Public forum on the Water Street debt reduction millage this Thursday

wsmillageforum

The last time we, the citizens of Ypsilanti, were asked to pass a tax increase in order to pay down the debt associated with the 38-acre Water Street redevelopment project, there was an attempt to bring representatives from both sides of the debate together for a fair, neutral forum on the subject. Unfortunately, as you might recall, that attempt failed, and the public never got to hear the facts. Sure, there were a few articles here and there, but, for the most part, we just saw the “anti tax” and “pro tax” yard signs. Individuals representing the two campaigns were never on a stage together, responding to questions, and really discussing the issue the depth. Well, this time around, thanks to the leadership of The League of Women Voters and the Ann Arbor – Ypsilanti Regional Chamber, we’re actually going to get the fair, honest, and public forum that we deserve.

This Thursday, June 30, at 5:30 PM, there will be a forum about the proposed Water Street debt reduction millage at the Eastern Michigan University student center. The event is free, and open to the public. As space is limited, however, I’d suggest that you register online, if you’re planning to attend. Representatives from both the pro-millage and anti-tax sides will be present, responding to questions from the audience and League of Women Voters moderator Susan Smith.

For those of you not familiar with the millage proposal, and its intended purpose, the following clip comes by way of an article written by Tom Perkins for MLive this past April:

The city of Ypsilanti took the next step toward asking voters to pay off around $10.6 million in Water Street debt.

That represents about half of the $20 million Ypsilanti owed at the beginning of the year.

Officials are proposing a 2.3-mill tax that, if approved, would mean a homeowner with a property assessed at $50,000 would pay $115 annually, or $9.53 a month, for the next 14 years.

At its Tuesday meeting, council unanimously approved the language calling for the millage, which will appear on the Aug. 2 primary ballot.

Council Member Pete Murdock noted that a 2.3-mill road tax is coming off the books in 2017 so residents wouldn’t see a net tax increase if they approve the proposed Water Street millage…

In February, the city took advantage of low interest rates to save around $3.7 million by refinancing the debt. That, combined with a $2.2 million payment from its savings, knocked out about a third of the approximately $20 million in principal and interest Ypsilanti owed.

The city also plans to continue making payments out of its general fund over the next 15 years to cover $2.8 million of the remaining debt. City Manager Ralph Lange said he is planning to find another $700,000 to pay toward the debt by the end of this budget year, and that will save the city an additional $300,000 in interest. Additionally, Michigan Economic Development Corporation converted a $3 million loan into a grant…

By a wide margin, voters rejected a proposed Water Street debt retirement millage and city income tax increase in 2012, but city council members say this proposal is different.

The previous measure included an accompanying income tax and a 4.94 mill Water Street tax. The new proposal doesn’t include an income tax and the millage rate is less than half what city leaders asked voters to approve in 2012…

So, if you’re planning to vote come August 2, please consider coming out on Thursday and hearing both sides. A lot of good people, like my friends Lindsay Garinger and Shoshanna Wechter, have worked their asses off to make this happen, and I think we probably owe it to them to invest an hour of our time to become better educated on the subject… For those of you can’t make it, I should mention, we’re trying to find someone to shoot video of the proceedings, so hopefully there will also be footage online at some point as well.

As for the current status of Ypsilanti’s Water Street redevelopment project, I’d encourage those of you who haven’t done so already to read my recent interview with Ypsilanti Director of Economic Development Beth Ernat. I think you’ll find it pretty informative.

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50 Comments

  1. Ted
    Posted June 27, 2016 at 10:29 pm | Permalink

    I’d like to thank the Chamber for not picking sides this time.

    http://markmaynard.com/2012/05/ann-arborypsi-chamber-of-commerce-asks-ypsilanti-citizens-to-keep-the-interests-of-business-owners-in-mind-when-voting-on-may-8/

  2. ANDREW J CLOCK
    Posted June 28, 2016 at 6:58 am | Permalink

    I can’t make it, so will someone ask council why they thought giving H&K a massive corporate tax break and a sweetheart price for prime property on Water Street for affordable housing that every single metric says Ypsilanti doesn’t need was acceptable when you’re going to turn around and ask one of Michigan’s highest taxed communities to raise taxes to pay for the same land? Was it just desperation or are they really so obstinate that they can’t see how bad that looks?

