Or, perhaps more accurately, taxpayer, be aware!
With already one of the highest tax rates in the state among communities with tax bases rich in residential and industrial property, Dearborn voters will face up to seven different property tax ballot proposals this year. I cannot remember a single year ever with so many tax votes before us.
The proposals are on a collision course with what seems to be some anti-tax sentiment in Dearborn, which was evident when voters turned down a major school bond proposal last November.
Among the proposals expected this year are renewals of taxes collected for the Detroit Institute of Arts, Wayne County parks, Wayne County general services and the county’s regional school district, which funnels money back to Dearborn schools.
New taxes are expected to be sought for bonds for Dearborn Public Schools, for regional public transit services, and for after-school programs for kids in Wayne County.
Here’s a more detailed look at each of the proposals.
DIA MILLAGE RENEWAL
A renewal of the property tax supporting the Detroit Institute of Arts will be the first tax question of 2020 and will be the only countywide proposal on the March 10 presidential primary ballot. Even if you don’t want to vote for a presidential candidate in either party, you can vote on this tax renewal without participating in the presidential contests.
At 0.2 mills, it’s a relatively small amount. If your house has a market value of $120,000, it costs you around $12 per year. Its approval is nearly assured, as the DIA has been stepping up its public visibility campaign for several months with TV ads and mailings, and the DIA is regarded as a jewel in the region.
I love the DIA, and who doesn’t, but I find this proposal disappointing on a couple levels. For one thing, when the DIA asked voters to approve a 10-year tax in 2012, it was assumed this was a temporary tax to give the DIA time to get its endowment to a certain level. Along with going back on that commitment, the DIA is asking for this renewal two years early, and targeted an unusual election that will certainly attract mostly Democratic presidential voters, which is a very favorable audience for this sort of tax proposal.
DEARBORN SCHOOL BONDS
The most important tax question specifically for Dearborn residents will be another try at a bond issue for Dearborn Public Schools.
Dearborn voters narrowly and, frankly, surprisingly defeated a $240 million bond proposal that was the only item on a special election ballot last November. As a result, your summer property tax bill will be a little lower this year than in 2019, as some older bonds are paid off and the school district levies a lower millage rate for debt retirement. One estimate has the district’s debt millage at around 3.15 mills this year instead of the 4.82 mills we paid last year. If the market value of your home is $120,000, that will save you roughly $100 from last year’s bill.
Dearborn Public Schools has little choice but to try again this year to get voters to approve the sale of bonds, to borrow toward costly repairs and improvements to our district’s aging buildings. Despite last year’s bond failure, the work on the buildings is still needed, and it’s our responsibility to meet those needs. No one else is going to pay for them, certainly not the state.
The challenge for the school district is to come up with a plan that will diminish opposition in the community, and that will mean working with and incorporating suggestions from those who led the anti-bond efforts last fall.
Also to be determined is how much money the district will request. It has been reported that over $500 million in repairs and upgrades were initially identified as the district was researching building needs for last year's bond proposal. The list was pared to $240 million in order to have a net-zero tax increase proposal, by adding bonds as others were paid off, to keep the debt service tax rate the same from year to year.
Now, any new bond proposal will be a tax increase from what we will pay this year, so the district needs to factor that into the proposal. The school board may have to decide between the buildings’ most vital needs versus basic needs. All of this would need to be done by the end of July in order to meet early August deadlines for getting questions on the November 3 ballot.
COUNTYWIDE SCHOOL ENHANCEMENT MILLAGE
Michigan’s Proposal A of 1994 changed the way public schools are funded, shifting the emphasis from local district property taxes to money that flows from the state. It restricted individual districts from collecting local millage for operations. But a loophole allows regional school districts to ask voters for new property tax, which can then be distributed back into local districts.
Wayne County RESA (Regional Educational Service Agency) first attempted to jump through that loophole by asking voters countywide for 2 mills for “enhancement” in 2014, and voters said no by a narrow margin. The question was put on the ballot again in 2016 -- do they ever take no for an answer? -- and it was approved with 54 percent of voters in support.
That 2-mill increase approved in 2016 costs the owner of a home worth $120,000 about $120 each year.
Voters approved the RESA millage for six years, but RESA officials are aiming for an early renewal, this November, just four years after voters approved it.
The distribution formula in the 2016 proposal sent money to local districts based on student population. This set up winners and losers in relation to how much some communities paid versus what their schools got back. Some districts paid more into the RESA enhancement millage than they got back for their schools.
Dearborn schools actually had an advantage with the distribution formula. The two mills cost Dearborn taxpayers $6.2 million collectively, but the school district received $7.8 million. However, the benefits to local districts will be diminished if the tax is renewed, because a newer state law will require public school academies – charter schools – to get a cut of the tax pie as well.
