The City of Dearborn is finally going on the offensive, working to explain three critical ballot proposals in emails to residents and local media outlets.

While there has been a lot of emotion around what proposals to support, the operating and library millage are ones that need to be passed if Dearborn is to maintain its current level of services.

Below is information about each proposal from the City ofDearborn.

 

Proposal 1: Operating Millage

Q: What does this ballot proposal ask voters to do?

A: Determine whether to temporarily raise the authorized level of the City’s general operating tax rate by a maximum of 3.5 mills for a maximum of five years. The operating tax rate is the most critical source of funding for most City services.

 

Q: How much would 3.5 mills cost the owner of an average Dearborn home?

A: $187 a year. The averageDearbornhome has a taxable value of $53,435.

 

Q: If approved and levied, how long would the temporary tax rate increase be in place?

A: Five years or less. Each year, the city Council would have the authority to levy the number of additional mills necessary.

Q: Why are voters being asked to decide?

A: Because of a structural budget deficit, the City is facing about a $20 million difference in what it costs to offer current services and facilities and the revenue the City takes in.  Revenue for essential City services has declined significantly in recent years because of the decline in property values.

For instance, the value of an average home inDearbornin Fiscal Year 2008 was $69,583. Now it is $53,435. Overall, the City has lost about 16 years of growth.

In Fiscal Year 2008, the owner of an averageDearbornhome paid $948 in operating taxes. Now, the owner of an averageDearbornhome is paying $801, or $147 less, in operating taxes. If the 3.5 mills are approved and levied, the owner of the same home would pay $988. Other sources of revenue for essential City services have also declined significantly while at the same time costs have risen.

 

Current operating tax payments compared with operating tax payment made if entire 3.5 mills is levied
FY2012 Average Home Taxable Value	Payment with current operating tax rate	Payment if entire 3.5 mill increase is levied	Difference
$53,435	$801	$988	$187

 

Operating tax payments made in FY2008 compared with those made under the current operating tax rate in FY2012
	FY2008	FY2012	Difference
Average Home Taxable Value	$69,583	$53,435	($16,148)
Operating Tax	$948	$801	($147)

 

Comparison of property tax payments between FY2008 and FY2012 if the entire 3.5 mills is levied
	FY2008	FY2012	Difference
Average Home Taxable Value	$69,583	$53,435	($16,148)
Operating Tax	$948	$988	$40

Q: If the temporary tax rate increase is approved and levied, what do City officials say would happen during the next five years?

A: The City’s intention is to continue to align the number and types of services and facilities it offers with the revenue that is available to pay for them. The City also will continue to develop new ways to deliver services and operate facilities so their costs are in line with economic conditions.

 

Q: If approved and levied, would the 3.5 mills restore services and facilities that have already been reduced or eliminated?

A: If approved and levied, the temporary tax rate increase would raise about $12.25 million more in revenue. The City, however, is facing more than a $20 million shortfall, so the difference of about $7.75 million would need to be addressed in other ways. The intent of asking for an additional 3.5 mills is to have more resources and time than exist under the current tax rate to transition to a level of service that is economically sustainable.

 

Q: What specific steps has the City taken to reduce costs?

A: The City has been proactive in its cost reductions since 2001, even before economic conditions were generally understood to be in decline.

The following actions have resulted in more than $12 million per year.

• More than 200 fulltime positions have been eliminated, which represents 35 percent of non-public safety positions.
• The City has reduced pension, health care and other benefits for new employees; has reduced vacation and sick days for general employees; and is negotiating with general government employees for a 10 percent compensation reduction in the current fiscal year.
• The comprehensive program to replace fleet vehicles was cancelled and the capital investment program has been deferred.
• Technology has been implemented to reduce costs.
• Four bonds have been refinanced to generate cost savings.
• Duplicative services have been eliminated, including the Dearborn Health Department.
• Two of the eight outdoor pools and one of the four library buildings have been closed.
• Street sweeping and grass cutting have been outsourced to save employee and equipment costs; and departments have been restructured.

