cutting to the bone in ypsilanti

I’m still busy, preparing for the Shadow Art Fair, but I thought that you might want to discuss this article in the “Ann Arbor News.” Here’s how it starts:

Ypsilanti city administrators are proposing $2.4 million in spending cuts over three years if the city fails to raise additional revenues. The cuts include funding for six firefighters, four police officers and bus service.

City Manager Ed Koryzno said city revenues are estimated to drop from $14.9 million this year to $14.3 million in 2009 after the former Visteon plant closes in 2008. The plant is the largest taxpayer in the city…

I seem to recall, the last time police and fire department cuts were discussed, some folks suggested that the administration was just trying to scare the public into supporting the passage of a city income tax. I don’t know who to believe at this point. Hopefully, representatives from both sides of the debate will step forward and leave comments explaining their positions… Here’s one simple (two part) question to get the ball rolling – Is it absolutely necessary that we cut police officers and firefighters? Is there no more fat in the budget to be cut?

[For all of you not in Ypsi, you might be interested in watching this 60 Minutes piece before grabbing your guts and having big laughs at our expense. According to David Walker, the comptroller general of the United States, we’re all on the brink of fiscal collapse. As usual, Ypsi’s just leading the way.]

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48 Comments

  1. TooT
    Posted July 11, 2007 at 1:07 am | Permalink

    How about building some more fountains or maybe some more islands down the middle of Michigan Ave. That should help out the budget. Always bitching about money and wasting more of it than any other city.

  2. mark
    Posted July 11, 2007 at 1:11 am | Permalink

    Come on. You can’t complain about that library fountain. It lasted a whole two years before it began to crumble.

  3. John Gawlas
    Posted July 11, 2007 at 6:26 am | Permalink

    Well, the fountain was not funded by the City. Private donations and the Ypsilanti District Library take responsibility.

    Back to the subject, the only appreciable savings necessary to offset close to a million dollars in revenue shortfall (due to loss of ACH/Visteon/Ford/whatever and reduced state revenue sharing of locally collected sales/income taxes) comes down to personnel.

  4. egpenet
    Posted July 11, 2007 at 7:16 am | Permalink

    Who has the beautiful Starkweather Fountain hidden in their barn ior basement somewhere? Fess up and put it back … whoever you are!

    Mr. Gawlas … how’bout a new development plan for the city, including Water Street and other available city properties … and let’s just get on with it. How about a couple $mil for Water Work Park? Nobody uses that? There’s your first bond payment, right there.

  5. maryd
    Posted July 11, 2007 at 7:56 am | Permalink

    I can live with those cuts. When there is not enough dough you tighten the belt. I cannot continue to pay more taxes. I can barely keep up with tuition, car repairs etc…
    And our adult children can never begin to catch up with their taxes even higher than our own.
    I simply cannot trust this city govt with a bigger chunk of my pie to waste.
    Ypsi should not join the list of loser cities with an income tax, it will be the nail on the coffin. Stop City Income Tax!

  6. Ol' E Cross
    Posted July 11, 2007 at 7:57 am | Permalink

    Too many parks and fountains, that’s Ypsi’s problem. That’s why I hate living here. Can’t go anywhere without tripping over a damn park.

  7. Posted July 11, 2007 at 9:00 am | Permalink

    How much does the Mayor and the City Council make? Couldn’t cutting start there? Unless they’ve been running the city out of the goodness of their hearts (or want of power).

  8. egpenet
    Posted July 11, 2007 at 9:59 am | Permalink

    Here we go!

  9. Pete Murdock
    Posted July 11, 2007 at 10:23 am | Permalink

    In the discussion about the City’s financial woes, it always seems to be about them and not about the residents who also are struggling through these difficult times and are the people paying the taxes that support their spending. City Council acts as if the hard economic situation only impacts them not us. Recently there was a front page story in the NY Times about an Ypsilanti family on the Westside struggling to raise their family and keep their house. It is not an atypical story. The City is full of houses in foreclosure. One need not go any further than across the street from the Mayor to find an example.

    Here are some facts about City taxes that they seem to want to gloss over:

    – Ypsilanti already has the highest tax rate in Washtenaw County – one of the top five in the State.

    – The tax rate has increased over 5 mils (over 20%) in the last six years even with Headlee rollbacks.

    – Proposition A automatically increases your property value and taxes annually by the rate of inflation and much more if you are a recent property purchaser caught in the pop-up situation.

    – Tax revenues paid to the City by residential property owners have increased 60% in those six years -over 3 times inflation.

    – The proposed City income tax would generate an additional $ 4 plus million a year – a 40% – 50% increase in general fund local tax revenues.

    – According to an analysis done by Mayor Schreiber, the proposed City income tax would increase the local tax burden per household to 1-1/2 times that of Ann Arbor

    – And would amount to a 35% increase in City taxes for the average household

    This is insane. Clearly the residents of this City have been paying their share of taxes in times of stagnant wages and hard economic times. Can we be expected to absorb a HUGE tax increase like this on top of the increases we have already been paying? I don’t think so.

    stopcityincometax@gmail.com

  10. Citizen Blogger
    Posted July 11, 2007 at 12:42 pm | Permalink

    @ kathleen: The February 2006 Solvency Plan says on page 6 that “City Council compensation is also proposed for elimination ($45,000, 6% of the total cuts)” in 2007.

    http://cityofypsilanti.com/news/SolvencyPlan

    $45,000 / 7 = $6428 to each of them. In my opinion, that means that they’re doing it “out of the goodness of their hearts” as you put it, because if they’re in it for the money, they’re total suckers.

  11. Posted July 11, 2007 at 2:25 pm | Permalink

    “Is it absolutely necessary that we cut police officers and firefighters?”

    The simple answer is no. To the extent that it becomes a necessity in the future, it will be a result of the City’s inability to pay the Water Street debt on time, not the loss of Visteon or due to the non-existence of an income tax. I find it amazing that, in the rush to avoid recriminations, the cause and effect relationship between Water Street and our financial situation gets ignored. Ignoring the problem or acting as if it is irrelevant won’t move us any closer to solving it. The only thing that has potential for creating real fiscal stability at this point is finding a fiscally sound way to deal with Water Street. That’s where the effort should be focused, not on framing the issue in terms of cuts or income taxes.

    As an aside, the Plante-Moran study of more than two years ago projected the close of Visteon and adjusted for it in its assumptions, establishing that this is neither new nor should it be surprising from a planning perspective.

  12. Posted July 11, 2007 at 3:16 pm | Permalink

    “Is there no more fat in the budget to be cut?”

