The city of Ann Arbor has recently announced it is expecting a deficit of $6.1 million for the upcoming year. In response, the city has been searching for ways to climb out of the red, considering revenue-raising proposals, such as levying a citywide income tax and cutting critical city services. While it is important for the city to maintain a balanced budget, it is equally important for public services to remain abundant and accessible.
The projected deficit is largely a result of increases in city employee wages and rising health care costs. According to the city administrator, Roger Fraser, absent successful reforms, the city could see a shortfall as large as $15 million by 2010. But while the proposed fiscal solutions remain in the development stage, there is still justification for concern. Given Ann Arbor’s history of sharp cuts in similar situations, it seems more than likely these recommendations will take effect.
The new changes would require a 5 percent across-the-board reduction in funding for all city departments — likely terminating several services and numerous jobs. The proposed cuts include closing the Northside Community Center and Mack Pool, reducing curbside compost pick up and leaf blowing, cutting 26 police positions and closing a fire station. The proposed cuts to the police and fire departments have already created controversy. After a series of cuts over the past few years, Police Chief Dan Oates maintains that the public would finally notice the consequences of another reduction. Also troubling is the suggested elimination of another fire station — the second closing over the last three years. Thankfully, given the likely costs to effective fire service, Mayor John Hieftje has indicated he will fight the station closing.
While the city has seen consistent budget cuts recently, administrators have thus far been able to avoid the introduction of an income tax. Now, however, city administrators have
proposed a flat income tax that would give the city half a percent of the salary of all nonresidents who happen to work in Ann Arbor and a full percent from city residents. The proposal, aside from lacking the progressive qualities of conventional income taxes, would deny more than 60,000 commuting workers the right to vote on the measure — an unjustifiable imposition, even for the purpose of balancing the budget.
The flat nature of the proposed tax would disproportionately impact lower- and middle-class employees, as many commuters are unable to live in Ann Arbor because of the high property taxes. If the city must impose an income tax, it needs to be done in a progressive manner, taking more from those who have more to sacrifice.
Ultimately, the city needs to do everything in its power to avoid implementing unnecessary cuts and imposing the proposed income tax. The value of public services like the Ann Arbor’s police and fire departments cannot be overstated. What may seem like excessive resources now may one day be vital in an emergency.
Instead of risking valuable public services and an unjust income tax, Ann Arbor should seek out more progressive ways of balancing its budget.