More cuts may be on the way

By Dan DuChene
Apr. 22, 2009    ·    12:55 a.m.

Cut $436,204 from the public safety budget and loose three firefighters, or cut $224,231 from the City Hall staff and move to a four-day work week.

Those were the options presented to the Ypsilanti City Council Tuesday night in light of an anticipated 7.9 percent loss in revenue next year due to a reduction in taxable value.

In his presentation to City Council, City Manager Ed Koryzno said the revenue loss could increase to 10 percent in two years. He said the development came as a surprise as staff had assumed the city had reached the bottom of the cuts it would have to make last year.

“Unfortunately, that’s not the case,” he said. “We had no idea that taxable value would decline as substantially as it has.”

The more than $500,000 difference between what the city had originally budgeted for next year and what it now expects is coupled with a more than $1.5 million unexpected boost in revenue this year.

Koryzno said this year’s boost stems from a “favorable” outcome from the Michigan Tax Tribunal settlement with Visteon as well as savings in departmental savings. What was anticipated as a $128,000 surplus this year turned into a $1.7 million surplus.

Mayor Paul Schreiber pointed to this surplus in regard to the anticipated budget shortfall next year. Koryzno said the city anticipates difficulty coming up with the cash to cover design fees and matching grant funding to repair street repairs.

Koryzno recommended using the money to cover those costs as opposed to using it to offset the anticipated shortfall next year.

“That just delays the inevitable,” he said. “We’ll still have to make the cuts next year.”

Koryzno added, the earlier personnel cuts are made, the earlier the city can start saving on the costs. He said not making the decision now could compound the costs later.

Of the two scenarios, Koryzno recommended Council choose to make the cuts to public safety. The plan would keep a road patrol position vacated at the police department unfilled. The position is open due to the officer’s deployment to Afghanistan.

The plan would also eliminate the police chief’s secretary and three firefighters, leaving 15 at the department.

Ypsilanti Fire Chief Jon Ichesco said he needs four firefighters at a scene in order to extinguish a fire. With these cuts, he said the department would have to call in a staff on overtime if someone were to take a vacation or call in sick.

Ichesco said the cuts could effect mutual aid agreements with Ypsilanti Township and fire district discussions with Ann Arbor.

The second plan presented by Koryzno would eliminate the building secretary position at City Hall, move the assessor to part-time and move to a four-day work week for City Hall staff. The loss of a day would mean a 20 percent reduction in pay for all staff, but keep fringe benefits the same.

“That reduction would result in an exodus of employees,” Koryzno said.

While explaining his rationale in choosing the public safety cuts, Koryzno said more than 50 percent of the costs in the general fund are related to public safety.

Councilmember Bill Nickels, D-Ward 2, said it would save more money and ensure the changes were structural if the city were to eliminate positions as opposed to reducing time.

“We deal with whole bodies,” Nickels said. “I continue to support that as we continue with these negotiations.”

Councilmember Brian Robb, D-Ward 3, recommend blending aspects of these recommendations with other items not listed.

“I favor a cocktail,” Robb said. “I don’t see it as an ‘a’ or a ‘b,’ I see it as a mix of sources.”

Robb recommended cutting the payment to the Ann Arbor Transportation Authority for busing as another cost cutting move.

Koyzno said he will take what he learned from Council Tuesday and incorporate it into the budget presentation he makes next month. City Council will begin voting on the budget in June.

Storm water utility
After discussing the anticipated budget shortfall, City Council heard a presentation about a plan to charge property owners a fee related to storm water drainage.

The presentation stems from a direction from Council earlier this month to explore the possibility of pursuing such a program, which is designed to offset expenditures in the city’s major street fund.

Vic Cooperwasser, from California-based firm Tetra Tech, made the presentation. Copperwasser had been involved in a feasibility study done for Ypsilanti on the same topic in 1997.

If implemented, the program would allow the city to collect a fee from all city property based on the amount of rain water runoff from impermeable surfaces like driveways and buildings. The fee could be applied to universities, schools and churches, as well as commercial and residential property.

Copperwasser said there are 800 cities in 39 states that have implemented such a program. He said eight other cities in Michigan currently collect the fee.

He said the cost to the consumer averages at nearly $50 a year nationally. In Ypsilanti, however, the feasibility study determined a $48 a year average cost. He said it could generate $257,500 a year.

Copperwasser said most cities issue the bill along with the water utility bill.

Councilmember Lois Richardson, D-Ward 1, said her constituents wanted to know what residents would get in return for paying the charge.

“It frees up more money to do things like fix potholes,” Copperwasser said.

Additionally, he said it would allow the city to generate revenue from entities it wouldn’t be able to normally. He said the program is popular among cities that host a university.

However, Copperwasser did state that no cities in Michigan have adopted the program since 1997, when courts started debating whether the program was a fee or a tax. He said there is legislation being introduced in the Michigan Senate to set criteria for the program’s implementation.

He said the utility should be adopted by ordinance and allow for credits based on steps taken to reduce rain water runoff.

Related article: Ypsilanti to explore new storm drain utility charge