Christopher Taylor explains why Ann Arbor's debt has doubled to nearly $250 million
Ann Arbor City Council Member Christopher Taylor has sent out a letter to residents, explaining why the city's debt more than doubled to nearly $250 million over the last decade.
"This is a substantial change and you should understand the reasons behind it," writes Taylor, D-3rd Ward, adding the short answer is "infrastructure."
Ann Arbor City Council Member Christopher Taylor, D-3rd Ward, is attempting to explain the reasons for a substantial increase in the city's debt load to city residents.
Ryan J. Stanton | AnnArbor.com
On a per capita basis, the city's debt has gone up from $943 to $2,199 under City Administrator Roger Fraser's watch since 2002, AnnArbor.com reported this week.
Attempting to convince residents that it's not as bad as it sounds, Taylor says there's a distinction to be made between different kinds of debt.
"When most of us think about government debt, we think about the national debt," he writes. "Generally speaking, this debt has accrued due to deficit spending."
That's not the case in Ann Arbor, Taylor says.
"Ann Arbor does not have any debt of this kind. Zero," he writes. "We balance the budget every year. In fact, we typically end each year with a surplus."
Taylor goes on to explain that the city’s debt has accrued due to the sale of bonds — money borrowed to cover long-term capital improvements. Three projects primarily led to the city's increased debt, and all were needed to address infrastructure needs, Taylor says.
Wastewater treatment plant
Taylor explains that about $70 million in bonds were issued between 2004 and 2008 for improvements to the city's 1930s-era wastewater treatment plant.
"I need not stress the importance of a safe and functioning facility of this nature," he writes. "These bonds are being repaid directly from sewage fees."
Underground parking structure
Taylor says a $49 million bond issuance in 2009 for the underground parking structure on South Fifth Avenue was needed to keep pace with demand for more downtown parking.
"Adequate parking for workers, visitors and customers is vital to the continued health of our downtown," he writes. "These bonds are being repaid from parking system revenues and the DDA’s portion of downtown property taxes capture."
Police-courts building
A $27 million bond issuance in 2008 for the new police-courts building at Huron and Fifth, next to city hall, was needed to house the 15th District Court, formerly located in the Washtenaw County Courthouse, and to provide an adequate police station, Taylor writes.
The condition of the former police station on the first floor of city hall was "particularly troublesome," Taylor writes, characterizing it as a "cramped quarters" that suffered from leaks, security insufficiencies, radon and asbestos.
"These bonds are being repaid by the city in part by contributions from the DDA; in part by fees from cell-phone tower leases; and in part by the city out of monies that it would otherwise have paid in rent to house the District Court and various city departments, which were previously renting portions of the Dahlmann City Center Building," Taylor writes.
Based on the dedicated revenue streams for each of those projects, Taylor says he believes the city can meet its debt obligations without difficulty. He notes independent debt-rating agencies have evaluated the city’s fiscal health and actually have increased the city’s credit rating.
"It is worth noting as well that even with the increased debt carried by the city, Ann Arbor is currently utilizing only 26 percent of its statutory debt limit," he writes. "In 1999 it was utilizing 21 percent of its statutory debt limit. In other words, although the absolute amount of debt has doubled to meet infrastructure needs, Ann Arbor’s statutory limit has nearly kept pace."
Ryan J. Stanton covers government and politics for AnnArbor.com. Reach him at ryanstanton@annarbor.com or 734-623-2529.
Comments
63Townie
Mon, Mar 7, 2011 : 5:59 p.m.
"Debt is debt". I couldn't agree more. Where was all the concern when the greenbelt millage was up for a vote? Ann Arbor taxpayers are more than willing to throw money at parks, or greenbelts, or greenways, or whatever when times are flush. For many other frivolous projects, we sit idly by while council spends away. We'll attend council meetings in droves to keep a pool open, but howl like banshees when our closest fire station closes, can't find a cop or lose half our front suspension in a pothole. When are we going to hold our council member's feet to the fire and demand more fiscal responsibility, good times or bad?
kathryn
Sun, Mar 6, 2011 : 12:13 a.m.