    I’d argue that it’s not about cutting fat, but about balancing priorities. If the City’s priority is to cut firefighters and police, and push for an income tax, and then purport we can’t have the former without the latter, then so be it. It’s this cynicism, coupled with a perceived lack of initiative, that I think creates the conflict and ensuing impasse in this debate.

    What about generating revenue outside the bounds of a tax? For example, other municipalities along the I-94 corridor have negotiated agreements with their respective counties and the state to collect overweight fines from the heavy trucks that ruin our highways. These fines are usually in the thousands of dollars per offense. They generate millions per year in revenue throughout the state, and municipalities such as Taylor and Van Buren make huge amounts of money ticketing commercial violators. We have police personnel trained to do this, but unlike other cities, Ypsi hasn’t gone to the trouble of negotiating deals to make it worth our while.

    Every time this issue comes up for discussion, it’s poo-poo’d by the establishment, even though it’s never really been pursued in earnest. But, for it to happen, we need to take the initiative.

    How many other opportunities are being lost to lack of initiative? Whatever happened to the first and foremost recommendation of the City’s Blue Ribbon Panel, “regional cooperation?” Is it any wonder that there’s skepticism here?

  13. egpenet
    Posted July 11, 2007 at 3:22 pm | Permalink

    I once wrote on a little 3×5 card at a town meeting: “What other ways can the city make money besides an income tax?”

    My card was tossed aside. I saw the meeting MC do that. Not such a stupid questions, eh?

    I smell smoke.

  14. Glen Sard
    Posted July 11, 2007 at 4:00 pm | Permalink

    I’m confused by the ongoing suggestions that the City of Ypsilanti has somehow stashed away piles of money, or that there is still a lot of budget “fat” to be cut. Each year, the City budget process includes several hearings providing opportunities for public input; each year’s budget is publicly available on the City web site; and the City has regular independent audits of both its individual budgets and its overall operations — all of which have shown the city to be (by standard accounting principles) financially sound and well-managed.

    That being said, we face enormous challenges: Over the past two decades, Ypsilanti has lost most of its tax-generating heavy industries (Motor Wheel, Exemplar, Ford, etc.); tax restructuring brought about by “Proposal A” has hindered the City’s ability to capture additional revenue from rising property values; and the amount of revenue-sharing received from Lansing has fallen dramatically. Consequently, the City’s budget (in real dollars) has been flat or steadily falling each year for many years.

    Since state law requires that all Michigan cities keep a balanced budget, the City has responded by partnering with EMU and local governments to deliver services more efficiently — and by trimming its budget every year since about 1999. While none of these cuts have been popular, the cuts in earlier years were (in retrospect) relatively less painful. Now, deep cuts or the outright elimination of some services once considered “essential” are increasingly likely. Already, we have lost all but token funding for recreation (which continues in a limited form thanks to the support of generous volunteers), and public transit (which continues only because AATA has agreed to pick up our share of the costs for a one-year contract extension.) In the next two years, we are likely to see even more dramatic cuts — including reductions in police and fire protection, and the total elimination of ordinance enforcement.

    I’m certainly not excited by the prospect paying more in taxes. However, I’m even LESS excited by the prospect of slower police and fire response times (and higher home insurance rates), increasing blight, seeing city buildings and parks fall into disrepair, and having Ypsilanti residents lose access to public transportation. To those unwilling to pay a few more dollars each month, I have to ask: Can you put a dollar value on adequate police and fire protection? On having the resources necessary to combat unsafe buildings and blight? On providing a way for those in our community without cars to get to their jobs or to school? On sustaining the amazing progress we have made toward making Ypsilanti a community that is perceived to be safe, attractive and even “cool?”

    We are at a very difficult crossroads, and, frankly, none of our choices are terribly appealing. However, the temporary income tax proposed by City Council is a responsible choice — and one that will allow us to continue providing essential services while we continue working to solve our community’s larger economic and political challenges.

  15. Posted July 11, 2007 at 8:49 pm | Permalink

    It’s not really all that confusing, Glen. The “piles of money” that ought to be sitting in City coffers are tied up in real estate that appears to be depreciating with each passing week. While Water Street sits unoccupied, polluted and undeveloped, generating diddley squat by way of property tax revenue, City Hall wants to replace that revenue by burdening students, renters, businesses and residents who already pay the highest taxes in the county.

    Responsible choice? Bullshit. The responsible thing to do is pull out all the stops and get Water Street moving instead of waging a costly campaign to put a band-aid on what is obviously a cancer that, if not cured, may very well result in the demise of the town we all love.

    All the problems you cite above will become a reality if Water Street isn’t fixed. You know as well as I do that a “temporary” income tax won’t fix the problem without a fix for Water Street. It is precisely this lack of focus on fixing the actual underlying problem while waging an expensive campaign in favor of a tax that causes people to distrust their City gov’t.

  16. Sacred Cow
    Posted July 11, 2007 at 9:56 pm | Permalink

    Despite the claims of some here, an income tax was under consideration BEFORE the 2nd developer pulled out of Water St. This is not some new proposal to mask the shortcomings of the Water St.development project. Certainly Water St. has not worked out, and has only compounded what was already a looming budget problem at City Hall. But to pin all the city’s financial woes on Water St. is completely disingenuous. Why then was there a Blue Ribbon Finance Committee established back in ’05 (one which recommended an income tax, mind you), when we all thought Water St. would be developed back then?? Water St. is a total debacle, but the income tax is a reality our city was facing whether that property was being developed or not.

    In terms of whether these cuts are needed or are just “scare tactics”, look at the city’s budget figures. While I’m not privy to the intricacies of that process, I recall city staff suggesting that Police and Fire constitute nearly 70% of personnel costs in the city. Looking at the recent budget shortfall projections extending out to 2012-13, the city appeared to be looking at a deficit beyond 30% if we are forced to pay off Water St. debt through the general fund. Thus you could literally cut every single non-Police or Fire position within City Hall not required by charter (i.e. City Manager, Clerk, etc.) and still not make up that shortfall. The argument that we can simply “trim more fat” seems only to be made by those who make no attempt to actually study the budget projections offered by our city staff.

