Michigan’s economy has been struggling for many years. On March 15th, 1994 our state’s government passed proposal A which has haunted the budget ever since. This law did three majors things. The first was to raise the Michigan sales tax from 4% to 6%. Secondly and probably the most damaging was to limit annual increases in property tax assessments. Next was to exempt school operating millages from uniform taxation requirement.
I am not going to get in the middle of an argument about which party’s fault for the law or which political side I favor. Everyone who knows me can not believe that a labor union has a president that is a Republican. But to be truthful with you, it really does not matter on which side you are on. Frankly it matters whether or not someone today will step up to the plate and try to reverse it.
Back in 1994, Michigan’s economy was healthy and we had a surplus in the state budget. It has taken some time to see the negative reaction to the law passed. Now that the state is and has been in a recession with the auto industry cutting back, businesses moving out of Michigan with all the jobs, and the housing problems, this state will suffer for years.
Ok let’s go back to the 4-6 % sales tax. It was a great income when the population was growing, businesses were booming, and people had money to buy things. In todays economic situation the increase from 4 to 6 % does not bring in the money because the population decrease, jobs leaving the state, and people just don’t have the extra money to buy things.
And like I stated before the most damaging part of Proposal A of 1994 was the property tax part of this. Well let’s see now if your home value increases in value $10,000 in one year, the assessment could only go up 5% or the rate of inflation which ever is lower. In the past 15 years the national inflation rate has averages 2.5% with the lowest at 1.1% and the high 4.69%. So if you had a $200,000 home and the value went up $10,000 your increase would average $5,000 for that year. Multiply that by 15 years of increases and the state has lost out in on $75,000 of taxable income for one home. This may not seem like a big amount but it is a huge amount. Now that the housing crunch has decreased the values of our homes now the effect has made the situation worse.
Now you must be thinking, "why he is writing about this topic for the City of Portage Fire Department union?" The reason is while for many years, the economic struggles of our state have not been felt directly in Portage. In recent years though, this has not been the case. In the past several years, we have seen our budget slashed for training, needed PPE replacement pushed off into the distant future, apparatus replacement/maintenance get cut, and requests for more manpower ignored. What we have not seen is cuts to personnel.
The rumors about the new budget for our city has come out and for the first time in all of our careers there are personnel decisions being made in our city that could affect the safety of our firefighters and other public safety officers. The first memo is that the city is cutting the dispatchers down to one during the night. These individuals are running the police and fire department phones, 9-1-1 calls and all radio traffic. This is way too much for one person to do and could very easily result in errors and missed radio traffic that could put people on the street in jeapordy. Ultimately, that affects the citizens and the public at large in which we are sworn to serve and protect.
This may be the first of many cuts that we will see in the future at Portage. It is scary to think that it has come down to affect us. We always hear about the other locals getting manpower cuts, consolidations, and the public safety threats, but we have not felt it here at home. Even if times get better for the state, the money shortage will be felt for a long period to come. With elections coming up this fall, there is no better time for us to stand up for our American rights and vote. We can make a difference in the local, state, and federal elections. That difference is something that may impact our future more than we know.
Rick Nason
President
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