State of the City Address
State of the City Address 2010
Mayor John B. O’Reilly, Jr.
Good evening.
I hope the video reminded you of our positive accomplishments in 2009, especially the ones we worked on together as a community.
More of our successes are in the booklet we’ll give you as you leave tonight.
I urge you to take a look. We get so caught up in our day-to-day responsibilities that we sometimes fail to reflect on the events that draw us together and strengthen us as a community.
We’re going to need that strength even more in the days and in the years ahead because forces have combined to bring us to a defining moment in our City’s history.
Simply put, the actions we take or don’t take over the next few years will determine our destiny.
Though the gravity of our position should give everybody pause, our history clearly shows it’s not the first time we’ve been here. This City was incorporated just before the Great Depression and faced remarkably similar challenges in 1983.
The fact that we’re here tonight talking about those times proves we have the wherewithal to overcome significant challenges.
So the question in my mind isn’t, “Can we overcome these challenges?” The real question that needs to be answered is “Will we?”
One person answering a resounding “yes” to that second question for his company is Ford CEO and President Alan Mulally.
Many of you were at the Chamber of Commerce breakfast last week and, like me, were inspired by Mr. Mulally as he described Ford’s vision and its progress over the past 18 months.
We couldn’t be happier for Ford, especially because the history and fate of our community is so tied to that of Ford – and because the company’s success through difficult times lights our own path as we travel down the same bumpy road.
That road has forced Ford to focus hard on its core mission, to build its goals around fulfilling that mission, and to take whatever measures are necessary to succeed.
This last action was the most difficult because the necessary steps required painful sacrifices that affected many people.
However, without those sacrifices and the difficult decisions that prompted them, we would not be celebrating Ford’s recent successes.
Both the facts and history show us that there is no other way.
So let’s talk frankly about what we’re facing in
The first step is to deal with our new reality.
And this is it: The City can no longer afford to continue to offer programs, facilities and services in the way we traditionally have.
We’ve had years of revenue losses, and been burdened by a broken state tax system, which has had dramatic consequences for all cities during this economic downturn.
In response over the last few years, we’ve made meaningful cuts in our operations, which up until this point have had little direct public impact.
But now, on top of other economic pressures, we have a dramatic decline in property values across all types of property.
You’ve seen it yourself in the assessment notices you just received. I’ve actually had residents say to me: How is the City going to get by?
They’re right to ask.
We’ve already lost about 5 percent in property tax revenue in the past two years.
We experienced a 10 percent drop this year.
And we’re anticipating another 10-15 percent in the next two years. In total, that’s a decline of at least 25 percent.
Our revenue losses are cumulative, so each year we’ll start with fewer resources, while our fixed costs, those beyond our control, continue to rise.
If we take no action, make no hard decisions now, we’ll have a $20 million gap between our revenues and expenditures in just the coming year alone.
Obviously we will not let that happen.
So what are we going to do?
In some ways, the same things that you’re doing. We know that many households in
Most people have already made the common sense adjustments, like not going out to eat as much, and cutting back on entertainment and travel.
But now think of a sudden 10 percent decline in your income, and you begin to feel the direct impact in your day-to-day life. You spend less, you put off big expenditures, you forego vacations.
Think of another 10 percent cut on top of that, knowing there is little you can do about your fixed costs, like your mortgage payment.
The cuts get tougher and the tradeoffs bigger. The decisions start to become painful.
Do I eliminate my life insurance, or no longer save money for my kid’s college education or my own retirement?
Do I tap into my nest egg or scale back to one car?
Now add another 5-10 percent pay cut on top of that, and pretty much everything but your family’s essentials, like basic shelter, food and transportation, are on the table.
For some this is not theoretical. We all know households whose major breadwinner has lost their job, and their families have already gone through this awful ordeal.
Yet, we also know that anyone who has experienced these difficulties also develops a greater appreciation of what really matters to them and their families. When faced with declining resources, the things we truly value come into sharp focus.
And that’s where the City is with our finances today. Everything but the essentials is on the table—and even those essential services may have to be delivered differently.
Because of that, I’m not going to shy away from considering any idea regarding our programs and services, even the controversial proposals.
Up until this point in
But now too much is at stake for us to fall back into the mentality of “that’s the way we’ve always done it.”
So we need to ask the questions about everything we offer:
Is this service necessary and a critical component of our government? We would look to our City Charter for that answer.
Without the City, would the service exist at all? Or do other government agencies also do it?
Is it driven by market demands, and if so, is it more appropriate for a private entity to offer it?
Can we convert this service into a regional operation, pooling resources?
Does this service use all available technology in the most cost-effective way?
Can our Recreational facilities, like the DISC, the Golf Course and The Center, be run more efficiently with a business model, meaning they cover all of their costs, including ongoing capital investments?
Does the service help us build our community by attracting businesses and residents?
We need to look at everything we do and ask: are we delivering this in the best possible way within our available resources?
As tough as these questions may be, and as troubling the consequences they bring, they are relatively small ones.
The real questions are:
What do we want our community to be like in the future? What kind of
I can’t answer those questions alone. That’s for us to decide together.
But I do know that if we don’t make any tough decisions now, if we don’t do anything, then we absolutely won’t have the community we want for our children.
Understanding those words intellectually is much easier than putting them into action. Let me give you an example.
Last year we asked the Recreation Commission to evaluate our outdoor pools and make a recommendation regarding their future.
The commission reviewed the data on current and projected use, on investments needed to keep the pools operating, and on overall costs going forward.
In looking at that data, it was apparent that some pools should be closed. The impact on our overall program would be relatively small because residents still had other options to swim. And we were looking at adding new splash parks as an alternative to keep kids cool at a much lower cost to the city.
