Ludington City Council Meeting July 10, 2017: Preserving the Greed

The agenda for the July 10, 2017 meeting of the Ludington City Council was weighed down primarily by the usual midsummer tax levies and millage rate settings that have become synonymous with our council.  Since 2009, the city has voted for six ordinances to do this for the operating, DDA, and police pension millages, and failed to tell why they do that to the public other than they need to. 

The actual reason is that it allows them some cover when they propose to raise your tax rates under the state's truth in taxation rules, where under the proper conditions, they can raise the maximum tax rates allowed by Headlee upwards.  When Headlee rollbacks kick in, they can have truth in taxation hearings and raise the limits back up without a vote by the electors. 

The rollback comes into effect when the amount of property taxes to be collected for a year rises above the inflation rate applied to last year's taxes.  The initiated law behind Headlee was to reform greedy local governments from trying to collect as much taxes they can get.  Truth in taxation hearings were created thereafter in order to help taxing authorities collect more without a vote by the people in order to address unforeseen or emergency financial needs.  The leaders of Ludington don't need a reason other than a Headlee rollback has kicked in.

That was proved at this meeting by the officials and the council vote on a resolution to have a hearing, despite the fiscal factors.  But before this was even considered, they added three additions to the agenda.  A 6 month 2017 report by the fire chief, the announcement of an opening of the Board of Review after the ascension of Wallace Cain to a city councilor, and finally an amendment to extend the time the developer can seek more tax credits from the state for the bowling alley block property downtown. 

It seems that the state was stingy with the tax credits the first time through, so they had to petition more from the state before July 17, and came to the council at the last minute.  No matter, even without any info in front of them and the city attorney giving them a spotty opinion of why the extension was needed, the whole council approved it without questions.  The project, like the developer's project in Ann Arbor, has a lot of moving parts and I doubt whether any of the current councilors have done their homework.

Bob Louth, a local resident who keeps his boat down at the city marina, started the public comment by making complaints about firework issues in that vicinity (3:40 into the video), offering up some photos of what his watercraft went through on the night of the Fourth and unsafe conditions that were allowed that night.  His issue would later be talked about at the end of the meeting, but being that there wasn't anything like it on the agenda, he snuck the issue past the council's usual censors.

Monica Schuyler representing the Pennies from Heaven Foundation gave a brief overview of what was going on with the downtown and the fire station issue, nothing really substantive, rather it was more of a message to 'act now' before it's too late to get this 'deal'.

At around 8:00 in, I went to the podium and added my two cents, er, more like $49.  The transcript as usual, follows the video:

July 10th, 2017 Ludington City Council meeting from Mason County District Library on Vimeo.

XLFD:  "I've ran unsuccessfully for city council twice, and it's probably all for the better that I lost, because I surely do not understand the rationale of how they operate.  Tonight is a case in point, where they will likely pass a resolution to hold a truth in taxation hearing at the July 24 meeting in order to raise the DDA millage by .0018 mils. 

If a .0018 millage raise to a small portion of the tax roll does not sound like a lot of money, you would be right.  Considering the city normally gets around $44,000 from the DDA millage, this raise of less than a 900th of the full millage will raise only about an extra $49 yearly.  That figure is even in your packets on page 32. 

To realize that $49, you had the city clerk, manager, treasurer, and community development director working together for hours to figure out a truth in taxation hearing could net them an amount less than what they each get paid per hour on average for wages and benefits. 

Beyond that, tax law requires the City of Ludington to run a truth in taxation notice in the local paper of at least 16 column inches in size.  As the City of Ludington Daily News charges $17.17 per column inch for such notices, they will pay nearly $300 to announce this tax rate increase that will gain them a whopping $49. 

Being that the amount just for noticing this meeting won't be recovered by the tax increase until 2023, why would you vote for this resolution in the first place?  This will only add to our projected deficit in the coming year, and the only reason in the resolution for the tax increase is that the DDA has increased operating costs. 

This defies the latest budget figures which has the projected operating costs of the DDA actually going way down in 2018 and 2019 from the 2016 and 2017 figures by $20,000 each respective year.  The resolution is lying about why they are seeking this $49.  A DDA responsive to their constituents should be considering cuts in the tax rate given that reality.

So I would surely question and vote against this deceit and fiscal foolishness if I was a councilor, which the city intelligentsia can all be thankful that I'm not.  Thank you."

The first reading of the six ordinances began with City Manager Shay explaining how Headlee works, then came Councilor Johnson reading the numbers wrong when setting up the resolution to hold a truth in taxation meeting.  Then Councilor Krauch asked Shay about whether the public comment was accurate, spawning the reply:

John Shay: (20:35 in) "It is true the difference between the base tax rate and what the tax rate would be with the truth in taxation is small this year.  No doubt about it.  Other years it's been a bigger difference. 

What we're trying to do is basically preserve that millage rate, because that once those millage rates go down, they don't go back up.  And the DDA is looking at some other longer term capital projects in the downtown that they would use this millage money to help fund.  So the DDA gets its, not all of its revenue but a lot of its revenue from the millage rate as well as the 12% capture of the taxes generated in the downtown district.  So it's really trying to, well admittedly it's a small difference to both the taxpayer and the DDA, but once these millage rates go down, despite what your need is, they don't go up again without a vote...

