Ok Mr. Bing. You're in. Now please do the following...

[Locke09]

"You might be thinking of those quasi-city agencies like DEGC. They are not funded by the City. "

It's not? It's funded largely by the millions in taxes that otherwise would go to the city that get funded to the DDA and then to DEGC, Perhaps Detroit should look at ending the DDA.

Those are federal tax dollars aren't they? All I mean is it isn't part of the general fund, which is what we were specifically discussing.

But I understand and appreciate your logic. If there is funding that is going somewhere that could come to the City instead, to do the same work that the City or some other agency is already doing, then that could be considered additional revenue that would offset costs.

Although I note that P&DD appears to already get more revenue than it costs, at least according to the budget. And I seem to recall that block grant money has stipulations about how it can be spent. So, the City would have to find legitimate ways to use the money to offset costs maybe in agencies like DPW or environmental affairs. I'm not sure exactly how all of that works. But I think I get your point.

[kraig]

Don't focus on things as much. Make the city more people friendly. By that, I mean focus more on cultural activities that exist pretty much only in Detroit [[Science Center, DIA, River Walk, etc.) and build programs around those activities that will attract people.

Detroit needs to really establish some type of Arts and Entertainment district.

[Fnemecek]

The City expects to collect about $314 million in general city property taxes for this fiscal year. If one third is what's left over after debt service, that is $105 million.

Actually, the $314 million in property taxes is what is left over after our debt service payments. Debt service simply has its own fund - called the general obligation fund - into which our remaining city property taxes get paid.

[Locke09]

Actually, the $314 million in property taxes is what is left over after our debt service payments. Debt service simply has its own fund - called the general obligation fund - into which our remaining city property taxes get paid.

Okay. Then that equals about 50% of the general fund personnel costs, after you back out retiree costs.

It just seems that there are some interim steps that need to be taken before the city can slash property or income taxes. First, the projected revenue needs to be realistic and reflect historical trends and the current economic conditions. There should be little or no reliance on "ifs" unless there is a high degree of confidence that they will happen. Then, the budget needs to be brought in line with the revenue. It should be conservative, in case revenue projections still aren't met. The city does present each year, what looks like a balanced budget on paper. So either the projected revenue or projected expenditures or both are way off each year. Is this intentional?

After you have a better handle on budgeting, then you know realistically what you need to do to reduce reliance on income tax. Property tax can be reduced as bond obligations are paid and voters stop approving every bond that gets placed on the ballot. I'm more concerned about the 2/3 of property tax I'm paying than the 1/3. Acording to what you've shared, the 1/3 is at least going to services.

[Fnemecek]

The city does present each year, what looks like a balanced budget on paper. So either the projected revenue or projected expenditures or both are way off each year. Is this intentional?

I don't think it's necessarily intentional. There's a lot that goes into balancing the budget.

First, the City of Detroit has a $3.2 billion general fund budget that is currently running a deficit of approx. $300 million. This means that our budget figures are off by 9.38%.

Inside of that deficit, however, are a series of other facts. For starters, our original budget assumed that we would sell the Detroit-Windsor Tunnel and put $65 million into the general fund.

There's also the fact that we got the State of Michigan reduced our revenue sharing amount because we didn't get our FY 2008 audit completed in time. IIRC, that was a $150 million hit.

If one backs out those two figures, the remainder is an $85 million deficit that is explained by either higher costs or declining tax revenues, which works out to a deviation of 2.66%. Since we no longer have any kind of a contingency reserve, even the smallest deviation causes problem.

[hudkina]

We are currently paying a little over 64 mils in total property taxes. Almost 2/3 of that figure, however, is nothing more than debt service. We pay astronomically high property taxes, but very little of it actually goes towards paying for government services. We just paying on our debts from years past.

That's not true at all. Detroit's property taxes are split between:

Detroit General Fund - 30.63%
Wayne County - 21.61%
Detroit Public Schools - 19.96%
Debt Service - 11.48%
State Education Tax - 9.21%
Library - 7.11%

So barely more than 1/10th of your taxes go towards paying off old debts. I don't know how anyone could honestly think that number was 2/3.

