Winnipeg finances less dire than predicted as city deals with pandemic
City sees fewer requests for property tax deferrals than expected
The news from Winnipeg finance staff isn't great, but it isn't as bad as first predicted.
The city is anticipating a $73-million shortfall from lower revenues and higher costs due to the COVID-19 pandemic — but that's an improvement over last month, when the shortfall was projected tp be $78 million.
Most of the $5-million improvement comes from Winnipeg Transit operations, where the city is seeing a drop in costs for diesel fuel and less overtime from operating a reduced schedule.
The city instituted a number of measures in an effort to save money during the pandemic, including laying off nearly 700 non-permanent staff, the transit service cut, freezing fleet purchases and a voluntary furlough program.
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Interim chief financial officer Paul Olafson updated councillors on the finance committee Wednesday about the city's financial position and also what he called some "interesting markers" on an offer to property owners to defer their property taxes because of the pandemic.
As of May 15, the city received 235 requests from residents to defer their property taxes under its tax instalment payment plan, most of those until Oct. 1. Another 295 cancelled out of the TIPP program entirely.
Payments for a further 442 accounts were returned non-sufficient funds. The rate of non-payment last year was between ½ and one per cent. This year it is slightly ahead of that at 1½ per cent.
The response to the tax deferral program and the non-payments left the city "within its parameters for maintaining strong liquidity," Olafson said, but he expects more property owners will face pressure as the economic slowdown continues.
"I do expect that number will increase in the next few months," he said.
The projections are based on COVID-19 restrictions being lifted by September and there is no way to guarantee that will happen, Olafson told the finance committee.