From left: Washtenaw County equalization director Raman Patel with commissioners Conan Smith (D-District 9) and Dan Smith (R-District 2) at the April 16, 2014 board of commissioners meeting. (Photos by the writer.

The report was presented by Raman Patel, the county’s long-time equalization director. “Washtenaw County is showing improvements in the market,” he told commissioners. “We are slowly regaining our county’s equalized base. It appears that the worst part of the decline in market value is behind us.”

For 2014, taxable value in the county increased 2.02% to $14.18 billion. That’s a greater increase than the 1.68% climb in 2013, and an improvement over declines seen in recent years. Patel cautioned that several factors are impacting revenue for local governments, including the phase-out of personal property taxes, a variety of exemptions, and tax capture from entities like downtown development authorities.

More of the tax burden is also being shifted to residential property owners, he noted, compared to other categories, like commercial property. The category of residential property accounts for 67.34% of total property value in the county. Five years ago, in 2009, it was 63%.

In other action on April 16, commissioners gave initial approval to distribute proceeds from a countywide tax on hotels and other accommodations. For 2013, $472,846 was available for distribution. If the resolution is given final approval, the county will keep 10% ($47,285) to pay for enforcement of the accommodation ordinance. The remainder will be divided between the Ann Arbor Convention & Visitors Bureau ($319,171) and the Ypsilanti Convention & Visitors Bureau ($106,390).

During public commentary, Mary Kerr, president of the Ann Arbor Convention & Visitors Bureau, and Jason Morgan, director of government relations for Washtenaw Community College, highlighted the union training programs that will be coming to the area this summer. The CVBs have been instrumental in recruiting these kinds of events to Washtenaw County.

Commissioners also gave initial approval to the annual Urban County action plan, which outlines proposed projects funded by the U.S. Dept. of Housing and Urban Development. The Urban County is a consortium of Washtenaw County and 18 local municipalities that receive federal funding for low-income neighborhoods. Members include the cities of Ann Arbor, Ypsilanti and Saline, and 15 townships.

Final authorization was given to a two-year pricing proposal – for 2016 and 2017 – to provide police services to local municipalities through contracts with the county sheriff’s office. And commissioners gave final approval to a new brownfield redevelopment plan for the Thompson Block in Ypsilanti’s Depot Town.

In other action, the board passed a resolution declaring April 13-19 as National Public Safety Telecommunicator Week in Washtenaw County. They also honored Dr. Eugene Glysson, who had served on the county’s board of public works (BPW) since 1986, and was its chair since 1996. He died on April 2.

Several issues were raised during public commentary, including concerns about emergency sirens installed by a pasture in Scio Township. The owner told commissioners that the sirens spook his horses, causing a dangerous situation if anyone is riding them or standing nearby. Other topics discussed by the public included the creation of a new group to help end homelessness, called Our 2020 Vision, and efforts by University of Michigan students to reduce the use of plastic bags by imposing a per-bag usage fee. They’re garnering support in part through a MoveOn.org petition.

Equalization Report

The 2014 equalization report was presented by Raman Patel, the county’s long-time equalization director. He began by noting that this was Washtenaw County’s 56th report, and he’s been involved in the process for 43 of those years. [.pdf 2014 equalization report] [.pdf chart of largest county taxpayers]

This year, Patel said, “Washtenaw County is showing improvements in the market. We are slowly regaining our county’s equalized base. It appears that the worst part of the decline in market value is behind us.”

Raman Patel, director of equalization for Washtenaw County.

Equalized (assessed) value is used to calculate taxable value, which determines tax revenues for the county as well as its various municipalities and other entities that rely on taxpayer dollars, including schools, libraries and the Ann Area Arbor Transportation Authority, among others. There are 72 units of government in Washtenaw County that rely on property tax revenues.

For 2014, taxable value in the county increased 2.02% to $14.18 billion. That’s a greater increase than the 1.68% climb in 2013, and an improvement over declines seen in recent years.

It’s also an improvement over projections made when the county administration prepared its 2014 budget. The general fund budget was approved with a projection of $63.79 million in tax revenues. But actual revenues, based on 2014 taxable value, are now estimated at $64.511 million – for an excess in 2014 general fund revenues of $720,486. Patel stressed that at this point, the taxable value is a recommendation and must be approved at the state level.

Patel also presented tentative taxable values for specific jurisdictions. The city of Ann Arbor shows a 2.68% increase in taxable value, while the city of Ypsilanti’s taxable value is an 0.87% increase over 2013. All but three municipalities showed an increase in taxable value. Those municipalities with decreases are the city of Saline (-1.41%), Ypsilanti Township (-0.37%), and the city of Milan (-0.85%).

Properties in the Ann Arbor Public Schools district – which includes the city of Ann Arbor and parts of surrounding townships – will see a 2.37% increase in taxable value. Properties taxed by the Ann Arbor District Library, covering a geographic area that in large part mirrors the AAPS district, increased in value by 2.36%.

Taxable value is determined by a state-mandated formula, and is the lower of two figures: (1) a parcel’s equalized (assessed) value; or (2) a capped value calculated by taking last year’s taxable value minus any losses (such as a building being torn down), multiplied by 5% or the rate of inflation (whichever is lower – this year inflation is 1.6%), plus the value of any additions or new construction.

In 2014, commercial property showed a 3.97% gain in equalized value. Residential property value – the largest classification of property in the county – showed an increase of 5.84%. That’s stronger than last year’s 2.37% increase, which had been the first climb in value since 2007.

Values for developmental property – a relatively small category that covers properties not yet developed – continue to struggle, registering a decrease of 9.54% in equalized value. Industrial property, which dropped 4.78% in equalized value last year, is essentially flat in 2014 at 0.1%. Over the past few years that category has lost significant value, falling from an equalized value of nearly $1 billion in 2007 to this year’s value of $422.146 million.

Some staff of the county’s equalization department.

Countywide, about $400 million is captured by entities like local downtown development authorities (DDAs), local district finance authorities (LDFAs), brownfield tax increment financing, and other entities that are allowed to capture funds from taxing jurisdictions. For taxes levied by Washtenaw County government alone, $2.472 million goes to these other tax-capturing entities that would otherwise be revenues for the county’s general fund. That’s an increase of $67,409 compared to last year.

Patel reported that in 2013, the county had seen new construction valued at $368.14 million. Of that, 30% of that taxable value is capture by DDAs within the county, he said. This year, new construction is valued at $334.18 million, with 26% of that captured by DDAs.

The category of residential property accounts for 67.34% of total property value in the county. Five years ago, in 2009, it was 63%. That means the tax burden is shifting onto residential property owners, Patel said. He noted that residential property values are increasing – from an average sales price of $154,015 in March 2009 to $231,541 this March.

This year, Patel noted that 1,709 appeals were made to the various boards of review – property owners who contested their assessments. That’s significantly lower than last year, when 2,793 appeals were made. Of this year’s appeals, 1,128 appeals were granted, decreasing the total assessed value of property countywide by $21.112 million. In addition, 134 poverty exemptions were granted and 73 parcels were given exemptions for disabled veterans.

Patel highlighted state legislation regarding personal property taxes (PPT) that would affect the overall growth of equalized and taxable value. This year, property valued at up to $40,000 is exempt from the PPT, affecting 5,137 parcels. It’s part of a gradual phase-out of the PPT over the next 10 years, he said. The county’s equalization department is responsible for tracking this process for each unit of local government in Washtenaw County. A referendum on the Aug. 5, 2014 ballot will ask voters to approve a replacement of PPT revenues, directing a portion of the state’s “use tax” to local governments.

In addition, Public Act 161 of 2013 extends the homestead property tax exemption for disabled military veterans to spouses of deceased veterans. These new exemptions and the resulting losses in tax revenues are reflected in the county’s equalized and taxable value, Patel said.

Patel noted that Washtenaw County’s gross tax revenue is further decreased from downtown development authorities (DDAs), local development finance authorities (LDFAs), tax increment finance authorities (TIFAs), brownfield redevelopment authorities, and obsolete property rehabilitation authorities (OPRAs). These are issues that commissioners should be aware of, Patel said.

Equalization Report: Board Discussion

Several commissioners thanked Patel and his staff for their work. Yousef Rabhi (D-District 8) asked how the number of appeals granted this year (1,128) compared to last year. Patel replied that last year, more appeals were granted than this year – but in 2013, more appeals were sought as well.

Felicia Brabec (D-District 4).

Dan Smith (R-District 2) noted that the report gives separate equalized and taxable values for Willow Run and Ypsilanti public school systems. He wondered when the consolidation that took effect last year would be reflected in the equalization report. Patel indicated that the report will continue to list the districts separately for two more years, in case they split up again.

Smith also asked Patel if he could provide more historical information about the shift toward residential property, as a greater percentage of the total property in the county. “I think we need to be more aware of that shift that may be taking place, because it affects a lot of different policies in various ways,” Smith said.

Regarding that percentage, Felicia Brabec (D-District 4) asked if there were an optimal balance to be struck, in Patel’s opinion. Patel replied that 72 units of government rely on the tax base. The only way to increase or decrease that base is through changes in market value, he said. Aside from market value, the base is decreased through legislative exemptions. “And when you reduce your tax base, somebody has to pick up the burden – that’s the bottom line for everybody,” Patel said.

In Washtenaw County, he said, there are 140,161 parcels. Of those, 4,509 parcels are tax-exempt, he noted. Every year, additional parcels go into this category. In 2014, 69 parcels were exempted, with a taxable value of $8.27 million. Those exemptions are issued by townships, cities, the county and other entities. Someone has to pick up the burden, Patel said, adding that “it’s not a small thing.” In addition, a portion of the taxes from certain properties are being captured by entities like DDAs, he noted. “It all adds up.”

Conan Smith (D-District 9) referred to information that Patel had provided showing how property tax revenue would have increased if the state’s Headlee Act and Proposal were not in place.

Corporation counsel Curtis Hedger and Alicia Ping (R-District 3).

By way of background, the Headlee Amendment was approved by a voter referendum in 1978 as an amendment to the state constitution (Article IX, Sections 24-34). It limits the growth of property tax revenue by controlling how the maximum authorized millage rate is calculated. The maximum authorized millage rate is “rolled back” when taxable growth is greater than inflation. That limits the increase in tax revenue to the rate of inflation.

In 1994, Michigan voters approved Proposal A, a constitutional amendment that affected Article IX, Sections 3, 5, and 8. Designed to slow the increase of property taxes on individual parcels, it limits the increase in taxable value of each property to either the rate of inflation or 5% annually, whichever is less – even if the state equalized value (SEV) grows at a greater rate. When property is sold or transferred, the taxable value is reset – or “uncapped” – to the SEV.

Smith noted that during a strong economy, Proposal A didn’t have much effect. But when the economy turned down, Smith said “you saw this pretty dramatic skewing of what our revenue could have been from what it is.” In order to keep local governments whole, he said, legislative fixes are needed.

Patel noted that when the market value increases, it doesn’t mean that local governments will see that same growth in tax revenues. He pointed out that this year, equalized value for properties countywide grew 4.7%, but the increase in taxable value is only about 2%.

If Proposal A weren’t in place, the estimated tax revenue in 2014 would be about $87 million for the county’s general fund, Patel reported. Instead, it’s about $65 million.

Outcome: Commissioners voted to approve the equalization report.

Police Services Contract

A two-year pricing proposal for contracts to provide police services to local municipalities was on the April 16 agenda for final authorization. Initial approval had been granted by the board on April 2, 2014.

Washtenaw County sheriff Jerry Clayton.

For 2016 and 2017, the police services unit (PSU) price will be $156,709 and $158,276, respectively. An initial vote had been taken on April 2, 2014.

By way of background, on July 6, 2011, commissioners had authorized the price that municipalities would pay for a contract sheriff’s deputy through 2015. The price in 2012 – $150,594 per “police services unit” – was unchanged from 2011, but has been rising in subsequent years by about 1% annually. The complex, politically-charged process of arriving at those figures in 2011 involved more than a year of discussion between the sheriff’s office, other county officials and leaders of local municipalities that contract for these services.

The board’s decision in 2011 was based on a recommendation from the police services steering committee. That same group recommended the next pricing changes as well, based on the cost of a police services unit (PSU). The PSU price for 2014 is $153,621. For 2015, the PSU price will be $155,157. In the following two years, the PSU price was proposed to be $156,709 in 2016 and $158,276 in 2017. The pricing for those two years was authorized by the board in its April 16 action.

Those figures are based on a 1% annual increase in direct costs to contracting municipalities. That rate of increase for PSUs is included in revenue projections for the county’s four-year budget, which the county board passed at its Nov. 20, 2013 meeting. The budget runs from 2014-2017, and includes revenue projections based on contracts for 79 PSUs.

According to a staff memo, there will be an addition to the 2016 and 2017 prices for in-car printer replacement, after the total cost of ownership is determined. The memo also notes that the pricing is based on salaries stipulated in current union contracts with the Police Officers Association of Michigan (POAM) and the Command Officers Association of Michigan (COAM). Those contracts run through 2014, and new contracts are currently being negotiated. The memo states that “no assumptions were made for salaries or fringes change in this cost metric in anticipation of any union negotiations.” [.pdf of staff memo]

The county – through the sheriff’s office budget – pays for the difference between the price charged for each PSU, and the actual cost to provide those services. In 2011, that difference was $25,514.

In 2016, the cost per PSU is expected to be $195,104 – a difference of $38,395 compared to the price being charged to municipalities. In 2017, the cost per PSU is estimated at $199,188 – a difference of $40,912. [.pdf of cost estimates]

Discussion during the April 2 meeting included concerns by some commissioners about the financial sustainability of this approach to funding police services, and the need for new revenue sources for public safety. Sheriff Jerry Clayton had been on hand to present the pricing proposal, and supported suggestions to seek new funding for public safety. He characterized the issue of public safety as one that encompasses economic development, human services and other aspects of the community.

There was no discussion on this item during the April 16 meeting.

Outcome: Commissioners gave final approval to the police services contract price.

Thompson Block Brownfield

A resolution giving final approval to a brownfield redevelopment plan for the Thompson Block in Ypsilanti’s Depot Town area was on the April 16 agenda. [.pdf of Thompson Block brownfield plan] Commissioners had granted initial approval on April 2, 2014.

This photo of the Sept. 23, 2009 fire on the Thompson Block property was included in the brownfield redevelopment plan packet.

The plan covers 400-408 N. River St. and 107 E. Cross St., an historic property that has been declared ”functionally obsolete and blighted.” That qualifies the project as a brownfield under the state’s brownfield redevelopment financing act (Public Act 381), which allows the owner to receive reimbursements for eligible activities through tax increment financing (TIF). Approval also would allow the developer to apply for Michigan Business Tax Credits. The property is currently owned by Thompson Block Partners LLC, led by Stewart Beal of Beal Properties.

