Poletown dispute with Detroit now heading to court

By Charles Sercombe

The gloves are off.

Hamtramck filed a lawsuit against Detroit last week in Wayne County Circuit Court, demanding that Detroit pay the city $4 million.

Detroit has withheld over $3 million from revenue collected from GM”s Poletown plant. A small portion of the plant is located on the Hamtramck side of the Detroit border. The city has a tax revenue agreement with Detroit. Last year, however, Detroit officials claimed that Hamtramck has been overpaid and that part of the agreement has expired.

The standoff has had a huge impact on Hamtramck’s budget. The city has received about $4 million a year from the plant. City Manager Bill Cooper said that if no payment is made by December the city will be broke.

“If the City of Hamtramck does not receive these revenues before December, the City of Hamtramck will be in receivership, unable to meet its financial obligations to vendors or employees,” Cooper said in a press release.

Cooper and some members of the City Council recently met with Detroit City Councilmembers to inform them of the consequences facing Hamtramck. Detroit councilmembers said they were unaware of the dispute.

Cooper has also met with Detroit Mayor Dave Bing and his financial director. Detroit promised to have an audit completed to see if an overpayment was made and have it ready by the end of May.

Cooper said he’s been told that the audit is not yet ready. Cooper also said that even if Detroit over-collected revenue, Hamtramck should not be held accountable for Detroit’s error.

“Not only has the City of Detroit failed to prove that any such overpayment occurred, with full knowledge of the impact that its illegal embargo of funds is having on the residents of Hamtramck, the city has steadfastly refused to offer even the simplest of explanations of how or why Hamtramck can be held to account for the City of Detroit’s improper over-collection of taxes,” Cooper said in the same press release.

A spokesman for the Bing administration, Dan Lijana, would only say: “We do not comment on pending litigation.”

Cooper said he’s been putting off filing a lawsuit, thinking that Detroit would work out the dispute in a timely manner.

“The City of Hamtramck views litigation as a last resort to resolving disputes,” he said. “The stone wall that the City of Detroit has constructed around this issue has left Hamtramck with little choice but to seek judicial intervention.”