Would hiking property taxes save Wayne County?

Aug 5, 2013

It's no secret Wayne County is in rough financial shape, with an accumulated deficit nearing $200 million.

County budget officials say a financial review team that could lead to an emergency manager may not be far off.

Yet perhaps all is not lost: those same budget watchers say the county can still get back on the right track.

But their solution is about as politically popular as a property tax increase for Wayne County residents.

Because it IS a proposed property tax increase for Wayne County residents.

Even if this idea isn’t politically dead on arrival, it’s got to clear some big hurdles.

Voters would have to approve it on the November ballot.

And before even that can happen, the county commission has to give its approval.

Needed or not, can the idea get a fair hearing?

Right now, the county commissioners fall into two camps.

The first group is the "uh-uh, no way, it’s-silly-we’re-even-talking-about-this" camp.

You can put County Commission Chairman Gary Woronchak in that camp.

“There isn’t anywhere near the support on the commission needed to put any new county property tax on the ballot this fall,” Woronchak told Dearborn’s Patch.com.

“The county executive is welcome to forward any proposal he wishes, and we would give it the due respect of a hearing, but I know that right now it’s just not going to happen.”

Then there’s the second, smaller camp of commissioners who are willing to publicly, begrudgingly poke at this property tax idea.

The group includes Commissioner Tim Killeen.

"As an elected official, do I just say, 'No I don't want to put it on the ballot?' Just because I think it will go down in flames?” Killeen asked on Friday. “Or do I go to the voters and say, ‘Well, look voters, you can do what you may with this, but this is something that's needed?’"

How Wayne County got to this point

One thing neither camp debates: the financial crisis in Wayne County is real.

“Not in the next six months, but yes, in the next year or so, I could see [Wayne County getting] an Emergency Manager,” Killeen says.

The county has two kinds of problems: the self-inflicted kind and the economic downturn kind.

The recession took a big bite out of the county’s tax base.

When home prices nose-dived, so did property tax revenue.

“Then when you add problems in terms of the pension fund, that becomes more and more expensive all the time, as the pension fund becomes underfunded with all the payouts we’ve had recently,” said Killeen.

Then, of course, there’s a series of scandals, and what some call financial mismanagement, that have put the county in hot water.

“Certainly this jail debacle is draining resources from the county,” he says.

That “debacle” is the county’s wildly expensive new jail, which has already cost $100 million, isn’t yet finished, would cost another estimated $200 million to complete, and even then would be too small.

County officials are now weighing whether to ditch the whole thing, move the jail to a cheaper site they turned down years ago, and swallow the $100 million loss.

Which is not a great foundation for pitching a property tax increase.

“Some of this has been self-inflicted,” Killeen admits.

“You can’t cut your way out of these things.”

“We definitely need additional sources of revenue,” Killeen says.

“You certainly don’t want to go borrowing: borrowing money to pay off your credit card bills is not the way to go.”

While Killeen says “you can’t even just cut your way out” of a financial crisis like this, he says the most recent budget proposal can still go farther in shaving off costs.

"And I would feel more comfortable after we did more work in that direction, then going to the voters and saying, look, we've turned over all the rocks, this is our only option at this point."

So is a property tax increase the only option?

For Killeen, it just might be.

“This is the only significant source of revenue that’s on the horizon.”

But, I ask, won’t it be a crazy hard sell to get voters on board?   

“I do think it is going to be, and I will use your phrase, a crazy hard sell because of all the press we’re getting for a lot of our sins over the last few years.”

And even if voters do hold their noses and approve the tax hike, a new millage is no magic bullet.

“It certainly won’t drag us out of the hole,” Killeen says. “This won’t solve all of our problems by any means. We still have other work to do.”

Commissioners are supposed to get more hard facts about a possible millage hike in the coming weeks.