Beal plans to create 16 “luxury lofts” in the structure’s second and third floors, and up to 14,000 square feet of commercial space in the remainder of the site. The project is estimated to cost about $7 million.

The resolution considered by the board also ends a previous brownfield plan for part of the same site, which was approved in 2008. A fire in 2009 delayed the project. The new plan now covers the 107 E. Cross, which was not part of the original plan, and includes public infrastructure improvements, such as streetscape enhancements along North River Street.

The Washtenaw County brownfield redevelopment authority approved this plan at its March 6 meeting. Subsequently, the plan was approved by the Ypsilanti city council on March 18. The city council’s action included approving an “Obsolete Properties Rehabilitation” certificate, which freezes local millages at the current, pre-development level for 12 years. Because of that, the project’s TIF capture will apply only to the state’s school taxes.

The project can get up to $271,578 in eligible cost reimbursed over a 12-year period, for activities including brownfield plan and work plan preparation, limited building demolition, selective interior demolition, site preparation and utility work, infrastructure improvements, architectural and engineering design costs, asbestos and lead abatement, and construction oversight.

The intent of the state’s brownfield redevelopment financing is to support the redevelopment of urban sites that will increase the municipality’s tax base. Tax increment financing allows an entity to capture the difference between the taxable value before a project is undertaken, and the value of the property after it is developed.

A public hearing on this proposal was held at the April 2 meeting, when the board also voted to give initial approval to the plan. Only one person – Tyler Weston, representing Thompson Block Partners – spoke, telling the board that it would help the project.

Weston attended the April 16 meeting, but did not formally address the board. There was no discussion on this item.

Outcome: Commissioners gave final approval to the Thompson Block brownfield redevelopment plan.

Accommodation Tax Distribution

A resolution to give initial approval to distribute proceeds from a countywide tax on hotels and other accommodations was on the April 16 agenda.

Mary Kerr, president of the Ann Arbor Convention & Visitors Bureau, and Jason Morgan, director of government relations for Washtenaw Community College.

For 2013, $472,846 was available for distribution. If the resolution is given final approval, the county will keep 10% ($47,285) to pay for enforcement of the accommodation ordinance. The remainder will be divided between the Ann Arbor Convention & Visitors Bureau ($319,171) and the Ypsilanti Convention & Visitors Bureau ($106,390).

A final vote on that distribution is expected on May 7.

The county collects the 5% excise tax from hotels, motels, and bed & breakfasts, which is then distributed to the Ann Arbor and Ypsilanti convention & visitors bureaus and used to promote tourism and convention business. The contract calls for the county to retain 10% of that tax to defray the cost of collection and enforcement. (Until 2009, the county had only retained 5% for this purpose.) The remaining funds are split, with 75% going to the Ann Arbor Convention & Visitors Bureau, and 25% going to the Ypsilanti Convention & Visitors Bureau.

In December 2009, the board approved five-year contracts with the CVBs, outlining the distribution arrangement and creating an accommodation ordinance commission to oversee the process. An amendment made in September 2011 addressed the process for distributing excess funds that might accumulate from the county’s 10%, if that amount exceeds the expenses required to administer and enforce compliance with the tax. Beginning in May 2013, the county retained 10% of the tax proceeds, plus 10% of any remaining fund balance. If additional funds accumulate in the fund balance, they are to be returned proportionally to the two convention & visitors bureaus – 75% to Ann Arbor, and 25% to Ypsilanti.

Subsequently an ordinance change was made in October 2012, when the board voted to shift responsibility for collecting and enforcing accommodation tax from the county treasurer to the county finance director. The ordinance amendment transferred a 0.7 full-time equivalent accounting job from the treasurer’s office to the county finance department, and amended the accommodation tax policy to clarify that the tax is only assessed against the actual price of a hotel, motel or other rental – not against other amenities that the business might charge its customers, such as Internet access or an extra cot in the room.

Accommodation Tax Distribution: Public Commentary

The specific resolution was not addressed directly during public commentary. But Jason Morgan, director of government relations for Washtenaw Community College, and Mary Kerr, president of the Ann Arbor Convention & Visitors Bureau, attended the meeting to highlight the union training programs that will be coming to the area this summer. The CVBs have been instrumental in recruiting these kinds of events to Washtenaw County.

The United Association (UA) is coming in August, marking the 25th year that UA training has been held at WCC, Morgan said. The ironworkers union will also be training at WCC for the fifth year. The National Joint Apprenticeship and Training Committee (NJATC) National Training Institute for electricians is coming in July.

Morgan said he and Kerr wanted to make sure that the unions know they are appreciated by Washtenaw County and by WCC.

Kerr noted that the NJATC is celebrating its 25th year as a training program, so that milestone – along with the UA anniversary – will be bringing hundreds of additional people to this area. Collectively, the economic impact from these union training programs is $12 million annually in Washtenaw County, she said. That amount includes money spent on hotels, restaurants, entertainment, retail and transportation. “They do have a significant economic impact on the community,” Kerr said. “Our goal is to keep them here. Our goal is to roll out the red carpet and make this not only an educational opportunity for them, but also an entertaining and relaxing one as well.”

Accommodation Tax Distribution: Board Discussion

Several commissioners thanked Morgan and Kerr, and said they supported the economic vitality that unions bring to this community. Commissioner Ronnie Peterson (D-District 6) praised the work of the AACVB, saying that the county had an excellent partnership with them. He requested that Kerr return in the future to talk about the full range of activities that the CVB does. He wanted people to know that sometimes the government works well with the private sector. [.pdf of 2013 AACVB annual report]

Outcome: Commissioners voted unanimously to give initial approval to the accommodation tax distribution. Commissioners Dan Smith (R-District 2) and Conan Smith (D-District 9) were out of the room when the vote was taken. A final vote is expected on May 7.

Urban County Action Plan

The 2014 Urban County action plan was on the April 16 agenda for initial approval. The plan covers the period from July 1, 2014 through June 30, 2015 and outlines how the Urban County consortium intends to spend federal funding received from the U.S. Dept. of Housing and Urban Development (HUD). [.pdf of draft action plan]

Map of Urban County participants.

The Urban County is a consortium of Washtenaw County and 18 local municipalities that receive federal funding for low-income neighborhoods. Members include the cities of Ann Arbor, Ypsilanti and Saline, and 15 townships. “Urban County” is a designation of HUD, identifying a county with more than 200,000 people. With that designation, individual governments within the Urban County can become members, entitling them to an allotment of funding through a variety of HUD programs. Locally, the Urban County is supported by the staff of Washtenaw County’s office of community & economic development (OCED).

Two HUD programs – the Community Development Block Grant (CDBG) and HOME Investment Partnership – are the primary funding sources for Urban County projects. For the upcoming year, the Urban County will be receiving $2.914 million, including $1.832 million from CDBG and $925,308 from HOME. That represents a 5% decrease in CDBG compared to the current year, and a 2% increase in HOME funding.

The 2014 plan identifies six overarching goals: (1) increasing quality, affordable homeownership opportunities; (2) increasing quality, affordable rental housing; (3) improving public facilities and infrastructure; (4) promoting access to public services and resources; (5) supporting homelessness prevention and rapid re-housing services; and (6) enhancing economic development activities.

A public hearing on the 2014 plan was previously held on March 19, 2014. A final vote on the plan is expected on May 7.

Urban County Action Plan: Board Discussion

Discussion was brief. Felicia Brabec (D-District 4) noted that there was almost a $90,000 decrease in CDBG funding. She asked what that decrease means in terms of the county’s ability to provide services.

Mary Jo Callan, director of the county’s office of community & economic development, replied that the decrease is “better than we feared.” The staff had been anticipating more of a 7% cut, so a 5% decrease was good news. The $90,000 in cuts won’t affect just one program, she said. So it will result in either fewer projects or scaled-down projects.

Outcome: Commissioners voted unanimously to give initial approval to the Urban County action plan. Commissioners Dan Smith (R-District 2) and Conan Smith (D-District 9) were out of the room when the vote was taken. A final vote is expected on May 7.

Bond Re-Funding

Commissioners were asked to give final authorization to the re-funding of up to $16.5 million in outstanding capital improvement bonds, which were originally issued in 2006 to fund expansion of the county jail. Initial approval had been given at the board’s April 2, 2014 meeting.

According to a staff memo, $16.9 million in principal remains of the original $21.675 million bond sale. The county’s bond counsel, Axe & Ecklund, is advising the re-funding because of lower interest rates, and estimates a net savings of about $869,000 over life of the bond issue. The new issue would be called “County of Washtenaw Capital Improvement Refunding Bonds, Series 2014.” [.pdf of refunding resolution]

At the board’s April 2 meeting, bond counsel John Axe had told the board that current interest rates are between 4% and 4.3%. He estimated that the re-funding interest rates would be between 2.2% and 3.8%.

Outcome: Without discussion, commissioners gave final approval to the bond re-funding proposal.

Honoring Eugene Glysson

Commissioners held a moment of silence for Dr. Eugene Glysson, who had served on the county’s board of public works (BPW) since 1986. He died on April 2. They later passed a resolution of appreciation for his service to Washtenaw County. [.pdf of resolution for Eugene Glysson]

Ned Glysson, son of Eugene Glysson.

Glysson had served as chair of the BPW since 1996, and was considered an expert in solid waste management and planning. He also was a professor emeritus of civil and environmental engineering at the University of Michigan.

The resolution noted several of Glysson’s accomplishments, including his leadership in reviewing and approving an agreement with Washtenaw County’s only active landfill “that has provided long term support for the County’s solid waste program including its household hazardous waste program that has removed tons of hazardous materials from the environment…”

Glysson’s son, Ned Glysson, was on hand to accept the resolution, saying it would have meant a lot to his father. He noted that his father refused to retire from the BPW, and about a month ago he had attended a meeting “and was incredibly rejuvenated by it.” It had given his father something to live for.

Evan Pratt, who as the county’s water resources commissioner also serves as director of public works, said Glysson had been a good chair. Commissioner Yousef Rabhi, who served on the BPW for almost four years, recalled that in the early days he’d been late to a few meetings, and Glysson hadn’t been happy about that. “He told me I wouldn’t be late anymore, and I wasn’t,” Rabhi quipped. Rabhi called Glysson a mentor to him and a great environmental leader.

Rabhi noted that a new member will need to be appointed to the BPW, so he’ll be seeking applicants for that.

Telecommunicator Week

The board passed a resolution declaring April 13-19 as National Public Safety Telecommunicator Week in Washtenaw County. [.pdf of board resolution]

From right: Marc Breckenridge, the county’s director of emergency services; commissioner Yousef Rabhi; and Dave Halteman, manager of the county’s dispatch operations.

Marc Breckenridge, the county’s director of emergency services, was on hand to receive the resolution. He noted that six or seven dispatchers were working that night just a few blocks away.

Breckenridge introduced Dave Halteman, saying he’s worked with the county for 22 years, starting as a 911 dispatcher. In the mid-1990s, Halteman was promoted to lead the countywide 911 effort. Most recently, Halteman was involved in co-locating and integrating dispatch operations in Washtenaw County.

This month, Halteman was promoted to be manager of the county’s dispatch operations, Breckenridge said.

Halteman thanked the board, saying that the job of dispatcher is very difficult and requires the ability to multi-task.

Communications & Commentary

During the April 16 meeting there were multiple opportunities for communications from the administration and commissioners, as well as public commentary. In addition to issues reported earlier in this article, here are some other highlights.

Communications & Commentary: Emergency Sirens

Speaking during public commentary, James Richardson of Scio Township told commissioners that there’s a potential life-threatening danger – a new emergency siren that was installed at the edge of his pasture.

James Richardson of Scio Township.

When the county approved the expansion of emergency sirens into the townships, he said, they probably viewed it as an improvement in public safety. But they might not have considered the resulting unintended danger. When he first learned that the siren would be installed, he expressed concern that it would bother his horses. He eventually spoke with Marc Breckenridge, the county’s director of emergency services, who assured him that studies show that livestock get used to these types of sounds. “I can assure you that these experts haven’t seen horses very near a siren,” Richardson said.

On Saturday, April 5 at noon, the sirens went off for the first time that he was aware of, Richardson said. He happened to be watching his horses, who reared and bolted, running wildly through the pasture. If someone had been riding a horse at that time or even standing near them, it could have caused serious injury and possibly death, he said. If the horses had been near the north end of the pasture, they might have bolted through the fence and onto Liberty Road.

Richardson said he was appealing to the board to have the siren removed from this location. He doubted that his horses would get used to the sound, especially since the sirens are only tested once a month for 1-2 minutes. “I’m notifying you of this danger, and also notifying you that if you fail to act, the board and the county will assume full responsibility for all and any of the resulting damage or injury to my horses, to my property, or any personal injury resulting from the dangerous situation that the emergency siren creates.”

Commissioner Conan Smith (D-District 9) urged Breckenridge to explore how the county can protect the interests of landowners as well as public safety. Sometimes those things come into conflict, he added, but it’s worth having a conversation to explore the options. Commissioner Ronnie Peterson (D-District 6) said he’d like to ensure that someone in the county administration follow up on this issue.

Communications & Commentary: Budget

Responding to a query from Ronnie Peterson (D-District 6), Felicia Brabec (D-District 4) described the process for this year’s budget affirmation. Although the board passed a four-year budget in late 2013 – for the period of 2014 through 2017 – they also need to vote each year to reaffirm the next year’s budget, with any changes they might make.

Commissioner Andy LaBarre (D-District 7) talks with Greg Dill, the county’s director of infrastructure management.

As a first step, Brabec said, commissioners authorized the county administrator to hire a contract employee who will support budget-related work this year for the county board and administration. That authorization took place at the board’s March 19, 2014 meeting. That person will help the board work on aligning the budget to support community outcomes that commissioners had identified.

By way of additional background, as part of adopting a four-year budget, the board set up a new strategic model to help it determine where the county’s resources should go. The board set goals as well as outcomes that are intended to measure how those goals are being achieved. The priority areas for investment that were approved by the board in 2013 are: (1) ensure community safety net through health and human services, inclusive of public safety; (2) increase economic opportunity and workforce development; (3) ensure mobility and civic infrastructure for county residents; (4) reduce environmental impact; and (5) ensure internal labor force sustainability and effectiveness.

On April 16, Peterson asked whether there could be a working session to review the goals and outcomes, saying that some things might have changed since those goals were adopted. Brabec replied that those kinds of discussions are being planned. Because of frequent low attendance at working sessions, she wondered whether it might be better for the discussion to occur at a ways & means committee meeting. “The discussion will happen,” she said. “We just need to find the best way for those discussions to happen.”

