Detroit Mayor Duggan lays out how to tackle budget deficit with layoffs, paycuts

DETROIT – Coronavirus (COVID-19) is crushing two of Detroit’s revenue streams: casino gaming and income tax.

Detroit Mayor Mike Duggan projects a $154 million deficit for this year (the fiscal year ends in June). Next year is worse, a projected $194 million.

Duggan is recommending laying off all seasonal and part-time employees.

The rest of the city’s workers would fall in one of four categories:

  • 100% workers keep all pay, hours and benefits. That’s the Detroit Police Department, Detroit Fire Department and DDOT.
  • 95% workers take a 5 percent pay reduction but work 100 percent of their hours. They keep all benefits. They are the city’s executives.
  • 80% workers take 80 percent pay for 80 percent of their hours. They keep all benefits. They are accountants and office managers.
  • 10% workers take 10 percent of pay for 10 percent of their hours and they keep their healthcare. Examples are traffic control and DDOT ticket sellers, which aren’t working right now.

Duggan said this could ease up or get worse depending on how much more economic wreckage the coronavirus brings.

“If the economy opens up and comes back faster we’ll ease that off,” he said. “If it comes back slower we’re going to have to come back and talk about laying people off instead of just going 10 percent but this, I believe, is a reasonable expectation.”

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