible?

As local architect and newspaper columnist Brent Bellamy said nearly three years ago:

“As we move forward, it will be important that we are not seduced by the lure of the silver-bullet megaproject solutions we have so often looked to in the past. Constructing grand new buildings in isolation is rarely a path to prosperity. The boldest response will be a series of small solutions that work together to inspire fundamental change toward a common goal.”

— Brent Bellamy, Winnipeg Free Press, January 4, 2021

Looking ahead

It’s easy to look at all that and be pessimistic about the future of our city, especially when there are actual plans on the table to make things worse with even more road expansions.

But I believe we’re on the cusp of significant change. After 5 years of writing here, there are more of you reading than ever. In 2023, these letters have been read hundreds of thousands of times.

That’s a lot of you.

And as the readership here has grown, it’s been cool to see the increasing share of readers who aren’t from Winnipeg, which is now about half. It makes sense. After all, anyone familiar with the Strong Towns concept of the Growth Ponzi Scheme knows what we’re experiencing in Winnipeg isn’t unique, it’s a widespread North American phenomenon.

Just last week, the City of Brandon released a study that showed that the city is not bringing in enough revenue to cover infrastructure costs. And that’s only looking at the next 10 years.

Shocker, said absolutely no one reading this.

So I want to take this opportunity to thank all the readers from throughout Canada, the U.S. and the rest of the World who have found what you’ve read here useful in your quest to make your own city better. The more you do that, the more pressure you place on Winnipeg to get better. It’s win-win.

And to each of you in Winnipeg who have done the same, thank you for being part of the solution here.

Even though there are times when I feel that I’ve written everything I’ve set out to, as long as readership is growing, as long as you are finding this useful, then I’ll keep finding topics. I’ve got a few in the hopper already, including stuff like 4 Ways a City Can Hide Its Insolvency Using Accounting, as well as talking more about the actions we’ve been taking in my own neighbourhood that can hopefully inspire you to action in your own place.

As always, don’t hesitate to write to me if you have any questions, suggestions for topics, or if you want to have a chat over coffee (or beer!). I answer every email I get.

One final note for 2023: I’d just like to make a shout out to the Winnipeg Public Library, one of the many services funded by our municipal property taxes. In addition to all the other things a library card gives you access to, it also grants you free access to Canadian newspaper archives going back to 1753, upon which I’ve relied heavily to be able to provide you with critical historical context on our city budgets. Keep that in mind as we face something like our 60th straight year of service cuts.

As they say, those who don’t learn from history are doomed to repeat it. Again. And again. And again. And again.

Let’s just hope the next City budget isn’t released on February 2nd.


Elmwood Guy