Communications & Commentary: MPRI

Ronnie Peterson (D-District 6) spoke at length about the need to support the Michigan Prisoner Re-Entry Initiative (MPRI), calling it an unfunded mandate from the state. Yousef Rabhi (D-District 8) agreed that it was an issue the board needs to tackle. Rabhi noted that he serves on the board of the Religious Action for Affordable Housing (RAAH), which has made the Washtenaw County prisoner re-entry program one of its three top priorities. He thought the county should prioritize it too.

Peterson said he wanted a working session on the topic, including a discussion about how the county allocates its dollars for human services programs in relationship to the coordinated funding approach. “It’s not about stopping coordinated funding,” he said. “It’s about how we address the unmet needs of this community.”

Andy LaBarre (D-District 7), who chairs the board’s working sessions, said he’d be glad to schedule a session on this topic. He noted that this year, the working sessions had not yet achieved 100% attendance. So he hoped commissioners would attend.

The following week, on April 22, LaBarre emailed commissioners an updated schedule of the next six working sessions:

• May 8: MSU Extension update; and follow-up on road commission expansion
• May 22: Community Health Improvement Plan report; and report on homelessness in Washtenaw County task force
• June 5: Report on Virtual Business Advisor initiative
• July 10: Dog licensing public awareness campaign; and Mental Health Court update
• August 7: ID task force report
• September 4: Prisoner reentry (MPRI)

Communications & Commentary: Smoking

During the time on the agenda to bring up items for current or future discussion, Alicia Ping (R-District 3) pointed out that earlier this year, she’d raised the issue of possibly requiring that new hires be tested to make sure they’re nicotine-free. It’s a policy that’s trending in the private sector, Ping noted, and she’d like to have a broader discussion about it. “It’s an expensive liability to take on people who are purposefully are not contributing to their good health,” Ping said.

County administrator Verna McDaniel replied that staff are looking at a range of wellness issues, including that one.

Communications & Commentary: Homelessness

Elizabeth Kurtz spoke about the Delonis Center homeless shelter’s warming center. She thanked the board for funding an extension of the warming center until April 30. If it had closed on April 6 as previously planned, she said, a lot of people would have been outside during cold weather. She told commissioners that she’s lived on the streets for over a year, and based on the needs that she sees, she’s been working with others to end homelessness.

County administrator Verna McDaniel and commissioner Yousef Rabhi (D-District 8).

They’ve formed an organization called “Our 2020 Vision,” and are seeking support from local governments and private entities to help end homelessness by the end of this decade. The urgency of this issue will no longer allow it to be placed on the back burner, Kurtz said. Specifically, she called on commissioner Ronnie Peterson (D-District 6) to help acquire the vacant East Middle School in Ypsilanti for use in this effort, and asked other commissioners to help as well.

Ray Gholston also thanked commissioners for helping extend the warming center through April. The county had provided $35,000 to keep it open, he noted, but he questioned why it would cost so much “just to throw a few mats on the lunchroom floor, say goodnight and turn off the lights.” He said he still has a job and is still trying to figure out where he’ll sleep after this month. He’s part of the Our 2020 Vision effort, calling it a human rights organization that’s focused on the homeless population. The group is requesting a meeting with some or all commissioners, to help deal with the crisis.

Commissioner Yousef Rabhi (D-District 8) thanked advocates for the homeless for coming to the meeting, and said he looked forward to the board’s May 7 meeting when a timeline would be presented for addressing an update to the Blueprint to End Homelessness. [At its April 2, 2014 meeting, commissioners had directed county administrator Verna McDaniel to bring forward a plan by May 7 for updating the county’s Blueprint to End Homelessness, which was originally adopted in 2004. The process of updating that plan is to be completed by Oct. 1, 2014. For board discussion on this issue, see Chronicle coverage: "Homeless Issues Emerge on County Agenda."]

Communications & Commentary: US-23

Yousef Rabhi noted that an environmental assessment is being conducted for MDOT’s proposed expansion of US-23 near Ann Arbor. MDOT is seeking public input, and Rabhi said he intended to express his opposition to the project because of environmental concerns. It would be expanded from M-14 to just north of 8 Mile Road near Whitmore Lake. He encouraged others to provide input as well.

Communications & Commentary: Misc. Public Commentary

Several University of Michigan students spoke during public commentary. As a class project, they’re working on an initiative to reduce the use of plastic bags in Washtenaw County.

University of Michigan students spoke during public commentary.

Their proposal is based on a model used in Washington D.C. that includes imposing a small usage fee on single-use plastic bags. The goal is to nudge consumers to be more aware of their consumption choices. They’ve spoken with commissioner Yousef Rabhi to explore their options. To gauge possible support, they’ve started a petition on MoveOn.org and have reached out to community groups like Recycle Ann Arbor and the Huron River Watershed Council, as well as student groups at UM, Eastern Michigan University and Washtenaw Community College.

Lefiest Galimore touched on several issues during public commentary. As he has in the past, Galimore argued that the coordinated funding approach tends to prevent African-American organizations from getting funded. If his small organization is given $1,500 and a larger organization is given $35,000, then that larger organization will have more capacity to do its work, he said. So the county needs to look at that. Galimore also said that people with mental illness who get involved in the criminal justice system get labeled as criminals, and it’s then impossible for them to get productive jobs. “We need to look at that as a community.”

Thomas Partridge told commissioners that the agenda needed to give more attention to greater priorities, including efforts to eliminate homelessness by providing true affordable housing and countywide public transportation. He supported the transit tax that’s on the May 6 ballot in Ann Arbor, Ypsilanti and Ypsilanti Township.

Present: Felicia Brabec, Andy LaBarre, Kent Martinez-Kratz, Ronnie Peterson, Alicia Ping, Yousef Rabhi, Rolland Sizemore Jr., Conan Smith, Dan Smith.

Next regular board meeting: Wednesday, May 7, 2014 at 6:30 p.m. at the county administration building, 220 N. Main St. in Ann Arbor. The ways & means committee meets first, followed immediately by the regular board meeting. [Check Chronicle event listings to confirm date.] (Though the agenda states that the regular board meeting begins at 6:45 p.m., it usually starts much later – times vary depending on what’s on the agenda.) Public commentary is held at the beginning of each meeting, and no advance sign-up is required.

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Equalized (assessed) value is used to calculate taxable value, which determines tax revenues for the county as well as its various municipalities and other entities that rely on taxpayer dollars, including schools, libraries and the Ann Area Arbor Transportation Authority, among others.

For 2014, taxable value in the county increased 2.02% to $14.18 billion. That’s a greater increase than the 1.68% climb in 2013, and an improvement over declines seen in recent years.

It’s also an improvement over projections made when the county administration prepared its 2014 budget. The general fund budget was approved with a projection of $63.79 million in tax revenues. But actual revenues, based on 2014 taxable value, are now estimated at $64.511 million – for an excess in 2014 general fund revenues of $720,486. Patel stressed that at this point, the taxable value is a recommendation and must be approved at the state level.

Patel also presented tentative taxable values for specific jurisdictions. The city of Ann Arbor shows a 2.68% increase in taxable value, while the city of Ypsilanti’s taxable value is an 0.87% increase over 2013. All but three municipalities showed an increase in taxable value. Those municipalities with decreases are the city of Saline (-1.41%), Ypsilanti Township (-0.37%), and the city of Milan (-0.85%).

Properties in the Ann Arbor Public Schools district – which includes the city of Ann Arbor and parts of surrounding townships – will see a 2.37% increase in taxable value. Properties taxed by the Ann Arbor District Library, covering a geographic area which in large part mirrors the AAPS district, increased in value by 2.36%.

Taxable value is determined by a state-mandated formula, and is the lower of two figures: (1) a parcel’s equalized (assessed) value; or (2) a capped value calculated by taking last year’s taxable value minus any losses (such as a building being torn down), multiplied by 5% or the rate of inflation (whichever is lower – this year inflation is 1.6%), plus the value of any additions or new construction.

In 2014, commercial property showed a 3.97% gain in equalized value. Residential property value – the largest classification of property in the county – showed an increase of 5.84%. That’s stronger than last year’s 2.37% increase, which had been the first climb in value since 2007.

Values for developmental property – a relatively small category that covers properties not yet developed – continue to struggle, registering a decrease of 9.54% in equalized value. Industrial property, which dropped 4.78% in equalized value last year, is essentially flat in 2014 at 0.1%. Over the past few years that category has lost significant value, falling from an equalized value of nearly $1 billion in 2007 to this year’s value of $422.146 million.

Countywide, about $400 million is captured by local downtown development authorities (DDAs), local district finance authorities (LDFAs), brownfield tax increment financing, and other entities that are allowed to capture funds from taxing jurisdictions. For taxes levied by Washtenaw County government alone, $2.472 million goes to these other tax-capturing entities that would otherwise be revenues for the county’s general fund.

This brief was filed from the boardroom of the county administration building at 220 N. Main St. in Ann Arbor. A more detailed report will follow: [link]

From left: Raman Patel, Washtenaw County’s equalization director, greets Leila Bauer, chief deputy treasurer who is retiring after 41 years with the county. (Photos by the writer.)

After several years of reporting declining tax revenues, Raman Patel – the county’s equalization director – gave commissioners a report showing stronger signs of economic recovery, reflected in a 1.68% increase in taxable value. That translates into an estimated $2.327 million more in property tax revenues for county government than had been budgeted for 2013. [.pdf of Patel's presentation]

Also related to the budget, commissioners gave initial approval to a four-year budget planning cycle, a change from the current two-year cycle that’s been in place since 1994. Voting against the item was Ronnie Peterson (D-District 6). He and other commissioners expressed a range of concerns, including the fact that commissioners are elected every two years and therefore might not be able to contribute adequately to setting budget priorities. Although Peterson remained unconvinced, several commissioners observed that the annual budget affirmation process acted as a fail-safe, allowing the board to make adjustments based on changing priorities.

Another item that could have a dramatic impact on the county’s budget was only briefly mentioned: A proposal to issue up to $350 million in bonds to fully fund the county’s pension and retiree healthcare plans. It would be by far the largest bond issuance in the county’s history. County administrator Verna McDaniel plans to make a formal presentation about the proposal at the board’s May 2 working session. She distributed materials on April 17 to help commissioners prep for that meeting. [.pdf of bond proposal handout]

Commissioners also took a final vote officially to dissolve a countywide public transit authority known as the Washtenaw Ride. There was no discussion, but Conan Smith (D-District 9) – a vocal advocate for public transit – cast the sole vote against the resolution.

Other action handled by the board included a federal weatherization grant, a public hearing for the Urban County strategic plan, and resolutions honoring county employees and residents. Among them was Leila Bauer, the county’s chief deputy treasurer who is retiring after 41 years with the county. She received a standing ovation from the board.

County Bonding Proposal

County administrator Verna McDaniel passed out information to commissioners on April 17 regarding a major bonding proposal. She plans to make a formal presentation at the board’s May 2 working session. [.pdf of bond proposal handout]

The proposal is for a 25-year bond issue of up to $350 million to fully fund the county’s pension and retiree healthcare plans – the Washtenaw County Employees’ Retirement System (WCERS) and Voluntary Employees Beneficiary Association (VEBA).

Washtenaw County administrator Verna McDaniel.

Although commissioners were alerted to the possibility of this bonding proposal earlier in the year, the communication from McDaniel was the first time it had been formally raised at a public board meeting. She told commissioners that the material she was providing outlined six key points, including the purpose and objectives of bonding, and cost comparisons between estimated payments of debt service compared to the county’s annual required contribution to its pension and retiree healthcare funds.

She also provided a summary of relevant provisions in Public Act 329 of 2012, which the Michigan legislature passed in October of 2012. [.pdf of Public Act 329] The law enables municipalities to issue bonds to cover unfunded accrued pension and retiree healthcare liabilities, but has a sunset of Dec. 31, 2014.

The material distributed by McDaniel also lists benefits and risks of bonding, and a comparison of budgets based on bonding or not bonding.

Benefits cited by McDaniel include:

• Easier long-term budgeting provided by having predictable bond payments, rather than fluctuating amounts each year to cover pension (WCERS) and retiree healthcare (VEBA) costs. For example, the current combined WCERS and VEBA contributions in 2014 are estimated at $23.5 million. A bond payment is estimated at $18.6 million. [These annual lower payments don't take into account the higher amounts paid in interest over the life of the bonds, however. Details on the interest payments were not provided.]
• The complete elimination of the WCERS and VEBA obligations after 25 years.
• Proceeds from the bond, held in an intermediate trust, could be used to call the bonds after nine years, if some future event eliminates the WCERS and VEBA liabilities.
• Current rates for issuing bonds are at an historic low. Average debt service is estimated at 4%.

McDaniel also listed a few risks of bonding, including the size of the debt load, the uncertainty of market conditions, and the impact of defaulting, which would have consequences for the county’s credit rating and ability to issue bonds for other purposes.

The timetable proposes an initial board vote to approve the bond issuance on May 15 at its ways & means committee meeting, with a final vote on June 5. The board would vote on July 10 to approve the final bonding amount. During the summer months of June through August, the board typically holds only one regular board meeting each month.

McDaniel is also recommending that the county set up an intermediate trust to receive net proceeds from the sale of the bonds, and to invest and distribute the assets.

“This is an important and critical issue,” she said, “and we wanted to make sure you had as much information as possible in advance.”

Based on the county’s most recent comprehensive annual financial report (CAFR), Washtenaw County’s total outstanding debt at the end of 2012 was $60.877 million, up from $35.67 million in 2003. In 2012, the county paid $8.77 million in principal on its debt, $2.69 million in interest and other charges, and $166,892 related to bond issuance costs. [.pdf of debt data from 2012 CAFR]

County Bonding Proposal: Board Discussion

Ronnie Peterson (D-District 5) confirmed with McDaniel that the county’s legal counsel and bond counsel, John Axe, would attend the May 2 working session. [Axe has been advising the county on this proposal, and likely would be paid based on a percentage of the bonded amount.]

Peterson wondered if this proposal would impact the county’s current bonding capacity and ability to borrow for other needs.

McDaniel replied that this amount would be “well within our capacity.” The rating agencies allow the county to bond up to 10% of the county’s taxable value. According to the equalization report that was presented earlier in the meeting, the county’s taxable value is $14.416 billion.

Peterson asked McDaniel to provide more information at the May 2 working session about the county’s current bonding ability, as well as the impact that a $350 million bond issuance would have on the county’s ability to bond beyond that.

From left: Washtenaw County commissioners Dan Smith (R-District 2) and Kent Martinez-Kratz (D-District 1) review materials prior to the start of the county board’s April 17 meeting.

Dan Smith (R-District 2) said he was very interested in the impact that this bond would have on other communities in Washtenaw County. Rating agencies look at the total debt throughout the county, he noted. Communities have different levels of debt and taxable values, and he wanted to know how that would be affected regarding the “debt overhang.” [Debt overhang refers to the point at which debt is so great that an entity is unable to take on additional debt.]

