The City of Kalamazoo might have found a fix for its budget problems – at least for the next few years, but possibly beyond that. On Thursday, leaders announced that private donors have offered the city $70 million. That would put Kalamazoo’s finances on solid ground for three years.
During that time the city could cut property taxes by about 40 percent. Meanwhile, Kalamazoo would try to build an endowment to support its budget permanently. City Manager Jim Ritsema says this unusual approach has some things in common with the privately funded scholarships of the Kalamazoo Promise.
“And there’s a model of what this is for the community in the form of the Promise that gives me confidence that what we’re talking about can and will happen,” he says.
In an interview with WMUK Friday morning, Mayor Bobby Hopewell says the city "initiated the conversation" about the proposal with William Johnston and William Parfet. He says the long-term plan includes finding other philanthropists.
Board member Matt Milcarek says before the commission votes on the idea, it needs to make sure the private funds won’t buy influence.
“Dollar figures like this don’t come without expectations. And we need to make sure those expectations are as simple as, run your city efficiently in a way your citizens want,” he says.
Supporters say the city would have complete control over the money. Hopewell says the goals are to decrease the tax burden on city residents, balancing the budget, and working on issues such as long-term poverty. The mayor says the city has to have measurements, but there are no other stipulations.
Milcarek also says the city should remember the possibility of asking for a citywide income tax, in case the private funding proposal does not work out for some reason.
Other commissioners said even if Kalamazoo accepts the funds it should keep pushing the state to change its policies on city revenues, which they say have put many municipalities in a difficult place financially.
The Commission plans to study the idea in depth in the next few months.