    I also hear many claims that we overpay our city staff, which somehow has led to our budget problem. Several points on that: First, the AA News reported a couple months ago that the city worked with the County on a salary survey which found Ypsi was actually offering uncompetitive salaries a good 10-15% below what comparable communities were paying. This, of course, is probably why 90% of our city’s department heads have all left this city over the past 4-5 years (a point those who gripe about escalating salaries always conveniently fail to mention). As with anything, you get what you pay for. If we want to low-ball city staff as some here suggest we ought to, so be it. But all we will get are under-qualified employees who come to our city to gain experience before they move to a better paying city. I know some here might honestly prefer lousy city staff for their own self-fulfilling prophecies that gov’t is worthless and can do no good, but most sane people ought to feel differently. Secondly, some of the salaries the peanut gallery gripes about are so miniscule in the context of the budget deficit that it is laughable. Without mandated cuts we could be staring a $4 million defiict in five years, and someone is going to complain that a main cause is a new Assistant C.M. getting a $9K raise?? Give me a break. Even if we low-ball our staff to hearts content (as the anti-income tax crowd seems to prefer), it wont come remotely close to balancing the budget shortfalls the city faces. It’s little more than a weak talking point for those who would rather complain than offer practical solutions to the problem.

    Ultimately what we’re left with is two lousy options here. We can get taxed further, or we can watch our city services go straight down the dumps. I have found it ironic to watch clips of city council sessions where the anti-tax crowd equates us passing this tax to turning us into another Detroit. It’s ironic because most people would never tell you they aren’t moving to Detroit because there is an income tax on the books, but rather they wouldn’t move because city services are so poor that the place is literally unsafe for many. Yet that is precisely what we will do if we start gutting our police and fire depts. so that we all can save ourselves a couple hundred bucks a year. It is also ironic that the anti-tax crowd pretends to be “defending the poor” when the reality is it will be precisely those poor people who suffer disproportionally from the cuts in city services. Anyone think Mr. Pierce or Mr. Murdoch are taking the AATA to work in the morning?? Anyone think they go sit at Rutherford Municipal Pool with the kids?? How does there life get affected by the AATA routes getting cut?? The answer is they don’t. Make no mistake about it, the inevitable cuts that will come without an income tax will disproportionally impact the poor in our community.

    Really the choice is ours: Is a reliable Police and Fire service worth an extra $300 a year on average, or is not worth it?? If you’d rather have a little extra cash in your pocket and a lousy police force to go with it, then you should vote against the income tax. If keeping our community safe is a priority to you, you should vote for the income tax. Don’t get me wrong either, I’d love to hear a way how we can not cut AATA or a single Police position without an income tax, all while balancing the budget. But the reality is for all their hot air, the anti-tax crowd is deafeningly silent on actual alternatives to fix the budget problem. I’ve yet to hear them offer a single, practical alternative that leaves us with a balanced budget in 2010. Until I hear one, I’m going to assume our options are a new tax, or gutted services. Both are horrible options. But if I am forced to choose one (as I will be in Nov.) I have no doubt our city will be FAR worse off with a gutted police dept. than with an additional tax.

  17. Ol' E Cross
    Posted July 11, 2007 at 10:17 pm | Permalink

    I think it’s helpful to remember the income tax was suggested before Water St. developers bailed. If Water St. never happened, we should still be discussing a city tax.

    I’m in favor of an income tax because I’d be in favor of it even if the city didn’t have a fiscal crisis, for two reasons:

    The first is practical. If it makes sense for any city in the state it’s Ypsi, where a third of our land is taken up by tax free EMU.

    The second is ideological. Income tax is the closest thing we have to a fair tax. The tax options are:

    Sales tax: Always regressive. A fellow making a hundred grand pays six cents for a dollar coke and a fellow making 10 grand pays the same. The wealthy save/invest much of their income and are adept at shielding it from additional taxes. Those who live paycheck-to-paycheck save nothing and have an additional six percent tax on a far greater portion of their earnings.

    Property tax: It’s a crap shoot. I can point to dozens of folks in town who make 3-4 times what I do and pay far less in property tax. If I win the lottery tomorrow, my property tax won’t increase. And, I can also point to a new residents who make less than I but pay higher property tax simply because they’re new to the neighborhood.

    Income tax: Everyone starts at the same percent. The poorer you are, the greater impact the deductions have. It’s the fairest, least regressive tax option we have.

    It’s also helpful to remember that although it’s fun to have fun with numbers, the number that matters isn’t 35, 40 or 50, it’s 1 percent.

    Taking a purely consumeristic approach, investing an added one percent of my income (less than that after deductions) in my community is a purchase that will benefit my quality of life more than anything in the Ikea catalogue.

    Taking a humanitarian approach, the people most impacted by service cutbacks are the low income folks who can’t afford cars, backyard pools and playgrounds and home security services.

    The folks most impacted by a tax on income are the folks with the fattest incomes who habitually want everyone else to tighten their belts so they can loosen theirs.

  18. Ol' E Cross
    Posted July 11, 2007 at 10:33 pm | Permalink

    It looks like I was composing as Sacred Cow was posting. (Nicely said S. Cow and, you too, Mr. Glen.)

    Not that it matters, but I’m not very well connected in Ypsi. I wholeheartedly agree with the Sacred Glen, but I thunk my thoughts all alone.

  19. brian r
    Posted July 12, 2007 at 12:50 am | Permalink

    The rhetoric keeps me warm at night.

    the AA News reported a couple months ago that the city worked with the County on a salary survey which found Ypsi was actually offering uncompetitive salaries a good 10-15% below what comparable communities were paying. This, of course, is probably why 90% of our city’s department heads have all left this city over the past 4-5 years

    The Michigan Municpal League’s Pay & Benefits survey can be found HERE. If you can find where our employees are “a good 10-15% below” compararble communities, I’ll buy you dinner.

    As to the claim that our department heads have left due to pay, consider:

    Harry Hutchinson, DPW Director, retired
    Bob Bruner, Asst City Manager, became CM of Ferndale
    Megan Gibb, Planning Director, moved to the planning mecca of Portland
    Jennifer Goulet, DDA Director, took a job in Chelsea
    Bill Johnstone, HR Director, didn’t make it past his probationary period
    George Basar, YPD Chief, retired
    Jim Roberts, YFD Chief, retired
    Cherry Lawson, Clerk, took same job in Arizona

    I recall city staff suggesting that Police and Fire constitute nearly 70% of personnel costs in the city.

    Fire personnel costs are $1.6M and Police personnel costs are $3.3M. Out of a $16.1M budget, that’s 30%.

    Income tax: Everyone starts at the same percent. The poorer you are, the greater impact the deductions have. It’s the fairest, least regressive tax option we have.

    Except for the goddamn rollback that doesn’t benefit 67% of Ypsilanti’s population.

    public transit (which continues only because AATA has agreed to pick up our share of the costs for a one-year contract extension.)