[Novine]

"So barely more than 1/10th of your taxes go towards paying off old debts. I don't know how anyone could honestly think that number was 2/3."

You're assuming that none of the General Fund dollars are being used for debt repayment. I don't know if that's true. If you want to limit your statement to city tax dollars, your missing out on the huge chunk of taxes being paid to pay off school debt, which in 2007 was 13 mills.

http://www.ci.detroit.mi.us/Departme...7/Default.aspx

[East Detroit]

4. Ask the Governor to expand the borders of Detroit to be:

Detroit River/Lake St Clair x M59 x Orchard Lake/Pontiac Trail/Haggerty x I-275 x Nadeau Rd

Same with the school systems. Combine them all, or at least no local taxes to support them, only State taxes.

[hudkina]

The average Detroiter doesn't have to pay the 83.62880 mills. Any property that is listed as a homestead gets the 18 mill credit, and basically ends up paying 65.62880 mills, of which a little more than 1/10th goes toward the city's debt. Even if you count the school bonds [[for which most residents basically don't have to pay), the number isn't even remotely near 2/3.

[Locke09]

No matter how you slice it and dice it, I think it's safe to say that less than half of the property taxes paid go to city services. Less than a third if you're not getting the homestead credit. The rest is County [[which rivals the number of mills you pay to the city, and I don't feel Wayne County does much of anything for Detroit, without charging Detroit), School tax [[DPS and State Education), debt tax and library.

Detroit General Fund is only 30 mills. How does that part alone compare to the suburbs? We also have to keep in mind that Detroit provides [[or is supposed to provide) some services suburbs don't, or at least not to the same degree, like street lighting and sidewalk maintenance.

[Lorax]

1. Reduce property taxes to be in line with other cities- this will do more to encourage the purchase, restoration of homes in the city, target the most viable historic neighborhoods for further reductions, emphasizing the desire to preserve the best of what's left of the city's residential stock.

2. Regionalize the school and park systems.

3. Give the city's charter a tune-up- time for electing aldermen in a new ward system.

4. Centralize any future high-speed train service in and around the MCD. Add additional rail spurs east to Grosse Pointe, north to 8 Mile, west to Dearborn.

5. Get rid of the city's income tax.

6. Mandate city parking structure rates at 1.00 per hour and remove event fees.

7. Initiate a regional library system, add the DPL to it.

8. Incentivize citizens/investors to rehab existing buildings as opposed to erasing the built environment in favor of new construction.

9. Study the "shrinking cities" initiative and determine how to best proceed in returning large swaths of the city to nature, which would increase the green space, and provide a focal point around which to create new housing development.

[Fnemecek]

That's not true at all. Detroit's property taxes are split between:

Detroit General Fund - 30.63%
Wayne County - 21.61%
Detroit Public Schools - 19.96%
Debt Service - 11.48%
State Education Tax - 9.21%
Library - 7.11%

So barely more than 1/10th of your taxes go towards paying off old debts. I don't know how anyone could honestly think that number was 2/3.

First, the DPS portion is also debt service. If you look at your property tax bill, it even says "DPS Debt Service".

Second, your portion for Wayne County includes both general operations as well as a much larger portion for Wayne County debt service.

I advocate a wholesale refinancing and restructuring of Detroit's debts - general city + DPS + Wayne County. This would enable us to either lower our overall property tax burden, use tax revenue for other things or a combination of the two.

[preserve]

Isn't the Bing term just until the end of the year? How much do you really think he can accomplish in a couple of months? Dreamers, all.

[ThaFuzz]

In all of the analysis, I've yet to see anyone inquire about the unicorns.

[313WX]

Isn't the Bing term just until the end of the year? How much do you really think he can accomplish in a couple of months? Dreamers, all.

True, but he plans to run again in the next 4-year election.

