Mayor's cuts go deep in Detroit budget plan

The cost: Jobs, benefits, services to go

April 13, 2005

BY M.L. ELRICK and MARISOL BELLO
FREE PRESS STAFF WRITERS

No one is safe and nothing is sacred in the radical plan Mayor Kwame Kilpatrick outlined Tuesday as part of his desperate bid to stave off a financial meltdown.

Not even a McDonald's Happy Meal.

A CLOSER LOOK AT THE MAYOR'S PROPOSAL
On Tuesday, Mayor Kwame Kilpatrick presented a sweeping plan to tackle the city's projected $300-million shortfall for 2005-06. Among the measures the mayor proposes:

The mayor said 754 city employees will lose their jobs, remaining city workers will be asked to take a 10-percent pay cut, and voters will be asked to approve a 2-percent tax on fast food.

And, for the first time in more than 20 years, firefighters will be cut. Kilpatrick said he will lay off 61, as well as trim 38 paramedics and dismiss the current police academy class.

The mayor's austerity plan is the latest blow to a city that already has endured closures and layoffs in the public and parochial school systems, church closings, the seemingly nonstop erosion of its tax base from fleeing businesses and residents and bad publicity from local and national media.

But Kilpatrick said the plan -- which faces stiff opposition from unions and, possibly, the City Council, which must approve it -- is the only hope to eliminate a projected $300-million deficit. He has proposed a $1.4-billion budget for the 2005-06 fiscal year, which begins July 1.

The mayor threatened that the only alternative to his plan is more layoffs and deep cuts in city services.

"There is no more fat in city government," he told reporters and editors at the Free Press after presenting his plan to the council.

Even Kilpatrick called his plan, which calls for a major consolidation of city departments, radical.

Not even the police are safe.

After three years of promising not to cut officers, he said: "We won't be able to sustain this no-layoff approach in the Police Department for those officers on the street if their union doesn't come to the table and renegotiate their benefits with us along with our other unions," he told the council.

Kilpatrick's fourth budget address since he took office in 2002 was his bleakest. After trying -- and failing -- over the past two fiscal years to balance the city's budget as revenues declined and health care and pension costs ballooned, the mayor pitched a plan that calls for reducing services and shedding operations he said the city can no longer afford.

Kilpatrick, who has already closed the Belle Isle Zoo and aquarium, said he would end general fund operating payments used to help run the Detroit Zoological Institute, Historic Ft. Wayne, the Dossin Great Lakes Museum and the Detroit Historical Museum.

He said the city can save millions of dollars by maintaining ownership of the facilities, but allowing nonprofit groups already supporting the institutions to run them. The Detroit Institute of Arts is run in a similar manner.

The mayor also said he hoped Cobo Center and the Detroit Department of Transportation, which together receive more than $100 million a year in city subsidies, would be run by, or become part of, regional authorities by January.

He said the city would continue to provide financial assistance to the Charles H. Wright Museum of African American History because it is a newer facility and needs more time to build private support. He said his budget calls for giving $1.8 million next year to the financially troubled museum.

By consolidating city departments into seven units -- Public Safety, Economic Development, Health & Human Services, Municipal Services, Administrative Services, General Services and Financial Services -- Kilpatrick said they will be more focused and efficient.

He did not say how much money he expected to save by making the changes, but added that it could take up to a year for some of them to be completed.

First, however, he must convince council members to approve changing the structure of city government.

Council members were receptive to the mayor's message Tuesday, but said they were reserving judgment until they had more time to scrutinize the plan.

Although council members generally do not see the plan until the mayor presents it, Kilpatrick's team was working on it so late that copies were not distributed to council members until after he began his speech.

Council President Maryann Mahaffey interrupted him after a minute or two and asked that he wait until copies arrived. As they were handed out, Kilpatrick went back and started his speech from the beginning.

Sheila Cockrel and Sharon McPhail were uncharacteristically silent as their council colleagues quizzed Kilpatrick.

Cockrel said the presentation was light on substance.

"This is a very fragile fiscal document in a precarious political environment," she said.

McPhail, who is running for mayor, said she was keeping an open mind.

She said that while Kilpatrick said he inherited a lot of problems "one of the things I didn't hear was accepting responsibility...all of the development projects he's taking credit for were all started by Coleman Young or Dennis Archer."

Archer's deputy mayor, Freman Hendrix, said Kilpatrick's proposal "does not come close to addressing the real budget deficit of nearly $300 million."

Hendrix, who also is running for mayor, commended Kilpatrick for consolidating and eliminating departments, but said the mayor should have taken action sooner.

Irvin Corley, the council's fiscal analyst, said he thought the mayor's proposals seemed to be moving the budget in the right direction. He said the announced layoffs, the consolidation of departments and the push to regionalize DDOT were all encouraging signs.

"I'm cautiously optimistic," he said. "We are at the point where we have to do something to avoid receivership."

But John Riehl, president of the American Federation of State, County and Municipal Employees Local 207, said Kilpatrick can't count on his support.

"The mayor's got his foot on Detroit and he's threatening more cuts unless he gets his way with the unions," Riehl said. "He's got a hard fight with us if he thinks he's going to get a 10-percent cut in our wages."

Contact M.L. ELRICK at 313-223-3327 or elrick@freepress.com.