    Ah yes, the bus subsidy. It has surprisingly become a rallying cry for the income tax. What’s interesting to note, however, is that in 2006 Council passed resolutions supporting a fare increase and a County-wide millage. A County-wide millage means Council wasn’t interested in paying the bus contract. One pro-tax Councilmember even lamented about how unfair it was that Ypsilanti had a large number of work poor causing the City to rely on the AATA. More to the point, we’ve NEVER paid the entire bus contract. The AATA has always subsidized us. Finally, when Council cut the bus subsidy in last year’s budget, we ended the year with a $300K surplus. We could have paid the entire contract, we just chose only to pay $131K. Go figure.

    ***

    At the end of the day, it’s not about cutting and it’s not about increasing revenue. It’s about being able to spend the money you have wisely. In FYE 2008, the budget we passed was for $16.1M. That’s more than a million dollar increase over the budget from just two years ago.

    As always, everyone is encouraged to join me after Council meetings at The Sidetrack to talk budget and City politics. I hope to see you all this Tuesday.

  20. egpenet
    Posted July 12, 2007 at 9:55 am | Permalink

    Councilpersons …

    Mssrs. Manager & Mayor …

    It’s “who shot John? time.” What’s the truth? What’s the fiction? What SHOULD the budget amounts be? Why DIDN’T we pay AATA in full?

    Accounting principles? What did the City take in? What went out? What’s left? Mmm. OK. And, does the left column adds up to the same total as the right column.

    What are we speending we SHOULDN’T be spending? What revenues are we NOT getting we SHOULD be getting? Why are businesses NOT investing in the City? How could we fast-track some investment and development WITHOUT damage to the HDC, downtown or neighborhoods?

    Blue Ribbon … schmoo ribbon. We’re goin’ in circles. What are the FACTS!?

  21. Citizen Blogger
    Posted July 12, 2007 at 10:45 am | Permalink

    egpenet: the city has an independent audit done every year that has a lot of that take in, went out data. The past three years reports are online

    http://cityofypsilanti.com/services/finance/Audit%20Reports

  22. egpenet
    Posted July 12, 2007 at 12:48 pm | Permalink

    I know all that … CB … but audits do not make judgements about priorities, monies well-spent (mis-spent), fiscal planning issues, etc.

    Why didn’t we pay AATA?

  23. Ol' E Cross
    Posted July 12, 2007 at 12:59 pm | Permalink

    Brian,

    If you can find where our employees are “a good 10-15% below” comparable communities, I’ll buy you dinner.

    Nice one. You can imply that the survey shows that Ypsi employees aren’t underpaid without proving so. Much of the data in report just gives salary ranges, rather than actual salaries, so the report, in itself, wouldn’t be useful for developing accurate results. If you’re sure the county numbers are wrong why not refute them rather than suggest the secret lies deep in the 270 page MML report? I’m not that hungry.

    Fire personnel costs are $1.6M and Police personnel costs are $3.3M. Out of a $16.1M budget, that’s 30%.

    Sacred Cow said fire and police personnel were 70 percent of personnel budget, not the entire budget.

    Except for the goddamn rollback that doesn’t benefit 67% of Ypsilanti’s population.

    Okay, let’s talk about the 67 percent rentals (by the way, does anyone know if that oft used percent is based on properties or population?).

    I don’t see why a 2 mil rollback wouldn’t be a benefit to renters. If landlords costs are lowered, why wouldn’t it help stabilize rents?

    Either way, I think what we should be looking for is an equitable tax equation.

    To see how much Ypsi individuals contribute in property tax, divide the property tax paid by a home/apartment by the number of folks living there. I’ve yet to find a rental property where the percent of property tax per person isn’t significantly lower than what me and mine contribute. Obviously, they’ll be exceptions (the homeowning family of 8 vs. a duplex with 2) but, in general, rentals are higher density with similar property taxes. My renting friends use the same city services I do and then some and contribute less for them. It’d be easy enough to check my theory if anyone has access to the data: Divide the total taxes paid by homeowners by the total population of homeowners. Do the same for renters. See where the burden lies.

    Always glad to help the councilman sleep at night.

  24. Citizen Blogger
    Posted July 12, 2007 at 1:10 pm | Permalink

    egpenet: “Why didn’t we pay AATA?”

    What do we not pay to free up money to pay AATA?

    This goes back to Mark’s original question. If there’s fat left, where is it?

  25. Posted July 12, 2007 at 1:21 pm | Permalink

    I guess if the strategy is to merely call those who aren’t in favor of the tax “disingenuous,” then this will be a short debate. Sorry Mark, I did try to answer your questions.

    Glen, you want to prevent “unsafe buildings and blight.” Isn’t that pretty much the only thing that Water Street has delivered to date? Drive by it, I did this morning. It’s nothing but urban blight with a huge metal fence in front of it, and there’s no plan to turn it into anything else in the foreseeable future.

    When you talk about spending a “few dollars each month . . . for adequate police and fire protection, you neglect all the other costs associated with an income tax. What about loss of equity in home values? What about loss of opportunities to attract businesses to the very Water Street project if it does get moving. How will we compete with neighboring cities that don’t present such hurdles to opening and maintaining businesses with an income tax? How will we attract additional development if we can’t compete? What about the intangibles? Don’t you count those as costs? Are do you simply ignore them to make your argument more palatable?

    Sacred Cow: Only two options? I’ve suggested a third as an example above. I’ve suggested others in the past, and others have suggested many, many more. Is it not fair to criticize City Hall for suggesting that we bear more of a burden while they haven’t been diligent in exploring and communicating all the options? Why do think we need to artificially limit our options to just two? Why continually frame the issue in terms of cuts and cuts only?

    While we’re on the subject of options, why haven’t the Blue Ribbon Panel’s Regionalization Subcommittee’s recommendations been adopted and pursued in full?

    Isn’t it a legitimate criticism that the rollback appears to be nothing more than a cynical push to get homeowners to adopt the tax by making it cheaper for them while not making it any cheaper for lower income residents who rent? The July 2005 Addendum to the Blue Ribbon Panel’s report specifically addresses the inequitability in using a rollback. City Council ignored this recommendation by the Blue Ribbon Panel in its chosen ballot language. I think it’s fair that you read it and justify Council’s disregard of it before suggesting I’m being disingenuous. It appears quite clear that Council’s own panel was ignored in favor of political expediency.

    The whole thread about discussing an income tax before Water Street fell apart for the second time appears to prove the opposite of what’s being argued. If the income tax wasn’t recommended until after Water Street was begun and after the first developer pulled out, then it appears pretty darn clear that the income tax push is motivated by the failure of Water Street and the ensuing revisions to expectations once the delays began. At that point in time, it was going to take longer, it was going to cost more, and there was no guarantee that it would generate what Biltmore thought it would previously. Remember that Water Street promised it would ultimately pay back its cost and provide benefits and opportunities on top of that. It promised increased commercial activity that would bring more revenue in, an increased residential draw that would bring more commercial activity, more commercial occupancy in the existing downtown area, and more. What was promised initially clearly did not happen as of 2005, thus the Blue Ribbon Panel and its recommendation.

