November 15, 2012GROSSE POINTE WOODS — Now that voters in Grosse Pointe Woods have soundly defeated two millage proposals that would have raised property taxes to cover operating expenses and road repair, city officials have pulled out their calculators and red pens to see where additional cuts in city expenditures can be made.
By wide margins, Woods residents turned down two proposals that would have allowed the city to override the Headlee Amendment to the state's constitution and raise the city's millage rates to the 20 mills allowed by the city's charter.
The first proposal, which would have directed the additional revenue to the city's general fund, was defeated by a vote of 5,948 to 3,788. The second, which would have allowed the city to purchase bonds for road repairs, was defeated by a vote of 5,217 to 4,389.
"I think voters sent a message that elected and appointed officials must come to grips with the new normal," said former city council member Joe Sucher, a leader of the citizens group that opposed the millage proposals. "Municipal, state and federal leaders can no longer look to old models as a basis for decision making, but must instead craft new solutions to new problems."
Sucher joined forces with two other former council members, Lisa Pinkos Howle and Pete Waldmeir, in opposing the ballot proposals, citing $600,000 in cuts the city should have made before asking voters for additional revenue.
At issue is the decline in property tax revenues due to falling property values. According to Woods city officials, tax revenue has declined from $15 million in the 2007-2008 fiscal year to $12 million for the 2012-2013 fiscal year. The drop in revenue represents a 30 percent decline in taxable property values. The city maintained that even with the cuts it has made in the city budget, including a reduction in personnel from 105 to 86, freezing salaries, cutting health care costs and mandating five furlough days a year for non-union employees, the Headlee override was needed in order to maintain city services.
"We are disappointed with the results of the election, but it is important to note that even without the additional revenue, the city is still in good financial shape," said Mayor Robert Novitke. "What we must do now is make sure any cuts in the city's budget do not impact the services our residents have come to expect."
While Novitke could not specify where those cuts might be made, he did say city administrator Skip Fincham has met with department heads and asked them to review their budgets and manpower needs and to come back to him with where they feel additional cuts might be made.
Novitke also said the hiring freeze for new employees would continue and the city would continue to work with the unions representing city employees to reduce costs.
"We have been proactive in making cuts while maintaining city services," Novitke said. "We have kept the city's reserves at an acceptable level, and will continue to make sure the city is on sound financial footing."
With that in mind, the mayor noted the city will accelerate its budget work for the next fiscal year, a move Sucher concurs with.
"This country did not get to where we are by ducking the tough decisions, ignoring reality or taking the easy way out," Sucher said. "Hard work, bold new ideas and pulling together did it."