Why you should oppose the City of Howell Headlee Override Tax Increase

Is the City of Howell asking voters for more tax money than they need?  Let’s examine the facts on this moonshot request. A few years ago, the city assessed a “Rubbish Tax”, then they raised taxes an additional 1 mill for “roads”.  Then they attempted, without a public vote, to raise taxes 3 mills for “Public Safety”. 

Now they are asking for a 4.5 mills Headlee Override (1.5 mills more than before) to balance the books and implement infrastructure projects.   Doing the math, they first wanted to raise $864,000 in taxes without a vote but now they are looking for over $1,401,143. An increase of $537,143 or 62% more than a few months ago! What’s up with that?

The city claims they are being shorted State Revenue sharing but the State has been steadily increasing revenue to cities for the last 9 years, just not enough for Howell our Council says.  If State revenue sharing is the problem we need to pressure lawmakers to increase state funding, not punt the problem back to cities.

So how has the city been spending money?  Well, its deep in debt with 1 out of 8 tax dollars paying over a million dollars a year for bonds.  Maybe we should ask why and how the city got so deep in debt? Also, many don’t remember a few years ago the city had to buy property south of town for 2 million dollars to settle a lawsuit. It should have recently sold for over 3 million outright but instead Council struck a deal to subsidize a developer who has not paid for the land and taken it off the market for over a year.  It’s the worst deal ever, we may never see this money come back in our lifetime, and we should trust this Council with 1.4 million more dollars a year for 5 years?  

During a public hearing for the Public Safety millage the Mayor stated on the record (I have the recording) he did not trust the public to approve a millage that’s why they tried to implement the assessment.  So instead of putting the original 3 mills increase to a vote they increased the millage amount and are asking for more money than before.  Am I the only one scratching my head on this logic?    

Maybe the city budget is also under stress by Council taking on debt and expenses that should be the responsibility of the DDA. If fiscal responsibly is the city’s goal, then why did they get late-in-the-season paving bids for a parking lot that went $200,000 over budget? Is this the act of fiscal responsibly with our tax dollars?

The millage override request is for 5 years. Why five? It gives the city the opportunity to create dependency on the millage, and when it comes up for renewal it overrides the Headlee limits again and resets the millage capture rate to an even higher amount.  Do not be fooled with the claim the renewal would be a “scorecard” on the city’s performance. Once the tax increase trap is in effect can never go away, especially if the city takes on more debt.   

     

And finally, we should not be bullied with the threat to take away our brush and leaf pick if the millage does not pass, the actual cost is minor in relationship to total city budget. After all, if Council can find $74,000 for a downtown street study it can find the money for the one basic service we residents enjoy with or without another tax increase. 

City of Howell Fails to Follow State Law Notification for Special Assessment

The City of Howell’s notification to create a Special Assessment for Police Services is defective as it fails to follow State law. Says Doug Heins, a former Howell City Council Member.

Michigan’s law NOTICE OF SPECIAL ASSESSMENT HEARINGS Act 162 of 1962 requires all property owners be notified of their right to protest and appeal a special assessment.

The notification the city mailed out to property owners failed to include to include this legal requirement.  

“The hearing schedule for Monday April 23, 2018 will be invalid” stated Heins.  “The city is in such a hurry to jam this special assessment down our throats they failed to follow legal procedures.” 

“This is just more example of how our city being mismanaged.  They have spent themselves into a hole and think they can blame lack of State reimbursements for their budget shortfall”

“The City originally considered asking for a Headlee Override but rejected that approach, choosing more heavy-handed approach by creating a Special Assessment District to bypass the voters.”

“Not allowing a vote on their spending and taxing decisions show a great deal of disrespect to all city residents” Say Heins “They are wasting everyone’s time with this illegal hearing.”

City of Howell To Illegally Assess Property Owners for Police Protection

The City of Howell’s proposed use of an obscure Public Safety Special Assessment (Act 33 of 1951) process to balance the city budget for police protection is illegal states former longtime City Councilman Douglas Heins.

A special Public Safety assessment cannot be used to sustain a government function yet the city has clearly admitted they plan to defund the police to pay for other services and debt and replace the money with an illegal special assessment  I’ve been involved in city budgeting over the years and I can say some long-time members on this Council have made very poor budgeting decisions

http://www.cityofhowell.org/psa/

On background the legal theory of special assessments is they create a public benefit and make property values rise because the government’s assessment improves the land and they has a right to charge the property owner a special assessment tax.  

(Citation:  http://www.michiganpropertytax.com/specials.htm)

Michigan's Supreme Court ruled in 1986 the only justification for a special assessment levy is to increase a property's market value, so there must be a measurable special benefit for the special assessment to be valid. 

City Police protection already exists, so using a special assessment to continue an existing benefit, makes it hard to legally argue our property values will increase.  The city is actually creating a fake hardship to justify this assessment by defunding the police.

The city’s process for the creating an assessment district is also questionable. The city assessor will have to be very creative in pretending there is property improvement values to justify the assessments.  