    It’s cause and effect. Call it disingenuous all you like, but it doesn’t make it so.

  26. egpenet
    Posted July 12, 2007 at 1:46 pm | Permalink

    CB … according to BR’s post above … we had a 300,000 surplus we could have used to pay AATA what we owed. Is that a fact? I donno.

    This is a very UN-merry-go-round.

  27. Posted July 12, 2007 at 2:05 pm | Permalink

    What is scary is our own elected officials don’t know how tax dollars are being spent in the city or didn’t bother asking before blurting out the wrong answer. In fact city tax dollars were spent on the fountain. $40,000 of DDA tax money was pledged over 4 years. The rest of money of nearly $300,000 came from the library millage we all pay so that was also taxpayer money as well. Very little were private donations and those donations went to teh Tubman statue.

    When that money was pledged, we had budget surpluses and the city was supposedly making progress on Water Street. Water Street is a bust and facing more expenses like snow removal and sweeping of parking lots, the DDA is considering asking the library if they can spread the payments out over several more years.

    As far as the anti-income tax folks not making suggestions, they have. They have made numerous suggestions and each one of has been dismissed out of hand without any serious study or consideration by the status quo majority on City Council. The city council passed up the opportunity earlier this year to re-organize the Clerk and Assessing department that would have saved nearly $300,000 a year. Instead the council rushed forward hiring employees. This was exactly what the blue ribbon warned the council not to do.

    In July 2005 the Blue Ribbon committee wrote:

    “Moreover, when you have unexpected vacancies, before hiring a replacement, look towards regional cooperation to fill the need and save money for both organizations. This will be extremely difficult and the natural tendency is to say, “We don’t have time, we need this employee now,” and propose justifications for why cooperation will not work.”

    That is exactly what the City Council did. The council in November and again in February when they said we don’t have time to pursue regional efforts and on numerous occasions Schreiber and the city manager said regionalization won’t save money it is only cost avoidance. Then the Council rushed to hire a new clerk, taking three tries before they finally got one. Yet the Council had at least 6 months to look at the issue of regionalization and sharing services. There was no need to rush to hire a clerk, the County said they would help with the elections to give the City time to work on ways to save money and still provide clerk services.

    This was also from the Blue Ribbon report.

    “Since increased revenue from the state is not likely, perhaps the City and surrounding government entities could work with the legislature to create incentives for greater regional cooperation. Those incentives might include increased revenue for communities that form and implement strategic partnerships.”

    Nearly two years before the governor proposed the same thing in her 2007 State of the State speech. Yet from 2005 to 2007 the city has done nothing to help attain this recommendation of the Committee.

    The Council also has not put out the legal services contract for review despite recommendations from the Blue Ribbon committee that said all professional services contracts should be reviewed and put out to bid every three years.

    The three year time frame is a requirement in the City Charter for the City Auditing services and the committee recommended that all professional services should undergo the same review.

    Again since 2005, no review or RFP was let for the legal services or other professional services. Again that review should see significant savings but the Council has refused to even consider those recommendations from the Blue Ribbon committee.

    In 2005 the city council and staff told the citizens Blue Ribbon Committee on City Finance that there would be a $2.5 million dollar shortfall in the coming year. When the budget was done, instead of a shortfall there was a surplus and then Bill Nickels introduced a resolution tabling the City Income Tax for a year. Nickels justification a the time was that with the surplus it would be hard to ask for the voters for more taxes.

    Then in 2006, both the former mayor and then candidate Schreiber hammered at every candidate’s debate that the city was expecting a $1.6 million shortfall.

    Well here it is 2007-2008, and again the city just passed a balanced budget for the current fiscal year with no budget cuts and they again had surplus which they promptly spent. Over the last three years there has been a $2 million surplus.

    When I pointed that out, the former Mayor launched into a personal attack she and others accused me of declaring bankruptcy and hiding past financial skeletons. This was never true but it is much easier to launch into personal attacks than talk about the facts around city finances and budgets.

    During the City Council 2006/2007 retreat when the council was discussing the solvency plan, Gawlas proposed that the solvency numbers be changed so that the plan didn’t look so grim.

    You know if council can just change the numbers for the projections to suit their needs, then the best predictor we have is past performance. $2 million surplus over three years and no budget cuts for the coming year and substantial increases in discretionary spending in the most recent budget.

    If things are as dire as the current status quo are saying, then before the roof caves in, why aren’t they beginning to implement the solvency plan right now. Roger Fraser, City Administrator in Ann Arbor in May 2007 talked about good fiscal stewardship and how Ann Arbor is implementing their solvency plan to take advantaged of the greatest savings early on to gain the most benefit from the changes. The City of Ypsilanti’s response is the exact opposite. No cuts this year, in fact they had spending increases this year.

    The City doesn’t want to consider cuts right now during an election year because that would hurt the chances of a City Income Tax passing.

    So instead of making cuts and saving money right now to pay for Water Street bonds due in two years, the council voted to spend the surplus predicted for the coming year on pet projects hoping to curry favor with certain folks by telling them those pet projects will be cut in the solvency plan if you vote against the City Income Tax. While spending that surplus on pet projects the Council failed to fully fund AATA forcing AATA to dip into their reserve

    That isn’t good fiscal stewardship of our city tax dollars; that is playing politics with public dollars.

    If the City was really interested in hearing from residents they wouldn’t have canceled the only town meeting about the City Income Tax, then scheduled a City Income Tax Council Meeting at 7:30 in the morning, and then had the second vote on the City Income Tax on July 3rd, a meeting that the Council had earlier told the public they were canceling. The council changed their mind and never told the public. They voted on the City Income Tax on the night before the Fourth of July national holiday when most people are out of town or already have family plans.

    They aren’t interested in hearing other ideas; they have already made up their mind. They only see two options, cut police and fire or raise taxes. Their goal is to tell you why you need to vote for the City Income Tax and show you plans and budget projections about why the CIT is needed. Yet if you go by their track record over the last four years, they have never been accurate in their projections for revenue or expenses. So how can we trust them now?

    The current budget is $16.1 million. The Plante Moran study says the CIT will generate $4.1 million in annual revenue. That is a whopping 25% increase in tax revenue. The City says they need the CIT to make up the shortfall from ACH but by their own estimate that is at most $800,000. So what are they planning to do with the rest of the $3.2 million? They won’t say. In fact, two council members said they City should tell voters what they are going to spent the rest of the $3 million in new revenue.

