Mayor Brian Bowman is sticking to his commitment to an annual property tax increase of 2.33 per cent, but roads in the city will suffer as a result.

The City of Winnipeg’s 2019 budget includes the tax increase, amounting to $40 more a year for the average homeowner, most of which will go to roads, with 0.33 of a percentage point going towards rapid transit.

Despite the tax increase, the roads budget is being slashed by nearly a third, from an original projection of $128.4 million for 2019 to $86.4 million, the lowest since 2014.

“This is the city’s new road reality,” said Bowman.

Bowman is laying the blame on the province for the $42-million cut, due to the city receiving $40 million less than anticipated from the province in road funding for 2018. The city is also scaling back on future plans for roads, reducing its six-year road renewal projection approved in September 2018 from $976 million to $801 million.

“Preparing this year’s budget was complicated by ongoing uncertainty regarding provincial government funding support to the city,” said Bowman.

The funding for roads may also have to be shared with other costly projects – the budget is recommending a rule change that will allow that money to also be used for bridge repair, renewal and replacement. The change requires approval from two-thirds of council to go through. The mayor said the flexibility is needed due to many bridges in the city aging, such as the Arlington and Louise Bridges. The budget does not include dedicated capital funding for either.

Bowman has been preparing residents for a tough budget for weeks.

When pressed about the use of rhetoric over the possibility of a much higher property tax increase in the lead up to budget day, the mayor said, “I think we have to be honest with people about the choices before council.”

It also includes a $10 million draw down from the city’s rainy day fund to help balance the books.

The budget includes the freeze for water and sewer rates for 2019 that was approved by council Thursday and lowers the controversial dividend taken out of the utility by a percentage point, from $38 million to $34 million.

While the frontage levy fee is being frozen, homeowners will pay more for garbage and recycling. The waste diversion fee is going up from $57.50 to $63 for the year. Finance chair Scott Gillingham said the increase reflects cost recovery related to the new garbage and recycling contract.

On transit, the city is pledging to give a break to low income bus users starting in 2020. That’s when a low-income bus pass will be implemented, costing 30 per cent less than regular fare in year one, 40 per cent less in 2021 and 50 per cent less in 2022. The city said the cost of the low-income program has yet to be determined.

It’s also committing $1 million to study how to go forward with electrifying the Winnipeg Transit fleet, including costing out the purchase of 12 to 20 battery-electric buses.

Other highlights of the 2019 budget include:

-An increase of 3.4 per cent for the Winnipeg Police Service budget, bringing funding to $301.4 million;

-An increase of 4.2 per cent for the Winnipeg Fire Paramedic Service, bringing its budget to $201.5 million;

-$31 million will go towards a $1 billion long-term plan to deal with combined sewer overflow;

-Parking rates are being frozen, but the budget calls for the Winnipeg Parking Authority to analyze current parking rates;

-$432,000 to improve snow clearing on bike and pedestrian routes throughout winter;

-The business tax rate is going down, from 5.14 per cent to 4.97 per cent. In the meantime the business tax threshold is increasing from $33,300 to $33,900;.

-More money will be made available for community centre improvements. A fund for renovation grants will more than double, from $965,000 to $2 million, and the maximum amount granted per project will also double, from $50,000 to $100,000.

The budget is subject to council approval following review over the next few weeks.