Relocating 41-A District Court to Macomb Makes More Economic Sense, Officials Say
Officials presenting data at a Dec. 15 work session of the Shelby Township Board of Trustees said relocating the court to Macomb Township is the better option economically.
Shelby and Macomb township officials agree, on paper, it makes more economic sense to relocate the 41-A District Court to Macomb.
"While Shelby and Macomb are similar in a lot of ways, there are some structural and financial difference that may lead Macomb Township to conclude it makes sense for them, and it's possible that it could lead Shelby Township to conclude, it doesn't make sense here," said Rob Huth, Shelby Township attorney.
On Wednesday, Dec. 15, the Shelby Township Board of Trustees held a televised work session to examine the pros and cons of relocating the 41-A District Court, which serves the townships of Shelby and Macomb and the cities of Utica and Sterling Heights, to Macomb.
Huth said the costs of running the court won't cover revenues, should the court remain in Shelby.
Increasing costs related to health care and personnel are largely responsible for the increasing expenditures.
"Macomb Township has said, under certain conditions, (they) would strongly like to consider having the court move there," Huth said.
He said one of the conditions is that Shelby Township cover the legacy costs of its retirees and the current employees nearing retirement.
These costs, which include retiree healthcare, accrue in Shelby at $175,000 - $200,000 a year, Huth said. If court employees continue on past their expected date of retirement, the potential legacy cost in Shelby could reach $8.4 million in the near future.
"We are asking our residents to weigh the costs of the court staying versus the court going. And while this is a decision ultimately made by many people, including the court itself, we need a resolution of who is going to pay for those legacy costs," Huth said.
While Shelby does have funds set aside to cover these costs until the end of the 2011 fiscal year, Macomb's post-employment healthcare is fully funded.
Moving forward, Huth said if the court moves to Macomb, Shelby could either accept as-is the number of legacy costs determined by accountants and pay a lump sum for its retirees, or negotiate with Macomb to pay the costs as employees retire.
In addition to retirement and benefits costs, Shelby trustees also cited differences between the townships' structures and associated finances as justification for the move.
"Our culture here in Shelby, our expectations are much different than they are in Macomb," said Richard Stathakis, Shelby Township supervisor.
While Shelby employs a full-time police department with 90 employees, Macomb employs none, depending on the Macomb County Sheriff for its services.
"Comparing Macomb to Shelby, we spend between $16 million and $20 million for police and fire that Macomb does not have that expense … this is an expense for our residents," said Paul Viar, Shelby Township trustee.
Macomb also sports a larger general fund balance, almost $16 million more than Shelby as of 2009.
What the future holds
Negotiations between Shelby and Macomb are expected to continue through the New Year.
The Shelby Township board asks residents of both townships to express their opinions on the issue during this time.
Macomb Township Clerk Michael Koehs, who attended the work session, said he, too, plans to recommend his own township board and residents watch the video of the Dec. 15 presentation, which will soon be available on the Shelby Township TV website.
In compiling their data, Shelby Township assumed the court would only see a 1 percent increase in fines and forfeiture revenue, healthcare costs would increase by 8-14 percent, current employees would retire the first day they are eligible and there would be no increase in the number of court employees.