    But notice what Sacred Cow tried to do, she is trying to deflect away from accountability demanding that the anti-CIT folks need to propose an alternative budget. We have made numerous suggestions and they were all dismissed with no serious consideration. But what is the City planning to do with the $4 million in new revenue. When asked, the status quo decided to not tell citizens how they were planning to spend this new found money.

    Hmmm, what are they trying to hide? Remember, it was the hiding of all the financials regarding Water Street that got us into trouble in the first place. Now they don’t want to tell you how they plan to spend the City Income Tax. Like I said, you can’t trust their numbers, they have never been right in the past, how can we trust them now?

    Cheers!

    – Steve

  28. Posted July 12, 2007 at 2:42 pm | Permalink

    Ed, you are exactly right. There were surpluses last year and this year, however the City did not fund the requested payment from AATA. Remember the total payment due AATA is about $260,000. But over the last several years AATA had already given the city a discount. So AATA was willing to accept payment of around $186,000 a year with no strings. However the city decided to cut that amount even more to around $130,000 a year.

    If the city would just make the additional payment (about $50,000) to get it to the $186,000 AATA would be happy and so would the city bus riders. But the City and Council decided to not do that. That was a choice they made in their budget priorities.

    Council cut AATA funding but gave raises to managers and senior staff above the regular annual increases that were already in the budget. They restored conferences, travel, training, and a bunch of other stuff that they had already cut years before. They also added money to the rainy day fund. They could have if they wanted to, paid AATA the additional $50,000 and everything would be fine with regards to AATA funding.

    So you don’t get to go to a planning conference in Lansing on the City’s nickel. The planner can still go to Lansing, and get paid for his time, the City is just not going to pay the registration fee or the mileage or hotel. The employee still gets paid to go. And we get to keep AATA going.

    But it much simpler to wack AATA funding, spend the money elsewhere, and then tell folks, if you don’t vote for a City Income Tax, we are going to cut the AATA funding entirely. Those are the punishment cuts you are going to keep seeing if the Council doesn’t get more taxes. They are going to punish you by cutting vital services to convince you, you need to vote for the CIT.

    Then they go out, without any approval by the Council, and spend money hiring private investigators to investigate police officers and city council members. Look at this mess over Mayor Pro Tem Trudy Swanson. Is the City now going to hire private investigators to investigate every allegation of misconduct by Council members? How much is that going to cost the city every year and how much has already been spent.

    Cheers!

    – Steve

  29. brian r
    Posted July 12, 2007 at 4:54 pm | Permalink

    Okay, let’s talk about the 67 percent rentals (by the way, does anyone know if that oft used percent is based on properties or population?).

    It’s based on population per the 2000 Federal Census. 67% of Ypsilanti households are renters. 62% of its residents are renters. And 63% of it’s occupied units are rentals. I’d give you a link to the data, but I don’t want to make you read it.

    I think what we should be looking for is an equitable tax equation.

    I love this. What happened to the tax needing to be fair? It’s now about tax equity. The homeowners are the ones carrying the load are they? Is that why they deserve the rollback? Everyone is equal in Ypsilanti, but the homeowners are just a little more equal? That’s rich.

    ***

    We have three and a half more months of this. At least we have our priorities straight.

    It’s still about spending the money you have wisely.

  30. Glen Sard
    Posted July 12, 2007 at 5:38 pm | Permalink

    brian r: “Everyone is equal in Ypsilanti, but the homeowners are just a little more equal? That’s rich.”

    Even with the rollback, homeowners will continue to pay property tax, yet renters, obviously, would not.

    If then, all Ypsilanti residents – renters and homeowners alike – are required to pay 1% of their income, how exactly is that unfair to renters?

  31. brian r
    Posted July 12, 2007 at 6:01 pm | Permalink

    Mr. Sard, you are correct in stating that renters and homeowners both would pay 1% of their respective incomes, but the homeowners would get to take 2 mils off of their tax bill. The end result is that homeowners pay less than renters.

    For example, let’s say that you and I both have the same job each with an adjusted gross income of $75,000. I live in an apartment, but you live in a house assessed at $60,000. Let’s also assume that we both have no dependents therefore making our exemptionss the same, or 1 each.

    I would pay 1% of $75K minus 1 exemption times deduction of $1000 or $740 per year. My effective tax rate would be 0.986%.

    You on the other hand would get to take an additional $120 (2 mils times $60K) off of your tax bill making it only $620 per year. Your effective tax rate would only be 0.826%.

    You, as a homeowner, would pay less than me, as a renter.

    That’s regressive and unfair.

    The City’s website links to my income tax calculators HERE. You can do similar calculations to see my point.

  32. egpenet
    Posted July 12, 2007 at 6:02 pm | Permalink

    While you guys are going back and forth with this ‘Who shot John’ nonsense, I’m standing at the railing of the footbridge behind Materials Unlimited watching the carp carry off the surpluses. It boggles the mind!

    If I was AATA … I’d be thinking how to get even.

    Water’s getting low …

  33. maryd
    Posted July 12, 2007 at 8:04 pm | Permalink

    And let’s not forget that the council can simply vote away the (carrot) property tax rollback when things get tight.

  34. Posted July 12, 2007 at 8:32 pm | Permalink

    Glen, you may want to familiarize yourself with the Blue Ribbon Panel’s Addendum dated 7/18/05 before commenting further. It states, in relevant part:

    “Care must be taken to ensure that the proposed income tax does not disadvantage low income tenants who may not benefit from a property tax millage reduction.”

    “A rollback of property taxes in conjunction with an income tax would result in an inequity in which poor individuals in Ypsilanti households pay a greater percentage of their income to the City to maintain city services than wealthier households whose members would benefit from a millage reduction. This feature turns the proposed income tax/rollback into a regressive tax, i.e. a tax that takes a larger percentage from the income of low income people than from the income of high income people.”

    If the city’s own Blue Ribbon Panel thinks a rollback is a bad idea, I’d love to hear why Council thinks it’s a such a good one.

    Click here to read it.

  35. Glen Sard
    Posted July 12, 2007 at 8:53 pm | Permalink

    brian r: I disagree. Since the 2 mil rollback would NOT be deducted from a resident’s income tax bill, but rather his or her PROPERTY tax bill… the two hypothetical people you cite would both pay the exact same amount of income tax. However, the homeowner would ALSO still have to pay a substantial property tax.

    Even with a 2 mil rollback, Ypsilanti homeowners would still provide the vast majority of the City’s tax revenue – the only difference would be that the burden of paying for City services would be distributed somewhat more equally among all the City’s residents.

  36. Posted July 12, 2007 at 8:58 pm | Permalink

    Or not.

