Local revenue sharing in doubt now
By CHRISTIE BLECK
March 4, 2011
From Ingham County Community News
MASON - The governor's budget plan is a cause for concern among local city administrators.
Gov. Rick Snyder has proposed eliminating all statutory revenue sharing in the 2012 budget year.
An exception would be made for a $200-million fund set aside for local units that meet certain reform goals. Details about how that fund would work have not been released.
Revenue-sharing funds are derived from the state sales tax and are split between constitutional monies and statutory monies. Constitutional funds are protected, which means the legislature can't cut them.
Mason City Administrator Marty Colburn if statutory revenue sharing is eliminated, that would result in a loss to the city of $104,000.
However, Colburn pointed out that the governor's plan doesn't mean it will be the same as the legislature's plan.
Still, Colburn said, "One stroke of the pen can be devastating to a number of municipalities."
The city would have to make decisions such as cutting one item, a multitude of items or deleting services.
Creating a best estimate for a budget makes city administrators' jobs "challenging," Colburn said.
Leslie also feeling the fiscal pain
Leslie is facing proposed revenue-sharing cuts of approximately $95,000, according to City Manager Brian Reed.
That represents a 40-percent cut and roughly 10 percent of the city's general fund budget, Reed said.
"This is on top of 10 straight years of revenue-sharing cuts," Reed said. "We do not have a lot of areas to cut."
Staff, Reed said, will look at all options.
"For small communities like us, this is devastating," he said. "We are down to 10 full-time employees, so we are running out of places to cut.
"It is unfortunate that the state continues to balance its budgets on the backs of the local municipalities."
Reed stressed that Leslie has been well managed and ranked at the top on the state of Michigan fiscal indicator score.
"We have a finance director/treasurer (Cheri Neu) who was a finalist for the Michigan Municipal Treasurers Association Professional Recognition in Municipal Excellence (PRIME) Award, and the state continues to throw us under the bus by taking away money that was statutorily promised to cities historically."
Reed acknowledged the state's budget problem, but said that revenue sharing is not a "special-interest handout" but an agreement by the state to fund municipalities in exchangefor giving up some local taxing authority.
"This is going to be a very interesting story as it plays out," Reed said.
"The cuts to local communities are brutal."
Leslie is facing proposed revenue-sharing cuts of approximately $95,000, according to City Manager Brian Reed.
That represents a 40-percent cut and roughly 10 percent of the city's general fund budget, Reed said.
"This is on top of 10 straight years of revenue-sharing cuts," Reed said. "We do not have a lot of areas to cut."
Staff, Reed said, will look at all options.
"For small communities like us, this is devastating," he said. "We are down to 10 full-time employees, so we are running out of places to cut.
"It is unfortunate that the state continues to balance its budgets on the backs of the local municipalities."
Reed stressed that Leslie has been well managed and ranked at the top on the state of Michigan fiscal indicator score.
"We have a finance director/treasurer (Cheri Neu) who was a finalist for the Michigan Municipal Treasurers Association Professional Recognition in Municipal Excellence (PRIME) Award, and the state continues to throw us under the bus by taking away money that was statutorily promised to cities historically."
Reed acknowledged the state's budget problem, but said that revenue sharing is not a "special-interest handout" but an agreement by the state to fund municipalities in exchangefor giving up some local taxing authority.
"This is going to be a very interesting story as it plays out," Reed said.
"The cuts to local communities are brutal."
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