A senior on a fixed income living in a Ste. Anne trailer park pays $450 a year in property taxes to his local municipality. On the other hand, what he owes to his local school division in property taxes is significantly more at $1,140.
According to Lorne Weiss, the chairman of the Manitoba Real Estate Association’s political action committee, there’s definitely something amiss when the senior’s property tax bill to fund education is three times more than what he pays for municipal services.
“He’s not exactly living in a high-economic residential area — it’s a trailer in a trailer park!” stressed Weiss, during a stopover at the WREN offices.
Weiss was en route to Ste. Anne where he was to drop off newsletters outlining a new campaign calling for the elimination of education funding through property taxes. Weiss said a seniors group in Ste Anne had expressed its willingness to help spread the the letspayfair.com message by distributing the newsletters.
Seniors across Manitoba have joined forces with the MREA, the WinnipegREALTORS® Association, the Winnipeg Chamber of Commerce, the Keystone Agricultural Producers (KAP) and 36 other organizations — representing over 250,000 Manitobans — to form a coalition to lobby the provincial government to change the way it funds education.
Weiss said the aim of the coalition is to have education funded through general revenues in the same way that health care is funded in the province.
“Manitoba REALTORS® along with the coalition are committed to the fact that education is a priority, and should be funded by all Manitobans because it benefits all Manitobans.
“Using property taxes to fund education does not reflect a homeowner’s income and ability to pay,” added Weiss.
“Right now, about one-third of the entire education budget is being paid for on the backs of property owners,” said KAP president David Rolfe. “Farmers, seniors, families and business owners (who are not part of the ESL elimination) struggle to keep education adequately funded at the expense of their properties and farms because, in many cases, they are being taxed on debt.
“Public education is everyone’s responsibility and we’re calling on the province to show leadership and shift education taxes off property so we all can pay fair,”” added Ron Cornell, the political action representative of the Brandon Real Estate Board.
Just before Christmas, Premier Gary Doer told the WREN that funding education entirely through general revenues would stress the province beyond its economic capability and the Manitoba government is already doing all it can to ease the property tax burden.
He said his government has eliminated the province’s education special levy (ESL) and has a rebate system in place that now gives back 60 per cent of the property taxes paid for education on farmland.
Manitobans can also claim on their annual income tax returns a Manitoba Education Tax Credit of $400 which was raised from $250 in 1999.
While acknowledging that the measures taken by the province to ease the property tax burden were a good first step, Weiss said the province does have the wherewithal over the next four or five years to completely eliminate education funding through property taxes.
Weiss explained that a good economy has meant that provincial revenues have increased from
$5.5 billion to $8.5 billion over the last five years. Increased transfer payments from the federal government have also helped the province’s present bottom line, he added.
He also said that the export of electricity by Manitoba Hydro has been another economic boon to the province.
In 2006, Manitoba Hydro reported $881 million in exports, establishing a new record that was significantly more that 2005’s $554 million in exports and the previous record of $588 million in fiscal year 2001-02.
“All the current profits earned by the sale of
hydro-electric power are not going into general
revenues, but left in a pool that the province draws upon (the provincial government has in the past
frequently used hydro funds to help balance its
budget),” said Weiss.
“Taxpayers would like to see this money designated for education and flow into general revenues.”
Weiss further said that the rebate system for farmland has not effectively lowered the Manitoba farmer’s tax burden.
He said KAP has outlined two points of contention: production buildings have the most value and are not part of the rebate system, and farmers do not have a readily available cashflow and often have to borrow the money to pay for property taxes before they can approach the province for a rebate.
Weiss also said the elimination of the ESL on
residential property has not resulted in more tax savings for homeowners.
“We thought the phasing out of the ESL was a step in the right direction, unfortunately the government’s hands-off policy on overseeing school board budgets meant that school divisions swallowed up those reductions as fast as they were made.”
Weiss is concerned that Manitobans may see another round of property tax increases as school boards prepare their 2007-08 budgets.
“Our campaign is in place to raise public awareness at a time when school divisions begin the process of preparing their budgets.
“We also want to ensure that the current provincial government is aware of public sentiment when it prepares its next budget,” he added.
The coalition is urging Manitobans to show their support for the www.letspayfair.com campaign by sending their MLA an electronic letter found at the website, as well as electronic letters to Premier Doer, Education Minister Peter Bjornson and Finance Minister Greg Selinger.
“The campaign encourages Manitobans to pull out their property tax bills and take a closer look,” said Rolfe. “In some cases, citizens will find that as much as 50 per cent of the property tax bill is for education.”