For you history buffs, Michigan has had one school district go
into the red. And the Kalkaska school insolvency is credited in part
with spawning a new way to finance all our schools.
The question is, when will the first city in Michigan end up in
the red and what reforms if any will follow that?
Hamtramck is in the lead right now, but it's got 67 competitors
which are in various phases of fiscal disarray and the bankruptcy clock
is ticking.
Gov. Jennifer Granhom hears the tic-toc saying, "If we continue
down this path (not fully funding the cities) you will have more and
more cities that are going to be asking for an Emergency Manager or
bankruptcy."
Fortunately for her, she will be long gone if it comes to that
which means the new gov and new legislature can begin their New Year
worrying about that, too.
Over at the Michigan Municipal League, which lobbies the
legislature for funding, it continues to watch the perfect fiscal
storm. It's one part loss of revenue from the state, another part loss
of dollars from fewer property tax collections and a final part of
rising costs without enough dough to pay for them.
Tic-toc.
"No city wants to be the first to go into bankruptcy,' advises
MML lobbyist Andy Shore but "It's possible if the situation gets more
dire."
Cities cry out they have already cut too many cops, too many
firefighters, and too many services. There is $400 million in state
revenue sharing that is also at risk, and no one would be shocked if
that got cut, too.
Shore concedes municipalities have the option to raise local
millages and some have done that. Others are scared to try for fear of
voter push back. He would like to see lawmakers take the lead and do
some revenue raising on their own.
Right.
Like the old song goes, "Something's Gotta Give" and if not,
some city is going to join Kalkaska for the dubious distinction of
being the first to go under.