with poll: Ann Arbor among cities hardest hit by Michigan's underfunding of fire protection grants

Under a law passed by the Legislature in the 1970s, the state is required to reimburse local municipalities like Ann Arbor for the fire protection services they provide for state facilities like universities and prisons, which don't pay property taxes.

Historically, funding for the grants has come from liquor taxes, and more recently from the state's driver responsibility fees. But the state has been diverting money to other competing interests for years now, leaving the grant program significantly underfunded, Profit said.

The state fire protection grant payment to Ann Arbor this year amounts to a little more than $1 million, down 10.6 percent from the year before and nowhere near the $2.2 million called for in the funding formula, which is based on the amount of state-owned property in the city.

Collectively across the entire state of Michigan, the formula calls for doling out $21 million in fire protection grants to more than 60 municipalities, but only $10.2 million is being delivered by the state this fiscal year. That's down 6.1 percent from the previous year, records show.

Detroit should be getting $6.2 million but is getting less than $3 million. Lansing and East Lansing each should be getting $2.4 million but are getting less than $1.2 million.

Republican Gov. Rick Snyder has proposed a budget plan that would drop fire protection grant funding to $8.5 million for the state's next fiscal year starting Oct. 1. That would come entirely from the state's driver responsibility fees, which have been diminished and are being considered for further cuts in Lansing.

Profit said it's a particularly bad situation for distressed cities like Ypsilanti. On top of its own budget worries, Ypsilanti is responsible for providing fire services for Eastern Michigan University, but the state is meeting less than half its $942,381 obligation to the city.

"Here you've got Eastern Michigan University, which has a regional benefit beyond the city of Ypsilanti," Profit said. "You probably wouldn't pick the most distressed community in the region and say, 'Let's put the fire protection duty on them.' "

Records show Ypsilanti spent $2.9 million on fire protection services last year, while Ann Arbor spent $13.8 million.

With dwindling staffing levels in the Ann Arbor Fire Department, Ann Arbor officials are considering closing two fire stations by July 1 to more efficiently concentrate the city's reduced resources. The department has seen deep cuts in recent years because of a lack of money.

Fire Chief Chuck Hubbard said this week the reorganization plan he's proposing will allow the city to better serve properties and facilities owned by the University of Michigan, but he said he isn't making a pitch to get the university to start paying for fire services.

City Council Member Stephen Kunselman, D-3rd Ward, said maybe the city's lobbyists should take that information to the state.

"Based on this new model, the U of M facilities are going to be much more covered," Kunselman noted at Monday's council meeting.

While U-M has never offered to make up for the state's lack of funding for fire protection grants, U-M is a partner in the fight to raise funding levels.

Spokesman Jim Kosteva said U-M has joined efforts with other host communities and schools, including EMU, in advocating for more funding, and getting access to some of the funds from the state's so-called "bad driver fines" was one successful result of those efforts.

"Otherwise the fund would be lower still, just like all statutory revenue sharing has fallen," Kosteva said. "It's largely a matter of trying to re-slice a pie of limited funds and it puts communities with state facilities against other interests."

Kosteva, who served in the Michigan House of Representatives from 1985 to 1992, said the state's fire protection grants have never been fully funded in their 30-plus years. Historically, he said, it has been in the low- to mid-40s in terms of percentage funded.

Kosteva noted Station 5 — one of three Ann Arbor fire stations that would remain in service under the chief's reorganization plan — is provided by U-M at no cost to the city. The university provides all utilities, performs all maintenance and charges no rent, and Kosteva estimated that represents a value of more than $225,000 each year.

Profit said he's working hard to convince Republican lawmakers to rethink the governor's strategy and instead increase funding for fire protection grants.

He said many Democrats like local state Reps. Jeff Irwin and David Rutledge, as well as Sen. Rebekah Warren, D-Ann Arbor, already are supportive of bringing up the funding levels, but now the challenge is convincing GOP lawmakers in other parts of the state.

Profit said he's working cooperatively on the issue with state Reps. Frank Foster, R-Pellston, and Mark Ouimet, R-Scio Township, and a number of U.P. legislators.

"I know we can put forward a good case and we're going to have to see how we fare in the budget process over the next several months," he said.

Profit said it strikes him that if the state can find new money for public safety, something Snyder is proposing, it also can take care of existing obligations for fire protection.

The Michigan Department of Licensing and Regulatory Affairs, known as LARA, oversees the state's Bureau of Fire Services. Mario Morrow, a spokesman for LARA, said the finance departments of LARA and the bureau work together to administer the grant program, but the earmarks for each fire department are determined by the governor's office.

"We just know we have an allocated amount in the governor's budget that comes our way and we have to work within our means we're given," he said.

Asked how the governor can find new funding for public safety initiatives but not new funding to meet existing obligations like fire protection grants, Morrow said that's a fair question. And he said cities are absolutely right to point out they're not getting the full allocations the state's funding formula calls for, but an answer to that problem isn't readily apparent.

"The grant isn't being fully funded," he said. "We're faced with the fiscal and financial realities of the current time of our state and we're trying to be fiscally responsible across the board and just trying to do the best we can with what we have to work with."

Tom Crawford, Ann Arbor's chief financial officer, said he'll be closely watching as the state budget talks play out in Lansing.

"One of the things I'm watching is the state fire protection grants," Crawford told council members this week. "They have not funded that fully in a number of years — I don't even know when the last time was, and there's some significant opportunity in that."

Profit recalled state funding for the fire protection grants has varied over the years — anywhere from $3 million to $10 million. When John Engler was governor, he actually tried to veto the entire program, but the Legislature had to override him.

Ann Arbor Mayor John Hieftje told AnnArbor.com this week he has no expectations the state will fully fund the program anytime soon. But he said while it appears the state can choose to ignore its obligations to fund the grants, the city can't stop providing fire services to U-M.