A news service for the people of Michigan from the Mackinac Center for Public Policy

Voting Day
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In the coffee houses and conference rooms of Troy, a community struggle is emerging over municipal funding.

The city says it needs a tax increase to sustain the standard of service the community expects.

Some residents say it’s time city officials realize the crises its residents face on a daily basis — foreclosures, unemployment, and a loss of overtime and pay cuts for those with jobs.

The city has put a 1.9 millage increase for five years on the ballot that will be voted on Tuesday. The millage would generate $37.7 million over five years, according to the city. If it is defeated, the average Troy tax bill will be $196 less a year.

A group of residents have rallied to fight the tax increase. They’ve held meetings and taken their fight to the local coffee shops, churches and colleges.

“Troy families have been hurting,” said Glenn Clark, a Troy resident opposed to the millage. “People have had their overtime cut, their salaries slashed … foreclosures are up. To put this massive tax on their backs is unwarranted. In this horrible economy, we have to look at other options.”

“We don’t need a tax increase,” said Jerry Staeger, a Troy resident who opposes the millage. “Everyone is cutting back, but not the city of Troy.”

But municipal lobbyists say the problem of municipal funding impacts virtually every city in Michigan.

“The biggest financial issues with cities, it is the absolute abandonment of the state in living up to its funding obligations of local government,” said Dan Gilmartin, executive director of the Michigan Municipal League, an association that represents the interests of municipal government.

Gilmartin said the state has kept $4 billion the last eight years that was earmarked for local governments so it could plug its own budget holes.

“It has to do with an absolute breakdown between the state and local governments,” Gilmartin said.

Troy City Manager John Szerlag said it’s a crisis throughout Michigan.

“It’s huge problem,” Szerlag said. “A lot of the smaller cities are quite frankly going to go bankrupt.”

The residents fighting the tax increase realize they will soon be joined by others as the local governments react to falling property values.

“This is a story that is coming to your town, too, so to speak,” said Oakland County Commissioner Bob Gosselin, R-Troy, who opposes the millage. ”Other towns will look for a tax increase.”

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