On November 5th three seats will be up for grabs on the Saginaw City Council at a juncture that is perhaps one of the most critical in the city's 154-year history. Beleaguered by escalating crime rates, declining property values, and intransigent unions, the one thing that Council distinguished themselves with since the last election four years ago was to cut services such as leaf-pick-up, code enforcement, and public safety in order to accommodate a general fund budget that currently is carrying $332,183,328 million in unfunded liabilities for three pension & legacy funds: Retiree Health, Police & Fire, and MERS, which covers all other city employees.
Considering that 70% of the general fund budget goes to public safety, with a majority of that being dedicated to legacy costs, is it any wonder or surprise that city governments have hit the wall of unsustainability?
In the Council's defense, when they recently attempted to move all City retiree's health care plans from 24 different plans down to one - a move that would have reduced health care cost by over $3 million a year, the retirees filed a civil suit, thereby halting that change in health care.
And so it is against this backdrop that we present the 2013 Review Saginaw City Council Candidate Forum, arguably the most detailed and in-depth discourse amongst council candidates that you will read or hear prior to election day.
The field is a large one consisting of 19 candidates: Michael Balls, Jeff Bookmyer, incumbent Dennis Browning, Ed Brown, Clint Bryant, James Carthan, incumbent Larry Coulouris, Charlotte DeMaet, Lauren Frey, Mark Johnston, Rahmaan Kelley, Bicardo Longoria, Cirven Merrill, Brenda Moore, Dawn Morrell, James Nightingale, Rod Pritchett, Demond Tibbs, and Thomas Winn.
The Review presented three questions to the candidates over 3 weeks ago and ten of them took the time and thought necessitated to properly respond to these questions, which are not easy ones. Each candidate was given up to 500 words per question to state their position. The candidates that failed to respond were: Mike Balls, James Carthan, Rahmaan Kelley, Ricardo Longoria, Cirven Merrill, Brenda Moore, Dawn Morrell, James Nightingale, and Rod Pritchett.
The responses are complete and unedited. Where appropriate, I have interjected an editorial commentary note. Hopefully this forum will assist in building an informed citizenry come election day.
Review: Please state your personal & professional background in terms of how you feel it best qualifies you for this position and what are your top three goals should you be elected to City Council?
Bookmyer: Currently, I have been the Market Master/Operations Manager for the Downtown Saginaw Farmer's Market for the last three years. Previously I was the Lead Community Developer with Healthy Community Partners, primarily working in the Cathedral District. In that position I worked with many dedicated, hard-working neighbors to facilitate positive changes and helped connect neighbors with one another at neighborhood association meetings, annual picnics, cookie bakes and swaps around the holidays, and published a neighborhood newsletter that had a circulation of over 1,100 for a period of ten years. I also supervised three other Community Developers that assisted neighbors in other neighborhoods and helped several neighborhood associations in the formation process and facilitated strategic planning sessions and conducted Asset Based Community Development training sessions.
In my adult life I have lived half of it on the west side and half on the east side which helps give me a healthy perspective on what some of the issues are in our city. At the ages of 22 and 24 I ran for City Council which led me to get involved with several community and business based organizations, they include, but are not limited to: Human Relations Commission; The Dow Event Center Advisory Board; Cathedral District Planning and Development Council; Cathedral, Northeast, Houghton-Jones, Covenant Neighborhood Associations; The Saginaw News Editorial Board; Citizens/Police Advisory Council; Board Member of Neighborhood Renewal Services of Saginaw, Inc.; Member and former Ambassador for the Saginaw Area Chamber of Commerce; Cathedral District Historical Homes Tour Committee. I have studied Saginaw's past, lived in the present and am concerned for its future.
My top three goals if elected are: 1. Have state legislators pass a bill for non-residents to pay 1.5% in income tax, which will bring in millions of dollars in revenues to address many issues facing our city. 2. Deed the necessary land to the Downtown Saginaw Farmer's Market at their current location so that they can build a permanent pavilion/structure. Currently it is on the “medical mile”, and the foundation of healthy living is healthy foods. Having worked at the market for the last three years, I know the importance of how it helps bring the whole community together. In the past it has been a municipal venture, but now it is functioning without monies from the city's general fund, being run by a competent and committed non-profit and it is flourishing. As a city councilman I would have to recuse myself from the vote, but it is a move that is crucial to continued downtown development. 3. Work together as a community to stop the violence that is wreaking havoc in our city. There will be no easy solutions to this very serious issue, but it is one that we must address collectively to get off the #3 most violent city per capita list that we are currently on.
