Hamtramck’s Top Expenses of 2020

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By Simon Albaugh – Yemeni American News

HAMTRAMCK, Mich. – It’s a complicated set of circumstances, but the math is sound: Hamtramck is losing money quickly. Since 2018, the City of Hamtramck has lost an average of over $2 million in its budget surplus every year, losing as much as $25 million, according to City Manager Kathleen Angerer.

The only way out of this budget shortfall is by changing two numbers: Increasing revenue and decreasing expenditures. But as any public official can probably attest, this is a long and difficult process. It’s already started with an independent financial review from the State of Michigan, which City Manager Angerer says will be released publicly around Mar. 2 of this year.

“Our administrative staff is already thinking about what we can do to balance a budget,” Angerer said. “But when you look at these numbers, it’s very plain to see that we will not be able to pass even the identical budget we had last year if we don’t have increases.”

In the meantime, there’s a number of challenges that Hamtramck’s City Council will need to think through. How does a city that’s among the highest-taxed in the state lose so much money? And what can a city that is continually losing its biggest revenue sources do to make up the loss?

Budget Challenges Started with Dodge, and then GM’s Closed Plant

As part of a complicated history of eminent domain, the main auto manufacturers that paid enormous taxes to the city of Hamtramck have all closed as of early 2020. With all the major revenue sources closing their doors – including the prison near the city’s eastern-most border – the city is dealing with the COVID-19 pandemic at its worst spending power.

This isn’t new for the city, since Hamtramck has been under state receivership twice before. But what is new is a repurposed state receivership system that hasn’t been popular in the Whitmer Administration, or necessarily in the administrations before it. As a financial emergency may develop in Hamtramck, the city administration may not be able to expect another round of State Receivership.

The answer to what happens next is simple. The city won’t be able to pay its employees, and many city services will not be provided.

“We are facing a disaster,” said Councilman Almasmari at the Jan. 26 City Council meeting. “If we don’t take this seriously, if we don’t take the effort to fix this budget and make hard decisions, we will find ourselves out of money and not being able to pay our employees.”

Hamtramck’s Top Expenditures of 2020

Like any other city, Hamtramck needs to provide essential services to its residents. Those services, like water, electricity and an education, are all funded through the existing revenue sources paid through taxes. However, Hamtramck was ranked among the highest in property taxes in the state of Michigan, even surpassing all of the Grosse Pointe Communities as of 2019.

Among the highest expenditures was utility costs, which were mainly funded through water and electricity bills for property owners. Another major cost was property taxes to Wayne County, which totaled above $5 million. Below is a list of the top 35 expenditures that were outlined by the Hamtramck City Council preapproved expenditures. This is only part of the cost of running an entire city.