Mayor Kilpatrick should say the following below in his State of the City address if we wants to keep Young African Americans in this city. Since he will not do such a thing this is what I would say if I was Mayor of the City of Detroit giving my address.
Giving honor to God who is the head of my household I am going to lay out what we need to do as we move towards the Next Detroit. Detroit is in a $93 million deficit and tonight I am going to show you what we must do. I know There will be resistance and threatening to sue the city but we must take the necessary steps if we are going to transform ghettos into Christian Communities.
First, we must realize that skin color does not matter when we are all sitting at the table discussing green. Whether you are Black, White or polka-dot we have one common interest, free-market capitalism.
We must begin to accelerate reductions in the city income tax. Add no new or increased taxes to the already sky high tax burden. The city of Detroit maintains an excessive tax burden that weighs on citizens and job providers alike. According to a study prepared by the Finance Department of Washington, D.C., in 2003 Detroit was the eighth highest-taxed city in the country for a family of four making $50,000.
Our city relies excessively upon two sources of income: municipal income taxes and the shared taxes and grants from the state of Michigan and the federal government. These two sources represent 78 percent of General Fund revenues, which is $1.26 billion for the Fiscal Year 2005-2006. Right here , right now we are in trouble economically.
We are going to sell Cobo Hall. I repeat, we are selling Cobo Hall. Since 1980, the city has spent $182.5 million to subsidize the Civic Center department, which runs Cobo Center. That works out to an annual average bill to taxpayers of $9.1 million, and in fiscal year 2005-2006, the city budgeted more than $15.5 million to subsidize the Civic Center's operations.
The fact that many hotels and other private businesses own and successfully run their own convention centers suggests that Cobo could indeed be safely entrusted to the private sector. Indeed, nearly every major private hotel chain in America maintains convention center-style accommodations, which include services to host the same types of trade shows, banquets, special events, and cultural events provided by Cobo Center. Cobo maintains five exhibit halls, 84 meeting rooms, and four banquet facilities.
How much could the city expect to receive in a sale of Cobo? Analysts predict that the Cobo Center could fetch $50 million. At that price, a privately owned Cobo could actually begin generating revenue for the city, to the tune of $1.9 million in property taxes annually.
Sounds good? There is more.
We need to privatize garbage pickup. The reason? To put things in perspective, shaving 30 percent from Detroit's total refuse collection bill would save the city more than $6.4 million out of an annual budget that currently stands at $21.3 million. We are moving ahead with this right now.
Today, I am proposing to contract city services to competitive private firms with proven track records. For those who are stuck on race and color complexity I challenge you to step up to the plate and place your bid in. I am asking my staff to conduct what is known as a "Yellow Pages" review of the services it provides. Whenever private companies can perform a particular activity, Detroit should either stop offering it or provide it through competitive bidding. Recently, Indianapolis saved more than $550 million by applying this Yellow Pages test to more than 75 city services. We are showing taxpayers that adequate guidelines, private contracting can be effective and avoid cronyism.
It is time for Detroit to downsize our city bureaucracy. The use of private contractors would allow Detroit to decrease its bureaucracy substantially. Through fiscal 2006, the city of Detroit maintained a complement of about 18,600 employees, yielding a resident per-city-employee ratio of just over 48-to-1. By contrast, Indianapolis maintains a ratio of about 203-to-1. Detroit’s poverty makes this gap inexcusable.
Tonight I am moving ahead with selling assets, such as underused buildings and equipment, and apply these one-time revenues to debt reduction and to retiree health care obligations. This is what is needed to move Detroit ahead. Our city is sitting on a mountain of untapped assets. For example, the city could sell our electricity generating department to the highest bidder. We also plan on regionalizing transportation and I thank State Senator Buzz Thomas for pushing for DARTA. We have to regionalize the water department so our neighbors can have a say so in the way rates are set. It is unfair to continue to keep our suburban neighbors out of the loop.
One way for Detroit to operate a more efficient, money-saving water distribution system would be for us retain ownership of the system but contract out for the various services it involves. There is no shortage of examples of how this might be done. There are over 400 privately operated but publicly owned water utilities in America. There are 10 in Michigan. These are based on contractual arrangements between municipalities and private companies for operations and management services such as maintenance and billing. The Los Angeles-based Reason Foundation reports that savings from such contracts average between 10 and 25 percent. Shaving just 20 percent from Detroit's $236 million water budget could save $47.2 million annually, assuming water rates and fees remain the same.
Earth Tech, Michigan's largest private water and wastewater management firm, might be a good place to start. It holds seven water distribution contracts in the state. Typically, Earth Tech has saved its Michigan clients between 10 and 30 percent on water distribution. The company's largest Michigan client, the city of Portage, contracts for water and wastewater operations. The firm operates the entire system with only 22 employees. This works out to an employee-to-millions of gallons per day ratio of 1.1, far below Detroit's 3.5. Earth Tech also handles 13 wastewater contracts in Michigan and performs billing for three clients.
There are tough times ahead for Detroit. My main concern is getting the city out of the Black.
We are making bold steps to move Belle Isle from the City's Department of Parks and Recreation to a joint partnership with the MetroParks Authority. MetroParks will be responsible for the maintenance of Belle Isle. Also, we are building two hotels on Belle Isle that will accommodate tourists who visit our city. A Joint Authority and the curtailment or elimination of Detroit's onerous regulations could turn the island into a commercial giant. Indeed, Belle Isle could quickly become for Detroit what Hong Kong is to China, or what Manhattan is to the rest of New York.
Our school system is in shambles. We still cannot move forward as One Detroit. I am asking that the Board of Education look into fixing Detrtoit Public Schools by opening the doors of converting the 50 schools that are slated to close by the end of the school year and convert those into public school academies. I will be travelling to Lansing to begin pushing for tax credits incentives for parents who use choice as an option for educating their children. I am also asking for the Michigan Department of Education and Detroit Lawmakers to push for Alternative Teacher Certification Requirements to increase the number of highly qualified teachers in the classroom.
We are considering consolidating both our Fire and Police Department into a regional authority under Wayne County. This way both the county and city can save money, time and creating accountability for our taxpayers.
Speaking of regionalization as we are trimming the fat from the bone of city services we are moving ahead of consolidating Detroit with Wayne County. We are becoming one. In these tight times we must push ahead of keeping our economic base intact. We must keep our young people here to continue building an economic engine that will keep future jobs here in Southeastern Michigan.
Some may not like what I have proposed tonight but we do not have a choice. We must begin to move ahead with forging new ideas and building new relationships. We must continue to push for greatness in the light of regionalization. All of us, regardless of race, creed, color or sex, must work together to build strong Christian communites in this region.