If Approved, Proposal S Would Allow Voters to Dictate What Detroit Spends Money On

On Tuesday, Detroit voters face one proposal that could impact almost every other candidate and item on the ballot. Proposal S would amend Detroit’s governing charter to let citizens decide what Detroit should do with taxpayers’ money.

Proposal S is a double-edged sword, says Eric Lupher, council president of the nonpartisan Citizens Research Council of Michigan, which analyzed the proposal. Lupher says the initiative is a “fundamental grassroots form of government to get very involved in making the decisions for your government. But one would argue there’s a reason why we have a representative democracy, that some decisions need to be made in the greater context of a budgeting process. And it just becomes too cumbersome, too, to have some elements of government go through the vote of the people all the time.”

Listen: Citizens Research Council of Michigan President Eric Lupher analyzes the potential financial pitfalls of Proposal S.

Eric Lupher, president, Citizens Research Council of Michigan: People reserve to themselves the ability to create law when their elected representatives aren’t doing what they hoped they would do. And they do that by circulating petitions, showing that there’s broad interest in that and submitting it. And ultimately it ends up on the ballot. The state of Michigan has this same permission for the voters to do this. And we looked at the 100 largest cities in Michigan and found that 90 of them have the same provision. So Detroit is more the exception than the rule in forbidding this at this time. But we also found that there are some issues that are created by doing this, because the [Detroit] city charter makes clear that the appropriation process is part of the budget process. (NOTE: The proposal language says it “would not extend to the budget.” But it would allow citizens to pass an ordinance and appropriate funds to pay for it.) City Council and the mayor’s office have to look at how much money the city has and prioritize police and fire and everything else to decide how to spend its money. Or to come with a budget amendment, which has to come from the mayor’s office. There’s charter provisions that say the City Council can’t act on a law that’s been initiated for a year. But what if the law that was initiated busts the budget if it doesn’t fit in with or everything else? Can the City Council then not act on it? The mayor usually has the power of line-item veto. It’s not clear how this fits with that. So it just creates a whole lot of legal issues. Clearly other cities have this power. We haven’t found any that have had to go through this. So it might just exist out there without the people acting on it.

Quinn Klinefelter, WDET News: There’s been concerns that some of this could violate the state constitution, particularly the requirement that governments conduct a public hearing prior to approving the budget. And, as you say, that state law requires the mayor of Detroit to have line-item veto authority. You say other places have not gone through this process yet. So this has not been tested at all as to whether or not this process would violate state law because it would be a valid referendum? In your view, do you think that would bypass state law?

No, you can’t bypass state law, whether that’s done by City Council action or a vote of the people. State law always trumps local law. It might have happened in other places. We just couldn’t find it, given the short amount of time to do the research on this question. But those constitutional concerns are real. I think it’d be a good time to be a municipal finance lawyer and have to argue the different sides of this. The city of Detroit is newly out of bankruptcy and still has a lot of financial concerns.

Did your analysis extend to what this possibly could mean for the city in terms of actual finances?

Well, it’s hard to say. This type of provision has been used at the state level when the law has been initiated. But usually it is very minor appropriations attached to the law that’s being proposed. So it’s not a budget-buster. [Detroit’s proposal] is open-ended. Somebody could come in and propose a great amount of money, which clearly could be detrimental to the city. And post-bankruptcy, the state law was written so that the city cannot run a deficit in anything, spending money they don’t have, without the ability of the mayor, the council to come in and rein that in. It would either force them to cut spending elsewhere, police, fire, parks, roads, and what have you, or run that deficit. So it could have very severe consequences if used in the extreme. In saying that, I’m also very mindful that the voters are smart. They kind of ask these types of questions. Something’s being proposed to spend a lot of money, can the city afford it? They don’t want their city to go bankrupt again, they don’t want to put their retirees through any more pain. As much as they might have priorities, I think the voters are pretty smart and are gonna ask these hard questions.

“Somebody could come in and propose a great amount of money, which clearly could be detrimental to the city. And post-bankruptcy, the state law was written so that the city cannot run a deficit in anything, spending money they don’t have.” –Citizens Research Council of Michigan President Eric Lupher

There have been those that support it that have said this is one way for the public to actually have an effect on government. Not have to just be reliant on officials telling you, “This is what you’re going to do.” That the people would have a voice.

Well, certainly, the initiative is sort of the fundamental grassroots form of government to get very involved in making the decisions for your government. But one would argue there’s a reason why we have a representative democracy, that some decisions need to be made in the greater context of a budgeting process. And it just becomes too cumbersome, too, to have some elements of government go through the vote of the people all the time.

Related: Detroit’s Proposal R Asks Voters If City Should Create Task Force on Reparations

At the same time, this is being put [on the ballot] in tandem with Proposal R, which calls for setting up a task force to look at possible reparations and how that would be devised. Proposal S would show how you would spend money to try to support Proposal R’s actions, if in fact that passed. But if the reparations [proposal] does not pass and Proposal S does pass, would they still be able to promote these ordinances to change appropriations one way or the other, whether or not it had to do with reparations?

Yeah, I’ve heard more than one advocate tie Proposal R on reparations with Proposal S on the Appropriations. But they weren’t put on the ballot together. Proposal R was put on the ballot by City Council. Proposal S is an initiated charter amendment, so people went out and circulated the petitions. And the language to Proposal S is not at all restrictive to say when it’s time for an appropriation for reparations, here’s your tool to do it. It is very broad. So it can be used by anyone and everyone to accomplish the purposes they want. That might be as minor as $100 or as major as millions of dollars. There’s nothing tying them together, other than the fact that they’re on the ballot at the same time.