Could outsourcing save the city?

By Charles Sercombe

Hamtramck city officials say they have no other options left to save the city money.

They are now looking into the cost-savings of outsourcing police, fire and all other city services to Wayne County, Highland Park or Detroit.

City Manager Bill Cooper was also instructed by the council to consider whether the city could take over some of those services for Highland Park.

“We are running out of choices,” said Mayoral Pro Tem Catrina Stackpoole about her proposal to have the city manager look into the matter.

She said this is the last option left for the city to consider because a majority of her colleagues on council refuse to raise the property tax rate to the legal limit or apply for an emergency state loan.

Stackpoole also pointed out that the city’s unions have refused to agree to major contract concessions. Stackpoole added that other communities are beginning to dismantle their police and fire departments because they are too expensive. Recently, Port Huron and Pontiac announced it would hire county sheriffs to take over police services.

The city is facing a $3.5 million deficit, and City Manager Bill Cooper has warned the city will be broke by mid-March.

The proposal stirred passionate debate at Tuesday’s Council meeting. A representative for the firefighters’ union said outsourcing will result in a loss of quality service and would also violate the firefighters’ contract.

Councilmember Mohammed Hassan was the only member to vote against the proposal, but he did not say why he opposed it. It was pointed out several times by other councilmembers that it was merely a directive to see what savings would occur.

Councilmember Gordon questioned why the council needed to vote on the issue.

“Why do we need a resolution for Mr. Cooper to do his job?” Gordon said.

Councilmember Shahab Ahmed countered, saying that because the issue is politically-charged, it’s best to have the council issue the directive.

Although a majority on the council was open to hear what the savings would be, no one was in favor of merging with Highland Park or Detroit. However, Mayor Karen Majewski noted that as Hamtramck heads into insolvency, “we have to face the reality of the situation.”

Stackpoole said that without other savings or revenue streams, such as raising the property tax rate, city unions would have to agree to severe cuts that they would likely not be able to survive on.

“They are not going to agree to that,” she said, which is why she proposed looking into outsourcing as an alternative.

If Hamtramck goes into payless paydays, the state could immediately send in an emergency financial manager, who in turn could recommend filing for bankruptcy.

Filing for bankruptcy was the first thing the city attempted to do several weeks ago, but state officials rejected that because the city was not actually broke yet.

Once the city has filed for bankruptcy, union contracts can be torn up and renegotiated.

It’s also likely a state-appointed emergency financial manager would immediately raise the property tax rate to its legal limit – an action that only Councilmembers Stackpoole and Ahmed have backed.

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