Mayor Dave Bing Gets Down to Business in Detroit

Dave Bing is the first Detroit mayor with a business background to serve since banker Frank Couzens' tenure in the middle 1930s. Bing's top goals for his four-year term reflect this: He plans to create jobs by easing burdens on businesses and by running city hall in a businesslike manner.

Couzens was credited with applying business principles in local government to help lift Detroit out of the Great Depression. Many Detroit residents, including business owners Lillian M. Blackshire and Bill Perkins, hope Bing will follow in Couzens' footsteps.

Perkins owns three auto dealerships, while Blackshire operates a human relations consulting firm and co-owns a property management company. They are among dozens of Detroit entrepreneurs hopeful that the local economy will thrive under the leadership of Bing, the founding owner of the Bing Group (formerly Bing Steel), which began as an automotive supplier and expanded into housing development.

Jobs Are the Key to Economic Success

"Mayor Bing has created hundreds of jobs in the city of Detroit (as a businessman) and is working to retain and attract jobs as the mayor," says his press secretary, Edward L. Cardenas. "He plans on continuing to keep Detroit the 'Motor City,' as automakers pursue green technologies while pursuing new opportunities in medicine, the life sciences, construction and the movie industry. He has also pledged to make the city more business-friendly to retain and attract new jobs and investment."

Blackshire and Perkins also see job creation, through an improved business environment, as the key to Detroit's economic recovery.

"Detroit has been hit so terribly by this loss of jobs," says Blackshire, 48, a 1980 product of Detroit Cass Tech High School. "People have found it difficult to maintain not just a comfortable level of living, but just a necessary level of living, trying to find ways to keep a roof over their heads, to keep food and clothing.

"We are going to need people working together as a unit, keeping a positive spirit, for which Detroiters have always had a knack and an ability to demonstrate."

The 60-year-old Perkins came to Detroit from Louisville, Ky., in 1977, and Bill Perkins Automotive Group now operates three stores. He joins Blackshire in maintaining hope.

"I have the utmost confidence in Mayor Bing's new administration," Perkins says. "This mayor has the experience and the know-how to turn things around. He's going to run the city like a business, rather than like a big city that's on a welfare program. He will make tough decisions that will start to put Detroit on the right track."

Budget Hurdles

Bing, 66, is faced with taking a budget that peaked at $3.7 billion in fiscal 2004, and shrinking the bottom line below $3 billion for fiscal 2011. Additional cutbacks loom in future years. He's taking a 10 percent pay cut, his appointees are doing the same through furlough days, and he is pushing resistant labor unions to get on board. This is simply good business, Bing says.

Similar to private sector business executives, Bing is streamlining in other ways. He has reduced the number of aides who report directly to him to five trusted individuals, and he aims to consolidate or eliminate some of city hall's 42 departments.

Taxing Troubles

The Detroit City Treasurer's Office Web site shows that families in owner-occupied homes pay about 65 mills in property taxes. For business and commercial properties, including rental units, the rate is roughly 83 mills. One mill equates to $5 for each $10,000 of a home's sale value. This means, for example, that the owner of a rental property with even a modest sale value of $50,000 pays more than $2,000 per year.

Detroit city government receives about 27.4 mills. City public schools and public libraries net a combined 35.5 mills (or 17.5 mills from owner-occupied homes). Wayne County government, schools and colleges receive 14.1 mills, and state government takes another 6 mills for public schools.

"Taxes in Detroit are very high, prohibitive," Lillian Blackshire says. "We own six (rental) homes, but we had to stop because of the taxes."

Bing will have to evaluate the property tax situation in Detroit. While the city needs revenue, some residents may feel like the taxes are too much to bear.

At the same time, the Detroit Chamber of Commerce looked at overall cost of living and asserts that New York City is more than twice as expensive as Detroit, while other major cities such as Boston and Chicago are at least 25 percent higher.

Foreclosures Cause Population Loss

A U.S. Census Bureau estimate pegs Detroit's population for 2006, the most recent year available, at 871,000, less than half the peak of 1.85 million in 1950. This leads to a pair of prime businesslike responses from the Bing administration.

First, Bing is pushing for a full 2010 census count, because $1,300 per year per resident is at stake in federal government aid, and losing that money would not be good business.

Second, the mayor is striving to turn vacant land into a job-creating asset through establishment of green space and cooperative urban farm gardens.

"These areas still require public services, even though there may not be a large population density," Cardenas says. "Attacking blight will help remove eyesores, while creating jobs for residents."

A Business/Education Connection

Similar to public safety, entrepreneurs say education is a key concern that affects all other concerns. Bing and Cardenas consider education so important that they placed schools at the top of their priority list.

"The mayor believes education is a key component for Detroit to be successful," Cardenas says. "If we do not have strong schools to educate our children and prepare them for the workforce, families will not stay in the city and businesses will not look to invest in Detroit."

Sources:

http://www.time.com/time/nation/article/0,8599,1925796,00.html
http://www.detroit.lib.mi.us/mrl/mayors.htm
http://pipl.com/directory/people/Frank/Couzens
http://www.crainsdetroit.com/apps/pbcs.dll/article?AID=/20060821/LIVINGD/60816029/-1/lid#
http://news.google.com/newspapers?nid=110&dat=19501101&id=s6cIAAAAIBAJ&sjid=o0IDAAAAIBAJ&pg=2205,3029987
http://www.detroitmi.gov/DepartmentsandAgencies/Finance/TreasuryDivision/FAQs/tabid/1527/Default.aspx
http://www.detroitchamber.com/index.php?option=com_content&view=article&id=79&mid=76
http://quickfacts.census.gov/qfd/states/26/2622000.html
http://www.detnews.com/article/20100108/METRO/1080431/1409/METRO
http://online.wsj.com/article/SB10001424052748703558004574581650636077732.html?mod=rss_Today%27s_Most_Popular