Last week we urged City of Hamtramck employees to agree to contract concessions to ensure the city’s survival.
Hamtramck is facing a $3 million budget deficit and by January the city could be without cash to pay bills or meet employee payroll.
There are two other groups who could ease Hamtramck’s financial crisis: the City Council and voters.
The council can still increase the city’s maximum tax millage rate by 2.3 mills. That increase will bring in an additional $500,000 a year. A majority of councilmembers have blocked increasing the city’s maximum tax rate despite the financial burden on the city.
Yes, homeowners are under financial strain too. But the alternative to not doing anything is for the city to come under the control of a state-appointed emergency financial manager. If a financial manager does step in, the very first thing that he or she will do is raise our tax rate to the legal limit it’s allowed.
It appears some councilmembers don’t have the courage to raise the tax rate for fear of voter backlash.
To that, we can only say: get some courage and do the right thing.
The council can also further help matters out by at least allowing voters to decide whether to increase our property tax rate past the limit allowed by law unless it’s voter-approved.
The city needs at least an additional 5 mills added to the tax rolls. That would bring in about $1 million a year. What the city really needs is an extra $3 million a year to prevent it from going bankrupt.
Asking for an additional $3 million would require an extra 14 mills. We doubt voters would approve that – although it would mean only an extra $420 a year.
At the very least the council should allow voters to decide the fate of the city. The extra money could be earmarked solely for budget deficit reduction.
Hamtramck is coming to a crossroads. If the city goes bankrupt it’s a good bet a state-appointed financial manager would contract out the city’s most expensive budget item: public safety.
It’s a very real possibility that we will be forced to merge our fire and police services. We think that would have dire consequences for the city.
Voters should be able to decide what will happen to the city. City officials need to get this proposal on the next available election date and stand out of the way. Let the voters decide.