Income taxes could go up in Flint

May 21, 2013

Last night, Michigan Radio's Steve Carmody reported on the city of Flint's budget.

While the emergency manager delivered a balanced budget for next year, the city council was concerned the budget cuts would negatively impact basic city services. 

This morning, MLive and the Flint Journal reported that the emergency manager, Ed Kurtz, wants to raise income taxes in order to stabilize the city's finances.

According to Dominic Adam at MLive-Flint Journal:

A 0.5 percent income tax increase to Flint residents and a 0.25 percent increase to workers living outside the city would generate $7 million in revenue annually.

The current rate is 1 percent for Flint residents and .05 percent for those living outside the city.

Property values in Flint dropped 18 percent this year and are projected to drop an additional 7.5 percent  next year.

"How long can we go and still provide even that low level of service?" Kurtz said. "The reality is the city of Flint has to have more revenue."

Flint is seeking the tax increase because of more than $6 million in grants plus its structural deficit that will exceed revenues by $3 million annually beginning in 2015...

Kurtz said the income tax would allow the city to operate at $3 million surplus that could be used for blight elimination, capital improvements or put into a rainy day fund.

A proposal to increase the income tax must be approved by the state Legislature and then by Flint residents.

-Julia Field, Michigan Radio Newsroom