The bond issuance that’s being proposed would add a substantial amount of debt on a per-capita basis, D. Smith said. Based on the data from the current equalization report and on the county’s current debt as provided in the most recent comprehensive annual financial report (CAFR), the county’s total debt – for all municipalities – is 9.2% of the county’s total taxable value.

Kent Martinez-Kratz (D-District 1) confirmed with McDaniel that the assumptions built in to her calculations factor in the new labor contracts, which eliminated defined benefit plans for new employees hired after Jan. 1, 2014. [See Chronicle coverage: "New Labor Contracts Key to County Budget"] He also highlighted a chart that showed “savings” that the county would see from this bond issuance, and indicated that he’d like more information about how those amounts are calculated. [.pdf of budget projection charts]

Yousef Rabhi (D-District 8) encouraged commissioners to email their questions to the administration prior to May 2, so that the financial staff would have adequate time to prepare responses. “It’s a big decision,” he said, “and we want to make sure we’re walking into this with a body of supporting information, both from professionals and from others in the community, to make sure we’re making the right decision on this.”

Rabhi said he had asked the administration to provide this material prior to the May 2 working session, so that commissioners would have time to review it and ask questions.

Equalization Report

Raman Patel, the county’s equalization director, made his annual presentation to the board on April 17. He began by noting that he has worked on 42 of the 55 equalization reports that the county has produced over the past few decades. [.pdf of Patel's presentation] [.pdf of equalization report]

Equalized (assessed) value is used to calculate taxable value, which determines tax revenues for the county as well as its various municipalities and other entities that rely on taxpayer dollars, including schools, libraries and the Ann Arbor Transportation Authority, among others.

After several years of reporting declining tax revenues, this year’s report showed stronger signs of economic recovery, reflected in a 1.68% increase in taxable value.

For 2013, taxable value in the county increased 1.68% to $14.2 billion. That’s an improvement over declines seen in recent years, when equalized value fell 0.76% in 2012, 2.85% in 2011 and 5.33% in 2010. It’s also an improvement over projections made when the county administration prepared its 2013 budget. The general fund budget was approved with a projection of $60.9 million in tax revenues. But actual revenues, based on 2013 taxable value, are now estimated at $63.236 million – for an excess in 2013 general fund revenues of $2.327 million. Patel stressed that at this point, the taxable value is a recommendation and must be approved at the state level.

Patel also presented tentative taxable values for specific jurisdictions. The city of Ann Arbor shows a 3.34% increase in taxable value, while the city of Saline’s taxable value is a 3.97% increase over 2012. All but six municipalities showed an increase in taxable value. Those municipalities with decreases include the city of Ypsilanti (-0.38%) and Ypsilanti Township (-2.53%).

Properties in the Ann Arbor Public Schools district – which includes the city of Ann Arbor and parts of surrounding townships – will see a 2.32% increase in taxable value. Properties taxed by the Ann Arbor District Library, covering a geographic area that in large part mirrors the AAPS district, increased in value by 2.11%. [.pdf of taxable value list by jurisdiction]

Taxable value is determined by a state-mandated formula, and is the lower of two figures: (1) a parcel’s equalized (assessed) value; or (2) a capped value calculated by taking last year’s taxable value minus any losses (such as a building being torn down), multiplied by 5% or the rate of inflation (whichever is lower), plus the value of any additions or new construction. This year inflation is 2.4%.

Patel reported that the county’s millage rate will not be rolled back this year. The state’s Headlee Amendment rolls back millage rates to prevent property tax revenues from increasing faster than the rate of inflation. That won’t happen this year, because the inflation rate of 2.4% is higher than the increase in taxable value.

In 2013, several categories of property saw increases in equalized value for the first time in years, according to the report. Commercial property showed a 2.2% gain in equalized value, compared to a 3.84% decline last year. It was the first increase in commercial property values since 2009. Residential property value – the largest classification of property in the county – showed an increase of 2.37%, gaining in value for the first time since 2007. Last year, the equalized value for residential property had dropped 0.57%, and had registered a 2.74% drop in 2011. The average residential sales price in February 2013 was $216,220 – up from a low of $154,015 in 2009.

Personal property values also increased, growing 3.15% compared to 2012.

Last year, agricultural property had been the only category that showed an increase. Growth continues in 2013, but at a slower pace. Agricultural property registered an 0.67% increase in equalized value this year, compared to an increase of 3.54% in 2012.

Industrial and developmental property values continue to struggle. Those were the only categories to register a decline in 2013. Industrial property showed a drop in equalized value of 4.78%. That compares to a 3.99% drop in value last year. Over the past few years that category has lost significant value, falling from an equalized value of nearly $1 billion in 2007 to this year’s value of $421.72 million. Developmental property – a relatively small category that covers properties not yet developed – had a 7.12% drop in equalized value.

Patel also highlighted the value of new construction in the county – $368.1 million, a 30% jump over the value of new construction in 2012. But most of the new construction is happening in DDA districts, he reported, so the full increase in tax revenue isn’t going directly to the taxing jurisdictions.

From right: County commissioners Rolland Sizemore Jr. (D-District 6), Ronnie Peterson (D-District 5), Andy LaBarre (D-District 7) and Alicia Ping (R-District 3).

Patel noted that countywide, about $418 million is captured by local downtown development authorities (DDAs), local district finance authorities (LDFAs), brownfield tax increment financing, and other entities that are allowed to capture funds from taxing jurisdictions. For Washtenaw County government alone, $2.405 million goes to these other tax-capturing entities that would otherwise be revenues for the county’s general fund. He noted that although the official taxable value for Washtenaw County increased by 1.68%, the net increase is just 1.35% – after subtracting the amounts captured by DDAs and other tax-capturing entities.

Another factor is the impact that the Headlee amendment has had since the state’s voters approved that measure in 1978. The county was originally authorized to levy 5.5 mills, but since 1978 that rate has been rolled back to 4.5493 mills, Patel noted. In order to levy its full rate of 5.5 mills, the county would need to ask voters for a Headlee override.

Compared to surrounding counties, Washtenaw is faring well, Patel reported. Taxable values were flat in Oakland and Lapeer counties, and Livingston County showed a modest increase of 1.18%. But values in other counties continue to decline, including Wayne (-1.20%), Macomb (-0.55%) and Genesee (-2.43%).

Though the news for Washtenaw was generally positive, Patel cautioned that the loss of the state personal property tax – which Michigan legislators repealed last year – could ultimately result in a loss of more than $5 million in annual revenues for the county government alone, and more than $40 million for all taxing jurisdictions in Washtenaw County. The tax will be phased out starting in 2014 through 2022. As part of that change, a statewide voter referendum is slated for 2014 to ask voters to authorize replacement funds from other state revenue sources. It’s unclear what will happen if voters reject that proposal.

The county also hasn’t recovered from a loss in property value over the past few years. Although the $14.21 billion in total taxable value this year is higher than 2012, it’s 9.2% lower than the taxable value of $15.65 billion in 2008. “Even with the improved market, it will take a number of years to regain the valuation status,” Patel said.

Equalization Report: Board Discussion

Several commissioners praised the work, thanked Patel and his staff, and generally applauded the news. There were also several questions.

Dan Smith (R-District 2) asked how Patel got the comparative data with other counties. Patel replied that there are 83 counties in Michigan with 83 equalization directors. “We get together every month,” he said. “This is my job, because I want to make sure that my county is going to equalize property just like every other county.” Every assessment should reflect uniformity and equity – that’s his responsibility, Patel said, adding that the state Constitution is very clear about this equalization process.

D. Smith also asked about tax tribunal cases, and wondered what the impact might be on appeals made regarding this year’s assessments. Patel reported that the county has about $800 million in taxable value that’s in contention. That doesn’t mean that the county will have to refund $800 million worth of tax revenue, he explained. Often the original assessments aren’t changed, even if they are challenged.

Responding to another query from D. Smith, Patel explained that the “developmental” category is used to classify property that would eventually be developed. At the point when it’s developed, the property will be reclassified – as commercial or residential, for example, depending on its use. So the developmental category fluctuates considerably from year to year. It’s a category “parking spot,” he said.

D. Smith also clarified with Patel that the total amount of tax dollars levied countywide – including all municipalities, school systems, libraries, etc. – was $632.299 million, based on 2012 millage rates. Yes, Patel said. The amount will likely change only slightly for 2013.

Yousef Rabhi (D-District 8) thanked Patel and called the report wonderful news. After years in recession and making budget cuts “down to the bone,” Rabhi said, it’s good to hear that the county will be taking in more revenues than it budgeted for. But he noted that the federal government is cutting back on its funding, and budget cuts at the state level are expected to continue. He wanted to highlight the fact that the county now has a potential opportunity to help sustain some of the ongoing community investments that would otherwise be damaged or cut back due to federal and state funding cuts.

Rabhi noted that Washtenaw County is doing well compared to other areas in Michigan, and a lot of that is due to government investments, he said – through the county, the universities, and other local entities. “We’re putting money back in our community for economic development,” he said, “and we’re building the economy here in Washtenaw County. I don’t think it’s just a coincidence that we’re seeing a return in property values.”

Conan Smith (D-District 9) noted that the county is still seeing fairly significant losses in industrial property values. He wondered if it was due to properties being taken out of that classification, or because those industrial properties continue to decline in value. Patel replied that these properties continue to decline in value. As an example, he noted that General Motors had removed personal property from its closed Willow Run plant in Ypsilanti Township, which contributed to the property’s loss in value.

C. Smith said it might be something to talk about with Ann Arbor SPARK, this region’s economic development agency. Even though several classifications are seeing a turnaround, he noted, that hasn’t yet happened for industrial properties. In order for that to occur, the properties need to become competitive in the marketplace, he said. SPARK is really the county’s “go-to partner” in terms of recruiting tenants for those buildings, he added, so perhaps that effort should be given more weight in SPARK’s strategic plan.

County administrator Verna McDaniel reported that Paul Krutko, SPARK’s CEO, is very active in working on GM’s Willow Run plant as well as other industrial facilities in the county. “I think he knows that that’s a huge concern,” she said. [Both McDaniel and Conan Smith serve on the executive committee of SPARK's board of directors. The county allocated $200,000 to SPARK in the 2013 budget.]

C. Smith asked Patel to provide a list of the top 10 industrial parcels in the county, based on valuation, as well as the 10 parcels that are experiencing the greatest loss in value. This information would help in targeting any marketing that might be done, he noted.

Alicia Ping (R-District 3) thanked Patel, noting that this was the first good news the equalization staff has delivered since she was elected in 2010. “I’m surprised you aren’t all out there doing the happy dance,” she joked.

Outcome: Commissioners unanimously voted to accept the 2013 equalization report.

Four-Year Budget Process

Commissioners were asked to give initial approval to a four-year budget planning cycle, a change from the current two-year cycle that’s been in place since 1994.

From left: Washtenaw County commissioner Felicia Brabec (District 4) and county administrator Verna McDaniel.

The board had been briefed on the issue at a Feb. 21, 2013 working session. County administrator Verna McDaniel has cited several benefits to a longer budget planning cycle, saying it would provide more stability and allow the county to intervene earlier in potential deficit situations. [.pdf of McDaniel's Feb. 21 presentation] State law requires that the board approve the county’s budget annually, but a quadrennial budget would allow the administration to work from a longer-term plan.

With a two-year approach, larger cuts must be made within a shorter timeframe to address anticipated deficits. A four-year plan would allow the administration to identify potential deficits at an earlier date, and target savings that would compound over the longer period, making the overall budget more manageable.

The county is currently working on a new budget starting in 2014. Earlier this year, the county administration projected a $24.64 million general fund deficit over the four-year period from 2014 through 2017. A much smaller general fund deficit of $3.93 million is projected for 2014, but McDaniel hopes to identify $6.88 million in structural changes for that year – a combination of new revenues and cuts in expenditures – in order to eliminate the cumulative deficit going forward. These numbers will be revised in light of the county’s equalization report, which estimates that the county will receive $2.327 million more in 2013 tax revenues than had originally been budgeted.

Four-Year Budget Process: Board Discussion

Dan Smith (R-District 2) said he thought it was a step in the right direction, though he still had some concerns. He’s talked with county administrator Verna McDaniel about this process, and sees more positive than negative things coming from the change.

His basic concern is that commissioners are elected on a two-year cycle, which is in “direct conflict with a four-year budget,” he said. Although McDaniel has plans to accommodate that, he said, there’s no getting around the basic fact. However, he noted that countywide elected officials are on a four-year election cycle, which would synch well with a four-year budget. [Countywide elected positions are the sheriff, treasurer, county prosecuting attorney, clerk/register of deeds, and water resources commissioner.]

D. Smith said he’d like a more intense budget discussion with the county departments. The board is rather removed from that department-level discussion, he noted. One way to intensify that discussion would be to institute zero-based budgeting, he said. On a four-year cycle, each department would wipe its slate clean and be required to justify each item in its budget. Doing this every four years might not be as onerous as doing it every one or two years, he said.

Ronnie Peterson (D-District 5).

Ronnie Peterson (D-District 5) clarified with McDaniel that the four-year budget process would begin with the budget that’s being developed, from 2014-2017.

Peterson then said that although his politics often differ greatly from Republican Dan Smith’s, he respected Smith as an individual and in this case he shared some of Smith’s concerns. Peterson stressed that this was the first time he had participated in a discussion about a four-year budget. [Peterson did not attend the Feb. 21 working session when McDaniel and the county's financial staff briefed commissioners on this approach.]

The responsibility for the county’s budget rests with the elected board of commissioners, he noted. Sometimes they just come to meetings “because we somewhat enjoy each other’s company,” he joked. But often there are pressing items related to appropriations, he added, citing the allocation of funds in the wake of last spring’s tornado touchdown in the Dexter area.

This responsibility is entrusted to the board, he said. In recent years, because of the economy, the board has made difficult decisions that sometimes resulted in residents not getting the services they need, he said, like the decision to stop administering the HeadStart program. [The responsibility for the Washtenaw HeadStart, which the county has administered since the 1960s, is in the process of being handed over to another to-be-determined entity.]

It’s not the board’s role to micromanage, Peterson noted, and the county would run quite well even if the board met only once every six months. Commissioners set the millage rate, accept the equalization report, make key hires – and set the budget, he said.

Earlier this year, the board approved new labor contracts that will determine the wages and benefits of employees for the next 10 years. As part of that, the board has the obligation to “right the ship,” Peterson said, and he didn’t know if commissioners could do that with a four-year budget cycle. They haven’t yet assessed some of the programs and structures that have been in place for years – programs and structures that need to be re-evaluated, he said.

