For the first time in decades, Leonard Village has raised taxes in order to eventually repair one of its main streets.
Last week, council voted 5-0 to increase the property tax rate from 6 mills to 7 mills beginning this year, so the village can help pay for a 3R (resurfacing, restoration and rehabilitation) construction project involving Elmwood St.
‘We don’t have the budget to cover the municipal bond that we would have to sell (to fund this project) and pay back without this increase,? explained village President Mike McDonald. ‘That was the primary reason.?
One mill is equal to $1 for every $1,000 of a property’s taxable value.
‘We hope that (the tax increase) will generate about $17,000 to $18,000 a year,? McDonald said.
Leonard is working with the Michigan Department of Transportation (MDOT) and the Road Commission for Oakland County to fix Elmwood St. in 2017. ‘That’s our timeline right now,? McDonald said.
He described the street’s present condition as ‘pitiful.?
‘We might not have been forced to do the work this quickly if it hadn’t been for the road commission project where they did Rochester Road (in 2013),? he said. ‘They made E. Elmwood part of the (detour) route and it received a huge increase (in vehicles), especially in truck traffic. It was pounded. We saw a lot of deterioration that year and last year as well.?
To the best of his recollection, McDonald believes the last time E. Elmwood was resurfaced was in the late 1990s.
‘It’s been quite a bit longer than that (for W. Elmwood),? he noted. ‘But W. Elmwood has never seen the kind of traffic that E. Elmwood sees. It doesn’t suffer from, to any degree, (the same level of) heavy trucks that go to the east. We have several contractors that live on the east side of the township. And we also have Cooper Standard in the village that has a lot of trucks coming and going.?
Right now, the potential scope of the project includes the entire 1-mile stretch of Elmwood St. It would involve removing the existing road surface, making repairs to the road base where needed and laying a new surface. ‘We hope to do the whole road,? McDonald said.
But that could change once a project estimate from an engineer is obtained.
‘We’re going to keep it within what we can afford to do,? McDonald said. ‘We (could) have to amend the project based on the amount of money that we have available.?
The village must pay for the engineering work out of its coffers and McDonald expects that to amount to $30,000 to $40,000.
According to McDonald, the road commission has indicated approximately $500,000 in funds from MDOT could be available for the project, but the village would have to put up a 20 percent match on top of that, plus pay for any asphalt work that’s done outside of Elmwood’s two lanes such as parking spaces along the street and driveway approaches.
The expectation is the village would sell a bond of $140,000 to $150,000 to cover its portion of the project and use revenue generated by the tax increase to pay off the debt over a period of years.
‘None of us (on council) was thrilled with the idea of having to increase the property tax, but we’re faced with a situation where we would not be able to take care of (our) roads if we didn’t do this,? McDonald said. ‘This is all driven by the escalating costs of road construction.?
He cited a Michigan Municipal League article that stated the cost of road construction increased 60 percent between 2002 and 2012.
How does the public feel about the tax hike?
‘Informally, there were a lot of questions raised by residents, but I think most of them understood what was driving this,? McDonald said. ‘It wasn’t just a casual increase, it had a specific purpose.?
To say that property tax increases are not a common occurrence in Leonard would be a gross understatement.
‘We’ve been at 6 mills a long, long time,? McDonald said. ‘Our village treasurer said it’s been over 20 years.?