Doing nothing is not an option.
Hamtramck’s financial forecast is not looking good. In about two years, the city will no longer be able to pay all of its bills.
What’s killing the city is the cost of retirees’ pensions. Add it all up, and it comes to about half of the city’s yearly budget of $16 million.
Voters were asked last year to help ease that burden by agreeing to a property tax increase to pay for the police and firefighters’ portion of the pension.
The city sought to raise property taxes up to 10.5 mills. The city now charges a half mill, but that covers only a fraction of the cost. Predictably, voters rejected the proposal.
While we understand this is not a good time for many households to agree to a hefty property tax increase, there will likely come a time when they have no choice.
Fortunately, city officials agreed this week to ask voters for approval one more time. An election is scheduled for Aug. 3.
(Editor’s note: In the print version of The Review it was said the election would be held on May 4. Although that date was stated in an overview of the city council’s resolution, the date was changed during Tuesday’s council meeting.)
We don’t mean to beat a dead horse here, but if the city misses a payment to its pension system, it will likely land in court, where a judge will impose a property tax.
Don’t think it will happen?
Look no further than the City of Melvindale, which was in the same predicament as Hamtramck is in: The city couldn’t afford to pay all of its bills, and missed a pension payment. A judge ordered 12 mills onto the property roll.
Hamtramck voters have a chance now to craft their own millage increase.
If we do nothing, a judge will likely impose a much higher millage judgment.
Posted March 12, 2021