Gail Stephens, CAO, City of Winnipeg

Media Appearances, Municipal Government, Frontier Centre

Frontier Centre: You discussed the fiscal turn around in Winnipeg today. Have taxes really started coming down in Winnipeg?

Gail Stephens: Taxes have come down in Winnipeg, we have had three years of freezes, three years of cuts and we now have one of the most competitive tax bases in Canada.

FC: Can you provide some indicators of increased efficiency, staff reductions … that sort of thing?

GS: At one time the City of Winnipeg had approximately 12,500 staff – today, we are below 8,000 staff. One other efficiency that sort of tells you how we have down-sized and restructured – we own or lease approximately 1 million square feet less space today compared to five years ago.

FC: Are you frustrated that rising school taxes seem to be erasing the benefits of tax restraint at City Hall?

GS: We get the complaints when school taxes go up because the citizens don’t understand whether the taxes are City taxes or school taxes. So either we need two tax bills or some way that clearly citizens can understand who the tax bill is coming from. Roughly well over half of the tax bill now goes to the School Divisions.

FC: Your reputation as a “re-inventor” of government preceded your appointment as City Manager. How much of that focus have you brought to the City’s administration?

GS: We have been in massive restructuring at the City for the last five years, including the sale of Winnipeg Hydro, transfer of Social Services, transfer of public health, amalgamation of a whole bunch of functions. We used to at one point have 29 line departments, we now have 9 line departments so we have done massive, massive restructuring and reorganizing to create better service.

FC: Can you give us a capsulated review of the City’s Special Operating Agencies, these autonomous organizations within government that operate more under business?

GS: We have created a number of special operating agencies including sand and glacial, animal services, with fleet management scheduled to be made a SOA very soon. We are looking at parking which has been approved as a SOA and we are hoping to give it a real downtown focus. We have some which are public/private partnerships. We have actually partnered with neighbourhoods and communities in key areas. We have a huge undertaking right now to look at all of our facilities and we are hoping that there is an opportunity to partner on some new facilities with the private sector. So, while we have SOAs we have also had contracting-out and the transfer of assets. We are looking at not just SOAs but better ways of doing business.

FC: Are you confident that their costs include fully loaded costs including cost of capital and other overheads? The private sector has a legitimate complaint if there is no level playing field and in-house providers are favoured.

GS: The last few years we have been very busy at fully-costing all departments. All departments carry their own debts, carry their own interest, all SOAs are charged business taxes, commercial taxes, property taxes, income tax so that we are comparing apples to apples when we compare the operation of those centres with the operations of business.

FC: What proportion of the City spending is contracted to the private sector and are there plans to expand that portion?

GS: I can’t give you the percentage because, of course, the big part of our organization are police, fire and paramedic and they are provided by City staff– we certainly contract out all of our recycling, we contract out a big portion of our solid waste, we contract out a big portion of our cleaning services. We contract out most of our construction now – most of our bridge work, etc. is all contracted out. We contract out even some of our engineering services. Most of our snow removal is now contracted out. So we contract out a fair amount.

FC: Are there any plans to reward Planning Department employees for shortening turn around times on permitting?

GS: That’s probably something you need to ask the department head, Harry Finnigan, if that is somewhere he wants to go. But I know the City has invested about another $1.6 million in the Planning Department. We realized over the last many years that it has been down-sized and we are re-investing to get a better turn around working with business more closely. We have come up with I think a very innovative plan and a new Director who is dedicated to making it happen.

FC: Mayor Glen Murray told a Frontier Centre luncheon that the City of Winnipeg had de-regulated zoning procedures to encourage more downtown residential conversion. What has been done and did it result in more housing?

GS: Fairly recently we introduced new zoning and it has gone through its various readings at Council. There are a couple of more pieces that are coming forward in July to make doing business in the downtown much more simplified. They are still in the workshed – we are just drafting the bylaws that go with them so, within the next few months, it should be easier for business in Winnipeg to develop and grow downtown.

FC: Policing continues to be an issue in the City. Some people would like to see a more results-oriented culture in the department.. ie.. more police on the street and a more flexible approach to two-officer police cars. Do you see this ever happening?

GS: We’ve had some wonderful cooperation from the Police Association in pilot areas in the City in using one-police officer cars where it makes sense in changing how we shift and changing the number of vehicles we have available. We are certainly looking at the four division model which I think provides for more police officers on the street and less administration and I think that has been introduced to Council and will be dealt with in the next few months. All of that, I think, puts more officers on the street and better policing where it is needed.

FC: Rent control plays a large part in the collapse of property values and yet no matter what party controls the Legislature it remains in force. How important do you think its effects are?

GS: I don’t really have the detailed information about rent controls. It certainly impacts the City in the sense that our commercial taxes on rental properties are based on net income and if net income is reduced, then so are the revenues to the City of Winnipeg.

FC: Should the City send the province a bill for the damages to the assessment base?

GS: No comment.

FC: The central irony in Winnipeg’s thirty-year odd long experiment with amalgamation is the contradiction of its main purposes – more tax support for the core, unified tax levels forbid the inner city from capturing the advantages of density and, instead, make it pay for higher suburban service costs. Has Unicity failed to deliver the promised goods?

GS: I don’t know that I can comment on that. What I do know is, in the last couple of years, a huge emphasis on re-building the downtown and the inner city. Huge housing programs, tri-level housing programs that tried to make the neighbourhood safer and provide new housing so that the downtown and the inner city becomes vibrant again.

FC: In your judgment what would an ideal City of Winnipeg Act contain?

GS: It would contain more flexibility to deal with the services we provide currently. I mean, you can’t even introduce things like a library fine or a fee because it requires provincial legislation so, I believe that the City needs the powers – they are a sophisticated level of government now – global players, so they need the powers to govern and run the City in the best interests of the citizens.

FC: How many pages would the ideal act be?

GS: Well, obviously, it would be nice to it “the shorter, the better”. Right now it is quite thick – but I guess that is a bit simplistic.

FC: Forty pages? Fifty pages?

GS: Well, fifty pages would be nice.

FC: How should we fund cities in a more effective way?

GS: I think letting cities be players in economic development by giving them a share of the sales tax is a wonderful solution for Winnipeg. Giving cities something like a dedicated fuel tax would help pay for much needed infrastructure is important.

FC: What percent of sales tax? Do you have any thoughts on that?

GS: Well, I think, the mayor believes that 1% would be great, 2% will get us closer to being sustainable.

FC: Winnipeg Hydro was sold recently. Now there are issues around water treatment plants. A lot of cities have used public/private partnerships to transfer those assets to outside players. What are your thoughts on that?

GS: Well, as you know, there are good and bad in both. Atlanta had a big crisis by contracting out their water treatment so I think everybody has to go in with eyes wide open. With the Walkerton scare and some of the issues there – whatever decision is made, it has to be made with real care because it isn’t a simple matter and we have only one source of supply of water in the City. Certainly the private sector will be involved in the building … it’s actually a very small operation… a water treatment plant in terms of numbers of people. The actual management of it involves maybe a dozen people. So it’s not huge – the biggest part would be the construction, the design and surely, obviously we don’t have that expertise in-house. A lot of that will be private sector.

FC: Are you an optimist about Winnipeg even though you are de-camping for a new job on the west coast?

GS: I am very much an optimist, Winnipeg is my home and part of me will always be here and I may come back. My adult children are here, my brothers are here, my parents are here. I think Winnipeg is one of the finest cities in Canada.

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