Winnipeg's financial controversy with the province continues: Bowman announces a possible increase of property tax

Mayor Brian Bowman on Wednesday issued a statement saying that property tax for city residents may be increased by 9.43%.

Winnipeg's city budget should be tabled on Friday, and funding problems with the province have not yet been resolved, which can lead to such measures. Earlier, the mayor has already demanded the provincial government to clarify this issue, and also said that the city still did not receive the promised millions of dollars for the 2018 projects.

Bowman announced that the new city budget could feature such an increase in property tax, for reducing $40-million gap which was formed due to the violating of financing agreements by the province government. This increase is 7.1% higher than that he promised during the election race.

The mayor noted that the reduction in provincial funding left the city only three options - hike property tax rates, cut planned infrastructure projects or add debt to cover the shortfall.

"All of which are terrible choices to have to make, and we will be providing clarity on how we are reacting to that new reality of provincial funding levels in the context of our balanced budget on Friday," Bowman said.

The mayor did not disclose which of the 3 options his government would choose. He noted that the preliminary version of the budget has already been agreed and the province is aware of this decision.

Finance Minister Scott Fielding, the former city councillor, fueled the situation in his Twitter. He named Winnipeg the "most generously funded major municipality in Canada." Also, he added that the city "doesn't have a revenue problem. It has a spending problem."

Bowman refused to respond to these attacks.

"It has gotten much worse to get clarity on the capital side. Just look at the fact that we are debating the 2018 year right now, hours before we table the 2019 budget," he said.

However, positive trends are outlined in resolving this dispute. The mayor said the provincial government is ready to support for Winnipeg's operational expenditures. Premier Brian Pallister also called on both sides for a calm dialogue.

"I call upon all parties to rise above it and work together constructively," Pallister said in his tweet.

MORE NEWS: Executive police committee postponed water-and-sewer rate increase

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