Thank you Grace Shore and the Macomb Chamber of Commerce for providing this opportunity to address our business community, county, state and national elected officials, and the nearly 100,000 residents of Clinton Township.

 

Also, thank you Larry Neal for allowing us to use this very beautiful Library, jointly owned by the residents of Clinton and Macomb Townships. And, let me thank my fellow township board members who serve our residents. It is a great honor for us to serve and I would like to introduce those who are here today.

 

As a nation we’ve gone through epic economic turmoil.  We are leaving the old economy behind, and it has parted way to a new way of doing business by corporations, by government, even by our own families. To survive, the Charter Township of Clinton is changing the way we provide services. Long gone are the days of doing what we’ve done comfortably in the past and these graphs will show you why.

 

Our two primary sources of revenue are property taxes and revenue sharing from the State of Michigan. Both have dropped significantly. Property tax revenues have decreased dramatically because of the falling values of our homes and businesses. Our total taxable value as of December 31, 2011 is 18% less than at its peak in 2008, a loss of revenue to the township of approximately $10.5 million a year. The major portion of this decrease is being felt by our police and fire funds. It is expected that taxable value in Clinton Township will fall again this coming year AGAIN decreasing revenues to the police, fire and general funds.

 

Additionally, the State of Michigan has severely reduced Revenue Sharing funds to cities and townships that help provide our residents with the services they have historically come to expect.

 

More than $25.5 Million in Revenue Sharing has been lost to us since 2002 and that amount will increase even more this year. That’s a significant percent of our general fund revenues. In the fiscal year ending in 2011, we will receive only $350,000 of statutory payments from the State, compared to $3.4 million we received from the state in 2002-- just 10% of what we used to receive.

 

In the past, Clinton Township enjoyed a standard that many communities eyed enviously. There was little or no motivation to collaborate with other communities. We were the fastest growing community in the state throughout most of the 80’s and 90’s. We went from a sleepy township that surrounding cities wanted little to do with. Then, Clinton Township became the place to be. We had an influx of businesses, builders, hospitals, colleges, the only new Mall in Southeast Michigan in the past 35 years—we were a major community whose residents and businesses demanded and expected major services from their local government.

 

Then the economy collapsed, and we still have all our residents and businesses to service but with dwindling resources. This stark differences between the Old and New economies dictates a different mindset for our community’s survival.

 

At the local level we’ve always known we play a very special role in the daily lives of our residents and business owners. All of our employees take a great deal of satisfaction in providing RESPONSIBLE GOVERNANCE and services for our residents and businesses.

 

I am very pleased to report that as Michigan’s most populated Township and 10^th largest community, we are weathering the economic distress that has put a stranglehold on communities throughout the country. In Michigan, our governor has initiated a program commonly referred to as EFM’s—or emergency financial managers. EFMs are called when financial matters are so bad that an outside specialist is appointed to manage a community’s affairs--from top to bottom. Let me assure you we are working very hard so this does not happen in Clinton Township.

 

Standard and Poor’s Rating Services assigns us its ‘AA’ long-term rating. Two key things here—Double A rating and LONG TERM! This rating is an indication of a community’s financial health and reflects the diligence and dedication of this and past township boards and our excellent staff members that service our constituents.

 

Standard and Poor’s continues in its report to state that “the township’s financial health has remained strong as a result of management actively adjusting the budget.”   However, it goes on to state that “the township board will be CHALLENGED to continue to balance the budget in the future given the ongoing tax base contractions. Standard and Poor’s also provided favorable comment that the township forecasts financial operations based on a rolling five-year financial plan and maintains investment policies, overseen by Treasurer Bill Sowerby, that follow the state guidelines. They were also very impressed that the township makes its full annual required pension contributions to the general, fire, and police funds.

 

The report finishes by stating that “the stable outlook reflects our expectations that the township will continue to maintain strong financial reserves while making budget adjustments to offset any future revenue decreases. However, management indicates that the financial years 2012 and 2013 are likely to generate deficits in all three major operating funds as a result of continued decreasing property tax revenue. If the township board does not take action to either reduce expenditures or enhance revenues in order to close the anticipated budget imbalance, we would then consider LOWERING THE DOUBLE A RATING. This would indicate a weakened financial outlook that could jeopardize the townships financial position.

 

Why is the Standard and Poor’s rating important? It gives an independent look at our fiscal health. It is looked at by businesses considering locating here and we all know that business coming here brings jobs and additional tax base.  I have no intention of allowing our rating to decrease, and I will work with the responsible members of our township board, along with an excellent finance department headed by Donna Lauretti and Mary Hein, to continue this RESPONSIBLE GOVERNANCE. By responsible members of the Board, I mean those willing to make the unpopular and tough decisions needed to keep the Township fiscally solvent. Decisions like not filling vacant positions, laying off employees, consolidating departments, and placing limits on health insurance costs.

