Detroit Mayor Mike Duggan said the city’s revenues have bounced back from a pandemic-related slump, and it’s on solid financial footing.
Duggan made his annual budget presentation to city council members on Thursday. The council ultimately needs to approve the city’s budget.
Duggan said the city’s financial rebound is largely due to what he called an “extraordinary” jump in income tax revenues. He told council members that’s driven by some large new development projects that earned major — and sometimes controversial— tax abatements.
“We've had almost a $200 million growth in our income tax revenues in the last decade,” Duggan told council members. “This is something that we have earned together, and we are financially strong because of what we did.”
Duggan’s budget proposes investments in city bus service, which hasn’t yet returned to pre-pandemic levels and has struggled to hire drivers. He proposed $21.6 million to hire another 117 drivers, in addition to more than 100 vacancies the city is currently working to fill. He also proposes $18.6 million for the Detroit Police Department, with a focus on officer recruitment and retention, additional neighborhood police officers and crisis intervention team members, and a new Transit Police division, and $20 million for capital improvements to city parks, facilities, and neighborhoods.
Duggan said it’s largely a “status quo budget.” He admitted it’s a little “tight,” because Detroit has now resumed making employee pension contributions after its 2013 bankruptcy. But he said the city has managed to honor those pension obligations, and build up a rainy day fund that exceeds what’s required by state law.
Duggan said that fund currently has $150 million, or 10% of the city’s total general fund budget. “That's certainly more in line with well-managed cities nationally, but it gives you a sense of how far we've come beyond the very low expectations Lansing had for us 10 years ago,” he said.
The city council will begin hearings on various aspects of Duggan’s proposed budget next week.
