Members of the Dearborn City Council met with a community task force on Tuesday at City Hall to discuss budget cuts. “We need to make some difficult decisions moving forward,” Dearborn Mayor John B. O’Reilly said.

Dearborn Mayor John B. O’Reilly (R) sits down with city council members and his task force to discuss budget cuts.

Within the next year the number of city employees is expected to decline from 911 to 743. That number may increase over the next few years. The city’s current millage rate is 13.62. City officials plan on raising it to 15 mills, then to 20 mills according to a future budget plan reviewed at the meeting.

No initiatives were voted on during the meeting. O’Reilly introduced the task force about a year ago in his State of the City address. There are 31 representatives from the business, neighborhood, service club, union, school and commission sectors on it. It is broken down into subcategories of administrative efficiencies, image and development and personal and revenue enhancements. One plan of the task force involves reducing expenditures from $105 million to $85 million to meet the city’s revenue stream.

O’Reilly said the city can’t depend on additional funding from the state and must work with its limited budget.  If the city doesn’t reduce spending it would experience a $20 million deficit every year from 2013 to 2017 according to the task force.  Suggestions from the task force will be analyzed by council members, then forwarded to a steering committee.  The committee is encouraging city officials to offer early retirement packages.

Three years ago the city experienced a five percent loss in property tax revenue, and 10 percent last year. There is a a projected 10-15 percent loss within the next two years. 

O’Reilly says the city must cut down on the services it offers to avoid facing serious backlashes in the future. He said the committee’s objective is to develop a five year vision for getting to the point where operating costs are in line with revenues.  

The city has reduced spending by $12 million a year, and plans on saving $20 million annually. “Now we’re transitioning into a much more difficult process of taking out services that are noticeable to the average citizen,” O’Reilly said. 

City officials will begin adopting three year budgets.  “The goal for that is so everyone can see if we do this this year does that put us in a better position next year or a worse position next year?” O’Reilly said.

He says property and market values are going to continue to drop over the next few years. “At the end of the day anybody who doesn’t think we’re going to continue to see market (and) property values drop in this town is living in a foolish paradise. That’s just not going to happen,” he said.

City services will be delivered differently. The mayor said cities may have to begin sharing services.

“Between Dearborn Heights and Dearborn the library systems may be equally available  to residents of both.  We can look at ways to begin getting through that and cutting the cost and having a good product available for anyone who wants to use it,” he said.