But the final decision was never made. An emotional response to the proposed change made it difficult to move forward.
We didn’t pursue the less costly alternative of the splash parks; and modest savings weren’t realized, meaning we’re facing even tougher financial decisions now.
This is a process that we can no longer afford to repeat.
To overcome our challenges, the preference of a few cannot overwhelm the good of the entire community.
Even though the decisions on what and how to change lie with me and with the City Council, you are the ones who will ultimately decide whether those changes are successful.
If we resist change, if we fight it and protest it, we’ll never take the actions we must in order to move forward together.
In fact, one of the biggest advantages we have is that we can still determine our fate with the right decision-making now.
As I mentioned earlier, this is not the first time we’ve dealt with difficult economic situations.
I was struck by similarities in my father’s State of the City Address from 1983, when the City was a few years into the last powerful recession.
In the packets you’ll get tonight, we’ve included excerpts from that speech.
See if these issues from 1983 sound familiar: a dire
My father also wrestled with decisions separating the “nice-to-have” services with the “need-to-have” services. One of the most talked about back then and today is plowing snow off residential sidewalks. I still have people swear to me that this service was just recently eliminated and that they desperately miss it. In your packets, all of you will have documented evidence to support that this service was eliminated back in 1983. So please, get over it.
Let’s look at some of the other solutions from back then. They look a lot like our plans now:
Consolidating departments at City Hall; determining the right workforce to meet our needs; the savvy use of technology to reduce costs; privatization where it made sense, like in trash collection; eliminating expensive “nice to have” programs; identifying true costs for services and then setting fees at realistic levels; and seeking other sources of revenue.
Like we intend to do today, we moved forward in 1983 for these important reasons:
First, because we rejected the “business as usual” model.
Second, because there was political will to tackle financial problems aggressively and make unpopular decisions in the short term for the good of the community in the long term.
And third, because citizens and businesses were engaged. A cross section of business leaders and residents served on a task force, making recommendations for City Hall to consider. That gave momentum and credibility to difficult decisions.
We have created another task force today, comprising 28 people from all across the community, who represent businesses, neighborhoods, service clubs, commissions, unions and the schools. They are all people with a long history of volunteering their time.
Our goal is to have the task force report their recommendations in May, giving us guidelines as we chart our course over the next five years.
We’re asking the Task Force to look at long term strategies for our community’s viability, even if those approaches mean a fundamental shift in the
That means not just defining our essential services, but helping us to transform them.
It’s a big job.
I’m grateful that they have accepted the responsibility on the community’s behalf. Will the members of the task force please stand. Join me in recognizing them for their willingness to serve.
We’re thankful for the Task Force’s help, but it’s important to note that we’ve been proactive in our cost cutting and fiscal management for years. We were looking ahead, and we will continue to do so.
Over the last eight years, we’ve eliminated 143 fulltime positions, that’s 25 percent of our fulltime non-public safety workforce; restructured employee benefits; reduced retiree health care costs; refinanced our debt; applied technology effectively; taken steps to sell Dearborn Towers; made our City Charter more flexible for evolving economics; joined beneficial purchasing cooperatives; and pursued all avenues to preserve the rights and interests of the City of Dearborn.
We’ve enlisted our employees in our cost-cutting and revenue- generating initiatives, and will keep working with our unions on changes we know must be made. Our employees have shared in the sacrifices, and in the solutions.
Still, because of economic impacts beyond our control, we’re compelled to do more.
We’re compelled to actively work with Ford Land Development Company to recruit and attract businesses to
We know that for
Along those lines, we’re excited to support a new
We’re compelled to pursue all options for funding, including aggressively seeking out federal dollars for core projects.
We’ve recently received $7 million for water, sewer, and road work; senior housing improvements; and energy conservation efforts;
$2.4 million to bolster our successful Neighborhood Stabilization Program, which protects our residential areas from blight.
$2.4 million in a federal COPS program grant, one of the biggest awards made across the state. It reinforces our excellent public safety operations by adding 10 more police officers to the force.
And $28 million in promised federal funds to build an intermodal passenger train station to boost our west downtown, and access to The Henry Ford and the
We’re compelled to support private development, advocating for state tax incentives for projects like the landmark
It’s a terrific partnership that will preserve and create jobs and bring more traffic to the critical east downtown area.
We’ve sought and obtained nearly $50 million in state incentives to make downtown development projects more attractive for private investment.
We’re compelled to continue to work with the
We’re compelled to partner with the Dearborn Public Schools to share costs and resources for the benefit of residents we both serve. We’re now meeting regularly to discover ways in which we can save money and create more efficient services.
But most importantly, we’re compelled to “rightsize” our government and provide you with services we can afford today and into the future.
This is where you come in.
We need you to accept that the actions we must take will directly impact you and your family.
We need you to support changes that depart from the past, but that will become the new standards of a positive tomorrow.
We need your involvement, your commitment, and your willingness to help us create a viable future, because working together has always been one of our greatest strengths and the foundation of our success.
To highlight that strength, if you are a leader in government, business, education, or a religious institution, please stand now.
if you are on a city commission, in a neighborhood association, or a service club, please stand.
If you volunteer in
Look around you, and consider the power in this room, and the constructive impact that you and your colleagues have already made on our community.
I see a tremendous force here, and the potential for so much more real, positive progress.
I am convinced that we are at a defining moment. And I am convinced that we can, and that we will, seize this moment and overcome our challenges.
Change doesn’t mean abandoning what truly makes
It didn’t in the past. And it won’t today.
I’m confident we’ll take the difficult actions to navigate these extraordinary times. Together, we will make the tough decisions, we will rightsize our service mix, we will create an even better City but with the same undeniable community spirit. And like those before us, our sacrifices will ensure that
Thank you and God Bless Dearborn.