[szla]

! sell the water department to a metropolitan authority for about 5 billion. spread the payments to the city over about 12-15 [[300 million per year?) this would give the city 12-15 years to get their house in order.
2 dump the public lighting dept. or sell it to edison. there would be some one who would be accountable. and the lights would eventually be back on.
3 reduce the city income tax to 1 percent for residents .5 percent non res. you could do this with the new money from the sale of the water dept. you could do this reduction over 5 years to ease in your costs.
4 establish a "new resident" homestead tax credit. some sort of reduction in property tax and a 1 percent income tax immediately which in five years the old residents would also have. have special programs for both the buyer and renter populations.
5 cap the threshold amount for paying income tax at about 100.000.00 to discourage people from moving out when they start to make real money. have the threshold go up according an inflation index. possibly even make it no tax for people who make more than a million as the resulting economic activity from services for these people would more than make up the tax that you never had in the first place,
6. sell or dump the dot to smart. detroit being in southeast michigan is eligible to be member of smart. you than take the small milliage and i believe you'd be 20-50 ahead. the vast majority of riders are in the city and smart would be obligated to address these riders.
7 make historic preservation an essential part of your administration.
love sincerely, szla

[crawford]

IMO Detroit can't cut ANY taxes right now. None. They have no revenue as it is.

If casino revenue ever dropped, the entire budget would be blown up. The city would go under.

The "increase taxes on vacant property" idea would have the opposite effect. You would chill any investment on vacant properties, and you would get a TON of foreclosed properties.

You are missing the point with vacant properties. They are not undeveloped because the owners are crappy or incentivized to hold the land; they are undeveloped because there is absolutely no economic incentive to build or renovate anywhere in downtown right now absent significant subsidies.

[Hypestyles]

downscale city departments that don't really do much/overlap.. truly take the "right-sizing" initiative, and look to shut down depopulated neighborhoods.. encourage more greenspace development..

[Novine]

"Even if you count the school bonds [[for which most residents basically don't have to pay), the number isn't even remotely near 2/3."

More wrong information. Everyone who pays city property taxes is paying the school debt taxes. The only exception might be in Ren. Zones but the normal rules for any taxes don't apply in those areas.

[2blocksaway]

It would be nice if he just did something.

It's been a little over a month and he has been pretty much invisible.

[DetroitPlanner]

Property taxes go into a lot more budgets than just the City's. The DPS, WC3, the County, Metroparks and several others all get a chunck. I can recall when the school capital millage passed in the mid-90's my property taxes jumped about 20 percent. In order to make a significant cut to the taxes, we must pay off not just Detroit's debts but the debts of a lot of other agencies.

Its not as simple as saying Detroit can cut the property taxes because Detroit don't control all of the property taxes.

There are people who do not live in the City [[namely higher income non-trouble causing folks) who stay away simply because the taxes in total are too high. There are some suburbs where the taxes are not significantly different that Detroit's, particularly when you consider the average cost of housing. Anything you can do to cut taxes accross the board will be an improvement, particularly for people who work downtown and don't want to drive in from places like Canton or Washington Townships, but only do so because of the cost of taxes.

By cutting taxes you also get more people to make geographically rational decisions about where they will live. This will also reduce the need to widen roads or have long bus/transit commutes. Higher taxes drive people away a lot more than the typical race card excuse most folks unfairly throw into the face of suburbanites.

Unproductive properties are not just because they are owned by a slumlord. Many in Detroit have serious economic or environmental conditions to consider. For example, one of the reasons why Detroit does not have more stores and its citizens all shop in the suburbs could be tied to the taxes that the businesses have to pay to keep a business open within the City limits as opposed to opening one literally acorss the street in paces like Dearborn or Southfield. Lowering taxes make those properties productive and puts people to work who in turn pay taxes.

Oh Mr. Bing, mow the lawns of the neighborhood parks. Its ridiculus.

[Fnemecek]

Property taxes go into a lot more budgets than just the City's. The DPS, WC3, the County, Metroparks and several others all get a chunk. I can recall when the school capital millage passed in the mid-90's my property taxes jumped about 20 percent. In order to make a significant cut to the taxes, we must pay off not just Detroit's debts but the debts of a lot of other agencies.

Amen! This is why I've advocated for a wholesale refinancing and restructuring of our debts: City of Detroit + Detroit Public Schools + Wayne County.

It's the only way we'll ever free up enough room to provide badly needed tax relief and still make improvements to government services.

[Crew]

How much does unicorn meat go for these days?