Officials debate state funding issues at joint governmental meeting

ESCANABA – State officials, including the governor, are looking at stepping up benchmarks for cities to be eligible for state funding. During a meeting of local municipalities at Escanaba City Hall Wednesday, officials voiced concerns about the changes that will cost more money.

For the past two years, Gladstone and Escanaba have been complying with a state mandate to be eligible for state revenues. The three criteria in Michigan’s Economic Vitality Incentive Program (EVIP) address accountability and transparency, consolidation of services, and employment compensation.

Gladstone receives about $100,000 a year for meeting the three criteria, while Escanaba receives less than $300,000 in the state funding formerly known as statutory revenue-sharing monies, which were about three times the current allocations.

Gladstone City Manager Darla Falcon said the state is requesting more from the cities but continues to not provide local officials with the funding to accomplish the requirements. She also said she’s concerned that all cities, no matter what their size, have to meet the same criteria.

“One size does not fit all,” she said, suggesting the program be based on population.

Escanaba City Manager Jim O’Toole agreed the proposed changes – including feasibility studies on privatization, consolidation of services, and pensions – will cost cities like Gladstone and Escanaba more money to complete. In some cases, consultants may have to be hired, he added.

O’Toole said, in his opinion, all state departments should be required to meet the EVIP criteria just like eligible municipalities are mandated to do.

Many local townships are not eligible for the program and therefore no longer receive these state revenues.

In the current fiscal year, municipalities eligible for EVIP funds must meet the program’s first requirement of government accountability and transparency. This includes a comprehensive report on how a city spends taxpayer money.

The second criteria is a plan demonstrating how a city cooperates with other entities to save money by consolidating purchases and services.

The third requirement is to list changes to employee compensation packages including workers contributions to funds.

EVIP changes being proposed include a more detailed debt service report. In addition to the already-required consolidation of services, the program is also looking at innovation and privatization projects. Added incentives being considered are plans to reduce employment compensation, including retirement plans.

In other discussion, those attending Wednesday’s meeting considered the possibility of consolidating the purchasing of playground and recreation equipment. Brief updates were also given on the progress of economic development efforts in the Central Upper Peninsula. The next joint governmental meeting is scheduled for May 8.