A couple Oakland County commissioners have told me about the financial wizard in this county’s government.
They credit him with keeping Oakland County in black figures, something not that familiar to other counties, though a balanced budget is required by law.
So, when Commissioner Brad Jacobsen gave me a flier inviting me to Rochester to hear Robert Daddow at a breakfast meeting, I made the reservation.
The Kiwanis Club of Rochester was the host. Be there at 7:15 a.m., have $4 for breakfast and be out of there by 8. Seemed like a good time to get an upbeat economic message.
That morning almost became a time I would not fulfill a promise. It had snowed most of the night, my drive wasn’t plowed and Rochester is sort of cross-country from Oxford. But, I’d given my word.
I’m reasonably glad I made it.
I say ‘reasonably? because Daddow’s message was hardly upbeat, certainly not encouraging, but very informative. He had four topics in his overview of A Perfect Storm — employment, auto industry, economy/budget and foreclosures/real estate market.
Just seeing the titles is signal enough of bad news coming. We all know our state is overspending, but by how much we didn’t know. Michigan has borrowed from the State’s Unemployment Trust Fund, among other funds, to balance the budget, which means it’s falsely balanced.
It’ll be 2020 before the state returns to the highest level of employees in the work-force. Single business tax increases are in that future.
The Big 3 will never be the same again for Michigan and the region. They need cash for investments, employee benefits and meeting CAFE standards.
Health care figures are based on ‘unrealistic optimistic assumptions,? Daddow said. Besides that; ‘improvements in technology through the Internet will facilitate use of India.?
As to our state budget, ‘Between the General Fund and School Aid Fund, $415 million in current revenue was recorded that will be replaced through fiscal 2052 — 44 years from off — for the tobacco securitization of future revenues.
The School Aid Fund estimated a loss of 10,000 students. The 2008 projected loss is for another 25,000.
Daddow notes that Michigan’s General Fund cash is $11.6 million, with vendor payables $1.6 billion. To me, in relating it to my life, this seems to me to be a major budget problem.
‘Pensions and retiree health care will continue to adversely impact local school districts,? Daddow said. There is no contingency to fall back on. The deficit in this category will grow from $2.2 billion to roughly $2.7 billion as of September 30, 2008. Conclusion: Balancing the budget becomes increasingly limited. You can cut, reform or tax. Reforms take too long, taxes are off the table, leaving cuts.
Lastly, sheriff foreclosures of mortgages in Oakland have grown from 715 in 1998 to 7,844 in 2007. Property tax surprises are coming to governmental units. Home values will continue to drop through 2012.
But, your property assessment will not drop as swiftly. When people get their assessment and go to the boards of review, they should expect a crowd. Maybe an angry crowd. Daddow said some boards are asking for an armed presence.
Oh, before I forget, have a nice day.