Browning: My wife, Sue and I have lived in the City our entire married life. We raised our 3 children here and have chosen to remain residents. We worship at Peace Lutheran Church and enjoy many of the things Saginaw has to offer. I'm involved with the local chapter of the American Red Cross as an instructor, am past president of the CAND Council, past president of Peace Lutheran School Board of Directors, and currently serve as chairman of the Supervisory Committee of Family First Credit Union. I served for over 30 years as a Saginaw Police Officer. My career included service in patrol, investigation, school resource officer program, and I was coordinator of Crimestoppers. I was a City Council member from 2000 to 2004 and was re-elected in 2009 and have served the past two years as the Mayor Pro Tem.
(Editor's Note: Top 3 goals not stated by Browning)
Brown: I am a lifelong resident of the City of Saginaw. I have raised two children here and my wife has raised her two children and now together we are raising our two children that we adopted here. Between the two of us we own 3 homes in the city. I worked for over 25 years for the City of Saginaw in different jobs in different departments, the first being a service man for the garbage trucks and the last being the chief foremen in the water & sewer department until my retirement in February of 2012.
During that time I held several position's including president, vice president, steward in two different unions which allowed me to come to the table as chief negotiator and work with 8 different city managers, several directors and department heads about a lot of different issues including negotiating many contracts over the years. During these times I earned a reputation as a person that got it done, that I was fair and I would listen, was not afraid to make changes nor was I afraid to stand up for was right and at the end of the day we were able to get things done and make the city better because of it.
I have worked with many different organizations and people on a lot of different projects in the city like Friends of Hoyt park, Veterans Plaza, Temple Theater, Habitat for Humanity to name a few and my reputation with all of them was I got the job done whatever it was that was needed with in the city. So with all that said I believe I can bring a lot to the council table and will be able to bring knowledge to the conversation and with the help of the other 8 council persons we can bring this city back to what it once was.
Goal 1: To hire the best city manager we can
Goal 2: To clean the city up and make it attractive and safe again
Goal 3: To bring business with jobs back to the city
Bryant: Through my experience working in several nonprofit organizations in our City and across our region, I am familiar with maximizing impact with limited resources. As labor leader I have negotiated in the public and private sector. After attending Pensacola Christian College, I came back to the City of Saginaw to help facilitate positive outcomes in the lives of the Citizens of the City of Saginaw.
My top three goals to “Improve the Quality of Life” in the City of Saginaw are 1. Public Safety: We must fully fund our first responders who work in one of the nation's 3rd highest city crime rates per capita. We need to take full advantage of all available grants that will help aid our first responders. With the declining population and a shrinking tax base, we must be able to ensure the safety of our citizens and the safety for guests across our city especially in our Old Town Business District and our Downtown area.
2. Economic Development: As a lifelong resident of the city of Saginaw I remember growing up in a city with a thriving economy. Having lived as a child near the GM Malleable plant on the city's southwest region, I recall the hundreds of cars that would fill the parking lot, the thousands of families that benefited from having those jobs within our city and the neighborhoods that were flush with property owners who were vested in the maintenance their homes. To expand economic growth in the city we must reach out to our Business community, offering them safety and fostering the entrepreneurial spirit of the citizens. We must promote business investment in our city. In effort to bring jobs (good paying jobs) back to Saginaw we cannot stifle growth by imposing new and higher taxes on potential employers. We also must diversify our economic development. We cannot afford to just have jobs in manufacturing alone we must encourage jobs in all industries.
3. Troubled Youth: Having worked for Saginaw Public Schools, I have mentored students at all ages and economic status. We must educate our children concerning the rich heritage of our city. Often times it just takes a listening ear to make the difference in the life of a child before they fall prey to drugs and violence.
The adage that, “it takes a village to raise a child” has never been truer than the current time we live. These are our children and the next generation of our city.
Coulouris: 45 years self employed in the hospitality business gave me an insight on how to treat people. At the end of the day a small business is no different than a large business. On the civic end I'm finishing my second term on council. I'm also very active on three neighborhood associations because I believe in the concept. In the late 90s I served on the City Planning Commission and also served on the Saginaw Charter Commission.