To Dog Guy: I don't love debt or taxes, but I do love clean, safe, potable water coming from my tap...and a clean, beautiful park to take my kids to, and good schools, and lots of other things about this town. Infrastructure requires investment. Large projects are usually funded with debt, because if a city saved up to buy those things, there would be howling about how they should cut taxes. I could have moved out to the township to avoid paying taxes, but I choose to live in the City of Ann Arbor--despite it's taxes--because I like (for the most part) what the City provides. As for the parts I don't like...well, I guess I should probably get involved, even maybe start going to City Council meetings and speaking up.
johnnya2
Sun, Mar 6, 2011 : 12:48 a.m.
Don't you know you should have to get your own water, and make your own schools at home. Roads should only be repaired if there is a profit involved. Kids don't need parks. There is a HUGE private industry willing to let people PAY for parks. The republican dream is no taxes and no government. Then only the rich can have, and the rest of the world can go to hell.
John B.
Sun, Mar 6, 2011 : 12:38 a.m.
Thanks for the sensible post. But for many of the the other folks here, it's easier to just complain. Over and over and over again. They never let the facts (or reality, or common sense) get in their way....
Tim Darton
Sat, Mar 5, 2011 : 9:51 p.m.
Dog, it's more like Pro-infrastructure. I have a house i really like but i had to take out a mortgage but guess what, my mortgage is no more than my rent payment used to be. When my plumbing failed I was out of luck with no place to flush so I was happy to pay to have it fixed. The city hall shepherds have not raised taxes when most cities in Michigan have so I guess it's alright.
Dog Guy
Sat, Mar 5, 2011 : 8:33 p.m.
Look at the hundreds of votes Ann Arbor gives to pro-debt comments! We tax parasites love debt, taxes, and and our city hall shepherds.
bugjuice
Sat, Mar 5, 2011 : 8:45 p.m.
Amen
Tim Darton
Sat, Mar 5, 2011 : 7 p.m.
Right, the debt needs to be paid but the point is, there are funding sources for all of it and hardy any of those funds could be used to pay for other things like salaries of general fund workers, mainly the PD & FD. DDA funds can't be used that way, neither can the sewer funds. Good lord, the sewer plant was built in the 1930's! It is incredible they kept it running all this time. The county threw the city courts out so the city had to build a court house and they PD was in terrible quarters, the rent the city saves along with the DDA money that can only be spent downtown, makes the payment. As others have said, it is great to see them keeping up with the infrastructure and if it doesn't impact the ability to pay for PD & FD then all the better. The Stadium Bridges? There is no funding stream unless they take from local streets so It is very good they won the federal funding. Income tax? If you saw the article here a few weeks ago it looks like there is little support for it on council.
YpsiLivin
Sat, Mar 5, 2011 : 6:24 p.m.
"Ann Arbor does not have any debt of this kind. Zero," he writes. "We balance the budget every year. In fact, we typically end each year with a surplus." Right. At a time like this, I can't help but think of the income tax issue. Does the City of Ann Arbor, which apparently ends each year with extra walking-around money in its pocket, need to collect income taxes from non-residents because these gosh-darned non-residents are spending too much time in the bathroom while they're at work and overtaxing the wastewater treatment plant? Do they hit Ann Arbor like drunken sailors on shore leave, thereby fueling the need for a new police-courts building? The parking structure has commuter written all over it, but the City can recapture its outlay by charging commuters to use the structure. It sounds to me like the people running the City want to shift some of the burden of paying for operations so the taxes collected from the good citizens of Emerald City can be used to pay off these debts. Regardless of whether you acquire it through overspending or borrowing, debt is debt. Ann Arbor has twice as much of it as it did ten years ago, and it's all got to be repaid.
Trouble
Sat, Mar 5, 2011 : 5:55 p.m.
Bery Elementary: If you make $10, you cannot spend $11. So bery, bery simple!
sbbuilder
Sun, Mar 6, 2011 : 2:27 a.m.
johnnya2 I like challenges, but your challenge isn't much of one. So, here are a few companies that meet your criteria: Apple Google Trader Joes Funding Corp Wrigley That's just off the top of my head. And there's this little tid bit: ''No-debt stocks are not burdened by high interest expenses, which enables such companies to get through hard times more easily and indicates that they can generate the capital internally that they need for the growth of their businesses." (source: Money Magazine) Then, there's that fantastic Canadian city Mississauga. Third largest in Ontario. No debt. 800 million in the bank.
A2Since74
Sat, Mar 5, 2011 : 4:17 p.m.
Yes debt is debt. The question is whether it is worth going into debt to finance the item in question. The only way I know of to even start answering this question objectively would be to examine my summer and winter tax bills line by line. I presume that all debit I am incurring as a taxpayer would appear here.
