Background: A
property owner challenged Lansing’s newly imposed stormwater utility
fee, arguing that the fee was a tax levied without voter approval in
violation of the Headlee Amendment to the Michigan Constitution
(Mich Const 1963, art 9, sections 25 and 31). Lansing had imposed
the stormwater fee on virtually all properties in the city to pay
for the city’s stormwater and sanitary sewer separation project
costs as permitted under state statute.
Why did the LDF get involved?
At issue was whether municipalities could fund
certain costs as a fee imposed as a regulation or as a tax requiring
voter approval under the Headlee Amendment.
What action did the LDF
take? Filed an amicus brief with the
Attorney General’s Office
Filed an amicus brief with the Michigan Court of
Appeals
Filed an amicus brief with Michigan Supreme Court
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What was the
outcome? The Michigan Supreme Court ruled that
the stormwater service charge imposed by Lansing was
unconstitutional and void on the basis that it was a tax for which
voter approval was required and not a valid use fee. The Court
established three criteria for distinguishing between a fee and a
tax: 1) a user fee must serve a regulatory purpose rather than a
revenue-raising purpose; 2) a user fee must be proportionate to the
necessary costs of the service; and 3) a user fee must be
voluntary—property owners must be able to refuse or limit their use
of the commodity or service. The Court found that the charge failed
to satisfy the first and second criteria.
Who prepared
the amicus brief? R. Bruce
Laidlaw Abigail Elias |