Wayne County cash crisis includes $70 million budget deficit

Wayne County is running out of cash, fast.

The general fund is now at risk of being tapped out next year, but Wayne County Executive Warren Evans says he'll do whatever it takes to avoid a state intervention.

Evans says before solutions can be discussed, first the depth of a $70 million budget deficit must be brought to light.

"We understand the fiscal illness and our determination is to make sure that illness isn't terminal," Evans said.

Evans says the report from Ernst and Young is in, the finances have been analyzed and the numbers are not good.

The problems - a $70 million deficit, hiring freezes on the way along with wage freezes with the exception of public safety.

"Absolutely healthcare is something that is going to be affected," Evans said. "Absolutely portions of pension-related issues are something we're going to have to deal with."

No solutions have been finalized yet, but Evans says the county is so short on cash - he's concerned about August of this year - and calling August 2016 "financial armageddon." 

A lack of cash can trigger bankruptcy and then - there's the pension problem. Public employee pensions are already under funded and deteriorating over 10 years from 95 percent funded to 45 percent.

"Are we going to find a way to give enough to make this work," Evans said. "Or are we going to be in a situation down the line where people who work 20-25 years for pensions are not going to get them."    

Evans says he's met with the stakeholders - the sheriff, the prosecutor, union leaders, mayors - and changes will have to come. Eleven union contracts are open right now while the prosecutor and sheriff are under funded. But the county has no money.

"If the stakeholders of Wayne County are committed to fixing real structural change," Evans said. "We're comfortable we can do that here in Wayne County. That we are not going to need an outside entity to fix it."

But Evans acknowledges the possibilities of a state-appointed emergency manager and bankruptcy, are not out of the question.

"Understand it's got to be fixed and stakeholders for Wayne County have got to understand that whether we fix it or someone else fixes it - it's going to get fixed," Evans said.

Evans said his team is staying in close contact with Gov. Rick Snyder. 

"The governor has said, he would like to sit back and see Wayne County take care of its own problems," Evans said. "I don't think he's predisposed to do anything. There's no doubt in my mind if we don't do what we need to do, he will come. I would just have to leave it at that."
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