Diagenes
Sat, Mar 5, 2011 : 4:12 p.m.
Debt is debt. It will have to be paid back regardless of what bucket the money comes from. The size of the debt is relative to the cost of living in the community. Parking and sewer rates, property taxes, license and permit fees all contribute to the cost of living in a community. The price of a meal in a downtown restaurant indirectly funds the DDA. The money still comes from residents/visitors regardless of what bucket it gets dumped into. Increase debt = increase payments. Eventually you run out of other peoples money and the whole house collapses. Look to Detroit for the proof.
johnnya2
Sun, Mar 6, 2011 : 12:41 a.m.
Look to Detroit to see just the opposite. The failure to invest in infrastructure has cost immense amounts of money.
KJMClark
Sat, Mar 5, 2011 : 3:35 p.m.
Maybe Mr. Taylor missed this, but the Federal Government issues bonds too. That's how the national debt is financed. What percentage of our credit limit ("statutory debt limit") we're using is less important than whether we can cover the debt payments. The real questions are debt service ("monthly payment") and credit rating. So far, our credit rating seems fine, but the credit rating agencies were parties to the mortgage backed securities debacle, so I'm not sure how much we can trust them. Which comes down to the debt service. If Mr. Taylor is right, there won't be any need to make calls for more taxes. If there are calls for more tax/fee revenue, then debt service is part of the problem. We'll see. I think he's wrong and making the wrong argument. The argument I would make is that the city has infrastructure needs, and we need to maintain/replace that infrastructure when the time comes, whether it's the roaring 90s or the near-depression 00s. 'Assuming' that things will get better in the future, we won't have any trouble with the current debt load, and we'll be happy we made the infrastructure investment. I'm not so sure that's a valid assumption, and that there aren't better uses for some of that money.
John B.
Sun, Mar 6, 2011 : 12:32 a.m.
So you think repairing the 1930s sewage system is a waste of money? Please, get real.
SonnyDog09
Sat, Mar 5, 2011 : 2:26 p.m.
I applaud the councilman for taking the time and making the effort to communicate with us. Compare and contrast this with hizzoner, who we only seem to see or hear from when there is a tree to be hugged, a bicycle path to open or another announcement to be made concerning his beloved choo-choos. I am one of the councilman's constituents, so I asked him where the city's unfunded pension liabilities are in his debt calculation and what the numbers would look like if those were taken into account.
1bit
Sat, Mar 5, 2011 : 12:58 p.m.
@Tim: I appreciate the thoughtful response and explanation. My point, however, remains. Investing in the parking structure would be useful at some point down the road, but not right at this moment. As you mentioned, the DDA money is more liquid than it is generally assumed to be (or should be). If there is excess money in DDA coffers that "must" be spent, then it is better spent giving parking "holidays" where nothing is charged to better attract patrons to downtown businesses. Again, it is an issue of priorities. I am not against the government as a "spender of last resort" in times of recession, but I believe there may be better options at this point than the parking structure.
1bit
Sat, Mar 5, 2011 : 4:50 p.m.
Well, bugjuice, as a "fool" who has actually been looking to build now I can tell you that money right now is not "cheap" (it's actually still very difficult to get credit), the cost of supplies is still high, and given that many contractors have gone out of business - it is not cheap to build. Again, the point is that "any fool" knows other projects may have been more worthwhile.
bugjuice
Sat, Mar 5, 2011 : 2:05 p.m.
So let's wait to build until interests rates rise and contractors raise their bids due to a better economy. Any fool knows that the most cost effective time to build is when money is cheap and contractors have to bid in competition with each other Waiting to build only increases the cost of projects and pushes the debt further down the road.
rosewater
Sat, Mar 5, 2011 : 2:15 a.m.
hmmm...last time I checked the federal, state and local governments had no means of making money other than collecting it from taxpayers. Don't care what the spin is, I wish they would stop spending money they don't have.
bugjuice
Sat, Mar 5, 2011 : 2:11 p.m.
So let's stop spending on roads, bridges, hospitals, airports, military, helping poor and elderly have enough to eat and most of all let's stop spending on education because it's obviously not necessary with all the smart folks posting here. Then it's welcome to the Middle Ages USA style. But hey as long as you got yours it's all right.
Mike
Sat, Mar 5, 2011 : 1:33 a.m.
