MSU Says No More Money for East Lansing Emergency Services

Above: MSU's Vice President Carol Viventi (courtesy MSU) and an ELFD truck on the MSU campus when MSU played Notre Dame last year.

East Lansing has formally asked Michigan State University for more money for the provision of emergency services, and MSU has now formally responded “no.”

ELi learned yesterday that on March 23, City Manager George Lahanas wrote “on behalf of East Lansing City Council” to MSU Interim President John Engler “to respectfully request that Michigan State University give consideration to increasing the Fire Service contract with the City of East Lansing.” This came as East Lansing was wrangling with the Fiscal Year 2019 budget, which starts on the first of next month.

About a week ago, Engler’s Special Counsel Carol Viventi wrote back to Lahanas to say MSU can’t afford to pay out more as it faces the costs of the Larry Nassar sexual abuse scandal: “Even though a settlement has been reached, we are still in need of additional information before we are in a position to look at financial commitments.” The settlement reached with Nassar’s victims calls for MSU to pay a half-billion dollars.

Providing services to MSU is costing East Lansing:

The City of East Lansing provides fire, paramedic, and ambulance services to MSU. ELFD operates a fire house known as Station 2 (shown below), including firefighting equipment and ambulances, on Shaw Lane on campus to serve MSU and the south side of East Lansing. According to Lahanas, “the University generates about 40% of the [East Lansing] department’s fire and EMS calls for service.”

The campus is within the City of East Lansing, although it pays no property taxes because of its nonprofit status. MSU maintains its own Police Department, as does the City of East Lansing.

According to Lahanas, in 1999, MSU was paying the City $1 million annually, but by 2003, the amount had dropped to $326,000. There it has remained to date, while costs to the City have risen. MSU has estimated the annual cost to the City of providing emergency services to be about $1.5 million, while the City estimates it at about $3 million.

The State of Michigan gives East Lansing fire protection grants to help offset this cost. Recently the City received $1.3 million for this, but according to Lahanas, “The amount of fire and EMS services and protection the University receives far exceed the combined compensation from the State and MSU.”

East Lansing also tried last year to get MSU to pay up:

Last year, in the run-up to a failed vote on an income tax for East Lansing, Mayor Mark Meadows and MSU’s then-President Lou Anna Simon (below) entered into a contentious round of negotiations over possible extra payments from MSU in exchange for dropping the income tax. The way the income tax was designed in conjunction with a property tax reduction was aimed at putting the bulk of the new tax liability on MSU employees who do not own homes in East Lansing.

Meadows and Simon were unable to negotiate a deal that was acceptable to both the City Council and MSU’s Board of Trustees before the vote. The last-round proposed deal, which called for MSU to pay East Lansing $20 million over 8 years if East Lansing did not pursue an income tax during that period. If the current income tax proposal passes on August 7, it will net about twice that amount in the first 8 years.

Top MSU administrators helped to fund the “vote no” campaign last year. But in a presentation on the income tax yesterday at Hannah Community Center, Meadows said that so far with this year’s ballot proposal, the “vote no” side has been relatively inactive.

East Lansing cuts emergency personnel positions while MSU grows its police force:

East Lansing has been cutting funding for police and fire positions as it struggles to deal with its large unfunded pension liability. While the number of sworn police officers in East Lansing has been dropping due to budget cuts, the number of sworn officers at MSU PD has been going up steadily each year.

East Lansing is now down to 49 sworn police officers, well below federal recommendations for staffing a city this size, and below the statewide average. MSU PD's website says that its force has “over 85” sworn officers, and ELPD Chief Larry Sparkes tells ELi he believes the current number is between 90 and 100 officers. MSU PD has not responded to a request for the exact number.

The 2016 annual report from MSU PD showed an annual budget of about $14 million out of a total MSU budget of about $1.3 billion. Meanwhile, East Lansing is spending about $22 million on public safety out of an annual City budget of about $34 million.

In terms of percentages, that means MSU is spending about 1% of its budget on public safety, while East Lansing is spending about 65% of its budget on public safety. As ELi has reported, East Lansing’s emergency services are especially strapped on big MSU game days, largely because of alcohol use, a problem MSU administrators have acknowledged.

Below: a game-day party at an East Lansing rental house last fall.

ELi asked Viventi’s office whether MSU might consider cutting back on its police force to obtain funds to provide to the City of East Lansing for emergency services, but we have not yet received a response.

MSU warns the City it might face liability from post-Nassar legislation:

In her response to Lahanas, Viventi wrote, “We hope the Mayor has had the opportunity to review the O’Brien package of bills and is continuing to follow them. These bills have the potential to cause the city a large liability, as the Interim President brought up in his meeting with the mayor.”

Viventi’s office has not responded to ELi’s question about what she means by this reference to state-level legislation, nor have Meadows or Lahanas responded to our questions about this. As The Bridge has reported, this series of Michigan bills is aimed at stopping “other predators from following in [Nassar’s] footsteps.”

One law already passed extends the statute of limitations on both civil and criminal charges of sexual assault. This could result in extra prosecution costs for the City of East Lansing, but applies only cases that are factually very similar to those involving Nasser. It is unclear why Viventi would suggest this could lead to liability for the City.

MLive has reported that Engler has been trying to get the State legislature to “slow down and take more time to examine the fiscal implications” of the legislation being considered.

For now, what is certain is that East Lansing voters will have another chance to vote on an income tax on August 7. If passed, twenty percent of the net revenue from that income tax will be used to pay for police and fire services.

Read ELi’s comprehensive guide to the income tax ballot proposal.