Jump to content
House Price Crash Forum
Sign in to follow this  
interestrateripoff

Debt Rising, A City Seeks Donations In Michigan

Recommended Posts

http://www.nytimes.com/2010/11/20/us/20michigan.html?_r=1&ref=business

DETROIT — A Michigan city is pleading with churches, schools and a hospital for donations to help cover its staggering budget deficit.

The mayor of Mount Clemens, Barb Dempsey, sent a letter this week to 35 tax-exempt organizations asking them to voluntarily contribute to the city’s general fund, which pays for services like fire protection, streetlights and roads. Ms. Dempsey said the city has already drastically cut its expenses, having disbanded the police department six years ago, but still faces a $960,000 deficit that is projected to reach $1.5 million next year.

“Those are all services that they utilize at no cost to them,” Ms. Dempsey said. “We figured it can’t hurt to send out letters. If you don’t ask, you never know.”

Mount Clemens, about 25 miles northeast of Detroit, collects no taxes from 42 percent of the property within its borders. The 4.2-square-mile city has about 17,000 residents and is home to 26 churches, a hospital, several schools and the headquarters of Macomb County, the third largest in Michigan. If not exempt, the properties would pay at least $1.2 million, enough to wipe out the deficit, Ms. Dempsey said.

Plunging property values across Michigan have greatly reduced the revenue collected by municipalities, and tax caps hinder governments’ abilities to demand more from businesses and residents. A proposal that would have allowed Mount Clemens to increase its tax rate was defeated this month by a little fewer than 500 votes.

Ms. Dempsey’s unusual request came several days after Hamtramck, a city adjacent to Detroit, asked the state for permission to file for bankruptcy, something no Michigan government had ever done before. The departing governor, Jennifer M. Granholm, said she hoped to find an alternative for Hamtramck, but warned that many communities were nearing insolvency.

“You’ve got a perfect storm hitting many of these communities,” Ms. Granholm told Michigan Radio, “and this is an issue that’s going to be very difficult over the next few years as the property taxes continue to decline, and communities all across the state are going to need some additional support if they’re going to provide the services that citizens expect.”

Charles Ballard, a professor of economics at Michigan State University, said it could take 15 years or more for tax revenue to rebound to pre-recession levels, given the way that Michigan governments are now allowed to levy taxes, and simply begging for more money is unlikely to make up much of the gap.

“People usually don’t pay a whole lot of taxes unless they have to,” Dr. Ballard said. “But it shows you the level of desperation that is in many units of government of Michigan.”

Some of those receiving the requests in Mount Clemens are grappling with budget shortfalls of their own. The Mount Clemens Community School District has laid off some employees, and the county is more than $24 million in the red next year.

Did someone in govt get a lovely nice graph which showed property prices going up and immediately worked out what future revenues would be and then spent the money / made commitments on those yet to be received taxes?

Still I'm sure Bernanke can solve all this mess out with his magic printing press....

Deficit spending was always the way forward, it allows you to spend the surpluses you've saved in the past.

Share this post


Link to post
Share on other sites

http://www.nytimes.c...=1&ref=business

Did someone in govt get a lovely nice graph which showed property prices going up and immediately worked out what future revenues would be and then spent the money / made commitments on those yet to be received taxes?

Still I'm sure Bernanke can solve all this mess out with his magic printing press....

Deficit spending was always the way forward, it allows you to spend the surpluses you've saved in the past.

Can US states default?  That might upset the bankers and sovereign bondholders mind you.

Share this post


Link to post
Share on other sites

There's a case for merging this thread with the Boulger thread with him recommending kids raid their grans and grandad's savings to buy a house. ;)

Soon they'll be recommending digging up graveyards and looking for gold fillings. Maybe they're doing that already. Don't give them ideas.

Edited by billybong

Share this post


Link to post
Share on other sites

Can US states default?  That might upset the bankers and sovereign bondholders mind you.

It's a city and not a state. State taxes are separate and on top of the city taxes, as are the federal taxes. Lovely simple system they have over there!

It's actually a really nice area, some good restaurants and bars. Shame really, as it will be quickly run down if they can't pay for the services.

PS. Lookup Detroits position on taxes if you want a real laugh.

"Detroit has hit the end of the line. It's budget deficit is between $446 million and $466 million (28% to 29%) of $1.6 billion with few ways other than drastic cuts in wages and benefits to address the problem." Bankruptcy looms for detroit

But then again, they can't organise a p*ss up in a brewery Missed this one for tax

And convict former mayor accused of tax evasion Kwame on trial

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 140 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.