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Wed June 1, 2011
In wake of Detroit's population loss, lawmakers work to prevent revenue loss
Update 5:07 p.m.
The Michigan Public Radio Network's Laura Weber reports that most Republicans voted against the change, but Republican House Speaker Jase Bolger was not among them.
He voted for the measure, which passed by a narrow margin:
"I think for a healthy Michigan we have to have a healthy Detroit, so House Republicans put up enough votes for passage and we advance this bill forward today," said Bolger. "But at the same time, we are certainly concerned about containing their expenses and not looking for additional revenue."
Weber reported that changes to the population requirement now goes to the State Senate, where Democrats hope to have them approved in the next week.
State law stipulates that a city must have a population of at least 750,000 people in order to tax at certain rates.
In the last census, Detroit's population fell below that threshold and now stands at 713,777 according to official U.S. Census statistics (that number is being challenged).
The city could stand to lose $100 million if it had to lower it's income tax rate.
Losing this much revenue in Detroit would hurt, so lawmakers in Lansing are working to pass legislation that will allow the city to keep taxing at current rates.
The Michigan State House approved a measure today that would allow the city to continue levying taxes on income and utilities by lowering the population threshold to 600,000.
The Michigan Public Radio Network's Laura Weber reported on this last night. Weber spoke with State Senator Bert Johnson (D - Detroit) about the bill. From Weber's report:
He says he thinks that 600,000 is a safe and low-enough number.
“You know, I think Detroit’s days of really hemorrhaging people are probably behind us. We’ll lose a few more along the way, but not in the significant numbers that we’ve seen over the past decade,” Johnson said.
Detroit Mayor Dave Bing said the city would likely face a financial emergency without changes to the law.