Peterson told commissioners that they hadn’t really started the process for the next budget year, let alone for four years. He said he wouldn’t be supporting a four-year budget. The board needed to have a retreat to discuss it, he said, adding that perhaps others have already met and made that decision. The public should have input too, he said.

Peterson concluded by saying that even for a two-year budget, things can change – either because of the economy, or because of changing priorities among commissioners. “If you can count to a majority, you can change the budget,” he said.

Andy LaBarre (D-District 7) spoke next, indicating that he shared concerns about the impact of elections on the budget process. But he said he’d support a four-year budget. Everything the board and administration has done so far this year has been with the goal of providing more stability and predictability, he said. A four-year budget process would add to that. “And I feel secure in that we have a fail-safe in the [budget] reaffirmation each year,” he noted. “To me, if that wasn’t there, this wouldn’t be in any way, shape or form a prudent or responsible thing to do.”

In some ways, LaBarre added, a four-year approach moves the county away from a crisis-to-crisis mentality and more toward a strategic and tactical approach.

Yousef Rabhi (D-District 8) emphasized that the board’s responsibility is to pass an annual budget, and the four-year budget cycle won’t change that. In two years after the next board is seated, commissioners could decide that they didn’t want to do a four-year budget cycle, he said. So he didn’t feel that he was forcing anything on future boards.

There’s value in having a budget process and in allowing commissioners to delve into the details, Rabhi said. So there should be some sort of budget process every two years, with the understanding that the budget extends beyond a two-year time period.

In terms of the budget process so far, Rabhi reminded commissioners that they’ve had one budget retreat so far. Also, there was a working session in February specifically about the four-year budget proposal. “It wasn’t as well-attended as it could have been,” he added, but materials from that working session were provided to all commissioners, weighing the advantages and disadvantages. [.pdf of McDaniel's Feb. 21 presentation]

Rabhi said he’s scheduled a second retreat for the board on May 16 at the county’s Learning Resource Center. [The LCR is located near the county jail, at 4135 Washtenaw Ave.] The meeting is open to the public, and will be held at the same time as the board’s working sessions, which begin at 6 p.m.

If approved, Washtenaw County will be one of the only counties in Michigan if not the country to do a four-year budget, Rabhi said. “It’s a wonderful way to lead the nation in fiscal stability and fiscal responsibility.”

Conan Smith (D-District 9) also shared concerns that had been raised about process considerations. From the standpoint of staff and administration, he said, a four-year budget makes a lot of sense because of the long-term planning process. But from the board’s perspective, he still was concerned about the two-year election cycle.

The resolution in front of the board simply gave direction to the staff, C. Smith said. It’s a good model, because it leads to longer-term decisions with more predictability. But it doesn’t obviate any of the concerns that had been raised by other commissioners, he said, so the board needs to develop a budget policy for this four-year approach. If they were operating on a two-year cycle, commissioners would approve the two-year budget for 2014-2015 at the end of 2013, but in 2014 they’d likely just rubber stamp it, he said. Commissioners know that they’ll be around for two years, so that second year budget is one they’ve already worked on.

It would be different on a four-year cycle, C. Smith said. There’s no guarantee that a commissioner would be around for four years. So it’s important to differentiate what happens in each of the four years. In the third year, perhaps there should be a substantive review of the budget – have the priorities changed, or are the original objectives being met? Then in the fourth year, commissioners would begin the budget process again with a “fulsome” assessment of the previous four years, he said.

In concept, the four-year process is a good approach, C. Smith said. But the board hasn’t yet articulated clearly the role that commissioners should be playing inside that process. He supported the resolution, saying that it simply gave direction to plan for four years. In September, if commissioners decide they want to adopt only a two-year budget, “we still have that right.” He said he’d be happy to be a leader in thinking through how the board can engage in the next four-year budget process.

From left: Pete Simms of the county clerk’s office and Yousef Rabhi (D-District 8), chair of the county board of commissioners.

Peterson spoke again at length, saying it was amazing to him that the board had only held two short retreats, but had already made decisions about budget priorities. [In fact, there has been just one budget retreat so far – on March 7, 2013 – although budget issues have come up during discussions at several regular meetings.]

The budget isn’t the responsibility of administration, Peterson said, and he hoped the board assumed responsibility for it soon. He praised the county’s employees and talked about their sacrifices over the past few years. He urged the board to assess the county’s programs and services, to make sure the county never gets into this same kind of position again. He questioned how anyone could see the needs of the county four years from now, when things have changed so dramatically just over the past nine months. National healthcare reform is one example of changes that could impact the budget in the future, he said.

Rabhi responded, thanking Peterson for raising these concerns. Rabhi said he wanted to have a robust budget process, whether it’s a two-year or four-year budget. He expressed willingness to address Peterson’s concerns over the current budget process, and noted that another retreat is scheduled for mid-May. There will also be more budget-related working sessions, he said. “I don’t know of any private discussions that have been had around the budget,” Rabhi added.

A budget task force has been working under the direction of the administration, Rabhi said, noting that Felicia Brabec – chair of the board’s ways & means committee – has been very active in those. In addition to retreats, working sessions and regular meetings, Rabhi said he was open to other suggestions from commissioners in the budget process.

Brabec agreed that the board needs to be thinking more strategically, and said the next retreat will focus on that approach, looking at things like community impact. Rabhi added that the budget can’t just be about dollars and cents – it’s also about community impact, and developing a framework for assessing impact.

Dan Smith stressed that the board would be voting on something very specific that night, and he read from the resolution’s only resolved clause: “… that the Washtenaw County Board of Commissioners approve the development of a Quadrennial County Budget.” It doesn’t say that the board will adopt a quadrennial budget, he noted – it’s just the beginning of the process. At any point, commissioners could change this approach. The actual voting on the budget itself is a long way off, he said, and this is just the first step in the process. He said he’d continue evaluating it over the next few months.

Conan Smith reported that he had communicated to Brabec and LaBarre – but not to Rabhi, the board chair – his concerns that the board hasn’t allocated sufficient time so far for a robust budget conversation. Waiting until late May for the next board retreat means that administration will already be deep into the budget process, he said, and it gets harder to change direction if you want to keep the process on schedule. He expressed concerns that presentations at the working sessions had been on topics with lower priority than the budget.

C. Smith said he knew there’s keen interest in bonding for pension and healthcare liabilities, but going down that path before the board has a conversation about budget priorities is not the right sequence. He thought there should also be more conversations on the budget at the board’s ways & means committee meetings.

In the last budget cycle in 2011, C. Smith said, the board had held three retreats “all before March.” [He had been board chair at the time. Retreats – including sessions on Jan. 29, 2011 and Feb. 9, 2011 – culminated in the board adopting a set of budget priorities and principles at its March 16, 2011 meeting.]

The board had “a more engaged conversation by this point in the last budget process,” C. Smith said, “so I think that might be part of what the tension is – it feels like we’re getting late, in all honesty.” He urged the board leadership – Rabhi, Brabec and LaBarre – to examine their budget schedule and possibly call additional meetings to focus on the budget.

Outcome: Commissioners voted 7-1 to approve the resolution directing the administration to develop a four-year budget. Dissenting was Ronnie Peterson (D-District 5). Rolland Sizemore Jr. (D-District 6) was not in the room when the vote was taken. A final vote is expected on May 1.

Weatherization Grant

Commissioners were asked to give initial approval to accept $185,654 in funds for the county’s weatherization assistance program.

The funding roughly equals the amount of federal weatherization dollars that the county received in 2012, which was a decrease of about 65% compared to 2011 federal funding levels. The current funding is allocated through the 2013 Low Income Home Energy Assistance Program (LIHEAP). The county last received LIHEAP funding in 2010, but has received weatherization grants from other federal funding sources in the intervening years.

For the period from April 1, 2013 to June 30, 2014, the program is expected to weatherize 27 homes. According to a staff memo, the work includes an energy audit inspection and follow-up inspection of the completed weatherization work, which might include attic and wall insulation, caulking, window repairs, furnace tune-ups, furnace replacements, and refrigerator installations. To qualify for the program, residents must have an income at or below 150% of federal poverty, which is about $35,325 for a family of four.

Weatherization Grant: Board Discussion

Dan Smith (R-District 2) asked whether the county would use outside subcontractors for this work, or if staff would do it. Mary Jo Callan – director of the county’s office of community & economic development (OCED) – replied that licensed contractors are hired to do the weatherization work, while staff members act as project managers and oversee the work.

Washtenaw County commissioners Alicia Ping (R-District 3) and Andy LaBarre (D-District 7).

D. Smith also noted that it’s been a few years since the county has received this type of grant. As he had read through the contract, there seemed to be some rather onerous requirements – such as making sure contractors meet the federal requirements needed to do the work. He wondered whether the county had sufficient resources to make sure all of those contract requirements are met. [.pdf of LIHEAP agreement]

Callan noted that although the county hasn’t received LIHEAP funding since 2010, there were large amounts of federal recovery (stimulus) dollars available in the interim. The requirements for all of this funding are similar, she said. Getting federal funds isn’t simply being given a blank check, she noted. It’s sometimes onerous, she acknowledged, but the county has a robust structure in place to manage dozens of federal grants.

Andy LaBarre (D-District 7) asked for Callan’s opinion on the proposed 30% reduction in LIHEAP funding that’s part of President Barack Obama’s budget. Callan replied that this is part of the analysis that her staff is doing related to the impact of federal sequestration. “A cut to this program is actually not new,” she said. It’s been a recurring recommendation in the federal budget for at least three years – either LIHEAP specifically, or weatherization in general.

Callan noted that the president’s budget also proposes a 50% cut in the Community Development Block Grant, which would have a tremendous impact on local programs. County staff is following this closely, she said. If the cut materializes, it would absolutely mean a decrease in the number of weatherization projects done each year. “And at some point, if you receive such a low allocation, you can’t have a program,” she said.

Ronnie Peterson (D-District 5) wondered how the county establishes criteria for delivering services. He said he’s very concerned about the elderly getting the services they need. In the past, he said, the program has served a lot of rental properties, while there are elderly homeowners who haven’t received the weatherization services. He wanted to see if senior citizens could get some kind of preference.

Brett Lenart, OCED’s housing and infrastructure manager, replied that the elderly are given a priority. The scoring system goes beyond a first-come-first-served approach, he said, and includes criteria like whether there are senior citizens or young children in the home, among other things. In response to additional queries from Peterson, Lenart noted that more information is available on the county’s weatherization website.

Conan Smith (D-District 9) reported that the Better Buildings for Michigan program has an version that’s available for non-low income families. A lot of people don’t qualify for weatherization program based on their income level, he noted, but could still use some support. He said he could help OCED connect with that program. [The Better Buildings for Michigan program is run by the Michigan Suburbs Alliance, where Smith serves as executive director.]

Outcome: Commissioners unanimously gave initial approval to accept the weatherization grant. A final vote is expected on May 1.

Employees, Residents Honored

At its April 17 meeting, the board presented resolutions of appreciation honoring Rabbi Robert Dobrusin and several residents from the city of Saline, as well as to Leila Bauer, the county’s chief deputy treasurer who is retiring after 41 years of service.

In addition, the board declared the week of April 14-20 2013 as National Public Safety Telecommunicator Week in Washtenaw County. Several members of the county’s dispatch operations were on hand and received recognition from the board. [.pdf of telecommunicator resolution] Marc Breckenridge, Washtenaw County director of emergency services, said dispatch operators have gone through a lot over the last couple of years, citing new technology and changes related to combining county dispatch operations with the city of Ann Arbor. “They’ve really come through for us, and we’re really proud of them,” he said.

Marc Breckenridge, Washtenaw County director of emergency services, was among those on hand to accept a resolution regarding national telecommunicator week.

Dobrusin was recognized for 25 years of “providing spiritual and pastoral support” for the Beth Israel congregation in Ann Arbor, the city’s “oldest Jewish Institution.” [.pdf of Dobrusin resolution] Also cited was his work as a founding member of the Interfaith Round Table of Washtenaw County and with the Interfaith Council for Peace and Justice. The resolution noted his human rights efforts, including his current position as national co-chair with T’Ruah: The Rabbinic Call for Human Rights.

Former county commissioner Barbara Bergman attended the meeting to accept the resolution on behalf of Dobrusin. She highlighted his work in supporting the rights of indentured workers, then indicated that this would be a surprise for him. “If you know Rabbi Dobrusin, don’t talk!”

The board also passed a resolution of appreciation for Leila Bauer, the county’s chief deputy treasurer. Her work over the years has included serving on the Washtenaw County Health Organization, Washtenaw County Community Mental Health board, Washtenaw County Human Services board, and the Washtenaw County Health Authority. She received a standing ovation from the board. [.pdf of Bauer resolution]

Several Saline residents were also recognized by the county board. Helen Martin was honored for her work with the Saline Downtown Merchants Association and Saline Main Street. Jeff Dowling was recognized for receiving the “Saline Salutes” 2013 Citizen of the Year Award, as well as for work with the American Cancer Society and various Saline community events. Joy Ely, owner of The Pineapple House, was recognized for receiving the “Saline Salutes” 2013 Lifetime Achievement Award, and for her support of downtown Saline. Also honored by the board was Sarah Chu, who received the city of Saline’s 2013 Youth of the Year Award. [.pdf of Martin resolution] [.pdf of Dowling resolution] [.pdf of Ely resolution] [.pdf of Chu resolution]

Outcome: Commissioners unanimously passed all resolutions of appreciation.

Washtenaw Ride Dissolved

On the agenda for a final vote was a resolution to officially dissolve a countywide public transit authority known as the Washtenaw Ride. Initial approval had been given on April 3, 2013.

The Act 196 authority, created in mid-2012 and spearheaded by the Ann Arbor Transportation Authority, was for all practical purposes ended late last year when the Ann Arbor city council voted to opt out of the transit authority at its Nov. 8, 2012 meeting. Of the 28 municipalities in Washtenaw County, the city of Ypsilanti is the only one that hasn’t opted out.

Washtenaw County commissioner Conan Smith (District 9).

The county board’s April 17 resolution rescinds a board resolution that created the transit authority, and requests that the state legislature also take action to dissolve the Washtenaw Ride, in accordance with Attorney General Opinion #7003. That AG opinion stated that “the dissolution of a transportation authority organized under the Public Transportation Authority Act requires an act of the Legislature and may not be accomplished by the unilateral action of the city in which it was established.” [.pdf of AG opinion 7003]

The county’s role in creating the transit entity had been laid out in a four-party agreement with Ann Arbor, Ypsilanti and the AATA, which commissioners approved on Aug. 1, 2012 in a 6-4 vote. Subsequent revisions involving the other entities resulted in the need for a re-vote by the county board, which occurred on Sept. 5, 2012.

