City residents are getting a property tax refund after residents pointed out a budgeting mistake.
“It’s not our money,” agreed Mayor Pro Tem Eric Haven at the June 13 meeting. “We made a commitment. We need to keep our commitment.”
Clarkston City Council voted unanimously to reduce its 2016 operating millage rate from 12.5069 mills to 12.1056 mills. One mill equals $1 tax for each $1,000 of assessed property valuation, or one-half market value.
SteveWylie, resident and former council member, told council this year’s proposed 12.5069 city operating millage, from which its general fund gets its revenue, is higher than the city promised two years ago.
“I’m giving you a chance to honor the commitment to taxpayers you made in 2014,” Wylie said. “The language is crystal clear.”
During the 2014 run-up to the Clarkston Independence District Library millage vote, City Council approved a resolution to “reduce its general operating millage levy by 0.691 mills from the level that the city would otherwise have imposed.”
City Manager Carol Eberhardt remembered.
“We said to the citizens, if the library millage passed, we would reduce the millage rate by that number, which we did,” Eberhardt said. “It was removed from the general operating millage.”
The city manager said the city kept its promise, when voters approved the library.
“We simply rolled it back based on amount voters passed and left it at that number – 12.5069,” she said.
Susan Wylie, Steve’s wife, said the resolution calls for adjustment every year.
“It says the city will reduce its general operating millage levy by 0.691 mills from the level that the city would otherwise have imposed,” she said.
“I don’t think so,” Eberhardt responded.
City attorney Tom Ryan, who was the city’s attorney in 2014, said he didn’t know how the 0.691-mill-reduction measure got into the resolution.
“The language shouldn’t really be there,” Ryan said. “It doesn’t make any sense.”
Cory Johnston, city resident and former council member, said the 2014 resolution was clear.
“I can’t believe Tom Ryan is sitting here saying he doesn’t understand part B (the 0.691 measure),” Johnston said. “There was plenty of time to argue it at the time. It’s quite understandable – take the maximum amount allowed from the county and subtract .691. That is what it says.”
The promise was part of what the library millage was sold on, he said.
At the time, Johnston called for an amendment to the city charter to guarantee the .691 roll back, but council made it a resolution, which can be voted away if desired.
“You can do it, and then see if people care,” Johnston said
The city’s maximum allowable millage was 13.1979 mills in 2006, and remained at that level for the next eight years, until 2014.
The city set its millage at that rate, 13.1979, every year, with the exception of 2007, when the millage was set at 12.8943.
City and township voters approved the district library on Aug. 5, 2014. Council then reduced the city millage by 0.3455, for the second half of the year, from the maximum allowable level of 13.1979 mills to 12.8524.
The following year, 2015, council approved a millage rate of 12.5069, which is 0.691 mills lower than the 2014 maximum rate.
However, the maximum rate was reduced in 2015 to 13.0777, according to the Oakland County Equalization Department.
The maximum allowable millage levy was reduced again for 2016, to 12.9168.
However, the City of the Village of Clarkston again proposed a millage rate of 12.5069.
“The last three years, the starting point was the 2014 Headlee number,” Wylie said. “It should be the 2016 number.”
The 0.691-mill is what the city used to pay to the township for the library, Wylie said.
“We used to pay Independence Township for use of the library,” he said. “We don’t have to do that anymore. That’s why the resolutionwas passed. It’s only fair for us to give it back to the citizens. That’s what you voted on. If you pass this millage, you’re not doing it.”
The city’s new Treasurer Caitlin Bentoski, who is preparing her first budget for the city, said she agreed with the residents’ analysis.
“I think Mr. and Mrs. Wylie have a valid point based on the way the resolution was written,” Bentoski said.
A resolution to accept the proposed 12.5069 operating millage was defeated 5-1.
Haven, and City council members Al Avery, Jason Kneisc, David Marsh, and Michael Sabol voted against the resolution. Mayor Joe Luginski was absent. Council member Sharron Catallo voted “yes.”
“Costs have gone up,” Catallo said. “Didn’t we already give it back?”
“It’s not a one-year deal,” said resident Karen Eckert.
Haven said he agreed council promised to reduce the millage by 0.691.
“We need to keep the differential,” he said.
“The council committed to reducing the rate and we need to live up to the commitment,” Avery said.
Bentoski said revenues at the 12.5069 level was budgeted to add more than $12,000 to the city fund balance.
Longer term, she expects more revenue through the state Act 51, which created the Michigan Transportation Fund, and other factors.
The 12.1056 mill rate will reduce the fund balance by about $4,000, “to fix last year’s mistake, too,” Wylie said.
Sabol made the resolution to set the millage rate at 12.1056 – the maximim 12.9168 minus .691, as well as .1202 to compensate for last year.
“We owe the city for what we missed last year,” he said. “It’s basically a refund to city residents for what did not do last year.”
Catallo called for the record to reflect the reason for the reduction, “make it known so it doesn’t always go down that far.”