 

We are on sound financial footing thanks not only to the responsible board members, but also to our department heads who have found ways to operate with smaller staffs.  This did not happen without a great deal of sacrifice by our employees.   I know I have challenged our staff and raised anxiety levels at times in making recommendations to the board to consolidate operations and tasks to do more with fewer employees.   Although it’s been a tough process, I believe that, for the most part, change has been met with strong support by those affected.

  

We have renegotiated significant concessionary contracts with all but one union, and are negotiating with that union right now. As I mentioned, the responsible members of the township board voted this year for placing limits on health insurance costs that will save the township significant dollars in expenditures in the coming years. Costs beyond these limits will now be borne by our employees. Let me reiterate that none of these changes are easy, and it is a sacrifice, but necessary.

 

Because of these significant cost reductions, our auditing firm, Plante and Moran, reported that strong management of our township resources produced a positive financial report for the township.   It indicated that the difficult actions that the board members have had to take have put Clinton Township in a strong position. It also stated that the township’s ability to provide quality services has been bolstered by our willingness and ability to adapt technology to better meet the needs of our community.

 

Our I.T. department is comprised of three people…a relatively small staff considering the size of our community and the number of employees they service. A big part of that is due to our IT Director Brian Moynihan. Here’s a story I like to tell. About a month ago Brian was on vacation. While taking his granddaughter to see a movie with his wife, he received an urgent phone call from Deputy Fire Chief Mike Phy and was told that the computer system in the fire department had stopped working. Now the importance of the computer system is that it directs all six fire companies to their emergency runs. Brian immediately left the theatre and his outing with his granddaughter and less than 45 minutes later the computer system was up and running again. This is just one small example of our employees working above and beyond for the benefit of our residents.

 

The continuing decline in property tax revenue to our Fire Fund is of great concern to us all as the department responded to 9,118 fires and first responder calls in 2011. We project that next year again there will be a shortfall that needs to be addressed. If it were not for a $3.4 Million federal grant, we’d currently have 12 less firefighters. This grant will be depleted in about 1 ½ years. Left unaddressed, the fire fund would deplete itself by 2015. That, in part, is the reason why I have had to recommend that the board not replace several firefighter positions due to retirement, and again why responsible board members have provided their support.

 

Additionally, I have had to recommend two sets of layoffs in the fire department. The first was for 7 firefighters and the second was for 12 firefighters. Again, responsible board members concurred with my recommendation. We were able to successfully hire back 12 with a federal grant. Had the board not had the courage to vote for the layoffs, the Fire Fund would have run out of money in December of 2011—that’s right, last year. It could have meant the quick depletion of money from the general fund until that too was exhausted, or we could have had massive layoffs in the fire department, far more than what we have had to date, to make up the financial shortfall. That’s why the layoffs in the fire department were necessary.

 

Fire Chief Jack Shea and his staff continue to investigate, review and implement best practices found among the local Fire Services. In 2011 the fruits of these efforts resulted in the signing of a pair of Inter-Local agreements by Clinton Township, Shelby Township, Sterling Heights, Warren and Macomb County.  Participation in these co-operatives will benefit the Fire Services by reducing the readiness costs to all five groups for Hazardous Materials and Technical Rescue response.

 

We experienced a number of high profile fires among the 250 fires the department responded to in 2011, and I would like to describe two that happened at the same apartment complex. Early last year, firefighters were called to a major fire on Wee Care Drive. They found 5 occupants, 2 adults and 3 small children, huddled on a second floor balcony. They had been forced to retreat to the balcony because their exit path was blocked by fire in the apartment’s public hallway. All 5 were quickly rescued using ground ladders. However, one other resident in the complex was quite vocal about our fire response. Only weeks later, the department responded to another fire call in the same complex. Firefighters found a kitchen fire and were told that a person was missing.  Firefighter Tom Schmid and Lieutenant Geoff Fecteau aggressively conducted a search, located and removed an occupant who was overcome by smoke and suffering 2^nd and 3^rd degree burns. They found her in a rear bedroom, pulled her out, saving her life. Ironically, this was the same woman who had had earlier issues with the department at the first fire. My guess is that she is thankful for our fire departments response.    Let me introduce you to the two who saved her life.  Firefighter Tom Schmid and Lieutenant Geoff Fecteau.

 

Of the 250 fires in the community, 49 met the criteria to pursue an investigation. Our Fire Marshall Steve Conroy has earned expert witness status as a fire investigator. Recently, after a second fire in a home in the 16 Mile and Moravian area, a team headed by Fire Marshall Conroy conducted an investigation which resulted in a prosecution, which is important, because Arson is considered a crime of secrecy. After teaming up with Police Detective Jim Hall, the perpetrator of this crime has received a jail sentence.   Thank you Fire Marshall Steven Conroy and Detective Jim Hall for your expertise and let me introduce you to the community—Fire Marshall Steve Conroy and Police Detective Jim Hall.

