Inside208

House Hearing on Personal Property Tax Fails to Answer Many Questions

Posted on December 4, 2012 by Dene Westbrook


Sterling Heights City Manager Mark Vanderpool and CFO Brian Baker testify in Lansing Tuesday about the personal property tax.

LANSING, Michigan – The first of two hearings on a plan to reform Michigan’s personal property tax had more questions than answers for lawmakers and a standing-room-only crowd in attendance.

The Tuesday hearing before the Michigan House Tax Policy Committee included a presentation by Michigan Department of Treasury officials about a highly complicated eight-bill package that phases out the personal property tax (PPT). The PPT is a tax on business equipment that many Michigan communities heavily rely upon for vital services including police and fire protection, schools and libraries. The Michigan Municipal League has raised numerous questions about the bills introduced last week.

Committee Chair Rep. Jud Gilbert, R-Algonac, started off the hearing saying it was his intention for the committee to vote on the package of bills during the second planned hearing on the issue scheduled for Wednesday, Dec. 5, but his comments were followed by a barrage of questions to the Treasury Department officials from Democratic and Republican committee members. Even as committee members were taking their seats Tuesday, they were being handed supplemental bills to the package released last week.

The lawmakers are trying to approve the bills during this lame duck legislative period, which ends this month.

State Rep. Vicki Barnett, D-Farmington Hills, best summarized Tuesday’s hearing when saying, “If we’re all this confused, I think we’re moving way too fast.”

Due to the number of questions committee members had on the issue, the lawmakers were not able to hear from many of the people who signed up to speak, including officials from League member communities of Meridian Township and Auburn Hills. However, the committee did hear testimony from Sterling Heights City Manager Mark Vanderpool and Sterling Heights Chief Financial Officer Brian Baker. Vanderpool said they were also representing the Macomb Area Communities for Regional Opportunities, which includes the communities of Macomb County, Utica, Warren, Sterling Heights, St. Clair Shores, Eastpointe, Roseville, Fraser, Mt. Clemens, Centerline, Clinton Township, and Shelby Township.

Vanderpool said the PPT plan on the table would most likely result in cuts to his community’s police and fire departments.

“We will lose about $1 million annually under the best case scenario,” Vanderpool said. “That’s the equivalent of 15 police officers or firefighters.”

Samantha Harkins, director of State Affairs for the Michigan Municipal League, said the League fully supports eliminating the personal property tax as long as there is a full, guaranteed replacement of the funds. She explained this plan currently has too many unanswered questions.

“We want to get this done, but not at the expense of getting it right,” Harkins said. “There is no need to rush this through in lame duck.”

Learn more about this personal property tax issue at replacedonterase.com.

Matt Bach is director of media relations for the Michigan Municipal League. He can be reached at (7340) 669-6317 and [email protected].

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