We are in the middle of a secular debt cycle where the federal government, state government, local municipalities and the consumer have over extended themselves in debt. And in the middle of all this we have Scott Taylor telling us that this is different debt, that this is normal. Nothing to see here folks! Move along now! moo! moo!
johnnya2
Sun, Mar 6, 2011 : 12:28 a.m.
Warren Buffet owns companies with debt. He seems to have done alright for himself. In fact borrowing money at low rates to get projects done NOW instead of waiting for the future when the cost to do them will be much higher is SMART. Imagine you have a small cavity in your tooth. You decide you would rather wait until you have the extra money to fix it instead off taking out a loan. You try to save, but as the tooth worsens the cost is now a root canal or extraction. The record low interest rates means that this is not only SMART, it makes good business sense.
bugjuice
Sat, Mar 5, 2011 : 2:16 p.m.
What's a "secular debt cycle"? Is it one that doesn't have to do with religion? If you're fortunate enough to buy a home, regular folks go into big debt for that. That's all the city is doing, going into debt for a new house and to keep it's infrastructure competitive in the future.
bugjuice
Sat, Mar 5, 2011 : 2:13 a.m.
Umm, his name is Christopher Taylor. It's in big letters in the headline.
Tim Darton
Sat, Mar 5, 2011 : 1:29 a.m.
1Bit, let me add they can't take from the sewer fund or DDA TIF fund to pay for the Stadium Bridge either. The bridge has federal funding so it should be OK but as they said here a few days ago if that goes away, the city has the money to pay for the bridge they would just rather use the federal money and keep the local money for local roads.
Tim Darton
Sat, Mar 5, 2011 : 1:26 a.m.
1Bit: There are many "buckets" of money in municipal finance. For most of the buckets the law prevents the city from moving funds to another bucket. They can't for instance use the water and sewer money that is funding the sewage treatment plant for salaries in the FD or PD. Nor can they use DDA TIF dollars. Funds from this "bucket" must be spent only in the downtown. They cannot be spent for salaries for the PD or FD. The city is in a negotiation with the DDA to get $2 million from the parking fund so that they can spend it on salaries in the PD & FD but the rest is to be spent on parking, parking makes money but it takes awhile. If the structure were not built, the money would not come in as well so one feeds the other. Building the parking structure is not affecting the cities ability to pay for other things, like salaries for workers. Two different buckets.
1bit
Sat, Mar 5, 2011 : 1:14 a.m.
Borrowing money for critical infrastructure projects makes sense. However, when we are the midst of a global recession and when we are trying to save pennies to prevent losing jobs (including firefighters, police and teachers) doesn't it strike you that a "critical" priority was underground parking? At a minimum, isn't the timing odd? Sure, additional parking is or will be necessary but how did this project rise up to the top of our priority lists? How did this move ahead of fixing the Stadium bridge or Argo dam?
bugjuice
Sat, Mar 5, 2011 : 2:18 p.m.
Like it or not, of all the locations in the downtown, the Library Lot makes the best sense for a parking structure. What goes on top of the structure and who pays for it is the real bone of contention.
cibachrome
Fri, Mar 4, 2011 : 11:49 p.m.
But with the pending double digit inflation, you can pay it all back with money that has less worth and value. If you are that uptight about it, raise a City or County sales tax or get the income tax going. Maybe it could be done in a manner such that the tax surcharges go away after the debt is paid up. Get radical and start charging Churches for property taxes. That includes their schools, gyms, bingo halls, athletc fields and parsonages. Now there's some money to be acquired !
xmo
Fri, Mar 4, 2011 : 11:38 p.m.
We are not spending enough! This town needs to spend until it hurts then we will finally get people who know how to manage a budget. Sad but true.
Matt Damon
Fri, Mar 4, 2011 : 11:05 p.m.
Debt is debt. Keep on spinning...
John B.
Sun, Mar 6, 2011 : 12:26 a.m.
304 to 3 in this case. QED.
HBA
Fri, Mar 4, 2011 : 10:49 p.m.
Chris Taylor's letter is PURE POLITICAL SPIN. Right-on Forever27. We agree 100% with your comments.
John B.
Sun, Mar 6, 2011 : 12:25 a.m.
Looks like the vote is currently 305 to 4, Helen. The truth wins again.
bugjuice
Sat, Mar 5, 2011 : 2:20 p.m.