 

And, speaking of our police department, working with a reduced staff, they responded to over 52,000 calls for help in 2011. It seems that this tough economy has spurred additional criminal activity in all communities. Even with the additional work load, our police department continues to partner with the Macomb County Sheriffs Department for the “Party Patrol”. This initiative is meant to enforce alcohol consumption laws with minors. It also helps educate the parents and adults in their responsibilities. 

 

As 2011 came to a close, we thought C. T. would avoid any homicides during the year. But near the end of 2011 unfortunately we had one. However, the suspect was identified and arrested within three days of the incident.

 

When I look at reports that list the types of crimes and activities our police department deals with daily, it saddens me to see what people can do to each other. You’ll recall the robbery and rape of an elderly women in her apartment at Heritage Estates.

 

I knew our detectives would not rest until the perpetrator of this crime was behind bars. Let me introduce the detectives who left no stone unturned until the suspect was identified, arrested and awaiting trial. Detective Bill Furno and Detective Lt. Dave Dunn.

 

I receive many calls and letters from residents thanking many of our officers for their outstanding commitment to service, and I know we all take great pride in the manner in which Chief Fred Posavetz and his commanders conduct their business---all 24 hours of every day.

 

I need to point out that the same tenuous financial situation exists in the police fund as in the fire fund. Starting in 2012, expenditures are projected to exceed revenues and that gap will continue to grow thru 2015 when the police fund will be in dire straits.

 

The Township Board, and the administration of both the police and fire departments will be faced with more difficult decisions this year and in the future regarding these services. I know that our board is very thankful for all that our public safety departments do to keep us safe, and we respect how you carry-out your duties with such pride and dignity.

 

Now I would like to turn the page and talk about a few other points of pride in our Township:

 

Here’s a listing of some of the things that we hope to see accomplished this year: 

I will continue to work with members of the township board and our very capable and dedicated staff, to find innovative ways to provide quality services to our businesses and residents with the knowledge that we will have less revenue in the years to come.

 

There is reluctance to raise taxes in local communities, but the decline in property values and the fact that the state has balanced their budget by reducing our revenue sharing has really put the strain and responsibility to figure it out, on local governments. You have seen and heard how we responded. We have fewer fire and police in the ranks and fewer civic center employees, thru attrition and layoffs. You have also heard me talk about the hard cap for health insurance that is now in place and contract concessions from our unions, and consolidation of departments. We are doing business differently, and we have studied other options, but we still forecast continuing decline in revenues.

 

The only way we will be able to balance the budget for both the police and fire funds this coming year is not to replace employees as they retire. We will have 11 police officers and 7 fire fighters retiring this coming budget year.  I will be bringing forward a balanced budget for the board to approve very soon. The budget will have these staff reductions included.

 

WE ARE RUNNING OUT OF VIABLE OPTIONS OTHER THAN CONTINUING TO REDUCE THE NUMBER OF EMPLOYEES IN OUR PUBLIC SAFETY DEPARTMENTS.

With this in mind, I requested that our finance department do a 10 year forecast of the number of additional mills that would be needed to keep our police and fire department staff levels at the point they were this past January 1, 2012. This does not mean putting the staff levels to the point they once were, or even the point we would like them to ideally be, but at the level of one month ago. After adopting our budget, I will be reviewing this information and report the findings to the township board.

 

We’ve used many different ways to balance the budget. I have outlined how we have done it thus far, and despite the economic distress of the economy and housing market, I have outlined why Clinton Township continues to be a wonderful community for our businesses and residents. I often hear people say that they do not need to leave the township to find anything they require in their lives.

 

I have highlighted how employees are changing and adding to their roles to help with our budgets, and it is this change in attitude as we move from the old economy to the new that will allow us to address the issues of today as well as tomorrow. We have not added many staff members over the past several years—we have actually lost many --and one benefit of that is that we have a dedicated staff that knows their work. I’d like to publically thank our township employees, all of them, for their outstanding and dedicated service to the community and for their advice and support to me.

 

What is our FUTURE? We are being told by experts to expect at least two more years of continuing decreases in property values which means fewer resources to draw upon, BUT WE really don’t know for sure. 

 

Look at this photo. What do you see?

 

Is it a sunrise, or sunset?

 

Think of the state of our economy. We can either believe we see a sunset and we can expect continued darkness, or we can see a sunrise with a bright day coming. Recent news has indicated a slight turnaround in the economy. However all local units of government will lag behind this recovery until the housing market bottoms out.

 

I, as Supervisor, prefer to see a SUNRISE and a BRIGHTER day on the horizon. I prefer to see a township that weathered the storm ---and re-invented itself, and will continue to reinvent itself.

 

What I can tell you is this:  I will continue to bring forward RESPONSIBLE GOVERNANCE for our Board of Trustees to consider so that Clinton Township CONTINUES TO BE A COMMUNITY OF EXCELLENCE. This is the type of leadership our community expects and deserves.

 

THANK YOU and God Bless Clinton Township.