There are two other transit efforts now under way. Washtenaw County is part of a southeast Michigan regional transit authority (RTA) created by the state legislature late last year. The RTA was formed to coordinate regional transit in the city of Detroit and counties of Wayne, Macomb, Oakland and Washtenaw. Conan Smith has been a strong advocate for the RTA, and made Washtenaw County’s two appointments to the RTA board before his term as county board chair ended on Dec. 31, 2012.

Separate from the RTA effort, the AATA has been meeting with representatives of the county’s “urban core” communities to discuss possible expanded public transit within a limited area around Ann Arbor. It would be a smaller effort than the previous attempt at countywide service. The AATA hosted a meeting on March 28 to go over details about where improvements or expansion might occur, and how much it might cost. [See Chronicle coverage: "Costs, Services Floated for Urban Core Transit."]

There was no discussion on this item.

Outcome: On a 7-1 vote, commissioners passed a resolution dissolving The Washtenaw Ride. Voting against the resolution was Conan Smith (D-District 9), but he did not comment on his vote during the meeting. Rolland Sizemore Jr. (D-District 5) was absent.

CSTS Job Creation

On the April 17 agenda for a final vote was a resolution authorizing the creation of 39 new jobs and the reclassification of 76 others for Washtenaw County’s community support and treatment service (CSTS) department. Initial approval had been given on April 3, 2013.

CSTS is a county department employing about 300 people, but receives most of its funding from the Washtenaw Community Health Organization, a partnership between the county and the University of Michigan Health System. The WCHO is an entity that receives state and federal funding to provide services for people with serious mental illness, developmental disabilities and substance abuse disorders. WCHO contracts for services through CSTS. Although staffing has remained fairly constant in the last five years, demand for services has increased by about 40%. These jobs are being created to provide the capacity to meet that demand.

The new jobs include client service managers, support coordinators, mental health professionals, mental health nurses, management analysts, administrators and a staff psychiatrist. All of the reclassified positions are client service managers. Of the 39 new positions, 30 of them are union jobs, represented by AFSCME.

According to a staff memo, the changes will add $14,255,535 to the CSTS 2012-2013 budget, bringing the budget total to $41,822,489. Of that, WCHO is providing $38,692,815, including revenues from grant pass-throughs. Other revenues include $165,190 from the Haarer bequest and $246,846 from a contract with the Washtenaw County sheriff’s office.

CSTS Job Creation: Board Discussion

Ronnie Peterson (D-District 5) clarified with CSTS staff that they would be returning later in the year to secure approval for their annual budget. The CSTS budget runs from Oct. 1 through Sept. 30. At that time, there would be a broader picture of the services that CSTS offers, he noted. The organization is shifting to more of a fee-based approach, Peterson said, and someone will need to assume responsibility for paying for these services. It would be helpful to show exactly what services are delivered by CSTS. It’s a very complex department, he said, and most people don’t know what services it provides. “You are the resources of last resort for many of our citizens,” he said. It’s important that the county provide the support that CSTS needs to deliver its services, he noted, especially as funding changes at the state and federal levels.

Yousef Rabhi (D-District 8) thanked the CSTS staff for their work, and said he echoed Peterson’s sentiments.

Outcome: On a final vote, commissioners unanimously approved the creation and reclassification of CSTS jobs.

Public Hearing for Urban County Plan

A public hearing to get input on the Washtenaw Urban County‘s five-year strategic plan through 2018 and its 2013-14 annual plan was held during the board’s April 17 meeting. [.pdf of draft strategic and annual plans]

The Urban County is a consortium of Washtenaw County and 18 local municipalities that receive federal funding for low-income neighborhoods. Members include the cities of Ann Arbor, Ypsilanti and Saline, and 15 townships. “Urban County” is a designation of the U.S. Dept. of Housing and Urban Development (HUD), identifying a county with more than 200,000 people. With that designation, individual governments within the Urban County can become members, entitling them to an allotment of funding through a variety of HUD programs. The Urban County is supported by the staff of Washtenaw County’s office of community & economic development (OCED).

Two HUD programs – the Community Development Block Grant and HOME Investment Partnership – are the primary funding sources for Urban County projects.

The plans indicate that the Urban County area is expected to receive about $2.7 million annually in federal funding, which will be used for these broad goals:

1. Increasing quality, affordable homeownership opportunities

2. Increasing quality, affordable rental housing

3. Improving public facilities and infrastructure

4. Supporting homeless prevention and rapid re‐housing services

5. Promoting access to public services and resources

6. Enhancing economic development activities

Only one person spoke during the April 17 public hearing. Thomas Partridge criticized the lack of affordable housing in the county, and said there was insufficient funding for adding adequate housing. He urged commissioners to hold their retreat and do their strategic planning in the boardroom, where the proceedings can be televised and accessible to residents.

Communications & Commentary

During the evening there were multiple opportunities for communications from the administration and commissioners, as well as public commentary. In addition to issues reported earlier in this article, here are some other highlights.

Communications & Commentary: Thomas Partridge

Thomas Partridge spoke during the evening’s two opportunities for public commentary – each time speaking for the full three minutes that speakers are given. He described himself as an advocate for the most vulnerable residents, and called for ending housing discrimination in every city and township in Washtenaw County. He advocated for zoning and planning policies that ensure non-discrimination in housing. Partridge also demanded the recall of all elected officials who ran for office on the platform of advancing Michigan, but who subsequently neglected their promises and have taken the opposite attitude.

He also noted the much lower turnout during public commentary at the county board meeting compared to an Ann Arbor city council meeting earlier in the week. [The council's April 15, 2013 meeting had included two public hearings on controversial topics: 45 speakers participated in the public hearing on proposed changes to the Ann Arbor Downtown Development Authority ordinance, and 51 people spoke on the 413 E. Huron site plan.]

Responding to Partridge’s comments about the need for more public participation, county board chair Yousef Rabhi said the board wanted to ensure that there aren’t any barriers to citizens participating in its meetings. Any time he speaks with constituents, Rabhi said, he stresses the importance of the county’s work and encourages input. But he conceded that the county board doesn’t draw the same kind of crowd that the Ann Arbor city council does. On the other hand, he noted, the county board’s meetings don’t last until 3 a.m. [The council's April 15 meeting had adjourned after 3 a.m., before the council finished its business. Most council agenda items were postponed until May 6.]

Present: Alicia Ping, Felicia Brabec, Andy LaBarre, Kent Martinez-Kratz, Ronnie Peterson, Yousef Rabhi, Rolland Sizemore Jr., Conan Smith, Dan Smith.

Next regular board meeting: Wednesday, May 1, 2013 at 6:30 p.m. at the county administration building, 220 N. Main St. in Ann Arbor. The ways & means committee meets first, followed immediately by the regular board meeting. [Check Chronicle event listings to confirm date.] (Though the agenda states that the regular board meeting begins at 6:45 p.m., it usually starts much later – times vary depending on what’s on the agenda.) Public commentary is held at the beginning of each meeting, and no advance sign-up is required.

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Equalized (assessed) value is used to calculate taxable value, which determines tax revenues for the county as well as its various municipalities and other entities that rely on taxpayer dollars, including schools, libraries and the Ann Arbor Transportation Authority, among others.

For 2013, taxable value in the county increased 1.68% to $14.2 billion. That’s an improvement over declines seen in recent years, when equalized value fell 0.76% in 2012, 2.85% in 2011 and 5.33% in 2010. It’s also an improvement over projections made when the county administration prepared its 2013 budget. The general fund budget was approved with a projection of $60.9 million in tax revenues. But actual revenues, based on 2013 taxable value, are now estimated at $63.236 million – for an excess in 2013 general fund revenues of $2.327 million. Patel stressed that at this point, the taxable value is a recommendation and must be approved at the state level.

Patel also presented tentative taxable values for specific jurisdictions. The city of Ann Arbor shows a 3.34% increase in taxable value, while the city of Saline’s taxable value is a 3.97% increase over 2012. All but six municipalities showed an increase in taxable value. Those municipalities with decreases include the city of Ypsilanti (-0.38%) and Ypsilanti Township (-2.53%).

Properties in the Ann Arbor Public Schools district – which includes the city of Ann Arbor and parts of surrounding townships – will see a 2.32% increase in taxable value. Properties taxed by the Ann Arbor District Library, covering a geographic area which in large part mirrors the AAPS district, increased in value by 2.11%.

Taxable value is determined by a state-mandated formula, and is the lower of two figures: (1) a parcel’s equalized (assessed) value, or (2) a capped value calculated by taking last year’s taxable value minus any losses (such as a building being torn down), multiplied by 5% or the rate of inflation (whichever is lower – this year inflation is 2.4%), plus the value of any additions or new construction.

In 2013, several categories of property saw increases in equalized value for the first time in years, according to the report. Commercial property showed a 2.2% gain in equalized value, compared to a 3.84% decline last year. It was the first increase in commercial property values since 2009. Residential property value – the largest classification of property in the county – showed an increase of 2.37%, gaining in value for the first time since 2007. Last year, the equalized value for residential property had dropped 0.57%, and had registered a 2.74% drop in 2011.

Last year, agricultural property had been the only category that showed an increase. Growth continues in 2013, but at a slower pace. Agricultural property registered an 0.67% increase in equalized value this year, compared to an increase of 3.54% in 2012.

Industrial and developmental property values continue to struggle. Those were the only categories to register a decline in 2013. Industrial property showed a drop in equalized value of 4.78%. That compares to a 3.99% drop in value last year. Over the past few years that category has lost significant value, falling from an equalized value of nearly $1 billion in 2007 to this year’s value of $421.72 million. Developmental property – a relatively small category that covers properties not yet developed – had a 7.12% drop in equalized value.

Patel noted that countywide, about $418 million is captured by local downtown development authorities (DDAs), local district finance authorities (LDFAs), brownfield tax increment financing, and other entities that are allowed to capture funds from taxing jurisdictions. For Washtenaw County’s alone, $2.405 million goes to these other tax-capturing entities that would otherwise be revenues for the county’s general fund.

Though the news was positive, Patel cautioned that the loss of the state personal property tax – which Michigan legislators repealed last year – could ultimately result in a loss of more than $5 million in annual revenues for the county government alone, and more than $40 million for all taxing jurisdictions in Washtenaw County. The tax will be phased out starting in 2014 through 2022. As part of that change, a statewide voter referendum is slated for 2014 to ask voters to authorize replacement funds from other state revenue sources.

This brief was filed from the boardroom of the county administration building at 220 N. Main St. in Ann Arbor. A more detailed report will follow: [link]

In April, the county’s equalization department produces an annual report describing Washtenaw County’s total equalized (assessed) value of property. The report is part of a state-mandated equalization process, and gives an indication of how much revenue the county will receive from property taxes in the coming year. [See Chronicle coverage: "Report: Better-Than-Expected '12 Tax Revenue"]

Later in the year – in October or November – the equalization and property description department presents an apportionment report, which gives details of the taxable valuations for property in the county, by municipality. The report also includes the amount of millages levied and the dollar amounts collected in taxes. [.pdf file of 2012 preliminary apportionment report] Like the equalization report, the board is required by state law to vote on adopting the apportionment report.

This year, all the taxing entities in Washtenaw County will be levying in total about $621.687 million in property taxes – a drop from $622 million in 2011 and $639 million in 2010. The county alone will levy about $80.578 million this year, compared to roughly $81 million in 2011 and $83 million in 2010.

This brief was filed from the boardroom of the county administration building at 220 N. Main St. in Ann Arbor, where the board of commissioners holds its meetings. A more detailed report will follow: [link]

Raman Patel, left, Washtenaw County's equalization director, shares a laugh with county board chair Conan Smith before the April 18, 2012 meeting. (Photos by the writer.)

The report includes a calculation of taxable value for all jurisdictions in the county, which determines tax revenues for those entities that rely on taxpayer funding, including cities and townships, public schools, libraries and the Ann Arbor Transportation Authority, among others.

It was the 41st report that Raman Patel, the county’s equalization director, has completed – and he delivered some positive news. The county’s general fund budget was approved with a projection of $59.734 million in tax revenues. But actual revenues, based on 2012 taxable value, are now estimated at $62.395 million – for an excess in 2012 general fund revenues of $2.66 million.

Despite reporting better-than-expected taxable value, Patel cautioned that if the potential repeal of the state’s personal property tax is passed – being considered by legislators in a set of bills introduced last week – it could result in a loss of more than $5 million in annual revenues for the county government alone, and more than $40 million for all taxing jurisdictions in Washtenaw County.

Although most of the meeting focused on Patel’s presentation, other business covered a variety of issues. Commissioners discussed the next steps in an effort to deal with mandated animal control services in the county. A work group has met that includes representatives from the county, the Human Society of Huron Valley, and other municipalities that have animal control ordinances, such as the cities of Ann Arbor and Ypsilanti, and Ypsilanti Township. Some commissioners highlighted the need to develop a policy to guide the work group, which will give recommendations about the cost of animal control services.

Related to the March 15 tornado that touched down in the Dexter area, board chair Conan Smith reported that he had declared a state of emergency earlier this month and sent a letter to Gov. Rick Snyder requesting reimbursement to local municipalities for costs incurred as a result of the devastation. Local governments itemized about $1 million in costs, but the total – primarily in damages to residences – is estimated at over $9 million. [.pdf of Smith's letter to Snyder] [.pdf summarizing tornado-related expenses]

During the meeting, the board also passed a proclamation recognizing the National Training Institute, put on by the National Joint Apprenticeship & Training Committee – a partnership of the International Brotherhood of Electrical Workers (IBEW) and the National Electrical Contractors Association (NECA). The training institute is held in Ann Arbor at the University of Michigan and this year runs from July 25-Aug. 3, bringing more than 3,000 people to town. Commissioner Rob Turner, an electrical contractor, is a member of both the IBEW and NECA.

Among the other action items at the April 18 meeting, commissioners (1) set a public hearing for May 2 to get public input on an annual plan for the Washtenaw Urban County, which gets federal funding for projects in low-income neighborhoods; (2) authorized the issuance of up to $6 million in notes at the request of the Washtenaw County road commission, for work in Ypsilanti Township; and (3) approved the hiring of Nimish Ganatra as assistant prosecuting attorney over the dissent of Wes Prater, who objected to paying a salary above the midpoint range.

Equalization Report and Local Tax Revenue

The state-mandated equalization process runs throughout the year, as both the county and local assessors within each municipality examine the value of land and other property, such as buildings. Local assessors turn their findings over to the county, which then conducts independent assessments based on sales studies and physical appraisals. Next, the county’s equalization staff looks at how their findings compare with the local assessors’ findings. (The county has authority to request that local assessment rates be altered, if it considers them to be too high or too low.)

