Clinton Township Won’t Fully Recover from Loss in Property Values Until 2023, Supervisor Says

With residential foreclosures down and good market sales up, Clinton Township’s housing market is showing marked improvement, but Supervisor Bob Cannon says it could take another 10 years for property tax revenue to return to peak 2007 levels. 

As property taxes make up a large portion of the township’s annual revenue, the threat of cuts in staff and services to balance the budget continues, Cannon said during his State of the Township address Friday.

“The challenge before us is that available resources continue to shrink and will continue to do so until we arrive at a new economic reality that is far different than what we knew five years ago,” he added.

In the last five years, property values in Clinton Township have cumulatively declined 30 percent, which has meant a loss of almost $20 million for the police, fire and general fund.

“We hear reports that we have bottomed out and that the economy is starting to improve,” Cannon said. “Does this mean that since it took us five years to sink to this level that it will take us five years to get back to the property tax funding that we had in 2007? The answer is a resounding no.”

As Clinton Township is now 95 percent developed, growth in taxable value is limited to the rate of inflation – 2.5 percent on average. Losing 6 percent of taxable value every year for the past five years (on average), it will take 10 years at 2.5 percent to return to the 2007 values the township relied upon in tax revenue.

“And this does not include the township’s other main funding source which is state revenue sharing,” Cannon said, adding that since 2002, the township has received 31 percent less funding from the state for a total loss of $27.4 million. “Needless to say, limited resources are in the foreseeable future if we do nothing.”

In reaction to this continued decline in revenue, the township has reduced its staffing levels through attrition and layoffs by more than 112 positions, modified its current employee health care benefits as well as retiree health care and retiree benefit provisions for new employees, and consolidated the Engineering, Water and Sewer, and Public Works into one department.

The following cost-saving measures are expected to go into effect in 2013:

• Department of Public Services will move out of the building at Garfield and Clinton River, which is now beyond repair, and into a new building near the Morley Candy Factory on Hall Road in March.
• An update of the Five-Year Recreation Master Plan, which will be presented to the Board of Trustees and public in February, is expected to open new opportunities for grant funding.
• Cannon will recommmend consolidation of the IT, Human Resources and Finance departments
• Clinton Township police dispatch, followed by fire dispatch in 2014, will be consolidated with Macomb County.
• Two citizens committees will be created to determine whether a millage increase is needed for public safety. Should either, or both committees recommend an increase, a special election could be held as early as August for Clinton Township voters to decide the tax increase.