When you use the noun "we" please don't include me, Helen.
golfer
Fri, Mar 4, 2011 : 10:42 p.m.
build some more bike paths. yes i know this is nothing but i think we need to watch what we spend our money on. do we need it right now. if yes do it. if no we do not then put it aside. watch out city tax will be soon. with that and the money the gov is taking away we will not have money to spend.
Matrix
Fri, Mar 4, 2011 : 10:35 p.m.
Wait until interest rates skyrocket due to rising inflation as a result of trillion of dollars being printed. Can the city of Ann Arbor handle 8-20% interest rates? No wonder Fraiser jumped ship.
John B.
Sat, Mar 5, 2011 : 1:25 a.m.
The bonds are at a fixed rate. Anyone dumb enough to take on a variable-rate loan gets what they deserve, imo.
ferdcom
Fri, Mar 4, 2011 : 10:24 p.m.
Your poll options are once again flawed. Do you think AA has taken on too much debt? Answers are Yes or No -- the desirability or even necessity of the projects have nothing to do with whether they can be afforded. I need a lot if things but if I buy them all on my credit cards I will take on too much debt.
Tim Darton
Fri, Mar 4, 2011 : 10:12 p.m.
Born: Almost none of the money being used to pay off these bonds could legally be spent for police and fire salaries. None of the sewer $$ and none of the DDA $$ could be used, only what came from the general fund and that's not much. Much of the payment for the police and courts building is being made out of rent that used to go to the county to pay for space in their court house. The county kicked the city courts out so they could move their own juvenile courts into the space so the city had to build. The only money that could have been spent on salaries, the cell phone $$, are going to fund the police station the cops have needed for 40 years. The city operating budget and the capital budget are two different things. BTW, the city does not have a deficit, they always have a balanced budget. When the reporters write about a deficit they are talking about a deficit for next year but the whole point is that the city will make adjustments so they don't run a deficit. Get it? As for the Stadium Bridges, it would have been stupid to bond for it when they can get federal money, if that does not work out they have the money saved to pay for it but I would much rather they spend that on local roads. It still works, I use it almost every day.
Paul A.
Fri, Mar 4, 2011 : 10:01 p.m.
I understand Alan Goldsmith's comments. Debt is debt. I wonder if he paid cash for his home? For his car? For his kid's college? Etc. Managing debt is really the issue, and based on Taylor's letter (I assume his numbers are fairly accurate) it appears that the City is doing a fairly good job on this issue. Once again, I wish annarbor.com would at least attempt to explain where funding for various projects comes, so that we, the readers, can better evaluate how the sources of money in large measure determines what projects get done and how there are legal limits on where these monies can be spent. Again, the Stadium bridge is an excellent example.
BornNRaised
Fri, Mar 4, 2011 : 9:43 p.m.
So why is it that police and firefighters are getting let go and basic city services are being slashed to fix a "$2.4 Millon General Fund deficit." ??? Why doesn't Mr. Taylor explain that to everyone? So is he saying Fraser lied about the city having a deficit?
Awakened
Sun, Mar 6, 2011 : 11:46 a.m.
Step One of the politico's "Blame it on Fraser" campaign. Wait until he is out the door and it will be in full swing.
DonBee
Fri, Mar 4, 2011 : 9:31 p.m.
I note the shortfall in the various pension funds is not included in the debt. I wonder how the numbers would change if that was included? When Mr. Frasier arrived they were overfunded. Now they are not.
Awakened
Sun, Mar 6, 2011 : 11:45 a.m.
The recent pension fund report showed it was at 90%. (June 30, 2010.) It had been at 100% until the 2008 stock dip. The City has had to significantly increase their contribution to bring it back up. The full report is on the State of Michigan's Treasury site.
Jenna Thom
Fri, Mar 4, 2011 : 9:28 p.m.
@sbbuilder and DeeDee I completely disagree. I think we do need the parking especially in the area that is closer to State Street. Downtown is more than just Mainstreet. If we want downtown to thrive and to grow, we need additional parking. Only time will tell on this, but it falls in to "the planning for the future " category for me. Better to be proactive. As for the police courts building, it appalls me that so many people think that the current city hall is a decent place to work. The place is abysmal and all these comments from people who say that they are against it must not be from actual residents who have been inside the building. The building is a disgrace and outright embarrassing for the city to have put up with it for so long. As for the courts, they had to move. Although I have not seen the inside of the new building, the outside does not look gold plated to me, it looks like ordinary materials although has a modern twist which I do love. We had to build a new police courts building and I don't think the price tag of $45 million (I think that's what it was) is not that much considering the Library wants to spend $70 million on their new building.