  3. Anonymous
    Posted June 28, 2016 at 6:58 am | Permalink

    If this vote happens, will we still sell to the out of state affordable housing project?

  4. Glen S.
    Posted June 28, 2016 at 7:34 am | Permalink

    The idea that this proposal is somehow pain-free because it would simply replace the existing road millage is short-sighted. Has anyone taken a good look at many of our local streets lately? City streets were all replaced over a five-year period, and many will need to be repaired/replaced in the next few years. When we get to that point, where will that money come from if we’ve already dedicated those (potential) funds?

  5. 38
    Posted June 28, 2016 at 8:49 am | Permalink

    Anything that staves off state receivership and gives us more flexibility is a good thing in my opinion. It’s critical that we don’t mess up Water Street, as we will be living with these decisions for generations. The difference between a strip mall catering to check cashing businesses and a condo complex with bars and restaurants is enormous, and we can’t put ourselves in a position where we need to accept the first because loan payments are coming due. We can debate whether or not this was a good decision to begin with, but we have to deal with the situation as it exists today.

  6. maryd
    Posted June 28, 2016 at 8:58 am | Permalink

    I am backing this idea. Voting for the new millage in August WILL be the least painful way to pay off our debt. AND it is NOT the evil city income tax that would have been a real killer for our town. I find it somewhat amusing to find those who supported a city income tax, do not support this solution. It makes me suspect that for some in our community, it isn’t about solutions at all but about politics of the worst sort.

  7. Glen S.
    Posted June 28, 2016 at 9:54 am | Permalink

    So the answer is to continue to add additional property taxes onto homeowners and small businesses – who already pay among the highest rates in the state – without asking EMU, churches, non-profits, etc., to contribute in any way?

  8. Lynne
    Posted June 28, 2016 at 9:56 am | Permalink

    I am leaning towards supporting the tax but am still open to voting no if someone presents a viable alternative. I cant make this event but look forward to the online debate which is sure to follow it. I figure, I’ve still got more than a month to weigh things over

  9. Mark H
    Posted June 28, 2016 at 10:09 am | Permalink

    Andrew Clock, your comment about the Water Street project having “prime property” is confusing. In a capitalist market, prime property has buyers competing to acquire it. No such competition for the Water Street property or parcels of it has ever existed. Wishing it was so doesn’t change the facts: the Water St acres are empty brownfields of very much sub-subprime real estate. Nobody wants to buy it without a very large public subsidy for their “investment.”

  10. Dan
    Posted June 28, 2016 at 10:36 am | Permalink

    “Nobody wants to buy it without a very large public subsidy for their “investment.”

    A major reason that no one wants to buy the land is because of the high taxes in the city. Why buy land and build in the city, when you can move a mile or 2 in any direction and build the same thing with much lower tax rates? New development is happening all over washtenaw county, except in the city of Ypsilanti. It’s clear as day why that is, but the city wants to keep increasing the tax rate.

    Even if this millage passes (it wont), no one will develop anything there unless they are basically getting it all paid for by local, state, and federal grants and tax incentives. That is why the low income housing project will happen regardless. There is no other option.

  11. Andrew J Clock
    Posted June 28, 2016 at 10:40 am | Permalink

    The city manager had previously set the price for Michigan Ave. frontage parcels, especially along River Street, north of $300k. The sub- $150k price is what H&K was going to pay for property that had previously been considered unbuildable due to soil conditions (not pollution, that wasn’t known at the time)

    After putting up such a long battle over footprint and design with Washtenaw Parks & Rec that we’ll likely never see the promised rec center, the city manager and council rolled right over for H&K. I’m not saying that the property is actually worth $350k, but that’s what the asking price was for a much smaller parcel, and if there is a prime spot, MI & River is it. The city’s own marketing analysis of the property says as much. What was the process that got us to this purchase price? Would another developer have been offered the same 50% discount? And again, why, when citizens are being asked to take on even more tax burden because of Water Street, was H&K given a tax and purchase price break for a project that we have a housing study telling us we absolutely don’t need? Its a bad look.

