| Author
|
Post |
 
|
|
untanglingwebs
El Supremo
|
Report says Flint lost out on nearly $55 million in revenue sharing in last decade
Print Dominic Adams | dadams5@mlive.com By Dominic Adams | dadams5@mlive.com
Follow on Twitter
on March 19, 2014 at 7:10 PM, updated March 19, 2014 at 7:11 PM
FLINT, MI – Flint’s finances would have been $55 million richer if the Legislature had never cut state revenue sharing to local governments, according to a Michigan Municipal League report.
“Had our state shared revenue not been cut, we wouldn’t be in the financial situation that we are in and our police and firefighters wouldn’t have been cut,” said City Council President Scott Kincaid. “I’m sitting here saying, ‘This is the reason why we have an emergency manager.’”
Kincaid and other city leaders have been in Lansing since Monday, March 17, for the Michigan Municipal League’s capital conference.
“For example, look at Flint, which is now under an emergency manager,” MML’s Samantha Harkins told MLive-Lansing in a statement. “Flint will have lost $54.9 million by the end of 2014. The deficit in its 2012 financial statements is $19.2 million. Flint could eliminate the deficit and pay off all $30 million of bonded indebtedness and still have over $5 million in surplus.”
Michigan communities have missed out on some $6.2 billion in revenue sharing payments over the past decade, when lawmakers diverted funds to fill holes in the state budget, the report said.
The state constitution mandates a portion of the state sales tax get handed down to local communities.
“No one can go back in time, but the numbers make a clear point that Michigan’s municipal finance system has been broken by poor decisions made by both sides of the aisle in Lansing and the results of those poor decision are referenced in the large number of communities that continue to face fiscal stress five years after the start of the great recession,” said Mayor Dayne Walling. “Michigan’s local governments are still in a recovery mode, but the major problem is no longer the economy, it’s the decision making in our own state Capitol that’s putting its own needs first.”
The report said Detroit lost out on $732 million from 2003 to 2013.
Walling said the MML commissioned Plante Moran to do the revenue sharing study.
“Communities are frustrated that they continue to be in the back of the line even when the state is receiving more revenues than projected,” Walling said. “With a more equitable sharing of the sales tax revenues, Flint would be able to dig out of the current deficit more quickly.”
The state shared revenue would have allowed Flint to provide services such as public safety, infrastructure updates and possibly avoid some of the massive layoffs of city workers.
The loss of General Motors jobs also helped property values rapidly decline in Flint during the time state shared revenue dipped, Kincaid said.
“This just goes to demonstrate to all the communities that when the state shared revenue is cut, it puts communities in financial distress,” he said. “What I think this report does is that it shows all the municipalities in the Michigan Municipal League that they’re not that much different from Flint… We wouldn’t ever have had to declare a deficit for the city of Flint.”
The Flint Journal could not reach Emergency Manager Darnell Earley for comment.
"While an overall loss of revenue during the last decade, including the decrease in revenue sharing from the state, has contributed to the current financial emergency, there are other factors which have had an equal impact in this situation," said city Spokesman Jason Lorenz in an email. "Poor decision making and mismanagement during the same period, for example, were just as detrimental to Flint's organizational and financial health. While the emergency manager understands the MML's theory and its conclusions, there are still those other factors which need to be corrected in order to end the current financial emergency and prevent such an event from occurring in the future."
Dominic Adams is a reporter for The Flint Journal. Contact him at dadams5@mlive.com or 810-241-8803. Follow him on Twitter, Facebook or Google+.
Report says Flint lost out on nearly $55 million in revenue sharing in last decade
http://www.mlive.com/news/flint/index.ssf/2014/03/...
hare
jacksondm20 hours ago
While there are multiple factors that have contributed to Flint's economic troubles the loss of revenue sharing represents a broken promise by the state -- and has contributed enormously to Flint's problems. A few decades ago, there was a two-pronged tax issue. Cities would be limited in the rate of income tax they could levy - in exchange for a promise of generous revenue sharing from the state - which then "took" some of local tax to return to local governments on a formula basis. That promise has been broken in recent years. So in order to fund STATE programs (in part because of very substantial tax cuts by Engler that crippled revenue for several years AFTER he left office - the state simply passed the problems on to every local government in the state.
Yes, the city could have done better! (Think the millions in law suit losses under Williamson, for example). But the loss of revenue sharing has played a major role in problems by MANY cities across the entire state. |
|
|
Thu Mar 20, 2014 7:03 pm |
|
|
untanglingwebs
El Supremo
|
Six things Flint could have paid for with $55 million in state revenue sharing
Print Dominic Adams | dadams5@mlive.com By Dominic Adams | dadams5@mlive.com
Follow on Twitter
on March 20, 2014 at 7:50 AM, updated March 20, 2014 at 7:51 AM
FLINT, MI – A report from the Michigan Municipal League details that Flint has missed out on nearly $55 million in state revenue sharing over the last 10 years.
“For example, look at Flint, which is now under an emergency manager,” MML’s Samantha Harkins told MLive-Lansing in a statement. “Flint will have lost $54.9 million dollars by the end of 2014. The deficit in its 2012 financial statements is $19.2 million. Flint could eliminate the deficit and pay off all $30 million of bonded indebtedness and still have over $5 million in surplus.”
Here are six things that Flint could pay for with that money:
1. Public safety: The city wouldn’t have to rely as much on Gov. Rick Snyder’s funding of an expanded Michigan State Police force here or to operate the Flint City Lockup. The city also wouldn’t be as beholden to grants such as the SAFER grant, which pays for 39 firefighters.
2. Water system upgrades: The city said it will spend $7.5 million from its water and sewer fund to pay for the upgrades at its water treatment plant. The upgrades are needed so the city can treat raw water it will get as part of the Karegnondi Water Authority. Use of the money for the water plant upgrades haven’t allowed the city to repair its aging water mains. With 600 miles of water pipes through the city, just 1 percent has been replaced in the last 15 years.
3. We’ll leave the lights on: A $68 street light bill per home brought in nearly $3 million in revenue for the city.
4. Streets: The city has not been repairing its aging roads because of its deficit. With more than 500 miles of roads, the city has said it can afford only to patch potholes rather than reconstruct sections of crumbling streets.
5. Blighted properties: Last year, grass on the nearly 10,000 lots in Flint owned by the Genesee County Land Bank only got mowed once during the summer.
6. Garbage pickup fee: Residents pay $146 per year for garbage pickup. That generated more than $5 million for the city during this fiscal year.
What do you think the city would have been able to pay for if it got $55 million in revenue sharing over the last 10 years? Post your feedback in the comments section below this post.
Dominic Adams is a reporter for The Flint Journal. Contact him at dadams5@mlive.com or 810-241-8803. Follow him on Twitter, Facebook or Google+. |
|
|
|
Thu Mar 20, 2014 7:10 pm |
|
|
|
FAQ
Search
Memberlist
Register
Profile
FlintTalk.com Forum Index
> Political Talk