Wayne RESA needs resolutions from a certain number of district school boards to put the renewal question on the November 2020 ballot. RESA officials began that process with a presentation to the Livonia Public Schools Board of Education at a study session February 3. The Dearborn school board will probably stay quiet on this one, since it needs to focus entirely on funding our building needs. Also probably, the Dearborn school board would prefer not to have a bond proposal on the same ballot as the RESA renewal, but avoiding that seems unlikely.
WAYNE COUNTY OPERATIONAL MILLAGE
Wayne County can levy 5.6 mills each year for general operations under the county charter approved by voters in 1981. Any tax above that has to be approved by voters.
Voters approved 1 mill in extra tax for county general operations in 2000, and then approved a 10-year renewal of that millage in 2009. It has expired and will be put on the ballot either in August or November. The one mill generates roughly $35-$40 million that the county would have to cut from services and personnel if it is not renewed. It costs the owner of a home worth $120,000 roughly $60 each year.
WAYNE COUNTY PARKS MILLAGE
Authorized by voters in 1996, the Wayne County parks millage is dedicated to the county parks system and also provides some funding annual to parks projects in local communities. Voters have renewed this tax four times, every five years since it was first approved, most recently in August 2016, from 2016 through 2020.
This tax will expire after it appears on our December 2020 tax bills. The county might put a renewal on the ballot this year, because there is no countywide election scheduled in 2021. If the county waits until 2021, it would have to reimburse election costs to any communities that don’t have local elections scheduled. That’s still a possibility, but it’s also incentive to try to push through a renewal this year.
The county parks tax is one-quarter of one mill, and costs the owners of a home worth $120,000 roughly $15 per year.
PUBLIC TRANSIT MILLAGE
Advocates of regional public transit are relentless in their quest to create a new property tax to pay for coordination and expansion of mass transit.
The state created the Regional Transit Authority of Southeast Michigan in 2012 for that purpose, giving the RTA the power to ask voters for funding via property tax. RTA did just that in 2016, proposing a 20-year new levy of 1.2 mills that would raise $3 billion and build on existing bus systems to improve transit through the RTA member counties, Macomb, Oakland, Wayne and Washtenaw.
Voters did not approve that new tax in a close vote, with 50.5 percent saying no. The 2016 proposal got a majority of votes in Wayne and Washtenaw, lost by a close margin in Oakland and was defeated soundly in Macomb to result in the failure overall.
Not wanting to take no for an answer, transit advocates pushed to come back with a proposal in 2018 with an even higher tax, 1.5 mills, but that never made it to the ballot due to lack of support from Oakland and Macomb.
So, they’ve embarked on a new path: Cutting out Macomb and possibly Oakland, to create a partnership for transit between Wayne and Washtenaw, and possibly Oakland, under the state Municipal Partnership Act.
Before this can happen, the state Legislature has to amend the Municipal Partnership Act to make some changes specific to potential combined transit efforts. Regional leaders were confident this would happen when they announced the effort last November, but the Legislature has moved a little slower than I would have expected in making the requested changes to state law.
Assuming things move forward, there will be a public transit tax question on the ballot in November, with the expected ask to be around 1.5 mills. That would cost the owner of a home worth $120,000 around $90 a year in new tax, and would be in addition to the 1 mill we already pay in a tax to support the SMART bus system.
NEW TAX FOR AFTER-SCHOOL PROGRAMS
An under-the-radar group advocating for more after-school programs for children is proposing a new property tax of 1 mill, and it’s possible this proposal will wind up on the ballot either in August or November. One mill would cost the owner of a home worth $120,000 roughly $60 per year in new tax.
Using the friendly-sounding name, Wayne Kids Win!, the committee intended to fast-shuffle this tax onto the March 10 presidential primary ballot, where it would find a favorable audience of mostly Democratic voters. Given the low profile of this effort, it was possible this new tax could have been approved and on its way to your tax bill before you knew anything about it.
However, the committee tripped itself up in its attempt to use petitions to get the favorable ballot placement. Funded mostly by DTE and Quicken Rock Holdings, who ponied up $200,000 each, the Wayne Kids Win! committee paid nearly $500,000 to a Grand Rapids company to quietly collect signatures. I say “quietly” because the only news media mention of the campaign was at the petition drive’s launch last October, and there was no further news until more than 90,000 signatures were filed in early December.
The committee, whose efforts to create a new tax were endorsed by Detroit Mayor Mike Duggan and others, gave the signatures to the Wayne County Clerk at the deadline for March 10 ballot proposals. However, the committee failed to factor in the need for the clerk’s office to verify those 90,000 signatures – which the clerk’s office was not able to do in time to meet January deadlines for printing absentee ballots.
It’s hard to imagine a group that has invested so much money won’t still try to move forward. They probably won’t want to go on the same ballot as the Wayne RESA enhancement millage renewal, so watch your August ballot for this one.