Plubius
Sat, Mar 5, 2011 : 5:14 p.m.
Actually, no new parking as needed - what is needed for for people to stop being so friggin lazy and start walking. Downtown A2 is miniscule - park and walk!
nowayjose
Sat, Mar 5, 2011 : 4:04 a.m.
@ Mike, what makes you think the police courts building isn't utilitarian. You must have not been in it, but don't mind being over reaching in your comment. The police/courts building is the best the city could do with the money they had. Its no palace, but its better than the deplorable conditions they had before. But I'm sure your tax dollars deserve something better, because you don't work in a building full of asbestos and radon.
Mike
Fri, Mar 4, 2011 : 10:20 p.m.
They could have build a very utilitarian police department and court building. Most people who have to deal with the police and court system don't get much choice in the matter so it's not like the building is going to bring extra revenue to the city. I feel the same way about schools and post offices. I don't go to the post office to look at it and be amazed by the building, I just want to mail a letter. Once a kid is inside the classroom the teacher becomes the most important part of that building
Mick52
Fri, Mar 4, 2011 : 9:25 p.m.
I have to give Mr. Taylor some credit for sending this information to his constituents. He is trying to explain this situation so it is understandable. A proper thing for an elected official to do. Every community has to rely on borrowed funds for large projects, it is very common. This is no an endorsement of A2's practices however, I agree with those who point out the condition of the Stadium bridge was ignored far too long. Ditto that main arteries that are feel like they were hit by artillery. It seems as though those in the council seats rank essential services different than I do, but the voter majority apparently agrees so be it. In re to the police court building, is that all there is in that addition, or did the city use the poor police facilities to piggy back on some new digs? In construction, there is design based on function and design based on aesthetics, the latter being much more expensive and it appears that was the decision with that ugly building.
DeeDee
Fri, Mar 4, 2011 : 9:06 p.m.
Sewage treatment and the stadium bridges are good examples of the kind of critical infrastructure that is being neglected around the country and for which the bill will be larger later than doing it at an appropriate time. The parking lot and new city building are just big boondoggles - the deck at 4th and Williams is rarely full. The library lot was popular because if was a SURFACE lot, and I bet people will not like the underground structure any better than the current deck when it is complete.
sbbuilder
Fri, Mar 4, 2011 : 8:59 p.m.
Hey, deficits (or debt) don't matter. Someone said that a little while ago. And, guess what, they sure as heck do matter. They matter a great deal. Water treatment? OK. We needed that. But, we opted for the whole enchilada plan. The works. We'll see if we bit off too much here. Police/courts? Again, the gold plated version was selected. Needless Underground parking? Now, here I seriously beg to differ. Nothing was broken, hence nothing needed fixing. We just decided to throw some more straws on the camel's back. Hey, debt doesn't matter.
Edward R Murrow's Ghost
Sat, Mar 5, 2011 : midnight
It's one of the very few things about which the former VP was correct. But, then, even a stopped clock is right twice a day. Those who think governments' budgets should function in a manner that even remotely resembles a household budget need to take a remedial class in macroeconomics (if they ever took one in the first place). Good Night and Good Luck
sbbuilder
Fri, Mar 4, 2011 : 11:11 p.m.
bugjuice Yeah, I'm aware who said that. I couldn't believe he actually said that. At first I thought he was just being cynical. But, no, he seems to have succomed to the anti-fiscal responsibility disease that is epidemic in DC.
Mike
Fri, Mar 4, 2011 : 10:22 p.m.
Parking fines are one of the city's biggest source of revenue. More parking = more income.....simple
bugjuice
Fri, Mar 4, 2011 : 9:26 p.m.
Dick Cheney said deficits don't matter. I think Reagan said it too. Maybe even the great economist Karl Rove.
djm12652
Fri, Mar 4, 2011 : 9:17 p.m.
More parking? That's a good one. The only time I've seen the William and 4th structure full was during Art Fair...and only during the daytime hours. People will park illegally after hours in delivery zones to avoid having to walk around the block or near the bus depot to get to restaurant row on Main Street. So what makes anyone think the diners will use this new underground structure which is a block further from Mainstreet?
Alan Goldsmith
Fri, Mar 4, 2011 : 8:43 p.m.
