Deal or no deal? Poletown agreement in the works

By Charles Sercombe
Hamtramck had a little extra something to celebrate this past week.

Besides the Blowout and Paczki Day festivities, city officials learned there was a tentative settlement with Detroit over how much in tax revenues will be shared from the GM Poletown plant.

The two cities have been disputing a long-held agreement over the plant. City officials said that until the Detroit City Council reviews the proposed settlement, no details – and they meant nothing – could be disclosed.

In all the years of reporting here, this is about as close-mouthed as city officials ever get. Unless by the weekend, lips become looser.

Several weeks ago, we asked Hamtramck Councilmember Cathie Gordon under what circumstances she would OK a settlement with Detroit, and she said it would have to include all the money she believes Detroit owes Hamtramck.

So, did the deal come close to that?

“If you want to say that,” Gordon answered.

Asked further to clarify, she said: “I did what I had to do for the city.”

The dispute has been going on for nearly two years. Detroit has been claiming it overpaid Hamtramck by several million dollars. In the meantime, Detroit has withheld yearly payments from the plant, totaling about $4 million.
That was an amount that Hamtramck had budgeted and was counting on. Detroit’s unexpected withholding of the money had been causing the very real possibility of Hamtramck facing payless paydays in the coming weeks.

Hamtramck officials attempted to negotiate with Detroit officials, but those talks went nowhere. Hamtramck eventually filed a lawsuit against Detroit. In the meantime, both sides sat down with state officials to find a way to settle the matter.

Those efforts have apparently paid off.

Now the big question is whether the Detroit City Council will agree to the deal. Since it was worked out by Mayor Dave Bing’s administration, there is no way of telling considering the rocky relationship between the two.

Gordon said one hopeful consideration is that Detroit Councilmembers are sympathetic to Hamtramck, and had earlier promised to get to the bottom of the dispute.

“I believe they believe in us,” Gordon said of the Detroit Council.

A decision by Detroit councilmembers was expected sometime Thursday – the day The Review went to press.

Although news of the tentative settlement was well received, Hamtramck’s financial picture isn’t rosy.

The city is still looking at a budget shortfall because of proposed revenue sharing cutbacks made by Gov. Snyder.
Hamtramck is seeking a $2.5 million state loan to help stabilize finances. City Manager Bill Cooper said he has not yet heard back from the state about the loan.

Gov. Snyder has proposed to cut all state revenue to cities by one-third. Cooper said that figure is misleading because part of the new revenue sharing plan requires cities to adopt what’s called “best practices” in budgeting, which includes how well each city finds ways to merge services and cut costs.

Cooper said Snyder has not been specific on how that will be judged and how that translates into how much money will be shared with Hamtramck.

Cooper isn’t alone in that concern.

Many communities are complaining that Snyder is setting them up for failure so an emergency financial manager can take over