This Week in Michigan Politics, Jack Lessenberry and Christina Shockley discuss a drop in local revenue sharing, a retiree deal in the Detroit bankruptcy, a new controversy over Belle Isle and management changes in General Motors.
Local revenue sharing slows
A report out this week from the Citizens Research Council shows state revenue grew by more than a billion dollars between 2009 and 2012.
But it also shows that revenues for local governments dropped by about that amount.
Lessenberry says local governments, especially Detroit, have complained that the state has taken back promises to share revenue with them and that has implications.
“Cities have less money for services, less money to fix roads and do other things that cities need to do.”
Detroit retiree deal
The city of Detroit reached a deal with city retirees.
Lessenberry says this is a two-pronged deal.
“First of all they reached a deal with the police and fire retirees. Kevyn Orr had been talking about cuts of 4%, or 10% if they didn’t approve and the new deal, but suddenly they don’t have cuts at all and they have a reduced cost-of-living adjustment of 1%,” Lessenberry says. “But then the more major deal was with the general retirees, who are much more numerous. Kevyn Orr had been talking about a 26% cut for them; now that’s down to a 4.5% cut, but they don’t get any cost-of-living at all.”
Lessenberry says the move is going to make a bankruptcy settlement much easier for the city, but Detroiters are also waiting for the state of Michigan to act.
“We have to remember that it all hinges on the state Legislature agreeing to come up with $350 million for that fund to shore up pensions and to save the Detroit Institute of Arts, and that is still far from a done deal.”
Belle Isle controversy
Yesterday, Crain's Detroit reported that Belle Isle, a state park in Detroit, will be closed to the public from Sept. 7 to 11 during the Intelligent Transport Systems 21st World Congress. This event is for business executives, politicians, and tech types to take a look at the latest in transportation.
A lot of people were very upset about that. Now, the state says the public will have some access to the island.
Lessenberry says people were emotional about the announcement because many were against Belle Isle becoming a state park. But Lessenberry says this is not the first time Belle Isle has been closed.
“Indeed it has been closed several times years ago when the Grand Prix was held there,” Lessenberry says.
Management changes in General Motors
General Motors is reeling in the wake of the botched recall involving faulty ignition switches and ignition locks. Now, there've been some management changes.
Lessenberry says the senior vice president for global communications and public policy and the head of the global human resources were essentially fired.
“(General Motors) said it wasn’t directly related to the ignition switches but you’ve got to make some changes to sort of satisfy public opinion when you have a crisis of this magnitude.”