visteon reassessment could cost ypsilanti over $700,000 anually

The “Ann Arbor News” ran a story yesterday on Ypsilanti’s now vacant Visteon plant. Apparently, ACH, the holding company now in possession of all the closed Visteon facilities in Michigan, has been challenging the tax assessments on all the properties, which had been calculated years ago, when they were occupied and running. Now, ACH is saying that they don’t owe Ypsilanti nearly what we say they do. And, if they’re proven right, it could cost the city close to $700,000 annually. It’s something that’s been on the horizon for a while, but it doesn’t make it any easier to accept. Here’s a clip:

…The Ypsilanti ACH plant sits on about 45 acres and includes 1 million square feet of working space. It is assessed at $36.4 million, and the company pays $273,000 on land and buildings and about $800,000 on equipment.
ACH is contending the plant and the equipment are obsolete and the assessment should be dropped to $5.5 million. That would cancel most of the tax on equipment and drop the taxes on land and buildings by almost half. The deal would cost the city about $7,232,000 a year…

To make matters worse, from what I understand, the Visteon facility in Ypsilanti is likely too rundown for it to be attractive to most likely buyers (unlike the 2 million square foot facility being vacated by Pfizer in Ann Arbor, which conceivably could have another life)… Maybe we could sell it to Hollywood so that they could blow it up. Who’s to say the next instalment of Die Hard couldn’t take place in rundown 1 million square foot automotive parts factory?

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6 Comments

  1. murph
    Posted June 3, 2007 at 9:57 am | Permalink

    The ironic part about this is that the personal property tax they’re challenging (on equipment) is based on numbers that they give the city. So in December they were saying, “We’ve got $x million in equipments,” and now, five months later, “$x million?! You’re crazy! Our equipment isn’t worth nearly that much! Where’d you get those numbers!?”

    Honestly, folks, just give the city the numbers you want in the first place, so that everybody knows what page you’re on.

    Two notes, also – there’s a typo in the article; a successful challenge would cost the city $723,200 a year, not $7.2 million, and, from your intro, the plant is not actually yet vacant. Just largely so.

  2. egpenet
    Posted June 3, 2007 at 10:01 am | Permalink

    The “next big thing” for Ypsilanti will NOT come from within City Hall or the 20/20 group, necessarily.

    But what the Mayor, Council and the 20/20 group MUST do is get us ready for “the next best thing,” which will likely come from an outside source … someone who can take some soybean acreage and create a manufacturing revolution.

    THIS time, it probably WIN’T be cars and trucks. Whatever …

    To be prepared when the idea comes to us … we neeeeeed to have our civic and civil ducks in a row. Planning, zoning, other open or unfinished policy and regulatory issues outstanding … FIX’EM.

    INSIST on progress downtown and get the job done. We have ordinances on the books that prohibit demolition by neglect and we have legal recourse in such cases.

    INSIST on progress with the Freighthouse in Depot Town, a proven community center and potentially a major midwest historic tourism draw. A BIG IDEA is currently being floated and should be pushed.

    Ypsilanti has great potential … but the hand-wringing needs to stop. Action must take place to stop the inefficient and ineffective spending on studies and marketing companies who tell us what we already know.

    At the same time, action must be taken to make it possible (planning, zoning/ZBA, enforcement, HDC) to welcome the next BIG IDEA.

  3. brian r
    Posted June 3, 2007 at 11:47 am | Permalink

    The statement “visteon reassessment could cost ypsilanti over $700,000 anually” is wildly misleading.

    The plant is scheduled for closure next year. This basically moves that up a year. The revenue was already removed from FYE 2008-09 revenue projections.

    Leave it to the Ann Arbor News to always get it right.

  4. egpenet
    Posted June 3, 2007 at 1:43 pm | Permalink

    What Ann Arbor News? They have a newspaper in Ann Arbor? Wow …

  5. mark
    Posted June 3, 2007 at 1:56 pm | Permalink

    That’s why I added that part in the intro about it having been on the horizon for a while now, Brian. The article made it sound like we were caught completely by surprise.

  6. Anonymous
    Posted June 3, 2007 at 2:50 pm | Permalink

    Remember, the City was expecting Visteon to leave in 2006. So any money they get next eyar is already a bonus. So even if they lose the protest it only moves up by one year the date by which Visteon leaves.

    The City should have been putting that money away for the rainy day fund or to help pay the Water Street. Instead they promised it for all sorts of other non-essential funding, like consultants to determine if employees are paid enough, pay raises topping 15% for non-union employees, membership in clubs and associations, and non-essential training. But you can bet those perks will remain while the city starts to slash the fire and police department to begin implementing punishment cuts to convince you to vote for a City Income Tax.

    By the way, the numbers about a potential $700,000 loss, those came from the city, not Visteon. Apparently it was the city that called the Ann Arbor News.

    The city gave the News the worst case scenario which would mean the property was valued at $0. If the property is re-valued at $5.5 million, it still generates $425,000 so the net loss is $275,000 in total revenue. The City will get about $200,000. So tehre is still revenue, and likely will be much higher.

    So it is apparently the City that is handing out doomsday worst-case scneario numbers to the News hoping it will scare people into thinking there is a huge crisis, when in fact, this money was already expected to be lost in the next year. Remember Visteon still will pay property taxes on the buildings, it is the personal property, the equipment, that will be hauled out.

    Given how few people have ever gotten their proeprty taxes reduced in the City, it is unlikely Visteon will fair any better in getting their taxes reduced.

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