City Town Halls Begin Tuesday; State Revenue Sharing Reauthorization Eyed

Sales Tax Cut, New Levy on Services May Bail Out Michigan Local Governments

January 14, 2007
By: Dave Rogers

Bay City Mayor Mike Buda brought home fried chicken from the Urban Core Mayors meeting in Detroit last week.

The takeout is just in time for the Town Hall meetings starting Tuesday at 6 p.m. at the Bay County Community Center in Veterans Park.

And maybe the mashed potatoes will help the city deal with a projected $1.1 million general fund deficit projected for the coming year that may result in layoffs of city personnel.

The crispy stuff from Mayor Buda got the attention of City Manager Robert Belleman and city commissioners. In the box were goodies that may help bail out Bay City and other local governments facing financial crisis.


The mayors heard that Republican Senator Ron Jelinek of Three Oaks indicated "officials should be willing to look at a broadened sales tax on services combined with a lower sales tax rate."

The influential senator said: "A mandatory tax increase, such as an income tax increase, will not be popular, but a sales tax on services might work because it is more of a voluntary tax."

At the same time, officials heard that the Michigan Municipal League is pushing a restoration of full state revenue sharing. Declines in revenue sharing over the past four years, cuts escalating to about 60 percent of previous fund totals, have squeezed cities:

Alpena has reduced police officers and firefighters;

Grand Rapids eliminated 192 positions;

Pontiac has vastly reduced services and is selling several city-owned buildings;

Ypsilanti eliminated recreation programs;

Mt. Clemens eliminated its police department.

Across the state there are nearly 1,600 fewer police officers and 400 firefighters on duty.

Other Town Hall meetings are slated 6 p.m. Wednesday at St. Hyacinth Field house, 6 p.m. Thursday at City Hall, Jan. 30 at 4 p.m. at City Hall for the public and businesses, and 7:30 a.m. Jan. 31 at City Hall for businesses.

The city's Human Services Committee is hosting a Martin Luther King Jr. recognition reception at 5 p.m. Monday in room 317 at City Hall. The meeting is open to the public.

Meanwhile, Mr. Belleman apparently has recalculated the unfunded pension and health care liabilities that he estimated earlier at $60 million. The latest figure he is using is $25 million.

City commissioners will have several Town Halls under their belts when they reconvene Monday, Jan. 22 in finance and policy session.

Commissioners will soon be presented a recommendation to sell parcels in the South End Subdivision. City staff will be exhibiting at the 31st Annual Home Show hosted by Bay County Home Builders Association Feb. 16-18 at the DoubleTree.

The city may soon have to deal with another new issue: Redevelopment Liquor Licenses. Although the city has tried to limit liquor licenses on grounds there are too many bars, the Michigan Liquor Control Commission has been authorized by the Legislature under Public Act 501 of 2006 to issue new public on-premises liquor licenses to local units of government. These licenses are targeted for development districts such as DDAs, TIFA (tax increment finance authority) or principal shopping districts for dining, entertainment and recreation establishments.