Twas Brill and the Slithy Goves

[XLFD]

On the March 24, 2014 Ludington City Council meeting the people of the Brill Company came to the City Council to get some tax relief.  My belief on tax relief is that it needs to be given as equally as possible to everyone; to allow it to one person or company that are willing to kneel to the local councilors at the expense of putting the increased tax burden on the rest of the community is not fair.  I have made this point at a couple of other public hearings on tax abatements like this one. 

 

In disclosure, I do not have any gripes about Brill the company, besides their willingness to apply for these favors, without their personnel ever coming in front of the council to argue against tax hikes for everyone, like the city did in 2009 and 2010 with special Truth in Taxation hearings.  Also, I have no stock in Kaines West Michigan, nor have I ever been assisted in any way by them, however, I strongly endorse them in this speech.  Here it is, check the Ludington minutes on demand site if you want to fact-check the Brill and Kaines history with the City (the speech starts at 9:40 in, and I got a couple seconds extra than five minutes):

 

March 24, 2014 Ludington City Council from Mason County District Library on Vimeo.

 

 

Tom Rotta, 100 block of East Dowland,

Let me tell ye of the tale of two of my industrial manufacturing neighbors, the Brill Company and Kaines West Michigan.

 

In the 1940s Brill Manufacturing set up shop in Ludington and existed for about thirty years until some guys down in Lansing set up some methods to have businesses avoid their share of local property taxes in 1974.  Some would call it tax relief, or targeted tax relief.  More enlightened folks would recognize it as the beginning of a slippery slope where governments would be able to provide tax breaks for favored businesses, at the expense of creating a heavier tax burden for everyone else in the community, including those in active competition with those favored businesses. 

 

In 1976, Brill Manufacturing came to the City Council and asked for the creation of a plant rehabilitation district to receive tax relief for their expansion.  R.W. Brillhart wrote to the city manager of that time: 

 

"My attorneys have informed me that, pursuant to a new law in Michigan,  companies expanding or replacing their facilities can apply to local governmental units for property tax relief on the new or replacement facilities. As I 'understand', this law does not reduce any present tax paid to the city or school district, but does provide for the reduction of, or exemption from, property taxes imposed on the new construction.

Accordingly, I am writing you as the City Manager to request on behalf of Brill Manufacturing Company, that the City create a plant rehabilitation district to include the real estate where the new building will be located. I would appreciate it if we·could schedule a meeting so that I may review with you Brill Manufacturing's plans and have my attorneys  explain the operation of the new-law to both of us."

 

And to my knowledge and belief, Brill was the first business in Ludington to get voted such relief.  Later on that year, they received an Industrial Facilities Exemption Certificate providing significant tax relief.

 

In 1990, they applied to become an Industrial Development District, which abolished the existing  Plant Rehabilitation District from 1976, which set the ground for applying for a new industrial facilities exemption certificate for a planned expansion.  The certificate was to last twelve years.

 

In 1997, Brill got some more equipment and came to the council who approved them for another industrial facilities exemption certificate.  In 1998, they came to the council for another half million addition for an industrial facilities exemption certificate.  In 1999, they came back for another certificate for other property.

 

In 2002, the four industrial facilities exemption certificates were transferred from Brill Manufacturing to the newly formed Brill Company.

 

In 2009, the Brill Company came before the council to receive another industrial facilities exemption certificate for more equipment.  And that's what they seek here today.

 

 

 

Brill is on the same block I live.  Across the street from my house, closer in proximity but on the next block is Kaines West Michigan.  Long before the laws of the 1970s went into effect which provided local governments the ability to get substantial tax relief mentioned by Mr. Brillhart, Kaines has been producing steel wire products-including displays, refrigeration racks, office accessories and specialty wire forms.  According to their website, Kaines'  small town values let them provide service that is uniquely personalized, with response times and quality that are second to none.

 

While Brill Manufacturing and the Brill Company have been getting tax relief for their expansions a half dozen times before this council, Kaines West Michigan has quietly expanded on their own and conducted their business without asking any favors of our city.  Kaines has sat by while as early as 1978, Straits Steel and Wire, in the same wire making business as Kaines, was getting its own series of industrial facilities tax exemptions, just like Brill. 