  12. Posted June 28, 2016 at 10:49 am | Permalink

    The city should just claim bankruptcy.

    I don’t know why anyone would buy property in Ypsi in its current state.

    Move to Ypsi and pay more than $2000 to service a debt for a unsellable, unbuildable brownfield site? Seriously?

  13. Posted June 28, 2016 at 10:57 am | Permalink

    Granted, I know nothing about city bankruptcies.

    Fortunately for all of you, I have no power. Just saying how it looks from the outside.

  14. Anonymous
    Posted June 28, 2016 at 11:01 am | Permalink

    I respect Mr. Larson for following up with the “I was just talking out of my ass” caveat. I wish everyone did that.

  15. Dan
    Posted June 28, 2016 at 11:28 am | Permalink

    That’s Dr. Larson, pal.

  16. General Demitrios
    Posted June 28, 2016 at 1:59 pm | Permalink

    It is important to keep in mind that the choice is not between this millage, and a state appointed emergency manager. In the event that we miss payments, it is much more likely that a renegotiation of the principle owed would take place. Ypsilanti is not financially mismanaged, it is just that the terms of the bond , plus the normal and reasonable needs of the city, cannot be met.

    What is for sure, is that, if this millage is approved, it cannot be undone by chapter 9 municipal bankruptcy.

  17. Posted June 28, 2016 at 2:04 pm | Permalink

    Peter — To my knowledge, local bankruptcies can only happen with the approval of the State, at least in Michigan, and Detroit is the only one the state has signed off on.

    In all other cases, Emergency Management is the option available to cities, and it doesn’t allow the cities to eliminate debt.

  18. maryd
    Posted June 28, 2016 at 3:03 pm | Permalink

    Peter, many of us bought land in Ypsilanti way back before a previous city council decided, in a time of over-exuberance, to take us all down the road of land speculation. Did we vote on this? No. Were there warnings? Yes. Were they heeded? No.
    It is old news now, over 10 years old… and we are left holding the bag. Most of us who live here love it. And we have an option before us to solve this burden hanging around our neck, dividing us and taking all our energy. It is not as Glenn mentioned above an additional expense. If this passes, it will simply continue a tax we already are paying. If we default on this loan, I shudder to think what will happen to my recovering housing value.
    And Peter…right now, people are lining up to move into our neighborhood again. I’d hate to see this turn around stopped.

  19. General Demitrios
    Posted June 28, 2016 at 3:12 pm | Permalink

    The question of whether or not a Chapter 9 reorganization would be allowed is very much open. While infrequent, it happens all over the country, and Ypsi is the classic case of a city that is well managed but unable to meet its debt. Further, an emergency manager is empowered to renegotiate debt, including elimination of some principle.

  20. Glen S.
    Posted June 28, 2016 at 4:11 pm | Permalink

    @ maryd

    The point I was trying to make is this: Claiming that the road bond expiring means we suddenly have “additional” money is a bit like saying because it is summer-time and our heating bill is low, we have extra money to spend on something else.

    Soon enough, it will be winter again, and we’ll need to fire up the furnace. Same with our city streets. Before long, when they need to be repaired/replaced, how will we pay for that?

    A major responsibility of our city leaders is to think long-term. To me, this whole argument of “we can pay off the Water Street debt and it won’t cost you any more” just seems simplistic and short-sighted.

  21. Joe M.
    Posted June 28, 2016 at 6:17 pm | Permalink

    I don’t think anyone knows what sort of impact it will have on a city level, but the increased registration fees and gas tax funds that start in 2017 should lead to increased funding for road projects a few years later.

    That, combined if the county extends its own road millage, might provide enough funds to support our area’s streets without a city road millage. Hopefully.

  22. Paul Schreiber
    Posted June 28, 2016 at 8:50 pm | Permalink

    I support the Water Street debt millage. It will give the city breathing room for strategic development at Water Street and other city-owned sites in the city as well as providing more money in the general fund for police and fire protection.

    Our roads need the other half of the road millage to be renewed when it comes up. That comes later.