My top goal is stabilization in all areas of the city. You can say we want to improve, which is great, but we don't want to sink any deeper. Part of stabilization can be achieved by being more aggressive to collect monies that are due us. We make it relatively easy for people to avoid paying monies they owe us. We need to play hardball when it comes to collecting money from people that are avoiding their obligations. They call it revenue enhancement, but we need to adopt stiffer fines and penalties in other areas than income tax collection. My second goal is blight elimination. For years now we've said the top goal is public safety, which it should be; but to do that it takes money, which comes from property values. Inadequate code enforcement reduces property values. If you have an out of town landlord they should have a local agent. If you have an out of town landlord, whom do you contact if they refuse to fix the problems? Can we refuse to sell them water if they refuse to fix the problems with their property? I feel strongly about this. Why should we let out of state owners collect rent, but not maintain their property? This is a simple tool and a simple solution. If they don't register their property, we don't sell them water. My third goal is to collaborate with Saginaw Future to enhance our economic base. We need to strengthen the city's relationship with neighborhood associations, which are a very valuable tool. I also think we need to reinstate community police officers, which is something that worked. The neighborhood associations need to be given hope.
DeMaet: As a lifelong resident of the city of Saginaw, my personal and professional background is that I am a concerned citizen that wants to improve this city by using my top three goals as a priority. My main goal is to get more police and firemen out on the streets of Saginaw. My second goal is to rescind the residential living of Saginaw city employees to actually live in the city. (Editor's Note: The ability to do this was pre-empted by State Law under the administration of Governor John Engler). They will no longer be able to live in the Township. A small increase in the Tax Cap to put more police and firemen back on the streets of Saginaw, and this increase will be only for Public Safety.
Frey: I have a BA degree in Economics from Wayne State University. As a personal financial advisor, I spent over 20 years working with and advising clients how to achieve their financial goals. Additionally, I served over 20 years in the U.S. Army. I know how to get the mission accomplished and work within governmental parameters. I served as the treasurer of Redford Interfaith Relief (the food pantry in Redford Township). In total I have over 15 years experience as a church finance chairman, currently serving at Ames United Methodist Church here in the city of Saginaw. Finally, I am on the board of directors for the United Methodist Foundation of Michigan where I serve as audit committee chairman and on the investment committee. With my extensive background in budgets and money, I will bring valuable insight to the city council for the residents of Saginaw.
Johnston: As a married father of two raising a young family in Saginaw, my concerns for this community are likely the same as the bulk of our citizens. I simply want to see Saginaw return to being a proud city that provides a safe place for all our residents to live, grow, learn and prosper.
My background is pretty varied but predominantly Project Management and Management/Supervision. That being said, I don't think there is any particular professional background that would make one better suited than another to serve on City Council. The Council deals with a wide range of issues that cross many disciplines. We simply need a group of level headed individuals, without personal agendas, that understand the issues facing our city, have the ability to analyze problems, propose and review potential solutions, and make the decisions that are in the best long term interest of the City and its residents.
My primary goal is for continued economic development and growth. The increased tax revenue that growth brings is what's needed for a true recovery in Saginaw. However, for that to occur, we first need to address the crime issue facing our city. We have some good things happening. There is development occurring, bight is being addressed through recent grant monies and we have a balanced budget, but we need a better long term solution to how we fund and staff our Police Department.
Tibbs: I have been a practicing attorney for 10 plus years. I currently serve as an assistant prosecuting attorney for Saginaw County. I previously served as an assistant prosecuting attorney for Wayne County (Detroit) and worked for a law firm that advised small to medium sized business. I have a Bachelors degree in Public Administration/Political Science from Western Michigan University, a law degree from Thomas M. Cooley Law School, and completed coursework necessary for a Masters Degree in Administrative Sciences from Saginaw Valley University.
I believe this educational background and work experience makes me uniquely qualified to assist in addressing two issues that concern Saginaw Residents - crime and economic development. I have been fighting crime for almost 10 years in two of the most dangerous cities in country, according to FBI statistics and have experience with advising job creators.
