Detroit City Council approved a $17.4 million increase to Mayor Mike Duggan’s proposed budget for the next fiscal year and a plan to shift $59 million in federal pandemic funding to focus on housing, eviction defense and benefits for overtaxed residents.
The council voted unanimously late Monday after several hours of delays to authorize the $2.6 billion 2023-24 fiscal budget and passed a resolution outlining their support for a host of other funding priorities. Duggan unveiled his spending plan in March. It includes a 2-mill property tax cut, pay increases for bus drivers and the start of legacy pension payments drawn from a $473 million fund created to prepare for the “pension cliff” a decade after Detroit’s bankruptcy.
“I think we have done an outstanding and fine job with this budget,” said Council Member Fred Durhal, who leads the council’s finance committee. “Long gone are the days of bankruptcy. Long gone are the days of when the city’s financial stability was in peril. We are on the road to fiscal stability.”
The council’s adopted budget plan will be presented to the mayor for review. Duggan has an opportunity to veto the budget, though the council could then override him by a two-thirds vote. The upcoming fiscal year starts July 1.
Around a dozen residents pushed the council to boost funding for the Right to Counsel legal aid program during Monday’s special session. Ruth Johnson, public policy director for Community Development Advocates of Detroit, argued the budget is insufficient to meet the city’s needs.
Funding for the delayed eviction defense program, which offers free legal support to low-income residents, tripled thanks to an allocation of $12 million in federal American Rescue Plan Act dollars. However, some residents say using pandemic relief funds that expire in 2026 creates an uncertain future for the much-needed program.
Attorney Tonya Myers Phillips of The Sugar Law Center said a quarter of the city’s renter population faces eviction, representing what she called a “staggering” population of people in crisis. Myers Phillips said the city needs $27 million per year to fully fund the program.
“We don’t accept the mayor’s proposal and we’re calling for more, because we deserve it,” Myers Phillips said.
Council President Mary Sheffield said residents are not going unheard, and she stands behind their call for more funding. Sheffield said she’s working with lawmakers to find state funding, since city attorneys have argued it’s illegal to use General Fund dollars for Right to Counsel.
“This is not the end,” Sheffield said Monday. “We will continue to fight and continue to advocate that this program is fully funded.”
The council also passed a resolution Monday to raise pay ranges for administrative assistants and the planning commission director. The resolution states the pay increases are meant to line up with salary ranges for Duggan’s executive assistants and legislative directors “in an effort to promote fairness and equity within Detroit City Government.”
Relief for overtaxed homeowners
Council injected $30 million into existing programs to give preference for homeowners who were overtaxed by the city in the past decade. Detroit’s overassessment of home values diminished residents’ wealth and worsened economic impacts of the pandemic, according to the resolution.
Residents who owned a property between 2009 and 2016 and claimed a principal residence tax exemption during those years are eligible for benefits. Affected homeowners can choose one of the following perks by Dec. 31, 2024:
- A 50% discount on the purchase one Detroit Land Bank Authority home or one side-lot
- Hiring preference for jobs with the City of Detroit
- Preferential access to the city’s newly-announced Down Payment Assistance Program
- Preferential access to Detroit at Work job searches, career services, and financial counseling services
- Children and grandchildren receive preferential access to summer jobs through the Grow Detroit Young Talent program
- Preferential access to buy or lease affordable housing created through tax abatements
- Preferential access to future housing assistance programs
Council members also want a 20% increase in financial assistance for businesses owned by overtaxed homeowners through the city’s Small Business Launcher program, also known as Motor City Match. Increasing the maximum award would require changing an agreement with the Detroit Economic Development Corp.
The council voiced support Monday for a state-level task force to find other funding sources to support overtaxed homeowners. Like Right to Counsel, efforts to direct city funding to overtaxed residents face legal challenges.
“I want to be very clear that this is not the end-all solution,” Sheffield said. “This is one way to begin to provide some type of relief and programs, that we can within the legal constraints that we have, to individuals that were over assessed. We are still actively working on some changes in state law that will possibly provide some type of tax relief to individuals that were overassessed and also looking to fundraise privately to create a compensation fund.”
Pandemic aid spending
Durhal said Monday that most council members didn’t have the chance to vote on programming $826.7 million in ARPA dollars in 2021 and residents have since shared priorities which should be considered. Durhal said the 2024 budget is a prime opportunity to reshuffle funding based on discussions over the last few years.
The council reprogrammed $59 million in federal American Rescue Plan Act funding as requested by Duggan’s budget team. Funds for affordable housing soared from $12 million to $31 million, while Right to Counsel funding rose from $6 million to $18 million.