    This millage will be a long-term benefit for development, businesses, and property values. It is a giant step toward sufficiency. Please vote YES for the Water Street bond proposal.

  23. Posted June 29, 2016 at 6:53 am | Permalink

    Murph,

    Thanks for that clarification.

  24. Posted June 29, 2016 at 8:39 am | Permalink

    General D, thanks for checking my memory — been a while since i looked at the EM statute.

    Yes, Chapter 9 is an option, but my note was that it requires approval from Lansing for a municipality to enter into that process (as laid out in MCL 141.1566), which is why only Detroit has gone through a bankruptcy. The Detroit example does provide precedent for reducing both pension obligations and general obligation bond debt, both of which were considered unlikely before — but it’s hardly a risk-free process.

    To the renegotiation of debt, yes, I understand “renegotiation” to be the key word there — no magic wand to unilaterally eliminate or reduce.

    Overall, I agree, the city has options. They’re not terribly good ones, though, and I personally don’t think Ypsi is in nearly bad enough shape to exercise either of those extreme options.

  25. Dan
    Posted June 29, 2016 at 9:10 am | Permalink

    Shocking that former mayor Schreiber supports another tax. This is the same guy that championed the housing project proposal. His logic is that because Ypsi is so poor that most citizens can qualify for subsidized housing, it must be a great idea to build a new subsidized housing complex and attract more poor people. This is not someone who envisions a better future for the city. He envisions continuing to be the poorest community in the county, which (not coincidentally) has by far the highest tax rate.

  26. kjc
    Posted June 29, 2016 at 12:14 pm | Permalink

    “attract more poor people”

    because we’re all supposed to just get it that income is everything and “poor people” are undesirable human beings.

    do you live in ypsi? how do we avoid attracting people like you?

  27. Frosted Flakes
    Posted June 29, 2016 at 2:03 pm | Permalink

    Kjc,

    Is taxable value per capita a concept you do not understand? I hope I am stating the obvious when I say: Ypsilanti has sustainability issues in terms of collecting the taxes for the most basic of services. You might want to tweak your militant mother Theresa act because it almost always comes off instead as a mean spirited and drunk rendition of Dana Carvey’s church lady. Get a grip. Be a little honest. Nobody cares how much you claim to love poor people. Nobody cares if you don’t like Dan…

  28. Jcp2
    Posted June 29, 2016 at 3:33 pm | Permalink

    I really don’t see Ypsilanti attracting and retaining households with children who could choose not to live in Ypsilanti unless educational options for their children improve. That is something not affected by the status of the Water Street debt.

  29. kjc
    Posted June 29, 2016 at 3:42 pm | Permalink

    FF, the mantra about fending off the encroaching poor is bullshit. Shove your per capita arguments up your lazy ass.

  30. Dan
    Posted June 29, 2016 at 3:49 pm | Permalink

    Most people live in the real world, kjc. Not in your imaginary kingdom where everything is free and police, firefighters, roads, etc are supplied by the public service fairy.

  31. Frosted Flakes
    Posted June 29, 2016 at 5:17 pm | Permalink

    Kjc,

    I think you are often guilty of misinterpreting the ideas of other people. Your beautiful soul sustains itself through mischaracterization of others. Your shtick or quirk or glitch or whatever you want to call it is not helpful to anyone at all. I will admit, however, in a perverse sort of way, I find your “contribution”, ifyou want to call it that, very interesting.

    Just curious: Why exactly are “per capita arguments” ,as you call them, “bullshit” ? It is a weird thing for you to say, no? I sincerely have no idea what you are talking about….

  32. Lynne
    Posted June 30, 2016 at 12:19 pm | Permalink

    It is hard to ignore arguments about demographics when one is a home owner. I try to but at the end of the day, I can refinance my house because it is valued lower than when I bought it and sadly, it has a lot to do with people who have money generally not wanting to live near people who don’t have money. I wish I had the answers and I agree with KJC that our own individual gains or losses shouldn’t affect our moral obligation to ensure that everyone is welcome in our community. Still, when I see how much better off financially people who choose racism and classism when buying a house, it is hard not to feel a little bit bitter.