We have to put public safety first and support our police officers. If the budget doesn't allow the City to maintain or hire additional police we have to be creative in attacking our crime problem. As an assistant prosecuting attorney, we often prosecute criminals who are already on probation and commit another crime while on probation. The state funded program closely monitors probationers and hands down “swift” punishment for probationers in the program. Other counties, including Wayne and Genesee, have adopted the “Swift and Sure Program” and it has been proven successful.
Second, I would also like to better the city neighborhoods by building on what Covenant Neighborhood Association and other neighborhood associations have done with their “Crime-free Lease Addendums”. “Non-owner occupied properties” are increasing in Saginaw and in some areas as high as sixty areas. In many cases, crimes and nuisances occur at these properties or the properties are not maintained to same degree as “owner-occupied properties.” I would like to see the city adopt an ordinance similar to the ordinance adopted by East Lansing. In East Lansing, if there are three or more complaints from a “non-owner occupied property” in a year, then the landlord could have their license to rent revoked. It requires property owners to be more vigilant with whom they are renting and requires to tenant to maintain a level of decorum that is equivalent to their neighbors. I believe such ordinance would prevent frequent police visits to the same property and increase the quality of life for the neighborhoods.
Third, I would like to see more strategic use of federal grant funds being used to demolish homes. Schools and churches are the foundation for neighborhoods and is what families look for when looking for a place to live. Rather than indiscriminately demolishing building, I believe there should be a plan to allow adjacent property owners to purchase the “soon-to-be” vacant property. I would like to see the process be modified so that it would only take days rather than months. The city would not have to worry about maintaining the property and the city would be able to collect property taxes on the recent purchased property.
I am married with the three kids. My wife has been teaching in the Saginaw Public School System for 10+ years. Neighborhoods are important to my family and me. We have an invested interest in the city's neighborhoods.
Winn: What experience best qualifies me for City Council position is my extensive experience in the Public Sector working for municipal and state government. I am currently employed by the Michigan Department of Corrections as a Deputy Warden. In this capacity I oversee a multi-million dollar operations budget along with a couple hundred employees, which involve several union contracts. I am also a 1st Sergeant in the United States Army reserve with 23 years of Military Service. Responsible for a Company of Drill Sergeants and equipment to complete the mission. I have been deployed to Afghanistan and completed a number of difficult missions in which I have been awarded the Bronze Star for exemplary performance of operations in a combat zone. I am a natural leader with numerous years of professional training in management.
I Graduated from Saginaw Valley with a BAS in Criminal Justice with a minor in Political Science.
I am also a Graduate from Delta community college with an associate in applied science. These are just a few things in my personal and professional background that best qualify me for the position of city councilman.
Review: As a city councilperson, you may be called upon to address the sustainability of the city's ability to honor its pension and other obligations to city government employees and retirees. With regard to these legacy costs, please state the actual amount of these accrued obligations as of FY2012, the amount by which these obligations exceed current funding available to pay for them, and what steps, if any you would support to solve the unfunded liability crisis apart from cutting services and increasing taxes and fees, which is what the Council and City Manager have done in recent years.
Bookmyer: According to an M-Live article on March 20, 2012, Timothy Morales stated that current legacy costs were $19.8 million a year. (Editor's Note: M-Live & Morales are wrong. For Saginaw County government it is $20 million. For the City of Saginaw all three pension funds are unfunded to the tune of over $300 million dollars - see Dennis Browning's breakdown below). As far as addressing this issue, it is one where the collective experience of the new council would have to come to a consensus and deal with it on a fair and consistent basis. I recall Earl Jesse speaking before this issue on many, many occasions with no answers from the council. It is an issue that will not be easily remedied and will require much discussion with members of the council, management and input from our citizenry. Part of the funding could come from the increased income tax base when non-residents start paying the 1.5% tax rate that resident now pay. There are no easy or painless solutions, for this issue, but if we work together, I am confident that a satisfactory solution can be found.
Browning: We break Unfunded Liability down into three areas: Health Care, Police & Fire Pensions, and MERS Pension Plans (all other city employees). Retiree Health Care unfunded actuarial accrued liability is $201,433,114, Police & Fire Pensions are $57,127,256 (these are 67% funded and the number listed is the unfunded portion) and MERS is at $73,622,958, which is 48% funded and this number is the unfunded portion.