Every property owner needs to ask the assessor how this assessment will increase the benefit for our property because Council made a decision to defund the police department. This assessment does not create a new Public Safety benefit, but only maintains the status quo.      

Also, people really need to question how the city has been spending money in the past. The city is crying poor but they recently locked up 3 million dollars in a vacant land deal to subsidize a development project. If the city had sold this property outright that would be 3 million more dollars in the bank right now. 

 It’s pretty clear this assessment process has the backing of the Michigan Municipal League and Howell is the test case, so if this passes without a challenge, every small city in Michigan will be doing the same thing.  

 The crazy quirk about this type of special assessment process is every property owner has to attend the public hearing and protest on the record to preserve their rights.  If a protest is not recorded at the public hearing the property owner person loses the right to challenge the legality of assessment at the Michigan Tax Tribunal.

If the city has a case for money more they should put it to a vote, and stop making property owners jump through hoops. This is a stupid, arrogant way to ask the public for more money.

By law a special assessment must apply to all properties even those exempt from taxation.  So, does the city plan to assess schools to pay for police protection? And if they do, how can the city argue that a school’s property value increases from the special assessment?  How about someone that has a vacant lot? How does vacant land get a special benefit from police protection?    

It’s the classic issue, of a spending problem not a revenue problem. The city is currently using thousands of dollars in general fund money to pay downtown projects, this is money that should be used for police, not parking lots.  Their priorities are all screwed up

Why should every property owner be forced to file a legal challenge to the Michigan Tax Tribunal?    It’s a gross abuse of the law’s real intent   

Howell Mayor and Mike Hall and Don Cortez violated campaign finance and election laws

Mayor and Local Howell Businessmen violated campaign finance and election laws

Michigan Secretary of State’s Bureau of Elections issues warnings and businessman fined

Doug Heins announced today that the Michigan Secretary of State’s Bureau of Elections has successfully concluded its investigation into alleged violations of the Michigan Campaign Finance Act committed during last November’s Howell City Council election.   Heins, an incumbent city council member lost his re-election bid to the Howell City Council had filed complaints of failure to properly identify campaign material and distribution of anonymous endorsement flyers that were mailed to voters and handed out door to door. 

After a lengthy investigation by the Bureau of Elections, the complaint against Nicolas Proctor, current Mayor of Howell, for not providing the correct “paid for by” committee statement on his yard sign was found valid and Proctor given a warning by the Bureau of Elections. “The Mayor ludicrously claimed to the State he had corrected the error during the election with sticker placed on the yard signs that weathered off, but could not provide any proof. The Bureau of Elections saw through this claim and correctly cited him for improper identification of his yard signs” said Heins.

The more serious complaint against former Howell Mayor Paul Streng for distributing anonymous flyers was dismissed, but during the investigation, the State had determined two local businessmen were responsible for creating and printing the anonymous endorsement flyers during the election. 

Mike Hall, President of Cobb-Hall Insurance and former Howell School Board Trustee authored the anonymous flyer and was found in violation campaign election laws for not identifying a “Paid for by” committee and address on the flyer. Hall was given a warning by Bureau of Elections.

Don Cortez, Owner of First Impressions Printing and current Livingston Educational Service Agency School Board Member was found to have committed the more serious felony violation of using corporate funds for printing the anonymous flyers.  Cortez paid a civil fine of $50 to the Bureau of Elections and signed a four year agreement to comply with elections laws.   

“This is a big deal” said Heins. “Of all the complaints to the State Bureau of Elections most are dismissed or warning letters issued.  To fine an individual is most unusual.  It shows the seriousness of the violation”

The question as who mailed out the anonymous letters remains unsolved. The Bureau of Elections was not able determine who mailed the flyer to local residents, despite asking questions of the 14 people listed on the endorsement flyer. All respondents denied any knowledge to who mailed the flyer. Sue Dolato and local businessman Joe Parker did not respond to the State’s request for information.

“The missing piece in all this is who spent hundreds of dollars to mail out the flyers?  It’s hard to imagine one person did this mailing in secret. If anyone is aware of who did the mailing, they have a responsibility to contact the Bureau of Elections at 517-373-2540.” Said Heins

“Overall I’m very pleased at the thoroughness and detail taken by Bureau of Elections in investigating violations of Michigan Campaign Finance Act. These local businessmen, have held public office should know better than anyone the election laws.  What’s really troubling is they don’t even live in the city but decided as outsiders to act behind the scenes and manipulate the voters of Howell.” Said Heins. 

“Campaign election laws are written to prevent these types of shady actions. The public has a right to know who is funding and distributing opposition flyers. Whether the information is positive or negative, knowing who is behind the flyers helps the public consider the source when choosing who to vote for” said Heins 

The complete investigation documents can be seen online at the Bureau of Elections web Site: 

https://www.michigan.gov/documents/sos/Heins_v_Proctor_517904_7.pdf

https://www.michigan.gov/documents/sos/Heins_v_Streng_524703_7.pdf

Doug can be reached at dougforhowell@gmail.com