    When I was looking for houses in 2000, there was a house I was looking at in Ann Arbor which cost $120k. That house is now worth, according to zillow, $256k. Whereas my house in Ypsilanti cost me $96k but was recently valued at $60k. Values are all well and good but sometimes it just sucks when you realize they can cost one a lot of money.

    I am pretty sure that most of the concerns about developments are coming from people who stand to lose a lot of money if it causes any further reduction in property values in Ypsi. I wish we lived in a world where making the moral choice was also the best financial choice but it isn’t. My friends who live in Detroit and whose houses don’t appreciate and who pay much higher taxes plus an income tax have a lot to say on this. Usually they live there because they love it and they consider these extra costs part of the cost of living in the city but even they get bitter about all of the disincentives we have for mixed income neighborhoods.

  33. JP
    Posted June 30, 2016 at 1:29 pm | Permalink

    Pamplona Installs Urine-Repellant Paint Before Running of the Bulls

    http://www.atlasobscura.com/articles/pamplona-installs-urinerepellant-paint-before-running-of-the-bulls

  34. EOS
    Posted June 30, 2016 at 2:49 pm | Permalink

    Lynne,
    The City of Ypsilanti is one of the more segregated in the area. So for you it was a morally correct decision to move to Ypsi because there are a substantial number of blacks who are concentrated in a small area on the south side? Why not choose a city where all the neighborhoods have a high level of diversity? Perhaps that would have been a more moral choice.

    I agree with the previous posters who identified the poor schools and the highest taxation rate in the county. Also, driving out business owners who were paying taxes so that the city could assume massive levels of debt for a chemically contaminated parcel of land where you are now trying to build more low income housing. If you can’t pay current bills, you probably shouldn’t be considering paying millions for a train depot when no one knows where the operating expenses for the trains will come from. I could list more stupid decisions of current and former elected officials, but I think you get the drift. Instead of raising taxes, the city should be more concerned with providing a level of services that matches the ability of the residents to pay. If you keep shaming and gouging the more affluent, they will leave. And then what will you have?

  35. Posted June 30, 2016 at 3:57 pm | Permalink

    lol

  36. Lynne
    Posted June 30, 2016 at 4:08 pm | Permalink

    EOS, I agree that a city with more diverse neighborhoods would have been an even more moral choice but alas, none in Washtenaw county where I need to be because of my job. And while it is true that Ypsilanti has a segregation issue, at least it isn’t quite like Detroit where it really costs anyone with a middle class income to live there. As a society, we like to segregate people into different tax zones whenever possible so as not to have to pay for services for poor people and that is the main moral objection I have to our system. Yes, we have poor schools and the highest taxation in the county and both of those things are related to having more poverty in our community. That is the reality of the state of Michigan. We allow people to choose not to contribute to anything which might benefit poor people and we reward people who distance themselves from the poorer among us with good schools, better services, lower taxes, and higher property values. Oh and then we blame the poor people for it.

    You are right that shaming the affluent may make them leave and that would be terrible. A better system would be to have the same tax rate in the whole state which would be redistributed in a way where there is equality in outcome. It won’t happen any time soon of course. Still if it were up to me, I would gouge the shit out of people on a national scale such that they would have to give up all their privilege by moving away and renouncing their citizenship if they wanted to avoid the gouging.

    The train station is one of those things which will add quite a lot to the value of our community, especially if that RTA millage passes and a commuter train is added in addition to the Amtrak one. It really is one of those you have to spend money to make money situations but I am sure you realize it will raise property values which in turn raises tax revenue.

  37. EOS
    Posted June 30, 2016 at 6:48 pm | Permalink

    The township is much more diverse throughout. It’s a mindset like yours that has driven taxes through the roof. If you want it, then pay. But don’t try to get others to pay for your services.

  38. Posted July 1, 2016 at 4:56 am | Permalink

    lol

    lol

  39. Maria Huffman
    Posted July 1, 2016 at 5:45 am | Permalink

    Peter Larson, you are smiling today, I take it. EOS’ post did make me chuckle, as well. But I kinda agree with him… It is is not as if Ann Arbor wants anything to do with Ypsi, except take their kids for money for AAPS…

  40. Posted July 1, 2016 at 6:09 am | Permalink

    I tried to lol only once, but it forced me to do it twice.

