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Posted on Sat, Feb 25, 2012 : 1 p.m.

State financial manager should be appointed for Ypsilanti

By Letters to the Editor

The City of Ypsilanti is not in financial trouble because of the Charter Township Act. Years ago the city had an opportunity handed to them to annex Ypsilanti Township and refused it.

The City of Ypsilanti is not in financial trouble because of falling property tax revenues, falling state revenue sharing dollars, or Lansing's long failure to fully fund the Act 289 dollars that the city should receive for providing fire protection to EMU - although these factors are making it harder for the current Council to fix the real problem.

The real reason the City of Ypsilanti is in financial trouble is because (former) Mayor Cheryl Farmer and her most reliable vote, (former) Council Member John Gawlas, chose to gamble the city's full faith and credit on a 38-acre redevelopment scheme, while (former) City Manager Ed Koryzno enabled this disaster by completely failing in his fiduciary and ethical duty to protect the city's general fund from such unprecedented risk.

If the city did not have to make million dollar-plus annual payments on the $30 million-plus "Water Street" debt, we would be like most other Michigan communities -- struggling but making things work.

With the Water Street debt, Ypsilanti is nothing more than an insolvent debtor in denial.

No amount of tax increases can pay this debt off and restore financial soundness. The city's own analysis bears this out.

It is time to invite the governor to appoint an emergency manager, and for that emergency manager to request permission to take the city through a GM-style managed municipal bankruptcy.

To wait, or to continue to hold to the Farmer/Gawlas' fantasy math that we can tax our way to prosperity, simply delays the inevitable and will make any future settlement of the debt that much more difficult and expensive for the taxpayers of this town.

Rodney C. Nanney



Tue, Feb 28, 2012 : 3:24 a.m.

What you are looking at is the result of ONE PARTY RULE where other voices are ruled out because there is an R after their name. Secondly this is what a town ruled by people with a D after their name looks like. (Does this remind anyone of Detroit?) This is what the Democrat dream of making everyone equal, government deciding what people should be paid (the living wage) and other such non-free market non-sense leads to. I pity the town. How about the council members who voted for this boondoggle pay the bill? Future leaders would learn a valuable lesson.


Mon, Feb 27, 2012 : 4:27 p.m.

a) this is why Rodney will never hold elected office in Ypsilanti b) this should be a stunner but...I agree with Pete. An income tax is a fair tax for all those who depend on city services and don't pay for them. Painful but true.


Sun, Feb 26, 2012 : 2:29 a.m.

Someone mentioned Ypsilanti already has the second highest millage rate in the state, is that true? Add on a possible Water St. millage, city income tax, county wide transportation millage and future pension related tax increases and Ypsi could perhaps surpass Detroit in the taxation of it's citizens. So how's the higher taxes and income tax working for Detroit so far? How many more underwater homeowners will decide to throw in the towel and walk away due to the higher tax burden??


Sat, Feb 25, 2012 : 11:02 p.m.

I will vote with Pete here. To many good things are happening in Ypsilanti for the citizens to give up control of its future. One can always take the easy doom and gloom approach or one can take a more positive, can-do approach which Pete is doing. Just look at the good here in town. EMU is growing and gaining prestige. The Downtown is filling up both with loft apartments and new businesses. Look at the success of the Haabs, Beezy's, Model Cave, MIX, The Rocket, Salt City and Michigan's number 1 shoe store, Puffer Reds. Soon the Red Rock Downtown Barbecue will open with a goal to be the best barbeue in the State and they like other businesses in Ypsilanti will draw from all over the area. The Wolverine will also reopen better than ever. Then we have Depot Town and its regional allure. Add the Bomber and there is a lot to be thankful for including our historic neighborhoods and homes. To those outside the area, Ypsi is becoming known as a pretty cool place. No one likes to pay more taxes but sometimes we have to do what is necessary to protect our City, our very capable police and fire departments, and our own personal investments. It is fair, and in fact we must challenge our City Council to make great decisions everytime now and I think Pete Murdoch is helping to lead the way with the kind of leadership that is needed. Thanks Pete!

The Black Stallion3

Sat, Feb 25, 2012 : 11:12 p.m.

