On
November 3, the residents of Wayne County will be asked to
vote on various ballot issues. We
encourage you to check ahead to see which issues effect you. All ballot issues go through Wayne County. We have included a link to the
Wayne County Elections in the County Clerks Office to assist you. There you will find everything that will be on the November ballot in Wayne County.
That includes city, school
millage and all other elections elections. Please check out the list to see those that effect you and then forward the link on to others in Wayne
County who are in your address book.
Some people may not even know there is an election this year. All elections are important. This year in particular as few are able to absorb the increases in taxes.
Proposition O is a renewal of the current millage rate without the increase in millage that has been rolled back under the
Headlee Amendment. I am concerned that if property values continue to decline but the overall state rate of inflation increases that there might be an increase through "Truth in Taxation "hearings. We will keep an eye on this for you and you can contact your various government representatives.
PROPOSITION O:
OPERATING MILLAGE RENEWAL
To renew the millage authorized in 2000, shall Wayne County be authorized to continue to levy this millage at the estimated 2008 rollback rate of 0.9529 (about 95 cents per $1,000 of taxable valuation) for ten more years (2010 through 2019), and proceeds used to continue existing County services, including programs for arrest, detention and prosecution of criminals, juvenile court and related services, public health, recreation, County parks, job training, senior citizen services, and programs for meeting medical needs of the poor, the disabled, and the aged? This renewal is projected to generate $43,495,573 in 2010.
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Keep in mind that if approved this year, the millage will be rolled back from this years Levy per the Attorney General opinion .
The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us)
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STATE OF MICHIGAN
MIKE COX, ATTORNEY GENERAL
TAXATION:
GENERAL PROPERTY TAX ACT:
HEADLEE AMENDMENT:
CONST 1963, ART 9, § 31:
Application of millage reduction fraction to renewed multi-year, voter-approved millages
In the case of municipalities seeking authorization to levy "renewed" millages, the millage reduction fraction specified in section 34d of the General Property Tax Act, MCL 211.34d, is calculated on an uninterrupted basis for each succeeding year as if the voter-approved millage it replaces had never expired. Under MCL 211.34d(11), the calculation of the millage reduction fraction does not commence at 1.0 for the first year of the "renewed" millage but with the fraction utilized for the millage levied in the last year of the millage it replaces.
Opinion No. 7193
March 30, 2006
Honorable Valde Garcia
State Senator
The Capitol
Lansing, MI 48909
Honorable Joe Hune
State Representative
The Capitol
Lansing, MI 48909
Honorable Chris Ward
State Representative
The Capitol
Lansing, MI 48909
OAG No 7131 examined this section at length and explained how the "millage reduction fraction" established by the Legislature as the basis for calculating the constitutionally required rollback was to be applied:
By this measure the voters mandated that the total of taxes assessed against all taxable property within a taxing unit shall not increase from one tax year to the next at a rate exceeding the rate of increase in the General Price Level for the prior year. In any tax year in which the value of all taxable property has, in comparison with the value of the same property for the previous tax year, increased at a rate in excess of the rate of increase in the General Price Level, the Constitution requires a reduction in the rate of taxation so that the revenue realized from such property for the current year does not exceed that which was realized from that same property for the prior year by more than the percentage increase in the General Price Level.
This constitutionally mandated rollback of authorized millage rates has been implemented by the Michigan Legislature in accordance with Const 1963, art 9, § 34, through its passage of amendments to the General Property Tax Act, specifically section 34d, MCL 211.34d. They establish the "millage reduction fraction" (MRF) as the basis for calculating a rollback and describe how the MRF shall be applied.
This fraction is calculated by comparing the value of taxable property that existed in the prior tax year with the value of the same property for the current year. It is designed to arrive at a true comparison by eliminating the increases and decreases in value attributed to additions and losses. Thus, the MRF involves the determination of the ratio between:
(a) the value of the property for the previous year, less losses, multiplied by the sum of 1.0 plus the rate of increase in the General Price Level (the numerator of the fraction); and
(b) the value of the property for the current year, less additions (the denominator of the fraction).
The value lost when property or improvements become exempt from taxation, are removed, razed, or otherwise destroyed in the previous year (losses) is subtracted from the numerator, and the value added by new improvements or other enhancements during the current year (additions) is subtracted from the denominator. Simply stated, losses, which are not present in the current year, are subtracted from the prior year and additions, which were not present in the prior year, are subtracted from the current year. Thus, the values compared are truly "apples to apples." It is the difference in the value of property that is actually present in both years that determines whether a MRF is appropriate, and to what extent.
If the value of such property for the prior year (properly adjusted), multiplied by the sum of 1.0 plus the rate of increase in the General Price Level, is less than the value of the identical property (again, properly adjusted) for the current year, then the value of such property has appreciated at a rate greater than the rate of increase in the General Price Level. To reduce the excessive increase in revenue that would result if the original millage were applied against that increased value, the effective millage (rate of taxation) is multiplied by the determined MRF, a number less than 1, so that the amount of revenue received is properly reduced. [OAG No 7131 at p 28; footnotes omitted.]