  37. egpenet
    Posted July 12, 2007 at 9:13 pm | Permalink

    I’m taking a couple of Advil … I’ve got a headache.

  38. Pete Murdock
    Posted July 12, 2007 at 9:17 pm | Permalink

    I don’t know where one gets the idea that renters don’t pay taxes – Landlords don’t pay the property taxes out of their own pockets, but out of the rents they collect. The state of Michigan calculates property taxes to be 20% of gross rent. So renters do pay property taxes – and they are 18 mils higher because it is not a homestead property.

    The fact is that with the same income the increase in taxes paid to the City with the proposed City Income Tax would be higher for the renter household than with the homeowner household and in any event the average household would be paying 35% more to the City. HUGE whether you rent or own.

  39. egpenet
    Posted July 12, 2007 at 11:34 pm | Permalink

    OK … TWO more Advil. I can’t get to sleep.

  40. Ol' E Cross
    Posted July 12, 2007 at 11:53 pm | Permalink

    Pete and friends, I agree that renters pay taxes through landlords. But, can we agree that we don’t live in 16th century France where “landowner” equates aristocracy? I’ve got plenty of Ypsi swinging-single friends with large incomes who sock away far more in retirement than I can imagine who rent as a matter of lifestyle. And, the students. The vast majority who rent are doing so out of luxury to get away from parents and campus beer cops. I wanted to rent in college. I couldn’t afford to. I lived at home as are the majority of trully broke students.

    Yes, we have many low-income renters. But, we also have many homeowners losing their “palaces” to foreclosure. There are priveledged and poor on both sides of the lease/mortgage fence.

    Brian, you may be morally depraved, but I admit, you have a more natural affinity for numbers than I. If the databases spit out such stuff easily enough, would it be that hard to use my (or your superior) equation to figure out what the average home-owned-dweller pays in city tax vs. the average rental-unit-dweller to find out what equitable would be?

    And Brian, I know you’re not a word guy but last time I checked (just now) equity meant “1. Fairness; impartiality; justice.”

    So, the only thing that happened to “fair” was I used a synonym.

    If the homeowners are “carrying the load” a rollback that helped others “carry their share of the load” would, as I understand it, be “fair” or “equitable.”

    Let’s find out who’s carrying the load.

    Personally, I don’t need a rollback. As I said, I like Ypsi, I like the city services, I’m willing to tighten my belt to protect them. I prefer an overfunded city to an underfunded one. If the anti-tax folks issue is really one of tax equi… I , mean, fairness, then lets fix the inequity and pass the tax.

    For the record friends, I like and respect Brian Robb as I do (most) anyone who sacrifices time and energy for menial, local public service. Sure, I care about the tax thing. But, any impotent barbs I may toss are only because I think his civic bulk will delight in deflecting them. In my heart, I’m still talking to blogger pre-council Robb, if I need to change my tone now that he’s gone public, I trust he’ll tell me.

  41. egpenet
    Posted July 13, 2007 at 12:11 am | Permalink

    OEC … can I have my rollback PLUS your rollback? Maybe then I could get to sleep! Sheesh!

  42. Posted July 13, 2007 at 8:07 am | Permalink

    Thought the categories of “renter” vs. “homeowner” may be overinclusive or underinclusive to an insignificant extent when it comes to “low” vs. “high” income analyses, it goes without saying that a substantial majority of homowners are substantially above the poverty level, and a substantial percentage of renters here in Ypsi at or near the poverty line. College students may get help from mommy and/or daddy, but that doesn’t make it any fairer to tax them more than me while many of them are working their way through school.

    I’m with OEC on the lack of need for rollback. I don’t need a rollback (in fact since I pay income tax to Detroit, my potential tax burden in Ypsi is negligible), but I think we should all be offended that Council ignored the Blue Ribbon Panel and put a rollback into our proposed tax just to sell it. That’s putting it in for cynical political purposes, nothing more.

    I have a hard time swallowing the whining about humanitarianism and the impact of busing changes on the working poor from those that advocate that the working poor pay more than the homeowners in Normal Park and College Heights. It’s open hypocrisy.

  43. Posted July 13, 2007 at 11:56 am | Permalink

    With the millage roll back, non-resident property owners would see a reduction in their property taxes yet most would pay nothing in an income tax. That is one of the many problems with the property millage roll back and why it is unfair to renters and lower income households as well as unfair to homestead property owners.

    For example ACH/Visteon would see a reduction in their property taxes, both real and personal, yet because they are losing money, they would pay little to nothing in a City Income Tax. The City Income Tax shifts taxes away from businesses and puts more of the tax burden on homeowners and residents of the city.

    Schreiber in all his campaign speeches argued against the property millage roll back and instead he advocated for the minority report from the Blue Ribbon Commission which was supported by three members of the Blue Ribbon commission for no roll back and a 0.8% City Income Tax. Schreiber said the no-roll back on property taxes would be fairer to lower income folks and not provide a benefit to absentee property owners.

    After Schreiber took office, he flip-flopped on the issue and backed a 4-mill property tax reduction and ultimately voted for a 2-mill roll back.

    Ypsilanti is about diversity and embracing all sorts of people from diverse backgrounds and socio-economic means. It seems like the pro-income tax folks want to divide the city into the haves and the have-nots. These folks seem to be arguing that homeowners are more deserving of special tax breaks which is what the millage roll back is, a special tax break. At the same time trying to argue that renters and homeowners pay the same, when Schreiber’s own analysis of the City Income Tax shows that is not the case.

    If this issue is about equity, then the City Income Tax is not the solution. But the city council did not vote to put a equity tax on the ballot they even canceled the only town hall meeting to talk about the City Income Tax and any other alternatives. Council in a 4 to 3 vote voted to put the City Income Tax on the ballot which even by the Mayor’s own report shows that the CIT will increase the disparity in our community.

    So if the issue for you is equity and fairness, than vote no on the City Income Tax.

    Then let’s sit down together and get serious about working on a system that is more fair and can provide the level of funding to provide city services. The City has never given citizens opportunities to discuss or work on other ideas; their single minded focus for the last 3 years has been a City Income Tax.

    In November you are being asked a simple question. Yes or No on a City Income Tax. The city’s own data shows the CIT won’t fix the funding problems, it gives tax breaks to the rich and absentee landlords, it unfairly burdens a majority of folks in the community who can least afford to pay a new and higher tax, and it will discourage new home ownership and investment in our community.

    Cheers!

    – Steve

  44. egpenet
    Posted July 13, 2007 at 1:23 pm | Permalink

    My headache is gone.

