TAWAS CITY – Among other business, the possibility of adjusting the Tawas City operating millage was discussed by council members at their May 6 meeting.
There was no action taken on the topic, and it will also be on the agenda of the next meeting on Monday, May 20.
City Manager Annge Horning said the municipality’s current operating millage is 18.2216, which has been the same rate since 2010.
“Based on State regulations, we have the ability to levy an additional .5 mill and increase the millage rate to 18.7216,” she said.
Horning explained that this is the maximum allowed, without having to go to a vote of the people. She added that the operating millage is deposited into the city’s general fund and can be used toward any expenses besides the sewer, water and library funds.
“Before signing the form that authorizes the tax levy for 2019, I would like the Council’s review of the current rate and the financial impact if changes are made,” Horning continued.
She provided them with a spreadsheet depicting the amount currently collected for a range of taxable values, and the financial impact if the millage rate is increased or decreased in increments of .1 mill.
For instance, those whose home has a taxable value of $100,000 are paying $1,822, based on the current millage. If this were to increase by .1 mill, their payment would go up $10.
Considering that the taxable value of all properties in the city is $56,681,079, the total impact if a .1 mill increase were enacted would be $5,668. For .2 mill more this would be $11,336; .3 mill, $17,004; .4 mill, $22,672; and the maximum levy of .5 mill, $28,341.
Horning said she wasn’t expecting council action on the matter during the meeting, as her intent was to only present the information for discussion at this point.
Anticipating questions which may arise, she also shared the following details with officials:
• .1 mill is equal to $0.10 for every $1,000 of taxable value.
• Taxable values are generally no more than half of the value of the property’s true cash value; many taxable values are less than half.
• The millage rate may increase or decrease by any amount and is not limited to .1 mill.
• East Tawas’s city operating millage for 2018 was 17.6677.
• If any changes to the millage rate are made, adjustments will also have to be made to the proposed budget for the 2019-2020 fiscal year.
Horning said this is something she would like to have council action on each year going forward – when the form is signed to authorize the tax levy – with the council confirming what the millage rate is, instead of meeting with the treasurer to do so.
Since this will be on the agenda of the next meeting, she invited council members to approach her with any questions they may have.
In other business, officials re-addressed a topic which was raised during their April 1 meeting regarding a possible property donation.
As reported, Ed and MaryAnn Wojahn submitted a letter, stating that they are donating a 13.46-acre parcel of land to Tawas City.
Horning said the property fronts M-55, next to Dean Arbour Ford, and goes back along Fifth Avenue, approximately to Roberta Drive.
The council voted at the time for staff to conduct more research into the parcel, and bring the information back for further discussion.
Mayor Ken Cook had also asked whether the land is buildable, to which Horning said a wetland delineation is needed before making such a determination.
Cook then questioned if a legal opinion should be sought before the city accepts the donation, noting that they could be taking on a sort of continued liability.
Horning was ultimately tasked with conducting more research, presenting it to the city’s legal counsel for opinion, then sharing it with the planning commission to make a recommendation back to the council.
Since then, she announced at the latest council meeting that, although the donation hasn’t yet been presented to the planning commission or legal counsel, she put the item back on the council agenda following some concerns which were raised during their recent budget workshop.
“I reached out to our insurance carrier and he didn’t feel that accepting the property donation would create a legal liability exposure for us because we would have a level of immunity that isn’t available to the private sector,” Horning stated.
“He shared, however, that development would be difficult and there is the potential for environmental issues that could bring with it a very large expense for remediation,” she went on.
“Without knowing that information and lacking any defined or recognized need for the property, he didn’t feel it was in our best interest to accept the donation. Before I proceed and start incurring legal fees, I would like the Council to share their thoughts,” she stated.
According to Horning, another recommendation she received was to ask the Wojahns if they would like to present the donation idea to the Iosco County Economic Development Corporation (EDC).
The EDC, she explained, has a funding mechanism which allows for help with new development, whereas, Tawas City doesn’t have the same ability.
“So it’s just another tool that they might be able to use, if that’s something that we want to recommend, as well,” she said.
Councilman Jon Studley remarked that receiving a donation is great, and it’s hard to turn down an opportunity to gain property.
“But I don’t know right now, strategically, if we have any use for that property,” he said.
“And I don’t know if we want to accept that, knowing that we may not do anything with it for a period of time. Because right now we have no plans to do anything with it,” he continued.
“And the environmental piece is a big thing for me, as well,” Studley went on, adding that there are uncertainties surrounding what that cost will be, whether the land is even usable and so on.
Councilwoman Jackie Masich said she had the same concerns as Studley, regarding what the use would be of the property.
She also pointed out that the city already has more than 100 acres of vacant land which hasn’t been developed, and that officials need to concentrate on developing.
Mayor Pro Tem Brian McMurray said he believes there is merit in seeing whether the county EDC would entertain receiving the property, especially when additional funding can possibly be provided.
Studley made a motion, if the Wojahns still want to donate the parcel, that they approach the county EDC to determine if there is interest. The motion passed 6-0, with Cook not in attendance.