He should give you an extra vacation day for the cudoos.

The Black Stallion3

Sat, Feb 25, 2012 : 10:56 p.m.

The solution for Ypsilanti is an Emergency Manager, it is a proven fact that Ypsi can not control their finances and they do not need to be allowed to make it worse with the leadership they have.

The Black Stallion3

Sun, Feb 26, 2012 : 2:34 p.m.

The part that gives it away is "IF" There is a problem with money now and Ypsilanti has no solution and "IF" they had not made a major mistake they would be OK. Now "IF" they can not resolve the problem then they will face an "EM".


Sun, Feb 26, 2012 : 4:54 a.m.

A "proven fact"? In what fantasy? Ypsi has done a better job than most in controlling its finances, hence the city's $9 million fund balance. The city is miles ahead of others when it comes to cutting unnecessary expenses, and would be in pretty decent shape if it weren't for Water Street. Ypsi bears no resemblance to a city out of control of its finances. Perhaps you've heard of Pontiac or Detroit? You apparently have no idea what you are talking about.


Sat, Feb 25, 2012 : 10:42 p.m.

Has anybody ever looked at why the City of Ypsilanti can't seem to attract new business and/or residents? I'm sure it has nothing to do with the 2nd highest tax millage in the State of Michigan. At least 25% higher than Ypsi Township or the City of Ann Arbor. And one of the main proposals is a City Income Tax. Does anyone still believe that raising taxes is a sustainable solution?

Pete Murdock

Sat, Feb 25, 2012 : 10:15 p.m.

Now to the fantasy that an Emergency Financial Manager will pull rabbits out of the hat and solve all our problems – I have met on several occasions with State Treasury officials to discuss Emergency managers, consent agreements and even bankruptcy. The bottom line is that the financial manager cannot create revenue and can't make the Water Street debt go away. He/she can do little more than what City Council can do only without any accountability to the public. So if you don't want to raise replacement revenue then what exactly would you have us cut or eliminate to balance our budget? Or do we leave that all up to the Emergency Manager? As to bankruptcy – It's not even an option. One needs the state (Governor) approval to file for bankruptcy. Governor Snyder has pledged - and his treasury officials confirmed – that there will be no municipal bankruptcies on his watch. Pretty much end of story. In addition we are not eligible for Chapter Nine bankruptcy since we are not insolvent. It saddens me that you have given up on Ypsilanti. You have become a purveyor of doom and gloom – a defeatist with no realistic positive solutions or remedies. You would leave the City's future to an unelected and unaccountable outsider. You've thrown in the towel. I haven't….because Ypsilanti deserves better.


Sun, Feb 26, 2012 : 5:10 a.m.

Mr. Murdock, I have no problem with you posting your opinion and your points are valid. However I do not think personal attacks like, "Rodney – You continue to live in fantasy land with your head stuck in the sand," "...crying about what a mistake it was..." and "You have become a purveyor of doom and gloom," is appropriate language for an elected official. It does not instill confidence. Excuse my post if you are not the Peter Murdock on Ypsilanti City Council.

Pete Murdock

Sat, Feb 25, 2012 : 10:15 p.m.

Rodney, No matter what you or I thought of the Water Street Project, folks that we elected committed the City's full faith and credit behind those bonds. Payments are now due and crying about what a mistake it was does not remove our obligation to pay our debt. And beyond that without the Water Street debt obligation there still remains a major funding gap ~$10 million over the next five years due to the loss in revenue. This gap seriously erodes our ability to provide services most residents want to maintain a safe and decent community. We are not a "debtor in denial", we only have the one unsecured debt. We are meeting payroll and paying our obligations. We are trying look to the future, beyond the next election or budget cycle, and plan long term to keep us from the situation you describe. Our plan is balanced and eliminates the projected deficit over the next five years. It includes cost reductions, a temporary Water Street Debt Millage that expires when the debt is paid off, a broader based replacement revenue source through the City Income Tax that nearly half of the revenue will be from non-residents, and the use of some reserves to reduce the Water Street millage. Now what's your plan? (more below)

Pete Murdock

Sat, Feb 25, 2012 : 10:14 p.m.