 

Kaines West Michigan is a good neighbor, who realize that whereas they may qualify for substantial tax relief, they do not seek it, and are content with allowing companies like Brill and Straits to lower their taxes, while shouldering the extra tax burden created by such corporate welfare along with the rest of the community that isn't blessed by our community leaders at City Hall.  Here's a hearty thank you to businesses like Kaines West Michigan and everyone else in the City of Ludington who seek no privileges for themselves, but would appreciate tax relief for everyone, which hasn't happened for a long, long time here in Ludington.  Ask your councilor when was the last time they voted to lower taxes or fees for all, and if they're honest they will tell you never."

 

Notice that even though I believe the Brill Company is going about things wrong, in my opinion, I do not directly criticize them, instead using the contrast between them and Kaines as regards tax abatements.  I am not advocating that Brill doesn't expand or move away, but instead follow the Kaines model, and avoid all the extra paperwork and shoulder-rubbing of the Ludington leaders to get a bone.  I may not have been the best orator that night, but Patsi Klevorn of the City of Ludington Daily News took something else from it.

 

 

 

Patsi took my narrative and turned it into something of her own, but she at least admitted I had some positive comments.  She prints, however:  "Rotta, during his comments, noted a desire to have "my attorneys" look at the request."   If my last name was Brillhart, and it was about 40 years ago, that just might be the case, but Patsi really needs to pay more attention to what is being said. 

 

She also notes that the new sewer water ordinance will not affect any fees, contrary to what I said in my opening comments.  "The fees would not change under the proposed ordinance." she reports.  The peroxide mixture must be a little strong-- here's some fees being raised significantly (note replacement taps go up as much as $100)(note also blue ink is the new wording, red ink is old wording to be changed):

 

[Willy]

Well done X. I enjoy reading your articles because I know they contain accurate information, This is another reason why LDN can not be trusted to report what transpires at City Hall. For Pete's sake Patti, record the meetings so you will be able to report the truth to your subscribers. My own feeling about these equipment taxes for companies is to eliminate them. I can see giving a tax break on new construction if a business is going to expand and provide new jobs. Nothing is really lost as long as they continue to pay on existing property. In my opinion, property tax should be eliminated for everyone. I would rather see a sales tax to replace property tax. In that way everyone pays.

[XLFD]

To my knowledge, there is something afoot in Lansing that is to address the issue; it remains to see whether it will help fairness or just help the 'favor system' along further.  I have always felt any shift of property tax to the sales tax affects the poor more.

You will notice that no city councilor remarked that they had ever lowered taxes or fees on their tenure of office.  That's eleven years time at least, since that's how long Holman has been on the council.  There is something inherently wrong when taxes and fees can only stay unraised, go up, or go up dramatically.  With the City's supposed surplus of nearly two years worth of revenue, you think they could grant a little relief to all residents. 

[AQUAMAN]

Everytime some local company asks for tax abatements, they promise more new jobs. In actuality, it seldom  happens. Matter of fact, more times than not, more jobs are lost due to higher production capabilities, thus reducing labor intensive requirements. I'm not saying that's the case with Brill Mfg., necessarily, but it might. What I would propose into the future, is that a verification process be attached with the abatement, for proof of new hirings, and more employees on the payroll. Without that, the trust system will be cheated again, and more people lose their jobs, and less taxes are collected, most likely resulting in individual taxpayers taking up the slack.

[XLFD]

Due undoubtedly to my unsolicited testimonial (LOL) the good people of Kaines West Michigan was formally recognized by the local Chamber of Commerce as Business of the year.  They beat out Barley & Rye/The Mitten, Spectrum Health Ludington Hospital, Adam's Construction and Northstar Chiropractic/Ludington CrossFit.  The other winner of the Community Service Award was Nancy Supran of the Circle Rocking S Children's Farm.  Surprising results from the chamber.  This link to the COLDNews tells about the proceedings.

 

[Willy]

Why in the World is there a "business of the year award" and who actually decides if one business deserves to be recognized over another? If companies are doing business and providing jobs, paying taxes, keeping their property in good repair, not causing a nuisance and are honest in their dealings then they all should be awarded. This award is just a "good ol boys" handout.

[XLFD]

I fully agree, that's why I was surprised by the results, as both businesses are from what I know, outside of the normal clique.  The chamber and their allies usually just love to have the extra media coverage for these often arbitrary designations.