Winnipeg has agreed in principle to extend its water and sewer systems into an adjacent area of the Rural Municipality of Rosser. The land in question is next to the Winnipeg Airport, and could eventually be part of a multi-billion dollar centre for manufacturing, warehousing and distribution – potentially a huge property tax bonanza.
A precedent is therefore set that will inevitably lead to demands for other such extensions. Already plans are underway for a similar extension of infrastructure into another adjacent municipality, West St. Paul, this time to support residential development outside Winnipeg’s boundaries. Both deals are contingent on service-sharing agreements that have not yet been negotiated.
As Winnipeg and Manitoba officials work on these agreements, they had better bear in mind that the costs that need to be calculated are not just the price of the services themselves, nor even just those plus the costs of maintaining an aging water and sewer system, but also the cost to Winnipeg of the inevitable loss of future tax revenue from residential, commercial and industrial development that would be attracted to locations which combine the advantages of a semi-rural environment with those of a fully-fledged big-city sewerage and water system.
These could balloon to include the costs involved in dealing with the problems of declining and decaying residential, commercial districts. In trying to decide what those costs might add up to, it is instructive to consider the example of Detroit, as I did in a previous blog entry. I looked at the implications of Mayor Sam Katz’s plan for the creation of a regional water utility, a plan that has not so far materialized. If it does, however, it will compound the potential losses to Rosser and West St. Paul – which will be governed by an agreement negotiated directly with Winnipeg – by taking negotiations over water service extensions out of Winnipeg’s hands.
We are on a slippery slope. Once we set the precedent of parcelling out a major asset of ours, our water system, to our competitors, and possibly giving up control altogether, it is others who will decide Winnipeg’s future.