The House will hold hearings on the proposal to repeal personal property taxes on Tuesday, December 4 and Wednesday, December 5 at 10:30 am in Room 521 of the House Office Building, 124 N. Capitol Ave., Lansing.
This proposal is very complicated, with a number of issues in need of resolution and understanding. Our hope is to have the debate continue beyond the lame duck session so that we can be certain to address all points of concern as opposed to rushing the proposal through in just a few days. If possible, please attend and share your concerns with the committee.
In addition, it is very important that your reps hear directly from their local constituents on this issue. The following are suggested talking points that identify many of the issues we would like members to speak about with their Senators and State Representatives as it relates to the repeal of the personal property tax (PPT). Please take a moment to call or write and express your concerns directly.
Talking Points:
We are not opposed to the repeal of The PPT. We are opposed to rushing through this process when there are numerous questions that have not been addressed.
Guaranteed replacement revenue is an absolute requirement. The cut or elimination of the PPT must not take effect if the ballot proposal to dedicate the use tax to replacement revenues is not approved by Michigan voters. The two must be tie-barred. If the use tax is not approved by Michigan voters, the cut to PPT must not take effect.
What are the formulas for calculating the Essential Services Assessment (ESA) and the reallocation of the use tax? Without an opportunity to fully vet the formulas against community data, we can’t be sure of their impact on our communities.
Is there an opportunity for a local referendum to block the ESA?
Why create a new level of government with its added cost and bureaucracy that appears to have broad power with little to no state oversight? This authority could create new conditions on funding that is vital for local operations.
This new bureaucracy can also intercept 2% of already-diminished revenue.
80% reimbursement is not acceptable; we need to get closer to 100% replacement funding.
The ESA should be allowed for all public safety, not just police, fire, and ambulance. It must include all public safety functions, including jails, 9-1-1 authorities, special public safety millages, public health, etc. These are not viewed or typically funded separately at the local level.
Cutting our revenue by varying amounts across the state without providing relief from our obligations will force locals to make up the revenue elsewhere.
This combined with ESA shifts the taxing burden from the state to the locally elected body. Assessing a new tax or increasing an existing tax is as unpopular locally as it is on the state level.
What about debt millages? If the money isn’t there from the ESA or use tax, that represents an automatic tax increase for homeowners.
How will revenue from special millages like street lights or refuse be reimbursed?
How will Treasury determine “total restricted qualified loss”?
Will the ESA pass scrutiny under a Bolt review?
What revenue has been identified to keep TIFAs and DDAs whole?
Thank you for taking action in this important matter.
Samantha Harkins, Director of State Affairs
Michigan Municipal League