City of Detroit Revenue Estimating Conference

Conference information and listening/viewing options are available here https://detroitmi.gov/sites/detroitmi.localhost/files/events/2023-02/2023%20February%20Revenue%20Estimating%20Conference%20Public%20Notice%20v3.pdf

https://detroitmi.gov/departments/office-chief-financial-officer Here is a link to read further about the Office of the CFO.
Jay Rising CFO

IMPORTANT: If you believe anything in the coverage this afternoon is inaccurate, please email us at documenters@outliermedia.org with “Correction Request” in the subject line.

In a little early on Zoom meeting..some technical difficulties getting straightened out. https://t.co/I4ZN4LFiJR

Still before start time- Janice Butler discussing with Gabriel Ehrlich about ability to be able to hear- also testing microphone in chamber under Lori Cetlinski camera https://t.co/Dm8RY7giww

The people in the meeting can not hear Gabe per Janice Butler.

Meeting has started George Fulton Prof @UMich - started- Jay Rising, Eric Busses (?) Renee (city council representative).. 17th meeting since this became law 2014
CFO Mr Rising, State Rep Mr Busses (?) and Mr Fulton is 3rd party-
They need new conference chair-elected Mr Busses

Previous meeting minutes approved- Detroit Economic forecast - Presentation by Gabriel Ehlich (they still can not hear him in chamber. They are working on it

They can hear him now— https://t.co/5FCMfwZUeq

Gabriel is discussing slowing economy and inflation- “too early to declare victory on inflation”. https://t.co/RpvuiorCsG

Mr Erhlich discussing housing market slow down. & Treasury Bonds as indicator for possible rescission-

Recession-

#Detroit should avoid any major country recession do to auto backlog per Mr Ehrlich

Lots of graphs- jobs for residents of Detroit and jobs in #Detroit going up from pandemic low numbers https://t.co/32YyswCKWp

Another Graph (notice Mr Ehrlich uses Blue and Maize lines- Professor at @UMich)Detroit City resident unemployment rates at historical lows. https://t.co/XqX5pihONk

Middle of next year predicts Detroit complete recovery from pandemic- (per Mr Ehrlichs group).

Blue Collar jobs up 14% from pre-pandemic with a little more growth.
& white color job rates predicted to stay slower recovery (remote work, layoffs)
Service industry- now 5.6% higher than pre-pandemic. https://t.co/ZTADcwi3vF

Wages going up predicted for workers in #Detroit and #Michigan (now not keeping up with inflation. Predicted to exceed inflation in a couple years.

Blue line shows income adjusted foe #inflation- yellow just income- Statewide pattern not just city. https://t.co/RfwZyNvr4o

Inflation slow down- slowing to 2.5% 2024-2027 predicted- inflation already slowing down

Last Graph- asking for any ??? https://t.co/wXTEXeVY1k

Mr George Fulton gave praise for the predictions and presentations.? If we can be mislead by the model- Mr Ehrlich advised models are linear- extreme times could cause model to breakdown (like Covid pandemic). Mr Fulton excited about Detroit forecast.

Mr Fulton -? Odds of minor recessions and how likely is Detroit to avoid. Mr Ehrlich says his team says recession
2/3 odds, but he feels more like 50/50

Mr Ehrlich more optimistic about Detroit due to auto backlog and other major projects in the city

Mr Fulton ? If large wage increases for UAW contracts in 2024 could increase the overall wages?- advised yes-
No more ? From Mr Fulton-
Jay Rising CFO says 5th time-end of pandemic doesn’t make it easier- audio issues for myself and Mr Ehrlich

Mr Ehrlich advising if recession where noticeable here employment counts would fall- no projection of decline in employment counts so should miss a mild recession.
Mr Ehrlich signed off-

Mr Ehrlich still on camera, but muted-

Steve (?), Evan Cunningham and Erika Barker from city office of Budget to present cities revenue

Names of voting principles including Eric Bussis (correct spelling) https://t.co/Vd79pEHPjH

$2.3 #Billion https://t.co/6j6sYRLXWG

Income tax loss due to remote workers (estimated red dotted line on top of each year). https://t.co/VE7lsdgdSB

Increases in each category estimates from prior year.
Mr Fulton discussing https://t.co/PH6QmEvcXW

More graphs! It’s an economic conference! More $$$$ from the states than expected.-@GovWhitmer latest budget should make the state sharing higher than this model. https://t.co/Eb1XTBHlDd

Gambling taxes. https://t.co/umufAaOdfF

Internet gambling taking revenue from casinos.
Need to watch models- Mr Bussis- a lot of unknown difficult to forecast.
Mr Fultons microphone on and out- unable to determine his comments about internet gambling-

#propertytax https://t.co/p0kIorPbT0

Utility tax- New Construction not yet accounted for in forecast- https://t.co/p4C41zictR

Mr Bussis appreciates the improvements in this category presentation. https://t.co/JijdOtufv2

Risks built into the forecast- potential upside not build into forecast https://t.co/Z7Erto7WAP

Mr Fulton commenting on presentation and need to remain vigilant for the 18th conference in September-
More comments-
Renee Short -city council legislative policy division-thanking city budget Dept the OCFO and staff for hard work.
Advised of concerns about remote work refunds

Renee Short discussing gaming revenue onsite vs internet, and DDOT revenues

Auditor General Mark Lockridge commenting—-
thanking Evan, Steve and Renee.
Thanking his team.
Would like to meet more and have other directors or agency CFO’s discuss and meet with us.
His Tenor as auditor General is ending soon so this is his last conference.

Moving to Public Comments-

public comments 2 min limit- in person 1st- ? Mr Lockridge if him leaving will interrupt process. ..he advised city council will appoint and he hopes to work with them. Auditor a general 10 yr appointment.

Public Comment Evan ? Salary of Detroiters $47000…those working in city $97000…any way to get gap closed-
Mr Ehrlich advised they are aware of the gap. Mr Fulton referred to city job training opportunities for residents (breaking up hard to hear).

Public online comments Ruth Johnson ? Surplus ARPA $ and $ needed for eviction Right to representation funding.
Request office or budget reports online at city website-
Steve advised report is now online.

Ramses Dukes from City Council Calloway’s office ? What other forms of revenue are we exploring besides auto and gambling-Evan Cunningham responded-discussing risks of auto and gaming revenues- ie internet gaming, its a forecast estimate-other revenue sources would be prospective

$230 million surplus 2022- unheard of but prepared for the worst and got a lot extra-
Wouldn’t expect that big of forecast error.
Internet gaming revenue way above anticipated.
Refunds- remote work refund activity could have been more- so also over projected.

Motion to adopt- forecast is adopted for Feb 2023 conference-

Conference is ADJORNED.

Again-IMPORTANT: If you believe anything in the coverage this afternoon is inaccurate, please email us at documenters@outliermedia.org with “Correction Request” in the subject line.