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This article was published 7/3/2011 (3494 days ago), so information in it may no longer be current.

WINNIPEG - The City of Winnipeg plans to use higher frontage levies and recreation fees and take a dividend from water and sewer sales to cover the rising cost of delivering services this year.

Mayor Sam Katz and city council finance chairman Scott Fielding (St. James) tabled the city's 2011 operating budget this afternoon, a spending blueprint for $847.4 million in spending on all programs, from policing to insect control.

That's a rise of $27.4 million from 2010, when the operating budget was $817.7 million.

The spending increases include $12.1 million more for policing, $5.6 million more for fire-paramedic services and $4.1 million more for public works this year.

The city plans to retain its freeze on the pool of property taxes collected from residences and commercial properties for the 14th straight year.

Instead, the city plans to increase frontage levies for the first time since 2001, bumping it up to $3.75 per frontage foot from $2.55 per foot.

This move will help generate an additional $14.4 million for the city, a figure roughly equivalent to a three per cent property-tax increase.

All of the money will be used to upgrade water and sewer infrastructure, repairs streets and sidewalks and improve lighting, Fielding said.

The city also plans to collect an additionalt $900,000 in recreational fees by increasing charges for the likes at ice time at hockey rinks and pool rentals.

The city must recover the cost of delivering these services, Fielding said.

The city also plans to collect $17.2 million in a dividend from the sale of water and waste sales. The city has never done this before but is justified in doing so because the city incurs the risk of borrowing hundreds of millions to pay for sewage-treatment upgrades, Fielding said.

Opposition councillors Russ Wyatt (Transcona) and Jenny Gerbasi (Fort Rouge) compared the draft operating budget to a "shell game," noting the $14.4 million increase in revenue from frontage levies – which is supposed to be dedicated to infrastructure – is not matched by an increase to the public works budget, which is only rising by $4.1 million.

Gerbasi called the move a tax increase by another name. She also said she was appalled by the increased recreation fees and the new utility dividend, which she fears may lead to more urban sprawl as the city pursues more service-sharing deals with neighbouring municipalities.

The operating budget will be debated by council committees over the next two weeks. Council will debate the budget on March 22.