CHICAGO — Local units of government in Michigan grappling with falling revenue from state aid and local property tax collections will soon have a place to turn for help in undertaking cost-saving consolidation efforts.
The Michigan Municipal League Foundation has partnered with the state and other local government associations to launch a program funded with $350,000 of state money. Local governments can use the money to hire consultants to advise on sharing services.
A second measure, proposed by Rep. Marie Donigan, D-Royal Oak, would create a new state office that would also be devoted to helping local governments share services as well as raise new tax revenue.
The proposed Intergovernmental Agency Office would allow municipalities to tap various financial tools such as state-financed bonds, public-private partnerships, infrastructure dollars, and municipal finance experts. The House Intergovernmental and Regional Affairs Committee is considering the measure as HB 5930.
The Michigan Municipal League worked with Gov. Jennifer Granholm's office to craft the service-sharing program, said Arnold Weinfeld, president of the Michigan Municipal League Foundation.
"Given the cuts to state aid, cuts to education, and the loss of property tax dollars, the administration wanted to see what it could do," Weinfeld said. "Units often have ideas, but they don't necessarily have the entire funding source to put it together."
The municipal league will administer the program and will cover 50% of the costs of hiring a consultant. The local governments would decide which services they would like to share, and their respective governing bodies would need to approve the hiring of consultants and covering the remaining 50% of the consultants' costs.
Several government officials have already expressed interest in the program, which begins July 1, Weinfeld said. He added that the league is already working with several consulting firms on the program, including Plante & Moran PLLC, KPMG, Public Policy Associates Inc., and Citizens Research Council of Michigan, a privately funded not-for-profit research organization.
