Best Practices or Budget Cuts?

continued

Governor Rick Snyder is pushing local governments and school districts to adopt what he calls "best practices." For cities, he says, that means three things: transparency, collaboration, and health benefits. For schools, he adds two more: outsourcing and health insurance ownership.

The plan enacted by the legislature uses a stick-and-carrot approach to get municipalities and schools to cooperate. The stick is that municipalities will lose all revenue sharing and schools up to $500 in per-pupil funding if they don't go along. The carrot, which is really only a baby carrot, is that if they cooperate, they can get some of that money back: up to $300 per pupil for schools and up to two-thirds of their 2010 revenue sharing for municipalities.

That means a cut of up to $1.4 million for Ann Arbor--"and we're already getting $5 million less a year than we used to ten years ago in total revenue sharing, constitutional and statutory," says mayor John Hieftje. "They then eliminated statutory revenue [sharing], but they tell us we can get two-thirds back again--maybe--by meeting the three criteria."

Hieftje figures Ann Arbor as a cinch for two. For transparency, the governor wants municipalities to put a "dashboard" on their websites showing their budgets and other financial information. "We're very transparent," says the mayor. "We already have it out there.