So how do you meet the obligations without raising taxes? Recently, the Council attempted to move all City retiree's health care plans from 24 different plans down to one - the one that current City employees are on. This would have reduced our health care cost by over $3 million a year. Retirees have filed a civil suit, thereby halting that change in health care.
Saginaw cannot afford to have an emergency manager or to file bankruptcy. We will continue to work on reducing the unfunded liabilities in any way we can. I don't have all the answers, but I'm willing to think outside the box and listen to new ideas.
Brown: The city's overall pension & opeb Assets are $189,064,879 for 2012. Actuarial liability for 2012 was $521,248,207 and was underfunded by $332,183,328 according to the city's dashboard. In my opinion these costs we cannot walk away from, nor can we be denied them. We must find ways to fund them. I would like the to city to look into whether or not we could bond them out like the county is going to do and then somehow take the payments out of our existing budgets.
Bryant: Recently a dear friend of my family passed away from a debilitating disease. While she was fighting for her life there were changes imposed to her healthcare and the health care of her family. As a labor leader I have been able to bring parties together to turn a contentious issue into a positive outcome where equal parties' benefit. We must collaborate and have the open discussion concerning the city's promises to its employees, employees who have dedicated much of their lives to providing superior service to the Citizens of this City. One of the factors that we must address is the fact that our city is no longer a city of 100,000 plus residents, we are currently looming around 51,000 residents. The unfunded liability amounts for the city fluctuate. The fiduciary funds are approximately $113,000,000 in unassigned fund balance.
Coulouris: That's a tough one. First, this didn't start yesterday it began with General Motors. The contracts we developed with staff had to be in step with GM otherwise we couldn't get anybody to work with us. GM went bankrupt and I hope we don't. You have to honor certain contracts, but if there's a problem sustaining that then I don't think it's the city council's position but the personnel department that needs to develop a compromise. I don't know how you're going to take care of a $211,000 million unfunded liability. Are we any different than other cities regarding this? If the unions can't compromise then the alternative will be do take more drastic steps, which is happening in Detroit right now. But to take something away that was agreed by contract is a difficult situation. Being tyrannical about it isn't the answer.
DeMaet: I feel that due to General Motors leaving the Saginaw area and the fact that city employees can live in the township we have lost our tax base on these 2 facts. We can not do anything about General Motors leaving, but we can get our city employees to be city residents again by rescinding the ordinance that allows them to live in the township. If you work in the city you should support the city by living there, paying taxes and voting. Another thing we can do is to start taxing those residents who own businesses in the city who do not currently pay city taxes.
I feel everyone who works and resides in the city, should all pitch in to help each other and pay their fair share of taxes.
Frey: Obligations were made to the employees of this city, which need to be honored. However, when retirees refuse to work with the city to save money on insurance costs ($2-4 million per year) it makes it difficult to maintain services to current residents and benefits to current employees. Of course the unabated rise of health care costs continues to put severe stress on all plans.
Johnston: Of the multiple different pension funds, I believe the total combined unfunded balance to be in the neighborhood of $189 Million. You can understand the magnitude of the burden this has on the city when you consider that approximately 70% of the General Fund budget is allocated to Public Safety and then the majority of that 70% chunk goes to these legacy costs, not current Fire and Police salaries. This issue is not unique to the City of Saginaw and options are limited in how to resolve the issue. Increased revenue through economic growth will help but more will need to be done. Continued conversion from Defined Benefit to Defined Contribution plans is an option. I know this was recently pulled off the table do to interest rate issues, but I'll be interested to see how Saginaw County's bond issue to deal with their unfunded liabilities ultimately plays out.
Tibbs: I believe we should do all we can to support our current and retired police officers. Police officers and teachers are the backbone for any city. Police Officers and teachers should be treated with a certain level of deference. Officers put themselves in harm's way on a daily basis and we should do everything we can and consider every option to support them.
I believe the city should consider utilizing Public Act 329 of 2012. It would require collaboration between City Council, management, unions, and Saginaw residents.
In sum, it would allow the city to finance the cost of funding pensions and healthcare for retired police officers. The Act was specified design by the Michigan Legislature to address this issue. Before the Act, it was illegal for cities, like Saginaw, to finance such a debt. Ultimately, according to the City's Charter, it would be for Saginaw resident to decide with a vote. If Saginaw qualifies and it makes sense financially, I would support it. According to the 2012 budget, the unfunded liability is estimated at over $215 million.