"I am quite pleased that the city of Ann Arbor has enough foresight to invest in our infrastructure before a crisis occurs" You should really take a drive down Stadium and check out our foresight on the bridges. Lol.
Awakened
Sun, Mar 6, 2011 : 11:39 a.m.
I absolutely agree with Johnny. Those chunks of concrete falling onto cars on State St. from the bridge could never have hurt anyone. How could the City have planned for the need to replace a 80 year old bridge?
johnnya2
Sun, Mar 6, 2011 : 12:22 a.m.
What crisis has occurred on Stadium? Have people DIED? Cars fallen off the bridge. Yoru commute being longer is hardly a crisis.
Sven49
Fri, Mar 4, 2011 : 8:35 p.m.
Hey, it's only a quarter of a billion.
Haggis_Chihuahua
Fri, Mar 4, 2011 : 8:28 p.m.
Nice to learn the city's rolling in dough. I guess there'll be no more silly talk about needing a city wide income tax.
Andrew
Fri, Mar 4, 2011 : 9:50 p.m.
With the property tax income weaning, the best place to rise money is to set more speed traps, and more non-working parking meters like the ones on Liberty in front of Borders. Trust Ann Arbor Hieftie to go along with any aborted scheme to stay in power.
R
Fri, Mar 4, 2011 : 8:23 p.m.
Such a biased article. "Attempting to convince residents that it's not as bad as it sounds," the author writes. Gimme a break. Most of these comments below (and to some degree, the article's author) demonstrate a complete lack of understanding about municipal budgeting.
Jenna Thom
Fri, Mar 4, 2011 : 8:19 p.m.
I am quite pleased that the city of Ann Arbor has enough foresight to invest in our infrastructure before a crisis occurs. Anyone who says that the investment in our sewage treatment plant is not needed is a fool. Anyone who says that the old police building/city hall is an acceptable place to work has never set foot in the building and is not facing reality. The city is in a no win situation. Some of you complain that the city pays for bonds for infrastructure repairs that are known to be needed in the future and you call that an unnecessary increase in debt. While out of the other side of your mouth you claim that the city was not preemptive enough with the stadium bridge and should have pulled bonds to pay for it. If the city saves money and puts it aside to be used for a future project like they did for the police courts building or for the new sewage plant, then you say that the money should be moved around to pay for police, to buy another park, etc instead. It is so tiring to hear. We need to invest in the city. I am glad that council uses a mix of saving, bonding and federal/state grants to help pay for things. Ignoring problems just makes everything worse, while finding fault with every single solution just makes the problem more burdensome.
John B.
Fri, Mar 4, 2011 : 8:43 p.m.
Thank you for your sane, thoughtful post! (We don't see many like that, these days, unfortunately).
TripleVSix
Fri, Mar 4, 2011 : 8:11 p.m.
Taylor says the debt is due to "infrastructure." I agree with him that the problem can be summed-up by a single word, but that single word is actually, "Democrats."
Duane Collicott
Sat, Mar 5, 2011 : 6:51 p.m.
I think I stated it quite clear: Ann Arbor's problem is Democrats.
WovenGems
Fri, Mar 4, 2011 : 8:29 p.m.
TVS, are you saying Republicans would never fix the water treatment plant or would they just contract with Nestle to build a plant that would charge four times as much is currently being charged.
Forever27
Fri, Mar 4, 2011 : 8:28 p.m.
next time, try to actually formulate an argument. Rather than vilifying a political party. It's a little more complex than that.
dotdash
Fri, Mar 4, 2011 : 7:50 p.m.
Anyone have any points of reference? Ypsi, for instance? Westport, CT?
Alan Goldsmith
Fri, Mar 4, 2011 : 7:49 p.m.
Taylor leaves out the 3 Million dollar 'gift' /land purchase from the developers of the new building across from the Bling Pig after the DDA lagreed to loan them money for their project's parking structure. That $3 Million could have gone into the general fund...but...isn't.
Fred Zimmerman
Fri, Mar 4, 2011 : 7:47 p.m.
It seems to me that you are omitting one major difference between mortgage debt and the city's debt. Mortgage debt is secured. If you don't make the payments, the bank takes your house. Is the city's debt secured? If we don't make the payments, we default, and what happens then? Isn't this more like credit card debt? FredZ
John Q
Fri, Mar 4, 2011 : 10:29 p.m.
