Mayor’s address outlines gravity of fiscal challenges

Photo courtesy of the city of Dearborn

Photo courtesy of the city of Dearborn

Mayor John O’Reilly Jr. delivers his state of the city address last Wednesday. O’Reilly said the city is at a “defining moment” and will be forced to change the way many services are delivered or eliminate them altogether.

‘If we take no action, make no hard decisions now, we’ll have a $20 million gap between revenue and expenditures in just the coming year alone.’
— Mayor John O’Reilly Jr.

Times-Herald Newspapers

DEARBORN — Mayor John O’Reilly Jr. was unequivocal last week at the annual state of the city address: The imperative for change is now.

Speaking at the Ford Community & Performing Arts Center, O’Reilly said that mounting revenue losses and rising fixed costs will force the city to make fundamental changes to the way it does business.

After eight years of incremental downsizing, but never really separating the “need to have” from “want to have” services, the city no longer can afford to fall back into a “that’s-the-way-we’ve-always-done-it” mentality, O’Reilly said.

The mayor laid out an everything’s-on-the-table approach to cuts, saying every service the city offers must be questioned. But he cautioned that politics and the protests of vocal minorities could not be allowed to stymie change as they have in the past.

He cited as an example the city’s outdoor pool review by the Recreation Commission last year that was supposed to identify cost-cutting measures, but ended in inaction. He said the data the commission used showed that some pools had become unsustainable and should have been closed. Alternatives were discussed, such as less-expensive splash parks, but a final decision never was made because of emotional responses from residents.

“We didn’t pursue the less costly alternative of the splash parks, and modest savings weren’t realized,” O’Reilly said, “meaning we’re facing an even tougher financial decision now.

“This is a process we can no longer afford to repeat.”

Property tax revenues this year are expected to fall 10 percent, which comes on top of a 5 percent drop over the last two years, he said. And in the next two years, the city projects another 10 percent to 15 percent decline for a total four-year loss of up to 30 percent.

All of this is a capstone to a decade where the city has shed one-quarter of its non-public safety employees, which have city charter-mandated staffing levels.

“If we take no action, make no hard decisions now,” O’Reilly said, “we’ll have a $20 million gap between revenue and expenditures in just the coming year alone.”

To combat the looming challenges, O’Reilly said the city would consolidate departments, make better use of technology to reduce costs, privatize services where it makes sense, eliminate the “nice-to-have” programs, and set fees more in line with market rates.

Throughout the process, O’Reilly said, the city will rely on several methods of resident input, some of which include a telephone survey taken last year and a mayoral task force that currently is studying ways to eliminate expenses.

The mayor concluded by underscoring that changes are imminent and asked for residents to be involved and committed as the metamorphosis takes place.

“We need you to accept that the actions we must take to meet out goals will directly impact you and your family,” O’Reilly said.“We need you to support changes that depart from the past, but that will become the new standards of a positive tomorrow.

“Together, we will make the tough decisions … and like those before us, our sacrifices will ensure that Dearborn continues to shine for many generations to come.”