After this “equalization” occurs, the local municipalities send out notices to each property owner in their jurisdiction, stating each property’s assessed value as well as its taxable value. If property owners disagree, they can appeal that assessment. After appeals are ruled on, the county uses that data for its equalization report. Local decisions can be appealed to the state, so at any given time there are a certain number of parcels with assessments that might change, depending on the outcome of the state-level appeal.

Taxable value is a state-mandated formula, and is the lower of two figures: (1) a parcel’s equalized (assessed) value, or (2) a capped value calculated by taking last year’s taxable value minus any losses (such as a building being torn down), multiplied by 5% or the rate of inflation (whichever is lower – this year inflation is 2.7%), plus the value of any additions or new construction.

If the property changes hands, taxable value is reset at its equalized value.

Taxable value is used when calculating taxes for the county, as well as its various municipalities and other entities that rely on taxpayer dollars, including school districts, libraries and the Ann Arbor Transportation Authority, among others. [.pdf of chart showing 2012 equalized and taxable values for all jurisdictions]

Washtenaw County’s equalization report – along with similar reports from all of Michigan’s 83 counties – will be forwarded to the state. If the state agrees with the county’s report, then the county equalized values become the state equalized values (SEV) that appear on tax bills.

Equalization Report: 2012 Highlights

Raman Patel, director of the county’s equalization department, began his presentation by telling commissioners that this was the county’s 54th equalization report, and the 41st one that he has completed. [.pdf of Washtenaw County equalized values from 1959-2012] He introduced the department’s staff and thanked them for their work. The report requires coordination with all 73 local units of government, assessors and boards of review – he thanked everyone for their support. He also thanked commissioners Barbara Bergman and Leah Gunn, wishing them well as they end their tenure on the board. [Both have decided not to seek reelection this year.]

Patel reported that there are pocket of improvements, as well as some areas of concern. Unique to this year’s report, he presented an update on pending legislation that would phase out the state’s personal property tax, and provided a chart showing the financial impact on local taxing jurisdictions.

Also unique to this year’s report, Patel provided a detailed calendar of the equalization process, including deadlines for steps throughout the year. [.pdf of 2012 equalization calendar] He noted that unlike most other counties, his department prepares data regarding the county’s taxable value about two months ahead of the required deadline for doing that.

Here is a summary of highlights from the 2012 report:

• For 2012, taxable value in the county has fallen 0.77% to $13.7 billion. That’s an improvement over declines in recent years, when taxable value fell 2.85% in 2011 and 5.33% in 2010. It’s also a smaller decrease than was projected when preparing the 2012 budget. The general fund budget was approved with a projection of $59.734 million in tax revenues. But actual revenues, based on 2012 taxable value, are now estimated at $62.395 million – for an excess in 2012 general fund revenues of $2.66 million.
• Although the majority of local taxing jurisdictions still saw declines in taxable value compared to 2011, more showed gains than in recent years. The county’s largest local jurisdiction – the city of Ann Arbor – registered a 1.04% increase in taxable value, to $4.683 billion.
• This year, McKinley – an Ann Arbor-based real estate and property management firm – was the largest taxpayer in the county, with properties totaling $132.177 million in taxable value. Other taxpayers on the top 10 list are Detroit Edison ($133.919 million), Toyota ($115.896 million), DTE/MichCon ($104.726 million), Ford/ACH ($74.177 million), Briarwood Mall ($63.159 million), Domino’s Farms ($62.823 million), International Transmission ($51.296 million), Hyundai ($37.517 million) and THC Ann Arbor ($36.360 million).
• The Board of Review received 2,968 appeals of assessments, compared to 2,656 in 2011. This year, 1,589 appeals were granted – compared to just 738  last year – for a decrease of about $12.2 million in taxable value. Poverty exemptions increased dramatically, from 49 requested last year to 110 requested in 2012. This year, 74 poverty exemptions were granted, compared to 31 granted in 2011.
• In 2012, some types of property saw greater declines than others. Commercial property showed a 3.84% drop in equalized value, while equalized value for industrial property dropped 3.99%. Residential property value – the largest classification of property in the county – showed some signs of recovery, dropping only 0.57% compared to a 2.74% drop in 2011. The only category of property that showed an increase was agricultural, which increased in equalized value by 3.54%.
• The value of taxable new construction over the past six years has dropped sharply, from $578.89 million in 2007 to $246.313 million in 2012. However, this year showed the first increase in several years – up from $239.512 million in 2011.
• Washtenaw County’s less than 1% drop in taxable value was by far the smallest decrease compared to other counties in southeast Michigan. Both Genesee and Macomb counties saw the greatest declines in taxable values, falling by 6.83% and 6.01% respectively.

Patel noted that the gap between equalized (assessed) and taxable values is narrowing. This is important because when equalized value and taxable value are the same for a property – and if that property’s assessed value continues to fall – then its taxable value falls in tandem with that assessed value. And that means lower revenues for local municipalities. This year, 66.97% of property in the county – 92,547 parcels – had equal taxable and assessed values, compared to 65% in 2011.

There are a total of 138,203 parcels of land in Washtenaw County. Of those, 48.07% increased in taxable value, while 43.51% decreased in taxable value. The rest were unchanged.

Patel also highlighted the fact that many properties in the county are exempt from taxation, for a variety of reasons – as religious institutions, public entities like schools and universities, or businesses that are given tax abatements, for example. Since 2002, a total of 513 parcels have been granted this status with a 2012 taxable value of $230.293 million. It’s worth remembering the impact of that, he said. He also noted that this year, $2.135 million that would have otherwise come to the county government in tax revenues is being “captured” by other entities, such as downtown development authorities, tax increment finance (TIF) authorities, and brownfield authorities.

Patel’s presentation included a discussion of state legislation introduced earlier in the week – a package of eight bills that would phase out the personal property tax (commercial, industrial and utility) over the next 10 years. [.pdf of personal property tax update, including a chart showing the financial impact for all local taxing entities]

If the proposed legislation were to be in effect now, the county government would lose $5.223 million in tax revenues, Patel reported. Countywide, all local taxing jurisdictions would lose $41.679 million. Patel said he hoped lawmakers don’t enact this legislation, but that it might be wise to start looking at how to cover that loss.

Equalization Report: Board Discussion

Commissioners praised Patel and his staff for their work – Yousef Rabhi noted that Patel had been doing this work “since well before I was born.” Barbara Bergman recalled when she was a new commissioner 20 years ago, she met with Patel and he explained the equalization process to her and made her a cup of tea. It took more than a cup of tea for her to understand, she joked, and she thanked him for his kindness.

For this meeting report, the board’s comments and questions are organized thematically.

Equalization Report: Board Discussion – Personal Property Tax

Yousef Rabhi thanked Patel for presenting more detailed information about the impact of eliminating the personal property tax. He said he was glad that the board had passed a resolution opposing it, unless the state found replacement revenues. [The resolution was passed at the board's April 4, 2012 meeting.] Patel’s report should be a warning to Lansing not to follow through with this proposal, Rabhi said, calling it ridiculous and “absolutely devastating” to local communities.

From left: Washtenaw County equalization director Raman Patel with county commissioners Felicia Brabec and Leah Gunn. Patel has worked on 41 annual equalization reports. This will be the last one approved by Gunn, who is not seeking reelection, and the first one by Brabec, who was appointed to the board last year to fill a vacancy in District 7.

Rabhi pointed to a recent poll showing that 70% of voters oppose the PPT repeal. [He was referencing a poll conducted by the Lansing firm EPIC-MRA and commissioned by the advocacy group Replace Don't Erase Michigan's Personal Property Tax.] People recognize that the repeal would jeopardize local services and that it’s the wrong thing to do, he said. Rabhi noted that Saline mayor Gretchen Driskell recently testified against the repeal at a state legislative hearing. He encouraged everyone to call their state legislators to make sure that a repeal doesn’t pass. Local governments can’t keep giving up revenue sources and still provide the same level of services, Rabhi concluded.

Barbara Bergman echoed Rabhi’s remarks. She described property taxes as regressive, and said many of her constituents face increasing property taxes and decreasing pensions. They can’t sell their homes because of a soft market, so they’re forced to make tough choices. Bergman said she supported a progressive income tax in Michigan and hoped that it would happen someday.

Conan Smith asked Patel to comment on the impact of real and personal property tax laws in the county’s urban areas, which will be among the hardest hit by changes to the PPT. Places like Ypsilanti and Ypsilanti Township are also seeing declines in real property values, Smith noted. He asked whether those two communities are seeing sharper decreases in the value of commercial and industrial property, compared to other parts of the county.

Yes, Patel said – the closing of Ford and General Motors plants has affected those communities. [Ypsilanti's taxable value dropped 5.97% to $290.729 million in 2012, while Ypsilanti Township's taxable value dropped 6.09% to $1.14 billion. The only larger percentage decrease was seen in the Washtenaw County portion of the city of Milan, with an 8.16% decline in taxable value to $87.387 million. Part of Milan is located in Monroe County.]

Equalization Report: Board Discussion – Appeals

Wes Prater asked about the appeals process. There were 2,968 appeals and of those, 1,589 were granted – for a decrease of about $12.2 million in taxable value. How many of the appeals that weren’t granted locally will be appealed at the state level? he wondered. Patel pointed out that a property owner has until June to make an appeal to the state, so it’s not possible to know yet how many will be appealed.

Prater asked if there were more appeals this year than last year. Patel replied that he didn’t have the information at hand. [Last year, the local Board of Review received 2,656 appeals of assessments, and granted 738 – for a decrease of about $13 million in taxable value. Forty-nine poverty exemptions were requested, and 31 were granted. This year, 110 poverty exemptions were applied for, and 74 were granted.]

Patel explained that most of the larger appeals relate to industrial or commercial properties. There are a couple of large appeals that are still pending, he said, but in general that process appears to be stabilizing.

Equalization Report: Board Discussion – Trends, Projections

Dan Smith asked about the difference between agricultural valuations, which have increased by 3.54% over last year, and valuations for commercial and industrial properties, which dropped by 3.84% and 3.99%, respectively. Was there any history behind that, and would that trend likely continue?

Chart showing 2012 Washtenaw County equalized values. (Links to larger image)

Lori Cash, a management analyst in the equalization department, replied that over the past few years, the amount of land classified as “developmental” has declined. [In 2012, that category decreased by 19.11% to a total value of$49.493 million – the lowest of all property categories in the county.] The total equalized value increased in the agricultural category because local assessors have reclassified some parcels from the developmental category to the agricultural category, Cash said. So there are more properties classified as agricultural now than in the previous year.

Patel described the developmental category as a “parking lot.”  Assessors will use it when they’re uncertain about how the land will be used. D. Smith clarified with Patel that farmland isn’t necessarily becoming more valuable – it’s just that more property is now being classified as agricultural.

Pointing to the 3.99% decline in industrial value, D. Smith asked whether that trend would likely continue. Patel noted that several large manufacturers have closed plants in Washtenaw County – Ypsilanti Township in particular took hits from the closing of Ford and General Motors plants there, he said. [Ypsilanti Township's taxable value dropped 6.09% from last year, to $1.14 billion.]

Even so, Patel said Washtenaw County is remarkably resilient and has absorbed a lot of losses over the past five or six years. In addition to plant closings by large automakers, he pointed to the departure of Pfizer – that alone was a loss of $400 million in taxable value for the county, Patel said. And even more taxable value was lost when Pfizer sold its large research campus to the University of Michigan, he said, because as a public university, UM is a tax-exempt institution. Despite all that, Patel said, the county is stabilizing.

D. Smith then referred to a chart showing the number of parcels in which assessed value is equal to taxable value, as well as the number of properties in which those values are within 5% of each other or greater than 5%. Smith asked whether Patel expected that there will be more parcels in the coming years with equal assessed and taxable value.

Patel replied that it will depend on whether the real estate market moves values up or down – it’s difficult to predict. He noted that working on a two-year budget cycle, as the county does, is difficult. Because of the state-mandated process, the equalization department can’t prepare its report until April. That means the county doesn’t have a solid estimate of tax revenues for the year until more than three months into that year. And for the current budget – approved by the board in late 2011 for the years 2012 and 2013 – tax revenue estimates were made for 2013 even though the market values on which those tax revenues won’t be known until late 2012.

Rob Turner explicitly asked whether Patel and his staff had worked up projections for equalized and taxable values. Patel expressed some frustration, saying that he wanted to be respectful but that he had already indicated that he couldn’t make projections. When the equalization department completes its work each year, then they announce the results, he said. There are laws, rules and regulations governing their work, Patel said, and no one has pulled a projection from his mouth in 41 years. At that, commissioners laughed and Turner apologized for putting Patel on the spot.

Prater said he’s known Patel for most of the 41 years that Patel has been working on equalization reports, ”and I have yet to hear his first projection – and I’ve asked many, many times. So that just ain’t gonna happen.”

Outcome: Later in the meeting, the board voted unanimously to accept the 2012 equalization report.

Animal Control Services

There was no action item related to animal control services at the April 18 meeting. But during the board’s liaison reports, Rob Turner told his fellow commissioners that he had attended the first meeting of the animal control services work group, which included representatives of the county, the Humane Society of Huron Valley, and other municipalities that have animal control ordinances.

By way of background, at its Feb. 15 meeting, commissioners approved a $415,000 contract with the Humane Society of Huron Valley to provide animal control services for the county just through Dec. 31, 2012. The county’s previous contract with HSHV, for $500,000 annually, expired on Dec. 31, 2011. In the interim, the two entities had been operating under a $29,000 month-by-month contract.

From left: County commissioners Rob Turner and Rolland Sizemore Jr.

County officials said the new contract would provide time for ongoing talks to develop a longer-term solution to animal control services in Washtenaw County, including services that are mandated by the state. During the rest of 2012, the county plans to work with HSHV and other stakeholders to determine the cost of an “animal service unit” – that is, the itemized per-animal cost of providing animal control services. The county eventually will issue a request for proposals (RFP) to solicit bids for the next contract.

The budget approved by the county board for 2012 cut funding for animal control services to $250,000. However, during last year’s budget deliberations commissioners also discussed the possibility of paying an additional $180,000 to HSHV – if the nonprofit took over work previously done by the county’s animal control officers. That brought the total amount budgeted for animal control to $430,000 in 2012. HSHV officials have said that even $500,000 wasn’t sufficient to cover costs for all the work they do.

The $415,000 contract approved in February did not include the $180,000 that the county has budgeted for its own animal control officers. Instead, the county allocated an additional $165,000 from its general fund balance, to be added to the previously budgeted $250,000 for animal control services in 2012.

At the Feb. 15 meeting, the board spent considerable time discussing the roles of two entities – a board policy task force, and a broader animal control services work group led by the sheriff’s office – as well as a timeline for completing the work of these two entities. The resolution ultimately passed by commissioners included these resolved clauses that laid out a timeline for the work:

BE IT FURTHER RESOLVED that the Washtenaw County Board of Commissioners authorizes the Office of the Sheriff to develop a methodology to determine the cost of an Animal Service Unit (ASU) on behalf of the County. The Sheriff may choose the members of his work group, with the understanding that the Board of Commissioners will appoint Commissioner Rob Turner to act as a liaison. The work group’s report is due no later than September 15, 2012.