I would rather be holding bonds secured by a municipal obligation that an overvalued house that's loss value since the loan was issued. The city's required to raise taxes to cover the cost of debt payments. That's a lot more secure than a property that can lose value.
Alan Goldsmith
Fri, Mar 4, 2011 : 7:46 p.m.
All Taylor needs is some pom poms and an outfit. He's such a cheerleader. Debt is DEBT Mr. Taylor. Where does Taylor think the sewage fees come from? Skyrocketing water bills. Where does the parking structure payments come from? Money skimmed off increases in property values in the DDA area of control. The Police and Court building? The bonds are not covering the increases in the General Budget to operate the building. It's nice to see someone at least address the issue, even if he's wrong and this is just a cut and paste from his email. But despite the smoke, the DEBT has increased big time in Frazer's time in his position. Quit letting politicians make excuses and do some investigating please.
johnnya2
Sun, Mar 6, 2011 : 12:19 a.m.
No not true. Debt is not debt. Anybody who thinks that way really should have their financial education evaluated. I would also say this is the PERFECT time to have MORE debt. Interest rates are historically low. Infrastructure needs to be updated. We could have zero debt, but nobody would want to live in the city.
cinnabar7071
Fri, Mar 4, 2011 : 7:25 p.m.
If I lived in Ann Arbor and found out I owed $2199, I'd move to ypsi. WOW $2199 in debt for every Man, Women, and Child.
Andy Poli
Fri, Mar 11, 2011 : 4:16 a.m.
The article says that these few thousand dollars my family owes were spent mostly to give me drinking water. And most of it will be paid for through my water bill. Should I be sad that I'm not drilling my own well?
John Q
Fri, Mar 4, 2011 : 10:33 p.m.
Between a home loan, car loan and credit cards, I easily have 6 figures in debt. But I sleep well at night. Why? Because I have the means to pay it off, most of it is backed by collateral and most of it doesn't need to be paid off tomorrow. The same is true of the city. Unless you operate strictly on cash, few people are behaving any differently than the city.
Andrew
Fri, Mar 4, 2011 : 9:29 p.m.
$2199 in property taxes is peanuts. I am paying $4340 for a west side abode nobody wants to buy.
mrk
Fri, Mar 4, 2011 : 8:04 p.m.
Not to mention the City of Ypsi has the highest millage rates in the County. By a lot. Just sayin.' <a href="http://www.aaabor.com/downloads/Resources/MLSResources/Tax_Rates.pdf" rel='nofollow'>http://www.aaabor.com/downloads/Resources/MLSResources/Tax_Rates.pdf</a>
Tom
Fri, Mar 4, 2011 : 7:42 p.m.
This isn't a debt the way you are thinking about it. All of these projects are being repaid by the people using them. It's not like every person has to cough up $2199. And come on... no one wants to move to ypsi.
Forever27
Fri, Mar 4, 2011 : 6:55 p.m.
Meanwhile the stadium bridge literally crumbles because we couldn't gather up $30 million. I'm fine with the money spent on the water treatment renovations. But, the new city hall (aside from being hideous) was a waste and the underground parking structure was nothing but a boondoggle from the start.
Forever27
Fri, Mar 4, 2011 : 8:25 p.m.
@Tom, the city has "kicked the can down the road" on the bridge for over a decade. They refused to fund renovations themselves in hopes that they could secure federal and state money for it because we couldn't afford it. Had we not spent the ridiculous sums of money specified in the article above on the second two projects we could have easily paid for the bridge repairs years ago. As for the parking structure being needed, that is something that is constantly argued. Parking in Ann Arbor is nowhere near as bad as people claim it is. Having to walk more than a block from your car to your destination is not a shortage of parking, it's an overabundance of laziness.
TripleVSix
Fri, Mar 4, 2011 : 8:13 p.m.
Amen to the "hideous" comment. It takes the prize for the ugliest building in the whole county, if not beyond.
Tom
Fri, Mar 4, 2011 : 7:38 p.m.
The Stadium bridges project is still ongoing... not sure what you're talking about. Plus it isn't costing Ann Arbor nearly $30 million because of the federal and state money that has been granted. And yes... that money is still coming. Just because something passes in the House doesn't remotely guarantee it's passing in the senate or getting a signature from the president. The city hall is expensive and a solution could have probably been found for a lot less, but a new facility was definitely needed. The parking structure was also needed, and I have no problem with it, but I'm wary of how the city is handling the development rights for the property.