 

Q: Why can’t the City just sell assets like Dearborn Towers and Camp Dearborn?

A: The City will sell assets when it makes economic sense. The sale of any City facility would be a one-time financial boost, not an ongoing source of revenue.

• In 2007, voters authorized the City to sellDearbornTowersinFloridaafter certain conditions were met. As of October 2011, the City had an agreement to sellDearbornTowers. The current budget assumes a sale by June 30, 2012.
• CampDearbornis zoned byMilfordfor recreational use only, and so the pool of potential buyers is extremely limited.
• Because sellingCampDearbornis not a realistic option, the City continues to pursue ways to increase revenue at Camp and to keep it attractive for future users.
• For the last three years,CampDearbornhas received no money for operations from the City’s general fund.  So, Camp has not taken money away from the operation of any other City program financed by the general fund.

 

Q: My overall property tax bill has not decreased in line with the drop in property values. Why is this?

A: It is important to note that you pay other property taxes, not just the City’s operating tax. TheCityalso levies other voter-approved property taxes.  Voters approved a tax to pay for the construction of the federally-mandated Combined Sewer Overflow (CSO) project in 2004. This project reduces pollution in theRougeRiverand was ordered by the federal government.  The impact of that new tax took effect about the same time property values began to decline. That CSO property tax represents about 21 percent of your total City tax bill. Without the addition of that new voter-approved tax, the taxes you pay overall to the City would have decreased because of the decline in your property value.

There is also a voter-approved property tax to pay for the construction of theFordCommunity & Performing ArtsCenter. That voter-approved tax will expire in Fiscal Year 2013.

In addition, you pay a tax dedicated to garbage and rubbish collection.

You also pay taxes toWayneCountyand theDearbornPublic Schools, as well as other agencies, and the City has no control over those tax rates or how the money is spent.

It is important to note that for every $1 of property tax you paid in 2011, only about 33 cents was allocated to the City.

 

Proposal 2: Library millage

 

Q: What are voters being asked to do?

A: State law allows voters to dedicate one mill to offset the cost of providing library services. InDearborn, one mill would raise about $3.5 million. The library is currently financed through the general fund. Having a dedicated millage would reduce the need for the library to compete with other departments for general fund money. It is the intent, however, that general fund money could still be directed to the library if needed.

 

Q: How much would this tax increase cost the owner of an average Dearborn home?

A: About $53 a year.

 

Q: If approved, how long would the millage last?

A: No more than 10 years.

 

Q: If approved, would this mean the restoration of Snow Branch or prevent further branch closings?

A: The intent of the request is to provide a source of revenue to ensure some stability in library services. This does not mean the restoration of Snow Branch or a guarantee of the current number of branches. It would, however, provide resources for ongoing operational and capital costs as the library explores new ways, including increased use of technology, to provide access to information and services that best meet customers’ needs now and in the future. Meeting these needs must be accomplished in a way that is economically sustainable.

 

Proposal 3: Elimination of the Civil Service System

 

Q: What are voters being asked to do?

A: To determine if the Civil Service System should be eliminated from the City Charter.

Q: What does the Civil Service System do?

A: The Civil Service System applies to certain City ofDearbornemployees. Generally, the Civil Service System was intended to set the policies for hiring, promoting and terminating employees. It is overseen by a five-member appointed body that serves without pay.Dearbornis one of the few cities inMichiganthat still has a Civil Service System. Its policies do not apply to part-time employees, certain management or professional positions, or appointed positions.

 

Q: What other representation do employees have regarding work-related issues?

A: Most fulltime employees are covered by union contracts, which take precedence over Civil Service System policies. Contracts negotiated with labor unions cover wages, benefits and work rules.

 

Q: If Proposal 3 is approved, would anything replace the Civil Service System?

A: The proposal leaves open the opportunity for the creation of a Human Resources Commission to oversee any employment issues for City ofDearbornemployees that are not already covered by their union contracts.

This entry was posted on Tuesday, November 1st, 2011 at 10:40 pm and is filed under Around Town, City Hall. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.