Winn: Although I have reviewed the FY 14 budget it is over 300 pages. Although I consider myself competent in all areas, I am not a CFO, I do know that with the proper direction that I am capable of making an educated decision on the legacy cost, the obligation by law behind the cities responsibility to its retirees. The second part of that question is that without new revenue coming in there may not be any other choice but to cut services and or increasing taxes. That's the reality of the situation and one of the challenges I look forward to addressing
Review: The people of the city voted in the property tax cap, without an inflation adjustment, in 1978. Voters have voted 'no' in order to retain the tax cap every time the city council has put the matter on the ballot since then, most recently in 2009. However, since 1978, the city has increased the city income tax rate to the maximum rate allowed by Michigan law, shifted the costs of such essential city services as mass transit, garbage pickup, and much of law enforcement from the general fund to special millages on property, which are the functional equivalent of property taxes. Property tax payers now pay approximately 5% of the value of their property in property taxes alone. Please state the face amount of the current property tax cap, the property tax burden that you think is fair, the amount you paid in property tax in 2012, and whether you would vote for a tax increase as a city councilperson.
Bookmyer: The vote of the tax cap that was enacted by the voters in 1979, when I first ran for City Council capped the property taxes at $3.85 million per year if my memory serves me correctly. The tax cap has been circumvented by adding on new millages to fund essential city services as stated in your question. I feel the amount of dollars should be raised, but only by a vote of the citizenry. The Headlee Amendment would prohibit the raising of property taxes by way of raising the millage amount. The dollar amount of property taxes I paid last year was $1331.
Browning: Citizens of Saginaw have endorsed a special milllage of 7.5 mils for public safety. But as the tax base goes down, the amount received also is reduced. The double tax cap has limited the services that a community of 51,000 people should have. We can only work with what we have. If revenues go down, so must spending. Public safety is still a huge concern for citizens, but there are also other services that make up a good community.
Brown: The Saginaw City Charter has two tax caps in place since 1979. There is a dollar cap and a millage rate cap. City operating tax collections are limited to $3.8 million dollars or 7.5 mills whichever is less. Most city charters have a millage cap in place, but if there isn't one, state statute allows up to 20 mills. The dollar cap is unique to the City of Saginaw and as far as I am aware does not exist anywhere else in the country.
As property values rise, the millage rate is lowered to keep collections under $3.8 million dollars. This happened up until 2008, but then property values started declining drastically. As property values decline, the millage rate is increased up to 7.5 to levy up to the $3.8 million. Because property values have fallen so drastically, the city is currently levying the maximum 7.5 millage rate and only levying around $3.7 million dollars. If property values continue to decline the city will continue to collect less than the $3.8 million because of the 7.5 mill cap.
An example I like to use is this...If a company moved its headquarters to the City and built a $500 million dollar building, the City would not collect a dime more in property taxes. The millage rate would be reduced for everyone to stay under the $3.8 million dollars, so with that said and some provision put in place to roll back some of the increased fees, special taxes and somehow we protect our seniors from paying more, I would support lifting the dollar amount and possibly the mills amount of the tax cap, but first I would want to make sure we are spending every dollar we get wisely. I paid in 2012 a total of $2854.51 in taxes to the city not including what my wife paid.
As far as what I think is a fair amount. I am willing to pay what is levied and voted on by the majority of the residents of this fine city.
Bryant: In 1979, the city established two tax caps - the general operation mileage allowable is 7.5 mills and the second of two caps, caps the total amount of that mileage to 3.8 million dollars. To develop the property tax burden placed on Citizens that is fair, greatly depends on the services offered to the community by the taxes imposed from its local municipality.
We must carefully consider our available options. The citizens spoke in 2009 when voters rejected the ballot initiative to lift the caps. The City and council must be transparent and timely relay information to its citizens. The amount I paid in Property tax was $1,106.12. As of late, our Local government has seen a change in leadership with the retirement of our city manager. The 2013 election for city council may also usher in new leadership changes. Our new manager and new council must prove to the citizens of Saginaw that they will see more by paying more.
The cost of (special) assessments and fees will also prove vital in the discussion of lifting the tax cap. The key to keeping taxes low is to increasing our tax base.