To which all the councilor's bobbled their head in assent, Councilor Krauch and Henderson voicing words to the effect "Oh so its just preserving the millage rate."  They then passed unanimously the measure.  This means they will take nearly $300 from the City's general fund to put the notice in the newspaper, and receive under $50 per year for the DDA when they raise taxes on everybody in the downtown district next meeting.

Meanwhile, the long term capital projects in the downtown are non-existent.  Legacy Park, we've been told, will not be funded by the taxpayers, ergo DDA funds which are almost exclusively taxes should not be used.  And the latest budget figures show the DDA expenditures at $170,000 in 2016, projected to spend that same amount in 2017, and then projected to spend $150,000 in 2018 and 2019.  There is no 'long term projects' in sight, just cuts in their budget!  And that despite the fact that their TIF money is constantly growing (the budget actually shows 2017-2019 being constant in revenues from the TIF which is not likely to be the case). 

 

Fourth Ward stalwart, Chuck Sobanski, commented on a few issues at 34:15, that you definitely won't hear about in other media outlets.  He wondered how much money the City was bringing in by having boats being parked on city property in the 400 block of First Street.  He wanted the City to kick them out of there if no rent was required, and if they did collect money to help use it repair the Copeyon dock.  He berated the street work being done between Washington and Madison as subpar.

I followed with another lament about the unethical conduct by Spence Riggs and called for action to address it.  Sobanski and myself were totally ignored at the end of the meeting, however, they jawed on for a long time about how they could best regulate fireworks better and the liability behind Chinese lanterns.

XLFD:  "City leaders seem willing to refuse to comment honestly and honorably on the unethical actions of their fellow official Spence Riggs of the Planning Commission who tainted that body greatly.  At previous meetings, I have leveled some serious allegations like the city manager lying about something he should have known the truth about and a Planning Commissioner going through a series of willful acts in order to benefit himself financially from his public service. 

Riggs could have done this legitimately by noting his conflicts of interests at the February Planning Commission meeting he voted for zoning law he helped draft in order to allow his property to be buildable and much more valuable.  He didn't, it was never noted, it was never put in the approved minutes, so he is guilty of malfeasance of office at the least for his course of action for his own financial benefit. 

If you defend his actions in the process, you are defending corruption and unaccountability.  Riggs should be encouraged to resign his seat, and forced to follow the legal rules that others have been forced to use for splitting their lot of record.  Failing that, some honorable element of city hall should be looking to convene a hearing to consider his removal due to his obvious, willful and unapologetic malfeasance of office.  This is what both state and local laws of ethics for Planning Commissioners commands.  Thank you." 

Preserving the greed by using your money to prop up the DDA and preserving the greedy, by looking the other way when Spence Riggs pocketbook is enhanced due to him changing public policy without proper disclosure.  Shameful.

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Nobody, from the Council, City Manager to the LDN and other local media ever explains what goes on at City Hall like you do X. When you complete a report, the citizens can honestly say they have received important and complete information that should help them decide what is going on with Ludington's politicians. So why do the people keep electing these political misfits? They either do not have access to this information, are unaware of this information or they wish to remain in ignorant bliss by spending their time  watching the boobtube while scratching themselves where the sun don't shine. Another excellent report X.

Love the marina fireworks photo. Is it your creation?

The marina fireworks photo was actually found by just doing a Google Image search using marina and fireworks as parameters.  The photo used actually looks as if it may have come from Ludington at first glance, but when you look closer, you'll notice it isn't. 

That photo kind of mirrors how our local 'corporate' media works.  They'll write a story concerning Ludington, embellish the heck out of it, so you buy into the propaganda-du-jour they're selling, but in the end, in the reality, it is not really accurately depicting Ludington.  Ludington itself is beautiful and inspiring, you and I know this, your own photos capture it regularly, but the flaws that exist need to be addressed, not glossed over as the COLDNews and our city leaders prefer.

Modern municipal taxation is an odd character and I think you may be confused, Verdad, because the Downtown Development Authority is a taxing authority which is mostly funded through downtown district property taxes (a 2 mil rate which has been reduced by Headlee down to 1.6 mils) and the 12% TIF (which is effectively a taxing of other taxing authorities).  The DDA does not pay any taxes, it levies them and captures them which supplies the lion's share of their funding. 

Here, the DDA treasury will net an extra $49 through their millage rate per year.  They will get this after the general fund pays for advertising this TIT hearing of nearly $300.  So everyone pays extra taxes this year to place the ad, starting next year our shopkeepers in the downtown pay collectively $49 more. 

I believe they may be upping the millage rate under the belief that they will be able to get more TIF funding, however if they do it will once again come at the expense of the city's general fund.  I think our community development director knows how to play the city manager.

One of my campaign pledges when I was running for the Third Ward, which encompasses the entire DDA district, was to review the current popularity of the DDA millage by those who pay into it, and suggest a repeal vote if they were mostly against it. 

Whereas I think most would find it just an annoyance, there is a vocal and powerful contingent of officials and their cronies who have too much to lose if this $45,000 in taxes were lost.  Like you, I find no good reason for us to use tax money to prop up the DDA; it turns smart capitalists living in a free market into conniving socialists living in an unsustainable economic model promising free money.

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