Other ARPA funding increases include:
- $9.5 million to establish the Detroit Neighborhood Development Support program, which will coordinate economic and infrastructure initiatives
- $9.5 million more for recreation center improvements, raising the total to $39.5 million
- $1 million to establish a “Tangled Title program” to help transfer ownership of properties within families
- $5 million to fund operations and development of senior centers
- $2 million for a Home Accessibility program for residents with disabilities
- $1 million to improve historical sites and facilities
Deputy Chief Financial Officer Steve Watson said funds were moved from programs that likely won’t be implemented before the pandemic relief expires in 2026.
“We wanted to make sure (ARPA funds) could be reprioritized to things where we can spend more immediately,” Watson said Monday.
Budget documents show $11.6 million was pulled from programs to address internet accessibility and digital literacy, $10.2 million was moved away from the employment and job creation category, and $9.7 million was redirected from city services and infrastructure.
Funding boost for city departments
Council members also approved $17.4 million in additional spending and directed Duggan’s administration to pay for other unfunded priorities with revenue surpluses.
The council approved $400,000 to distribute 400 air purifiers to residents living near the Stellantis auto plant and former American Motor Co. sites. Detroiters have complained of noxious odors and air pollution stemming from those operations. The council also urged Duggan to seek reimbursement from private companies that own the sites.
Due to ongoing issues with air quality near the Stellantis plant, the council is asking the Detroit Health Department to provide physical exams for residents. The council also wants the health department to release an annual study on the impact of factories and truck traffic on neighborhood air quality, with another study focused on the new Amazon fulfillment center.
A $2.5 million increase was approved for the Office of Early Learning, including $1 million to acquire a facility. The funds will also pay for new staff positions.
The council added funding in several areas to benefit residents with disabilities, including $100,000 to hire a liaison between city departments and the disabled community. Also, job placement programs for disabled residents will receive a $100,000 funding boost. There will be more funding for outreach and a $200,000 increase was recommended for cultural competency training for health care providers.
Detroit’s municipal ID program will receive $309,268 to hire staff, allowing for in-house processing. The program was suspended last year, two months after being relaunched following a pandemic-era pause, based on concerns that applicants’ personal information could be obtained by federal immigration officials.
Detroit’s newly-assembled Reparations Taskforce, which meets publicly for the first time this week, will get $350,000 to perform its work. Funding for the council’s Immigration Task Force increased by $3,000.
A $525,000 allocation will reestablish the Green Grocer Program, which supported independent grocery stores with grants.
The council also voted for a $3.3 million increase for emergency tree trimming and removal and $150,000 to add two emergency warming and cooling centers. A $75,000 budget increase was approved for a retail study of African Town.
Each council member’s office received an additional $100,000 to pay staff members.
Cultural institutions secured funding increases from council members. The Charles H. Wright Museum of African American History received $2.7 million in extra funding to support its operations and pay for capital improvements. The Detroit Historical Museum received $1.5 million for the same purposes, while the Detroit Zoo received an extra $1 million to make water main repairs.
Other requests left on the table
The council passed an 18-page resolution advocating for funding a laundry list of other budget priorities. Most do not include a dollar amount.
The resolution calls on city departments to repair damaged sidewalks, increase rodent bait to capture rats and other vermin living in vacant buildings, prioritize traffic calming measures, institute a food waste recycling program and establish a pilot program for one month of free bus rides. The council also wants a parking plan to promote long-term accessibility to the Aretha Franklin Amphitheater.
The closing resolution asks the Detroit Water and Sewerage Department to study the cost of infrastructure to withstand severe flooding events and examine the cost of separating the city’s combined sewer system.
Other requests include $7 million toward new bus shelters across the city, another $7 million to increase wages for city workers as well as $7 million more for basement backup protection.
Other allocations being sought:
- $1 million in spending toward initiatives to help people who suffer from mental illness.
- $320,000 to give city mechanics a one-time, $2,000 bonus and use $400,000 in federal funds to give bus drivers a $1,000 bonus.
- A $250,000 side lot maintenance program to reimburse residents who maintain Detroit Land Bank properties.
- $2 million in APRA funding to create a program that helps seniors and disabled residents upgrade their homes to be more accessible.
The resolution seeks a handful of studies on the pros and cons of residency requirements for city employees, a retail analysis of Chaldean Town, the impact of high property tax rates on business development, whether speed humps interfere with emergency response times, the impact of automation on Detroit jobs and the effects of “long COVID.”
Council also wants a plan drafted to adapt vacant office spaces into affordable housing and to use 3-D printing technology to develop housing. Members want an Office of Poverty created to advocate for the city’s poorest residents and an Office of Small Business Affairs.
The council also asked for salary increases, citing a Human Resources Department study which found Detroit elected officials are underpaid compared to cities of a similar size.
City Council members in February approved immediate raises for themselves, Duggan and City Clerk Janice Winfrey. The pay hikes were recommended by the Elected Officials Compensation Commission, which turned down a request for larger salary increases sought by some council members and Winfrey.