  45. rodneyn
    Posted July 15, 2007 at 10:58 am | Permalink

    Are there other savings to be found, besides cutting police and fire services?

    Absolutely. Before I would consider an additional tax, I would want to see a virtually empty City Hall that is only open for limited service on a part-time basis. It would be better to pay the County for assessing, payroll and benefits, clerk/election functions, and other services.

    Planning/Development/DDA staff should be reduced or eliminated entirely. Their minimum necessary functions could be provided by a consulting firm on an as-needed basis at a significant overall cost savings (and with more consistent results!). I’ve heard the oft-repeated argument (mantra) that the Planning and Development Dept. and DDA staff are essential to the future of the City because they are responsible for economic development. Unfortunately, it is these same departments that are largely responsible for the deplorably poor handling of “economic development” projects downtown that has brought the City to its financial knees.

    Unfortunately, Mr. Koryzno and City Council have taken the “slow-death” approach – protecting as many jobs as possible each year by making only minimal labor cost reductions. How much better off would we be today if the City had made the hard decisions to empty City Hall back in 2002 or 2003?

    How much could the City earn from renting various City Hall offices as a business incubator?

  46. Sacred Cow
    Posted July 16, 2007 at 9:16 pm | Permalink

    First, I appologize for belittling the suggestions to balance the budget coming from the anti-tax crowd. I’m sure some of them are plausible, and certainly ought to be explored by City Staff. I’m in favor of literally any suggestion that may bring the city additional revenue. At the same time, however, it would be irresponsible for city staff to take potentially far-fetched ideas for new revenue, and actually incorporate them into budget projections. The Solvency Plan seems to represent what will happen without any new sources of revenue to the city. While new sources of revenue are plausible in the future, it would be absurd for city staff to budget for unknown, yet potential sources of revenue. I tend to think of the Solvency Plan as the worst case scenario, and hope natural circumstances would help alleviate it to a small extent even without an income tax. But I’m sure as heck not going to vote NO on this thing, only to keep my fingers crossed that we find some miracle revenue source that fixes our problems. As Ol’ E suggests, I’d rather pay to keep services high than to watch services go down the dumps just so I can selfishly save myself a couple of extra bucks.

    The budget projections that have been put forth (and I know the anti-CIT crowd doesn’t trust them) seem to suggest cutting Police and Fire will at some point in time be inevitable. Some of those charts presented (don’t even remember which one) show a deficit of $4 million or so within 5-6 years when Water St. debt payments are incorporated, and assuming no income tax. I don’t know how many times it needs to be said, but you can eliminate literally every single City Hall position beyond those required by the charter, and you still wont come close to bridging that gap. And that’s seperate from the fact that the very idea of eliminating city hall is pretty absurd. Every one of their jobs will in one form or another need to be contracted out to someone, meaning cost savings will be fairly negligible in the long run. Privatization is far from the panacea some here pretend it to be. And if you don’t contract out their work to someone, then you’re doing nothing but reducing service provision to this city in one manner or another. I know it’s easy to cynically sit on the sidelines and proclaim our Planning Dept. is worthless and we’d be no worse off without them, but I hope most people see beyond this ideological rhetoric.

    And enough talk about these surpluses of the past several years, as if we’ve been running in the black without the need of any cuts. I would suggest those making such claims to take a trip to the Senior Center or Parkridge Community Center and tell the folks working down there that we’ve made no significant cuts over the past 5 years to balance our budget. Somehow I think they’d be signing a different tune.

    At the end of the day, I’m with Old E. I don’t want to pay a penny more in taxes, but I want even less depressed city services that erode the state of our city. I have zero doubt that reduced Police services will have a FAR greater adverse impact on city property values and quality of life than an income tax. While I recognize the sideline City Manager’s here are flush with ideas to balance the budget without sacrificing anything, the reality is they have no authority in this process. We can lament the proposals of our current city staff all we want, does it really change the fact that the proposals will likely be implemented if the income tax fails?? For better or worse the city staff and Council we have now are we’ve got. They’ve told us what will happen without an income tax, and offered the income tax as an alternative. Would I prefer a third option? Absolutely, if a plausible one actually existed. But no one here is in a position to do anything about it. Until I can hear a practical answer as to how we achieve that solution (beyond just complaining on a blog), I will have to decide between the better of two bad options being presented by those actually in authoirty. And there is no doubt in my mind that our community is better off with quality services and additoonal taxes then we will be with the status quo in taxes and lousy service provision.

    P.S.- In response to Mr. Robb’s rebuttal about the salary survey. It was my understanding that the survey was conducted by the city and the County, not through MML. Of course I’m not privy to the resutls of that study without some serious haggling at city hall which I’m not about to do. Perhaps you could be so kind as to provide us with that information, as I’m sure you can get it much easier than any of us.

  47. Ol' E Cross
    Posted July 16, 2007 at 11:28 pm | Permalink

    I think I should warn Sacred Cow (admittedly, I’m making assumptions about screen names here), that most of my disposable income is spent on Sacred Cow.

    The rest is spent on gasoline.

    If the tax passes, I may have to reduce my consumption of gas or cow.

    Fortunately, I can walk to cow. To be fair, I’ve tried drinking gasoline. Once for ounce, it’s more affordable and, at first, does the trick, but it also gives me the shits. Sorry Boggs…in these tough times, a fella has to prioritize.

  48. brian r
    Posted July 17, 2007 at 11:00 am | Permalink

    Unless we change the way we deliver services as a City, we are going to cut those services whether you support an income tax or not. That is the cold, hard reality of all this that everyone needs to embrace. Now.

    The pro-tax members of Council are proposing to offer a millage rollback and increase City services as an incentive for voting yes on taxes. The problem with that is in order to deliver those increased City services, the City will have to deficit spend and use massive amounts of reserve in order to make those promises a reality.

    In the very first year of an income tax, the budget calls for spending $1.7M above revenues with the income tax making up that difference. Sounds reasonable, but by the third year of the tax, the deficit spending equals the income tax revenue. By the fourth year, the deficit expeditures are $1.4M MORE than the income tax generated. The general fund reserve will be completely gone at this point.

    In the fifth year, the City will spend $2.2M more than revenues PLUS an income tax. That means that these massive cuts that everyone is worried about and are hoping an income tax will prevent are coming in a huge way. The only difference between that and no income tax is that in addition to serious cuts to City services, you’ll have an income tax.

    The only way to be fiscally responsible to continue to cut whether we have an income tax or not. In addition, we must begin to explore new ways to deliver services — something we have been neglecting to do for the past five years.

    As someone who is against the CIT, I can only repeat over and over that it’s not about generating more revenue, it’s about wisely spending the revenue we have.

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