The pandemic is having a serious impact on the City’s revenues, requiring millions of dollars in spending cuts. We are very fortunate to have Tom Crawford as our interim City Administrator as we face this challenge. He has served as the City’s Chief Financial Officer since 2004 and helped guide the City through the 2008 recession. His experience is proving to be a great resource as we struggle through these challenges.
While some have proposed increasing fees or passing new millages, we must be sensitive to the impact that will have on residents already badly hurt by the economic downturn. I will oppose additional taxes during the current recession. Council will need to balance all of the budgetary demands and prioritize spending to stay within our revenues.
One candidate for City Council has proposed asking the State for assistance. That sounds great, but one of our challenges is the expected reduction in State revenue sharing. With falling taxes and climbing costs, it is unlikely that the State will have the resources to assist cities to make up their budget shortages.
That same candidate also said that new development would provide additional revenues to fund our needs. Putting aside for a moment the costs of providing municipal services and infrastructure for new developments and their new residents, this is impractical. Last year, development increased City revenue less than 2%, but the City is expecting a reduction in revenues of five to ten percent. New development is unlikely to add enough revenue to make much impact on our shortfall. This is especially true because the stay-at-home order has delayed progress on developments currently under construction. More important, the incentives for developers to build new buildings may be seriously undercut--by failures of retail outlets, by the likelihood that more office work will be done from home, and the prospect of many fewer students taking on-line classes from home rather than living in Ann Arbor.
We are going to have to do this the old fashioned way–by spending no more than we receive in revenue.
I voted against a consulting contract that will cost the City $250,000.
The consultant will update the City’s solid waste plan, a document that in the past has been prepared and updated by resident-populated committees with assistance from City staff. The consultant will make recommendations across the entire scope of City solid waste issues, including trash, recycling and composting. The previous solid waste plan ran from 2013 through 2017. The failure to begin the process to update that plan before it lapsed is inexcusable. Similar to the failure of our contractor’s operation of the Material Recovery Facility (MRF), we did not respond to a problem until it became a crisis. The MRF is an essential part of our recycling program that will not be restored in the near-term.
The $250,000 solid waste consulting contract is only minimally related to the downtown trash problem. I struggle to understand why it took so long to address the one downtown alley trash problem. This is not an isolated or new problem. Downtown merchants have concerns about trash pick-up in many alleys. An additional problem downtown is the lack of compost pick-up. Restaurants generate large quantities of food waste which is particularly suitable for composting. Currently, that food waste ends up in a landfill.