By J. PATRICK PEPPER
HEIGHTS — Despite the largest yearly drop in home values in history and a double-digit unemployment rate, Mayor Daniel Paletko gave an optimistic outlook for the city at his sixth State of the City address on Tuesday.
Speaking to a group of about 130 at Warren Valley golf course, Paletko hailed the opening of some new businesses, the restoration of some old ones and another year under budget for the city.
“I’m pleased to report the city of Dearborn Heights is in good shape and well positioned to meet the challenges that face us,” Paletko said.
He warmed up the crowd with a series of jokes about the country’s current financial woes before getting into city-related developments from 2008. According to Paletko, the economy was responsible for shifting the city’s efforts from attracting businesses to retaining and reinvigorating old ones.
In that vein, Paletko announced that Kroger, the city’s single largest employer, will be making a $4 million to $5 million upgrade to its Ford Road store in the Heights Shopping Center. The Kroger upgrades come after Target, another anchor in the shopping center, completed renovations to their store earlier this year.
Paletko also spoke highly of the city’s two Ram’s Horn restaurants, one on Ford Road and one on Telegraph, that underwent extensive renovations last year.
And although it was a tough year for opening new businesses the city did welcome a Walgreens pharmacy at the corner of Beech Daly and Ford Road. Paletko also announced that two new restaurants, Lava Java and Golden Bakery, would be opening soon.
“Given the kind of economy we had, last year was a good year for the city,” he said.
The city’s finances remain in solid shape too, Paletko said. He expects a $1 million cost saving over last year’s expenditures through consolidation of services, energy-saving measures, and more efficient procedures.
That won’t come without a challenge, though, as city estimates predict a $1 million loss in property tax revenue. Deflating property values and rampant foreclosures have contributed to what Paletko expects to be a 5 percent to 9 percent drop in tax bills for most residents next year.
“I always have residents asking me to lower their taxes. Well, this year you’re going to get your wish,” said Paletko.
Instead of asking for millage increases to make up for the shortfall, Paletko said he will request from City Council that the city absorb the difference through the cost-saving measures.
And as part of an effort to stem falling property values, Paletko said homeowners could see some relief if the city receives an expected $1.8 million grant from the U.S. Department of Housing and Urban Development’s Neighborhood Stabilization Program. The city failed to meet the initial qualifications for the program, but later was deemed eligible.
That money would be used to demolish abandoned and blighted properties, acquire properties in the Military Park subdivision for a proposed $13 million recreational center and offer home buyer assistance in targeted neighborhoods.
The recreation center would be funded through President-elect Barack Obama’s proposed economic stimulus plan. Obama has said that the target of the stimulus package would be ready-to-go projects. And after consulting with members of the presidential transition team, Paletko called for a blueprint to be drawn. In addition to the recreational center, he said, numerous improvements could be made to city infrastructure.