Tecumseh City Council seeks ways to fund street repairs
The Tecumseh City Council narrowed down road funding options at the Monday, July 7, meeting to a trash pickup fee or voter approved bond millage.
“First, we have to decide if we’re going to do it. Then secondly, how we’re going to do it,” said Tecumseh City Manager Kevin Welch.
The two options will be explored further by Welch and City Attorney Scott Baker and be presented at a special meeting on July 14. The meeting is for a public hearing about Tecumseh joining the Ann Arbor SPARK SmartZone with Adrian.
The city council is running out of time, though. To pursue a voter approved bond millage for roads this year, ballot language would have to be approved no later than the first week in August, according to Welch. The council has a regular meeting scheduled for Monday, August 4.
“Again, is it the end of the world if we wait another year?” asked Welch. “Roads aren’t going to get better, I can tell you that.”
“I do not think we can wait. We need to do something,” said council member Vicki Philo.
Council member Laurence Van Alstine Jr. did show frustration with how long it has been taking to make a decision about roads.
“I truly came prepared tonight to make a decision. We can put it off and put it off. We have been putting it off,” Van Alstine said. “It could be tonight, it could be a week from tonight. It could be when the cows come home.”
The trash pickup fee would generate $416,010 and allow the city to use the money currently allocated to pay for trash pickup to be used for roads or other places the council sees fit.
“I don’t know of a community in this county that is providing yard waste, recycling and total trash collection,” Van Alstine said. “I don’t think we have been logical in the setting of our priorities to deal with the shrinking of dollars.”
For 2015, the trash pickup fee would be $147 for residents. There are currently 2,830 stops.
“The way I see it, whoever gets to the ballot box first has the best chance of getting the money,” said councilman Ron Wimple. “I mean, if the city’s going after street repair, and the county is going to come after us for road repair and then the state’s going to do road repair. To me, I just see it as trying to beat the other two the ballot box to get your money first. And I guess I am opposed to that.”
Mayor Richard Johnson felt a voter approved bond millage was a better option for the city to take, saving the trash pickup fee for a later time.
“My good friend Larry [Van Alstine], I disagree with you on what we should do here,” said Johnson. “I do believe the voter approve millage is the way to go on this for a couple of reasons. Number one, it lets the voters choose what they want to do. And number two, we always have that trash collection fee in our pocket if anything were to happen over the next five years or however long we were to run this voter approved millage. We’d still be able to go back and get that and do something with it. Otherwise it’s like we shot the last bullet out from the gun and there’s nothing left.”
Both Johnson and council member Jack Baker felt that a voter approved bond millage for roads would better serve residents.
“Also, I must say that the people that have talked to me about this, and there have been a few, are more apt to vote for something that is specific for roads rather than the city needs more money,” said Johnson.
“I have a tendency to agree with Mayor Johnson as far as if we go for a bond millage being specially for roads,” said Baker. “That’s the talk that I hear from my constituents. There are people out there that are supportive of that who may not be supportive of just giving us a carte blanche check to do what you want with that.”
With a voter approved bond millage, voters would approve a specific bond issuance amount that would then authorize the city to levy the necessary millage rate to make the bond payments. A voter-approved bond would have to be spent in three years from the date of sale of that bond.
A $5 million bond for 10 years would levy 2.4099 mills. A home with a taxable value of $50,000 — 50 percent of the home’s market value — would pay $120 a year. A $10 million bond for five years would cost taxpayers $444 a year.
Depending on the bond amount, Welch suggested council break the bond into two issuances if it is a large amount to avoid having to spend a large amount of money in a short period.
“The cost to borrow a bond is not cheap. It’s probably $50,000 to $75,000 just to borrow a bond,” said Welch.
Council member Gary Naugle raised concerns about how to educate the public about what council would be asking for to help fund road repairs.
“We need to be to be perfectly transparent that the cost of replacing a road is beyond what you can afford at this point in time,” Welch responded. “I don’t think you’re going to get everybody that’s going to love this. Nobody wants to pay more taxes or pay more fees.”
The council voted to pursue a trash pickup fee, with Wimple and Johnson voting no. The council also voted to pursue a voter approved bond millage at 2 mills with Wimple voting no.
Welch will bring more information before the council at the special meeting regarding the trash pickup fee and voter approved bond millage.
“The most difficult decisions, and the decisions that will impact the residents of your community come right from the local government. I think this is a classic example,” concluded Baker.