Rodney – You continue to live in fantasy land with your head stuck in the sand. You continue to blame decisions made in the past, some as far back as 50-60 years ago, that we can do nothing about today. You totally ignore the situation as it is today in 2012 – not the 1950's or 2007. The reality of the situation TODAY is that the City has lost nearly $2 million annually since 2008 in property taxes paid by City residents and $2 million dollars annually from State shared revenues over the past decade. The Water Street debt payments becoming due is an additional contributing burden but is not the sole cause of our current deficit situation. The Water Street Debt obligation will be paid either by reductions in city services, or a debt millage (like most debt is serviced – see Ypsilanti Street Paving Bonds, Sylvan Township, Allen Park) – by voter approval in May or by court order in the case of default. But it doesn't go away by wishing it didn't exist nor does it go away with an Emergency Manager. (more below)


Sat, Feb 25, 2012 : 9:12 p.m.

Interesting thought process, not unlike many other Americans. File bankruptcy and let others pay your debt. How nice


Sat, Feb 25, 2012 : 9:05 p.m.

If the city is going to file for bankruptcy, then why does it need a an emergency manager? The REASON I keep hearing to have a EFM is to avoid bankruptcy. Of course there are many other ways to take care of debt. Mr Hergott mentioned a millage as one option. Restructuring the debt is another alternative. It seems those in favor of EFM have no desire to see people honor their contracts. Good plan there. I wonder how you would feel if somebody who owed you money decided to file bankruptcy to avoid paying their debt to you.

Mark Hergott

Sat, Feb 25, 2012 : 7:48 p.m.

A debt service millage can and more than likely will cover the water street debt. No, the real problem is the Police and Fire pension bomb that is set to go off in the next few years. Even a Water Street debt service millage AND a City income tax will not lift that albatross off of our necks. The only thing that will really solve this issue is a larger tax base, and barring the dissolution of the city into the Charter Township, the only way to widen the tax base is to create a regional public safety authority. The city needs to humble itself and acknowledge that the Charter township is geographically larger, more populous, and richer than the City. Perhaps, -and this is just a maybe- if the Township finally gets its long awaited comeuppance on the City, the two communities can work together to reduce crime and bring in state aid money. Of course, it isn't like I have put a lot of thought into this...


Sat, Feb 25, 2012 : 7:37 p.m.

Hopefully they can get started on the new Rec center before this happens. Would hate to see this land sold off to the highest bidding fast food joint..


Sun, Feb 26, 2012 : 3:21 a.m.

38 acres would hold a lot of fast food places.

Honey Badger Don't Care

Sat, Feb 25, 2012 : 8:43 p.m.

Think of the children.

The Black Stallion3

Sat, Feb 25, 2012 : 7:18 p.m.

I agree it is time for the Governor to appoint an emergency manager to get Ypsilanti solvent again, there is no other way.

Honey Badger Don't Care

Sat, Feb 25, 2012 : 8:43 p.m.

Watch out, you'll be next to go.

Monica R-W

Sat, Feb 25, 2012 : 7:04 p.m.

I understand the disappointment with former leadership taking on the Water Street Property and later, debt associated after the developer defaulted. Also, I can understand why some city of Ypsilanti residents would fight tooth and nail against any tax levy imposed to pay off this debt. But appointing a Emergency Manager Ypsianti, would represent a extreme reaction to solving this problem. The main problem in Ypsilanti available open real estate property locations to add taxable revenue to the city. Regardless, Ypsilanti residents have opportunities to address their grievances before a elected city council accountable to its citizens. An Emergency Manager appointment would take this right away immediately, as the E.M. is only accountable to Gov. Rick Snyder and Treasurer Andy Dillon. Instead of being reactionary Ypsilanti residents, along with the cities elected leaders need to work in unison for fiscal solutions to debt the city faces.

The Black Stallion3

Sat, Feb 25, 2012 : 7:29 p.m.

So why have they been dragging their feet? If they can't solve the problem the tax payers of this state will, we can not keep meeting and resolving nothing but when the next meeting will be.

Craig Lounsbury

Sat, Feb 25, 2012 : 6:33 p.m.

an interesting read. I grew up in Ypsi but haven't lived there since around 1984 so I will stand on the sideline here and read any comments with interest.