Section 34d of the General Property Tax Act (GPTA), MCL 211.34d, addresses your inquiry and warrants quoting in pertinent part at length:
(6) The number of mills permitted to be levied in a tax year is limited as provided in this section pursuant to section 31 of article IX of the state constitution of 1963. A unit of local government shall not levy a tax rate greater than the rate determined by reducing its maximum rate or rates authorized by law or charter by a millage reduction fraction as provided in this section without voter approval.
(7) A millage reduction fraction shall be determined for each year for each local unit of government . . . . For ad valorem property taxes that are levied after December 31, 1994, the numerator of the fraction shall be the product of the difference between the total taxable value for the immediately preceding year minus losses multiplied by the inflation rate and the denominator of the fraction shall be the total taxable value for the current year minus additions. For each year after 1993, a millage reduction fraction shall not exceed 1.
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(9) The millage reduction shall be determined separately for authorized levied millage approved by the voters. The limitation on millage authorized by the voters on or before April 30 of a year shall be calculated beginning with the millage reduction fraction for that year. Millage authorized by the voters after April 30 shall not be subject to a millage reduction until the year following the voter authorization which shall be calculated beginning with the millage reduction fraction for the year following the authorization. The first millage reduction fraction used in calculating the limitation on millage approved by the voters after January 1, 1979 shall not exceed 1.[1]
(10) A millage reduction fraction shall be applied separately to the aggregate maximum millage rate authorized by a charter and to each maximum millage rate authorized by state law for a specific purpose.
(11) A unit of local government may submit to the voters for their approval the levy in that year of a tax rate in excess of the limit set by this section. The ballot question shall ask the voters to approve the levy of a specific number of mills in excess of the limit. The provisions of this section do not allow the levy of a millage rate in excess of the maximum rate authorized by law or charter. If the authorization to levy millage expires after 1993 and a local governmental unit is asking voters to renew the authorization to levy the millage, the ballot question shall ask for renewed authorization for the number of expiring mills as reduced by the millage reduction required by this section. If the election occurs before June 1 of a year, the millage reduction is based on the immediately preceding year's millage reduction applicable to that millage. If the election occurs after May 31 of a year, the millage reduction shall be based on that year’s millage reduction applicable to that millage had it not expired.
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(16) Beginning with taxes levied in 1994, the millage reduction required by section 31 of article IX of the state constitution of 1963 shall permanently reduce the maximum rate or rates authorized by law or charter. . . . The reduced maximum authorized rate or rates for 1995 and each year after 1995 shall equal the product of the immediately preceding year's reduced maximum authorized rate or rates multiplied by the current year's millage reduction fraction and shall be adjusted for millage for which authorization has expired and new authorized millage approved by the voters pursuant to subsections (8) to (12). [MCL 211.34d(6), (7), (9) – (11), (16); emphasis added.]
Where the terms of a statute are clear and unambiguous, albeit complicated, they must be applied as written. See Storey v Meijer, Inc, 431 Mich 368, 376; 429 NW2d 169 (1988). The italicized text of MCL 211.34d(11) is determinative. For a renewal millage, the millage authorized is subject to a MRF identical to the MRF that would have been applied to the millage which it replaces had it not expired. For the first year of levying the renewed millage, the calculation of the MRF starts not at 1.0 but rather at the MRF of the expiring millage.
The millage about which you inquire was approved in 2004 after May 31.2 By its passage, the voters authorized levies in 2006 and subsequent years. No levies of the "renewed" millage are to be made until 2006.
For 2006, it is necessary to determine an MRF for the renewed millage. The MRF will be the same MRF as would have been calculated for the expiring millage and applied to it had it not expired. In other words, the calculation process does not start over but rather continues uninterrupted.
Like the situation addressed in OAG No 7131, the factual setting you present calls for a reduction in the rate of authorized taxation whenever the revenue monies to be realized from taxing property (after adjustments for losses and gains) at the voter-approved rate would result in realizing more tax revenue for the year of the levy than would be realized by multiplying the authorized rate of taxation by the taxable value of all property (after adjustment) times the rate of increase of the General Price Level for the preceding year.
It is my opinion, therefore, that in the case of municipalities seeking authorization to levy "renewed" millages, the millage reduction fraction specified in section 34d of the General Property Tax Act, MCL 211.34d, is calculated on an uninterrupted basis for each succeeding year as if the voter-approved millage it replaces had never expired. Under MCL 211.34d(11), the calculation of the millage reduction fraction does not commence at 1.0 for the first year of the "renewed" millage but with the fraction utilized for the millage levied in the last year of the millage it replaces.
MIKE COX
Attorney General
1 This subsection, MCL 211.34d(9), prior to its amendment by 2005 PA 12 (effective April 28, 2005), specified May 31 as the "cut-off" date rather than April 30. The change is not critical here as the election underlying your request was held after May 31 in 2004.
2 See n 1.
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State of Michigan, Department of Attorney General
Last Updated 04/03/2008 13:29:45