Bloomfield Township Board of Trustee Work Session December 11,

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1 Bloomfield Township Board of Trustee Work Session December 11,

2 Agenda Project Background Review Process Options for Consideration Summary Next Steps 2

3 Project Background Public Act 202: Protecting Local Government Retirement and Benefits Act Current deficit estimate ranges from $5 million to $7 million Deficit is structural: one time savings have limited impact Options to address deficit are limited: Reduce expenses Increase revenues Combination of both Plante Moran retained to explore options for reducing expenses 3

4 Process for Analysis Reviewed existing budget as baseline Department heads completed questionnaires about services and cost reduction options Interviewed department heads with assigned trustees and supervisor Reviewed staffing and funding levels from similarly sized local governments (both townships and cities) Serviceability level of service beyond mandate Identified reduction options for Board consideration Savings potential does not include one time transition costs or one time savings 4

5 Observations Township provides high level of service overall Several services provided are not mandated No silver bullet to addressing structural deficit Reductions in funding will result in reductions in service level Decrease in programs, responsiveness, quality, effectiveness Some reductions may impact ISO ratings and result in costs to constituents Township is in process of implementing modifications to help address budget deficit: Cost allocation plan Health care analysis 5

6 Property Value History Comparison of Residential TV and Township Millages Tax Year Taxable Value Average Township Taxable Value Township Millages Township Tax Revenue ,367,253, , $2, ,491,431, , $2,234 6

7 Budget Reduction Options 1. Eliminate animal welfare division 2. Contract for dispatch services 3. Reduce police patrolling to level supported by millage 4. Reduce fire responsiveness in Station 4 but retain EMS 5. Institute a property tax administration fee 6. Contract for assessing services 7. Reduce general fund support to DPW road division 8. Eliminate township programs 9. Reduce services in other departments 7

8 Eliminate Animal Welfare Division Animal welfare is a non mandated service and appears to be a unique service to Bloomfield Township Animal control is a county function that other local governments do not provide Several services provided are not mandated If implemented, there is a question about future use of the facility and whether to repurpose it or demolish it Total savings opportunity: $170,000 to $200,000 8

9 Contract for Dispatch Services Necessary service for police, fire, and EMS response Service provided by Oakland County to several local governments Other jurisdictions may be interested in providing services on a contractual basis Services to police and fire would be impacted Township would have limited oversight of services Would require additional support for inmate supervision Total savings opportunity: $375,000 to $700,000 9

10 Reduce Police Patrol Reduce police funding to level supported by millages Result would reduce services to community mostly in form of police patrol Results would likely include Less proactive patrol Less community outreach Longer response times Lower clearance rates More limited participation in regional enforcement activities Total savings opportunity: $1,330,000 to $1,600,000 10

11 Dedicate Fire Station 4 for EMS Only Fire response from Fire Station 4 would be eliminated under this option Would impact one area of township to greater extent than others Would require greater reliance on mutual aid Impact on EMS services would be limited Total savings opportunity: $800,000 to $900,000 11

12 Institute Property Tax Administration Fee General Property Tax Act allows collection of an administration fee of up to 1 percent of total tax bill per parcel Revenues are used to offset costs associated with collection of property taxes, including Treasurer and Assessing costs Relatively easy to implement and maintain Total additional revenue opportunity: $1.5 million 12

13 Contract for Assessing Services Assessing services are provided by other jurisdictions, including Oakland County Equalization Service is also provided by private vendors Transition would likely result in lower customer service There is a risk related to appeals processes and time dedicated to defend values Total savings opportunity: $140K to $400K 13

14 Reduce General Fund Support of Road Division Road division is an optional service Bloomfield Township is only township in Michigan to offer service Current levy of.7169 mills is supported by general fund transfer of $1.45 million Residents would need to establish SADs for maintenance If implemented, services would decline and may impact revenues from County Road Commission Total savings opportunity: $1.4 million 14

15 Eliminate Township Programs Gypsy moth control Electronic waste collection Shredding Household hazardous waste Dream Cruise support???? Others???? Total savings opportunity: $300K to $340K 15

16 Other Options Explore fee structure to ensure cost recovery Reduce or eliminate service levels through service reductions in following areas: Supervisor, treasurer, clerk and consolidate office services Information technology Buildings and grounds Ordinance division Motor pool and fleet Planning site plan review Engineering and environmental services Total savings opportunity: $400K to $500K 16

17 Summary Option Low High Estimate Estimate Eliminate animal welfare division $170,000 $200,000 Contract for dispatch services $375,000 $700,000 Reduce police patrol $1,330,000 $1,600,000 Dedicate Fire Station 4 for EMS only $800,000 $850,000 Institute property tax administration fee $1,500,000 $1,500,000 Contract for assessing services $140,000 $400,000 Reduce GF support of road division $1,400,000 $1,400,000 Eliminate township programs $300,000 $340,000 Other options $400,000 $500,000 TOTAL $6,415,000 $7,490,000 17

18 OPEB Bonds Taxable Value Estimated Debt Millage Rate Average Twp Taxable Value Average Increase In Taxes OPEB Bond of $65M $3,367,253, $199,870 $3, OPEB Bond of $80M $3,367,253, $199,870 $4, OPEB Bond of $100M $3,367,253, $199,870 $5, OPEB Bond of $125M $3,367,253, $199,870 $7, OPEB Bond of $160M $3,367,253, $199,870 $9, Does not factor in the interest expense on the debt -Average increase in taxes is the total, not the annual amount 18

19 Next Steps 19