Shelby Township Unveils Historic Deficit Reduction Initiative for Police Fund

The following information was submitted in a press release.

To address issues such as deficit spending, almost $40 million in unfunded pension and legacy cost commitments and the threat of insolvency as soon as 2017, the Shelby Township Board of Trustees and Shelby Township Police Department are undertaking a historic Deficit Reduction Initiative.

The initiative is a four‐step process that defines problems and solutions, and a public review of all the possible solutions, before ending with the Board’s decision on a course of action that places the Township’s finances back on solid footing.

“The objective of the Deficit Reduction Initiative is, of course, to do what is best for the Township, its residents, taxpayers and financial future,” Township Supervisor Rick Stathakis said.

“On its current course, the Police Department, which has an operating budget near $15 million, is facing a situation where it will be more than $40 million upside down in legacy costs by 2017 with almost no fund balance,” said Township Finance Director Kathleen Moore.

“That means, with current revenues remaining flat and not falling further, to pay off this massive debt all police operations would need to be suspended for almost three years just to get back to even,” Stathakis added. “This is a crisis that we must meet head on as the taxpayers literally cannot afford for the Township to wait any longer.”

The first step of the Initiative was completed June 27 as Police Chief Roland Woelkers, Township Labor Attorney Craig Lange and consultant John Kaczor presented an overall review of the Police Department, its finances and options for facing these challenges at a Board of Trustees public work session.

“The conservative majority of our current Board of Trustees has faced many challenges in the current economic climate with bold reforms,” Treasurer Michael Flynn said. “These experiences will be invaluable as we confront this, which is likely the largest fiscal challenge we have or will face.”

The Board is in the midst of step two in which Kaczor and Woelkers are investigating more than a dozen solutions that they formulated. Their findings will be presented to the Board at a public work session followed by step three as Woelkers, Kaczor and Lange present the options to the public for discussion.

“Step three is the most important step we have in this initiative,” Stathakis said. “This step provides the transparency and input from the taxpayers that will be paramount before the Board formally addresses these issues.”

The initiative will culminate with step four when the Board of Trustees selects the best option or options at a regularly scheduled, on‐camera Board of Trustees meeting.

“There has been a lot of rumor and speculation that we have already decided on the solutions to the challenges facing our Police Department,” Stathakis said. “This could not be further from the truth.

“The financial crisis facing our Police Department is something we have never had to face in the Township, so it requires a process that we have never had to institute. That is what makes the Deficit Reduction Initiative such a milestone.”