One-third of divisions ignore incentives and hike property taxes

The Manitoba government should take a lesson from next-door Saskatchewan when it comes to using property taxes to fund education, according to the Manitoba Education Financing Coalition.

The Saskatchewan government removed the power of individual school boards to raise property taxes by setting a province-wide mill rate, resulting in the same taxation rate for all residents of the province. 

To implement the change, the Saskatchewan government raised eduction funding by $241 million annually to $990 million, drawing the money from general revenues. Shortfalls in education program funding for school divisions with  smaller tax bases will be made up from the province’s general revenues.

Not only did Saskatchwan take away taxation power from school divisions, it also slashed school property taxes by 14 per cent, using general revenues to make up the difference.

The Manitoba Education Finance Coalition, which includes WinnipegREALTORS®, the Manitoba Real Estate Association and 40 organizations representing over 250,000 Manitobans, said Saskatchewan is showing the Doer government the way to creating fairness in this province’s education funding system. The coalition said the 

present system is archaic and unanswerable to Manitoba property owners who are forced to pay the tax burden.

“Over one-third of Manitoba school divisions have told the Manitoba 

government they intend to raise property taxes, despite the fact that the minister of education offered them a way to avoid increasing the tax burden on homeowners,” said Ian Wishart, president of the Keystone Agricultural Producers, which is a member of the coalition.

Manitoba Education Minister Peter Bjornson recently announced increased education funding and offered school divisions a tax incentive grant (TIG) in return for freezing property taxes.

Instead, Lorne Weiss, a past-president of WinnipegREALTORS® and the chair of the Manitoba Real Estate Association’s political action committee, said Manitoba school trustees thumbed their noses at Bjornson by ignoring the 

government’s incentives and going ahead with property tax hikes. 

It is expected that 12, or about one-third, of the Manitoba school divisions will be imposing tax increases ranging from 1.5 to 9.9 per cent this year.

“We have a dual problem in Manitoba,” said Weiss. “First 12 of 37 school divisions raised their taxes despite a specific request by the province not to do that. And then we have the provincial government saying they’ll think about what to do about it next year.

“We’d like to remind them that the public made it pretty clear during the last election campaign they wanted this thing resolved now.

“And the economic situation has made that all the more urgent,” he added.

Manitoba Chamber of Commerce president Graham Starmer said the Manitoba government had claimed it would adjust its funding formula to pay for 80 per cent of education, but reached that figure by rolling up both capital and operating costs.

“When we called on the province to take responsibility for education funding, we said it should be 100 per cent of operating costs and eliminate all the confusion on what gets counted and what doesn’t,” Starmer added. 

Winnipeg Chamber of Commerce president Chuck Davidson said it is the long-held position of the coalition that education is a fundamental service which should be “fairly and fully funded from general revenues” similar to health care.

“Well,” said Davidson, “now Saskatchewan has gone a long way towards that.”

Weiss said the looming question is whether the current funding and governance model provides Manitobans with the best value for their education dollar.

“It’s becoming increasingly clear as the divisions hike taxes, despite receiving increased funding from the province, that they cannot deliver balanced budgets,” said Weiss.

He wondered why “costs have gone up in Winnipeg School Division, but enrollment is down by 700 students?”

Weiss also queried the need for 37 school divisions in the province, 37 superintendents, 37 school division offices and almost 350 school trustees to make education policy decisions when it only takes 57 MLAs to govern the entire province. 

In Winnipeg, there are six school divisions and 54 trustees, which Weiss added is more than three times the number of councillors at city hall.

“Does all this duplication and extra cost provide better education for our children?” 

Dave Crabb, president of the Manitoba Association of Cottage Owners, said shifting education taxes off seasonal property is his group’s No. 1 issue. Some members of the association pay up to 75 per cent of their property tax bills to school divisions, but are not eligible to vote for school board trustees in the ward where their cottages are located nor send their children to schools in the areas where they own cottages.

He said by funding education through the province’s general revenues, all Manitobans will be paying a fair share.

Weiss said a system that raises taxes on cottage and commercial property owners who do not have a vote for local trustees is not based on fairness and equity.

According to Weiss, Manitoba should begin the process of reforming the funding system by following the lead of other provinces such as Saskatchewan which created a province-wide mill rate, and lessen duplication of services by following the example of Edmonton and Calgary which now have just one school ward each. 

“It is apparent the school divisions are not listening to the education minister,” added Weiss. “So he should take a serious look at how education is funded in Manitoba by questioning the wisdom of allowing school divisions the power to tax when they consistently abuse this privilege.”