WAYNE COUNTY — An initiative launched by Wayne County Executive Robert Ficano is continuing to bring municipal leaders from across the County together to engage in important conversations about generating different streams of revenue for communities that have been struggling financially as a result of the 2008 housing crisis. 

Municipalities nationwide are still facing tremendous income loss, after the 2008 economic crisis, as they attempt to climb out of a period where share and housing prices declined drastically.

Ficano’s initiative aims at getting municipalities to create new strategies for bringing revenue into the County, so they won’t have to rely so heavily on property tax income as a primary source of revenue. 

   In his State of the County Address this year Ficano discussed the disastrous effects of the 2008 recession, noting that it remained a challenge in 2012.

He explained that since 2008, property tax revenue in Wayne County has declined by nearly 30%, leaving the County with a significant amount less in revenue annually for its general fund, which impacts operating expenses.

In some areas, property taxes are beginning to increase, while in others they’re starting to fall. The County projects that overall values will begin stabilizing this year and next, but currently assessed values are at a 12-year low.

Ficano said that it will take until 2025 to climb back to 2008 revenue levels. Other local governments in Michigan continue to struggle with the same problem.

In 2012, the Michigan State Housing Development Authority listed 180 cities, villages and townships as “eligible, distressed areas.”  The long-term solution will require significant changes in the municipal financing structure of the State, which the initiative is addressing. 

Through the initiative, experts, elected officials and others are weighing in on the broken municipal funding model. 

A forum was held, as part of the initiative, on June 27, at  Wayne County Community College District in Taylor. 

Two panel discussions took place, entitled “Identifying the Problem” and “Identifying Possible Solutions,” along with an open discussion and interactive Q&A session.

“The State currently enjoys revenue streams that Michigan municipalities are not privy to,” said Ficano.  “Michigan municipalities rely on property taxes for revenue, and, due to record high foreclosure rates, many municipalities are in trouble.  These are communities that are experiencing tremendous economic hardship, which causes a greater need for services and, at the same time, less money to pay for them. That’s a terrible combination.”

The panel discussions were moderated by Detroit Free Press Columnist Nancy Kaffer and featured a diverse group of participants, weighing in on different aspects of the broken funding model.

The discussion featured the University of Michigan’s Debra Horner, program manager with the Center for Local, State and Urban Policy (CLOSUP). 

Horner played an integral role in crafting and analyzing the results of CLOSUP’s Michigan Public Policy Survey in January 2013. The survey produced results, indicating that 58% of Michigan local officials believe that there is need for significant reform of the State’s system of funding local government.

Suggested areas of reform include: gas tax, sales tax, Headlee and Proposal A, revenue sharing, the Economic Vitality Incentive Program (EVIP), and local and regional income taxes.

Wassim Mahfouz, who serves as an assistant to the Wayne County Executive pointed out that the initiative could be used around the country in municipaliites that are facing financial hardship and need to address funding models for local governement. 

He explains that Ficano has focused a lot on working with investors, which is also part of the plan, and his administration has led several successful projects that are continuing to generate revenue for the County. 

According to the Michigan Economic Development Corporation, since 2009, 38% of all investment in the entire State of Michigan occurred in Wayne County, along with 41% of all new jobs created. 

“We are committed to keeping this discussion going,” said Heaster Wheeler, Wayne County Assistant Executive. He says the County is working on attracting businesses and increasing home ownership. Mahfouz says that Dearborn Mayor John O’Reilly has also been involved in giving his input on the issue through the initiative. 

Additional forums on the topic are expected to take place Aug. 20 in Oakland County and Sep. 15 in Frankenmuth. The Michigan Association of Counties will be part of both forums. 

To learn more about the initiative, call the Wayne  County Executive’s Office at 313.224.0286.