  41. Maria Huffman
    Posted July 1, 2016 at 7:07 am | Permalink

    Eos is not an it.
    Unless he is computer generated, and even then someone had to write the code.
    is that the right it?

  42. Dan
    Posted July 1, 2016 at 8:02 am | Permalink

    “The train station is one of those things which will add quite a lot to the value of our community, especially if that RTA millage passes and a commuter train is added in addition to the Amtrak one.”

    This is exactly the speculative nonsense that lead to the Water Street debt. The city is planning to spend a few million dollars that it doesnt have on a concrete slab in the hopes that a new stop will be added to the line. Even though MDOT and Amtrak have told the city that it likely wouldnt happen (after previously telling them they wouldnt even consider it.) This is speculative spending, something a city has no business engaging in, as all people in Ypsi should be well aware of, but apparently arent.

    You’ve been sold a bill of goods on how much this and that tax will benefit your city, and you continue to eat it up. You fell for the huge AAATA millage a few years ago, and since the expansion of services, ridership has actually decreased! Now you will be suckered in to the RTA millage to do the same thing. You repeatedly fall for politicians claims that we need more buses and trains, but there is no demand for it. Governments get into trouble when they think they are smarter than everyone else and think they know better than what the market will dictate. It’s amazing to me that the residents of Ypsi will keep falling for the same thing after it has literally put you on the brink of bankruptcy or an EFM

  43. Lynne
    Posted July 1, 2016 at 11:39 am | Permalink

    I hate to break it to you but there is no Free Market Fairy that magically comes up with the best solutions automatically.

  44. Dan
    Posted July 1, 2016 at 11:59 am | Permalink

    The market doesn’t find solutions. It determine what is viable and what will fail. You seem to think that certain ideas are better than they actually are because they “make you feel good.” that’s all well and dandy but someone has to pay the bills and when you buy stuff that is outside of your means (i.e. beyond what the market will support) then you go into debt and things like Water Street happen.

  45. kjc
    Posted July 1, 2016 at 12:43 pm | Permalink

    i guess Dan doesn’t know any of the people benefiting from increased bus service. I know plenty. People get into trouble when they think they are smarter than everyone else.

  46. Dan
    Posted July 1, 2016 at 1:36 pm | Permalink

    I guess kjc doesnt realize that 350,000 people live in the county, and fewer of them are riding the bus now than they were before the huge tax increase. I guess kjc doesnt realize that everyone has to pay for the lower ridership at higher cost. I guess kjc doesnt realize that the county citizens subsidize each rider of the bus, as the fares dont come close to paying for the expense. So once again, kjc doesnt understand market dynamics and what is sustainable, viable, or needed, vs what is desired so that kjc feels good inside.

  47. Lynne
    Posted July 1, 2016 at 11:10 pm | Permalink

    I don’t know. Part of the value to me in funding the bus service is that it is available to me even if I don’t ride it regularly. That is exactly, btw, the kind of value that the market doesn’t really capture. Also, if I were you, I wouldn’t be shaking the economics stick at kjc on the issue of public transportation. There is just tons of data that shows that even though markets often fail to provide public transportation, it is something that almost always is a net benefit to a community in many ways. It increases potential employees and customers for businesses. It allows people to hold jobs when they otherwise wouldn’t be able to. That one thing alone probably saves the county much more than the cost of providing transportation when you start looking at the big picture. A person who can keep a job is person who is more likely to have a stable home environment which in turn really reduces social problems down the road. Expensive social problems. Even in the short term, a person working is a person paying taxes instead of being forced onto public assistance to survive. Focusing on just ridership is myopic.

  48. Westside
    Posted July 2, 2016 at 7:08 am | Permalink

    Why do so many people on here like to attack kjc? It really is often brutal to read this blog.

    P.S. The summer house is beautiful, the view of the mountains is to die for!

  49. Posted July 2, 2016 at 7:59 am | Permalink

    All public transportation in Kenya is 100% privately provided.

  50. Posted July 2, 2016 at 8:01 am | Permalink

    It is one of the most efficient public transportation systems I’ve seen.

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