Coulouris: I would definitely not vote for a tax increase. People are strapped now and you can't extract anything more. And you're absolutely correct about these additional fees for rubbish, public safety, and mass transit. People fear the increase in taxes and I don't blame them. If we lifted the tax cap July 1st it wouldn't make any difference. The albatross isn't the cap it's the limit that's part of the cap that only allows us to take in $3.8 million. The only way to increase revenue is to eliminate the dollar cap. That won't affect the average home owner, but it would allow us to realize revenue from large new businesses that came in. If we get new development in town and eliminated the money cap, it would allow us to realize more revenue without raising or lifting the cap. Plus if they eliminate the single business tax it will cost the city over $600,000. How do we replenish that? How much farther can you cut?
DeMaet: I believe that we need to raise the tax cap by promising our citizens that it will only be used for more police and firemen. And actually have it go to more police and firemen. We as a city council need to get back the respect and trust we lost when Mayor Ham was in office. I will support a small increase in the tax cap under the stipulation for using those monies for public safety only!! I will do my part by not accepting any tax payer money to pay for my service on the City Council.
Frey: As a member of the city council I would not vote for a tax increase. Politicians must learn to live within their budget. However, as the housing market rebounds, property values will increase and so will city revenue. Lastly, property tax information is on line as is the city budget. A requirement of running for election is to be up to date on all city obligations.
Johnston: Very true regarding the ala carte list of millages as being the functional equivalent of property taxes, but it's pretty much what I'd expect to see in a city that has a 35 year old tax cap that lacked the foresight to include some type of inflationary adjustment.
The city has been limited to collecting the lesser of the 7.5 Mils or 3.8 million dollars in property tax for the past 35 years while inflation continued to march on. The gasoline that the city purchased in 1978 to mow parks, operate city vehicles, etc. was on the order of 60 cents per gallon. Add in the fact that we've experienced a shrinking tax base and lowered property values yet have the same size infrastructure to support, and I think you can get a good feel for why the city struggles financially.
In 2012 we were only taxed at 7.063 Mils because of the secondary dollar limit of 3.8 million kicked in. My family's property tax bill in 2012 was about $3850.00. That was the equivalent of 4.6% of my homes taxable value, so hopefully closer to 2.3% of my homes market value. Now, take that 2.3% and eliminate the county and state items from the bill and the city portion come in at about 1.4% of my properties value.
Regarding a tax increase; as a tax payer, I love the word's “tax cap”, and don't generally consider the government to be a very good steward of my dollars. There is however greater accountability at a local level than a state or national. That all being said, I think a better solution to a tax increase would be to simply eliminate the $3.8 million component of the current cap.
The 7.5 Mil limit would still exist with the net effect of not increasing taxes on anyone, but would at least allow revenue growth for the city from development and the increased tax base that creates.
Tibbs: Ultimately, when discussing tax or anything someone is considering purchasing, you are asking if the product you are buying is worth the cost. Saginaw is the only municipality in the country that has such a tax cap. I believe why the voters voted “no” in order to retain the tax cap is because many residents do not want to pay another dollar to live. Also, there is a gap between current management's goals and what Saginaw resident's want.
If you review the budget and the various funds that compose of the budget, it appears it is “management-focused”. Current management has attempted to resolve the city's issues with more management. This is further supported by Citi-Stat and Performance Management Report.
Despite the tax cap and a declining tax base, Saginaw is the only major city in Michigan along I-75 that doesn't have an Emergency Financial Manager. So, I cannot say that they are doing a poor job.
However, with that said, if the city found a better balance, a balance that include quality management and workers that provided services that residents want, then is a good chance that residents would vote to repeal the tax cap.
According to the city's current charter, a maximum of 7.5 mills can be levied and a maximum of about $3.8 million can be raised. My wife and three kids live in a modest home in the Adams Boulevard area.
Winn: Once again the city hires and pays a handsome wage to employees to guide and direct me as a city councilman to the areas of the tax code that we need to address. If they are not capable of doing there jobs and need for me to tell them how much is needed to fund city operations whether it is asking for special millage or shifting cost. Then I will be looking to replace those in that capacity. Evidently they would not be earning their salaries.
Once the information is presented by the financial team that is paid to present the needed information to the council and I have reviewed and educated myself on the issue, I have the intellectual ability and integrity to make the best decision based on the needs and wants of the people and the best interest of the city.
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Oct 17, 2013
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