Interesting Article About Detroit's Revenue Sharing Money Today...

[313WX]

http://www.detroitnews.com/article/2...-vote#comments

On July 1, the city's income tax rate dropped to 2.4 percent for residents and 1.2 percent for non-residents as part of a 1998 deal between the city and the state, lowering revenue for the cash-strapped city by $8.5 million annually, said city lobbyist Kenneth Cole.

So if I'm understanding this correctly, the agreement between the city and the state for Detroit to lower its income tax rate in exchange for a set amount of revenue sharing is still in effect.

So that means the state of Michigan does in fact owe the alleged $225 million dollars in Revenue Sharing, since the city still has to lower its income tax rate and the state is no longer in financial distress with a $300+ million surplus.

Thus the Consent Agreement is in fact null and void.

Why should Detroit still have to lower its income tax rate whle the state backed out on its end of the deal?

[Locke09]

Rather ironic isn't it?

[dmike76]

From what I understand, Detroit backed out on their end of the deal. Also, do you know how much Detroit was supposed to lower their income tax? I think it was supposed to be more than .1% and if that's the case, then Detroit did NOT hold up their end of the deal.

[313WX]

From what I understand, Detroit backed out on their end of the deal. Also, do you know how much Detroit was supposed to lower their income tax? I think it was supposed to be more than .1% and if that's the case, then Detroit did NOT hold up their end of the deal.

In 2006, Governor Granholm granted the city a waiver, so to speak, temporarily allowing the city to maintain its 2.5% rate since it was losing tax revenue.

And I'm sick of the meme that only the city didn't hold up its end of the bargain. The state was the first one, back in 2003 or 2001, who declared financial distress because it had a budget deficit and thus said they can no longer afford to pay Detroit the money it was owed.

However, if it still must lower its income tax rate under the 1998 since it saw an increase in in come tax revenue in 2010 and 2011 [[likely from the increase in commuter base with all of the workers moving downtown), that means the agreement is still in effect and theoretically the state of Michigan should also hold up its end of the bargain as well since it now has a $300+ million dollar surplus and pay the city the $224 million dollars it owes.

And this yet another reason why I'd rather Detroit file for bankruptcy and have the federal bankruptcy judge [[a third party) handle this. I wouldn't trust the state of Michigan with a paperclip quite frankly. If the state of Michigan screwed Detroit in this agreement in 1998, now causing it to LOSE much-needed revenue, and it has left Detroit WORSE OFF in any supposed efforts to "fix" the city before, why should I trust the state of Michigan in this supposed "consent agreement?"

[Wesley Mouch]

This debate is irrelevant -- unless you're looking to justify your currently held position.

The purpose of an agreement like a consent agreement is to 'consent' to a path forward -- given all the realities of the current situation.

So whether or not there's some past grievance doesn't matter. What matters is crafting a way forward from where we are today. You can include or not include payments that are, might, could have been owed.

Using this as a wedge to stop the CA is only politicing.

[fryar]

The city's lobbyist sounds like a dapper gentleman.

The city/state relationship sounds pretty dysfunctional [[sorry, I'm new here).