BE IT FURTHER RESOLVED that the Washtenaw County Board of Commissioners hereby establishes a Task Force on Animal Control Policy. This group will exist solely for the purpose of developing an animal control policy for the county. This policy will be reflected in the RFP for a scope of services that the county will purchase. Meetings will be posted. Membership is open to any Commissioner who wishes to attend, and the preliminary report will be filed May 15, 2012. Once the data from the Sheriff’s work group is published, the RFP will go out forthwith, and the final report of the taskforce will be published by October 15, 2012.

The board’s policy task force has not yet met.

The animal control services work group includes these members: sheriff Jerry Clayton; SiRui Huang and Rick Kaledas of the sheriff’s office; Greg Dill, the county’s infrastructure management director; Catherine Jones of the county finance department; commissioner Rob Turner; county prosecuting attorney Brian Mackie; Ann Arbor city administrator Steve Powers; Ann Arbor interim police chief John Seto; Ypsilanti Township supervisor Brenda Stumbo; Mike Radzik, Ypsilanti Township’s police services administrator; Bill McFarlane, Superior Township supervisor; acting Ypsilanti city manager Frances McMullen; Humane Society of Huron Valley executive director Tanya Hilgendorf; and Jenny Paillon and Matt Schaecher of HSHV.

On April 18, Turner said the work group had discussed the issue of what comes first – policy or specific services? The group is looking to the county board for direction, he said. When the work group met, Turner said he reiterated the need to determine the actual cost of taking care of animals, including the number and kind of animals, as well as the cost per animal that HSHV incurs.

The work group plans to meet every other week, Turner said. The next meeting is set for May 1.

Animal Control Services: Board Discussion

Barbara Bergman stressed the need for commissioners to give input and direction to the work group. She noted that commissioners hold various opinions on the issue, but that they need to come to a consensus so that the work group isn’t operating without guidance.

Turner said he totally agreed, and cited the need for the board’s policy task force to start meeting. Leah Gunn noted that an email had circulated trying to find acceptable dates for a meeting, so that effort is already underway.

Wes Prater said he felt like the board had already reached consensus about the need to figure out the county’s mandated, statutory duties regarding animal control. There’s a shortage of revenues available, he said – that’s a factor too. Prater felt the board shouldn’t get too involved until commissioners get a recommendation from the animal control work group.

Ronnie Peterson said he had raised this concern previously. The board needs to set the direction and scope of work for the work group, he said – that should have already happened. What’s the board’s expectation of an outcome, and how far-reaching should the work group’s recommendations be?

Peterson concluded his remarks by urging the board to make a policy that encompasses all of its nonprofit support, not just the payments that the county makes to animal control services.

Road Commission Debt

At its April 18 meeting, commissioners were asked to authorize the issuance of up to $6 million in notes at the request of the Washtenaw County road commission.

From left: County board chair Conan Smith talks with county road commissioner Ken Schwartz, who formerly served on the board of commissioners. Road commissioners are appointed by the county board.

The funding would be used by the road commission to pay for road work in Ypsilanti Township, including road repaving and reconstruction, intersection improvements, traffic control devices, drainage upgrades and other related projects.

According to terms of a contract signed between Ypsilanti Township and the road commission, the township would reimburse the road commission for the work. The notes would be issued by the road commission and backed by future tax revenues it will receive from the state. The debt would not be backed by the county’s full faith and credit.

Ken Schwartz, one of three appointed road commissioners and a former member of the county board of commissioners, attended the April 18 meeting along with some road commission staff. They did not formally address the board during the meeting.

Outcome: Without comment, the board authorized the issuance of up to $6 million in notes by the county road commission.

Urban County Plan: Public Hearing Set

A resolution on the agenda set a May 2 public hearing to take commentary on the annual plan for the Washtenaw Urban County.

The annual plan describes how the Urban County expects to spend the federal funding it receives from the Community Development Block Grant (CDBG), HOME Investment Partnerships Program (HOME) and Emergency Shelter Grant (ESG) programs, operated by the U.S. Dept. of Housing and Urban Development (HUD). [.pdf of 2012-2013 draft annual plan] [.pdf of list of planned projects]

The Washtenaw Urban County is a consortium of local municipalities that receive federal funding for projects in low-income neighborhoods. Current members include the cities of Ann Arbor and Ypsilanti, and the townships of Ypsilanti, Pittsfield, Ann Arbor, Bridgewater, Salem, Superior, York, Scio, and Northfield. An additional seven municipalities will become part of the Urban County as of July 1, 2012: the city of Saline, the village of Manchester, and the townships of Dexter, Lima, Manchester, Saline, and Webster.

“Urban County” is a HUD designation, identifying a county with more than 200,000 people. With that designation, individual governments within the Urban County can become members, making them entitled to an allotment of funding through a variety of HUD programs.

The Washtenaw Urban County executive committee meets monthly and is chaired by county commissioner Yousef Rabhi. The program is administered by the staff of the joint county/city of Ann Arbor office of community and economic development.

Outcome: Without discussion, the board set a May 2 public hearing for the Washtenaw Urban County annual plan.

Assistant Prosecuting Attorney

Commissioners were asked to give final approval to hiring an assistant prosecuting attorney at a salary of $81,690. The vacancy opened in December, following an employee retirement. The hire requires board approval because the salary is above the $69,038 midpoint of an authorized range ($68,074 to $96,565).

The position will be filled by Nimish Ganatra, who most recently has served as assistant prosecutor for Jackson County, and previously was an assistant prosecutor with the Washtenaw County prosecutor’s office from 2001-2009. He is a graduate of Ann Arbor Pioneer High School, the University of Michigan, and Wayne State University Law School.

Because of furlough days negotiated as part of the recent collective bargaining agreements, his salary will be adjusted down by 3.846% to $78,548. Brian Mackie, the county’s prosecuting attorney, had previously told commissioners that because the office is currently under-filling a senior assistant prosecutor post, there is an overall savings of $12,983.

Initial approval had been given at the board’s April 4 meeting, passing on a 9-1 with dissent from Wes Prater, who objected to paying more than a midpoint salary. Rob Turner was absent.

Assistant Prosecuting Attorney: Board Discussion

Wes Prater asked county administrator Verna McDaniel about a new hiring process that he said the county had implemented in February. McDaniel was initially unclear about what Prater was referring to, but then sussed out that he was talking about a name change to an existing policy. She said the process didn’t change, but the administration started calling it the “hiring review process.”

Prater asked if the process had been used to evaluate hiring the new assistant prosecuting attorney. It had, McDaniel said. What about the other vacancy that had been filled in that office? he asked. That vacancy had been triggered in February by Gov. Rick Snyder’s appointment of Joe Burke as judge to the 15th District Court in Ann Arbor. Burke previously served as the county’s chief assistant prosecuting attorney.

On filling that vacancy, McDaniel said her staff had worked with the county prosecuting attorney, Brian Mackie, who made an internal promotion for that position. She noted that Mackie’s restructuring had resulted in an overall savings [of $12,983].

Prater asked to see the paperwork for the review of these positions. He noted that earlier in the year the board had approved a position in the water resources commissioner’s office that was also above the mid-point salary range. He hoped the same evaluation process had been used in that position too.

McDaniel affirmed that it had. In both cases, there had been restructuring that resulted in overall cost savings, she said. Prater replied that it would save even more to consolidate positions. The county’s long-term fiscal stability is what it’s all about, he said. He requested that the board review the overall hiring process at a future working session.

Outcome: On a 10-1 vote with dissent by Wes Prater, the board gave final approval to hiring the assistant prosecuting attorney at an above-midpoint salary.

Weatherization Grants

Two items related to federal funding for Washtenaw County’s weatherization program for low-income residents were on the agenda for final approval at the April 18 meeting. Initial approval had been given at the board’s April 4 meeting.

Commissioners were asked to authorize acceptance of $185,326 in federal funds for the weatherization program. The federal program was cut by 65% compared to 2011, but the state of Michigan is reallocating the previous year’s unspent funds as “carry-forwards” for 2012. In 2011, the county received $241,863 for this program.

The funding is expected to provide air leakage testing, health and safety evaluations, furnace assessments, refrigerator efficiency testing, post-inspection of the completed work, and consumer education services to 25 units. To qualify for the program, residents must have an income at or below 200% of federal poverty, which is about $44,700 for a family of four.

In a separate item, commissioners voted on authorizing acceptance of an additional $103,600 in funds redistributed to the county through the American Recovery & Reinvestment Act (ARRA). According to a staff memo, this grant brings the total of ARRA weatherization funds received by the county to $4,867,138.

At the April 4 meeting, Aaron Kraft, who manages the program, said the applications are handled on a first come, first served basis. There’s a waiting list, and the grants now being approved are already spoken for, he said. In response to another query, Kraft said that less than half of all contractors being used for the weatherization work are based in Washtenaw County.

In response to a follow-up question from a Chronicle reader, Kraft later gave a more detailed breakdown of how the $185,326 will be allocated: Support and administrative costs covering client intake/assessment of need, project management ($63,136); energy audit inspections and quality assurance inspections ($8,820); labor and material costs to complete the recommended weatherization improvements ($106,196); and weatherization specific training funding ($7,174).

Outcome: Both weatherization items were given unanimous final approval by the board, without discussion.

Communications and Public Commentary

There are various opportunities for communications from commissioners as well as general public commentary. These are some highlights.

Communications: Dexter Tornado Aftermath

During his liaison report, commissioner Rob Turner – the board’s point person for cleanup efforts following the March 15 tornado that touched down in the Dexter area – reported that work by the county had curtailed the previous week. He itemized some of the costs that had been incurred: Between $250,000-$300,000 for road commission work; $91,697 from the county for dumpster rental, debris removal, and tree clearing; $23,039 for a county parks and recreation crew, and port-a-johns; and $53,847 in overtime expenses for the sheriff’s office.

Turner – who represents District 1, which includes the area damaged by the tornado – praised all the staff and volunteers who had helped with the cleanup. Some people who thought they’d have to declare bankruptcy were able to stay afloat, because of help from the county, he said. Turner noted that the area at least is cleaned up and people are starting to get back to their normal lives.

Board chair Conan Smith reported that he had declared a state of emergency earlier this month and sent a letter to Gov. Rick Snyder requesting reimbursement to local municipalities for costs incurred as a result of the March 15 tornado. [.pdf of Smith's letter to Snyder] [.pdf summarizing tornado-related expenses]

Specifically, the letter states that local government units “have incurred approximately $1,075,882 in unbudgeted response and recovery expenses including debris removal and disposal, emergency protective measures/ non-federal road and bridge systems, public utilities, and parks and recreation.”

An attached document summarized expenses related to the tornado, including an estimated $7.54 million in damages to residential property and $750,000 in damages to businesses.

Communications: National Training Institute

At the start of the April 18 meeting, board chair Conan Smith and commissioner Rob Turner presented a proclamation recognizing the National Training Institute, put on by the National Joint Apprenticeship & Training Committee – a partnership of the International Brotherhood of Electrical Workers (IBEW) and the National Electrical Contractors Association (NECA). The training institute is held in Ann Arbor at the University of Michigian and this year runs from July 25-Aug. 3.

Turner, an electrical contractor and member of NECA and IBEW Local 252, recalled that the training institute was formerly held in Knoxville, but moved to Ann Arbor in 2009 after “a little bit of arm twisting and a lot of work” by the Ann Arbor Convention and Visitors Bureau. It helped that UM is 100% union, he said. When members came to Ann Arbor, “it was love at first sight,” Turner said. Between 3,000 and 5,000 people attend from across the country, he said, and it’s a great benefit to local hotels, shops, and restaurants.

Turner also complimented the hospitality of local merchants and residents, saying that midwestern hospitality is as good if not better than the famed southern hospitality.

Public Commentary

Only one person spoke during public commentary. Thomas Partridge spoke at both opportunities for public commentary during the evening. He urged commissioners and U.S. president Barack Obama to give priority to serving the needs of the most vulnerable residents locally, in Michigan and nationwide. Residents should have access to affordable housing, health care, transportation, and education, he said.

Partridge argued that tax reforms are needed. Current restrictions on forms of taxation in Michigan were the result of a constitutional convention led by Mitt Romney’s father in the 1960s, he said, and since then civil rights have been denied to public employees, union employees, and schoolchildren – especially children who are physically and mentally disabled. Commissioners need to work on tax reform, Partridge concluded, as well as the reelection of Obama, and the recall of Gov. Rick Snyder and GOP state legislators.

Present: Barbara Bergman, Felicia Brabec, Leah Gunn, Alicia Ping, Ronnie Peterson, Wes Prater, Yousef Rabhi, Rolland Sizemore Jr., Conan Smith, Dan Smith, Rob Turner.

Next regular board meeting: Wednesday, May 2, 2012 at 6:30 p.m. at the county administration building, 220 N. Main St. in Ann Arbor. The ways & means committee meets first, followed immediately by the regular board meeting. [confirm date] (Though the agenda states that the regular board meeting begins at 6:45 p.m., it usually starts much later – times vary depending on what’s on the agenda.) Public commentary is held at the beginning of each meeting, and no advance sign-up is required.

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For 2012, taxable value in the county has fallen 0.77% to $13.7 billion. That’s an improvement over declines in recent years, when taxable value fell 2.85% in 2011 and 5.33% in 2010. It’s also a smaller decrease than was projected when preparing the 2012 budget. The general fund budget was approved with a projection of $59.734 million in tax revenues. But actual revenues, based on 2012 taxable value, are now estimated at $62.395 million – for an excess in 2012 general fund revenues of $2.66 million.

Taxable value is determined by a state-mandated formula, and is the lower of two figures: (1) a parcel’s equalized (assessed) value, or (2) a capped value calculated by taking last year’s taxable value minus any losses (such as a building being torn down), multiplied by 5% or the rate of inflation (whichever is lower – this year inflation is 2.7%), plus the value of any additions or new construction.

In 2012, some types of property saw greater declines than others, according to the report. Commercial property showed a 3.84% drop in equalized value, while equalized value for industrial property dropped 3.99%. Residential property value – the largest classification of property in the county – showed some signs of recovery, dropping only 0.57% compared to a 2.74% drop in 2011. The only category of property that showed an increase was agricultural, which increased in value by 3.54%.

This brief was filed from the boardroom of the county administration building, 220 N. Main in Ann Arbor. A more detailed report will follow: [link]

Raman Patel, director of Washtenaw County's equalization department, presented his annual report at the April 20, 2011 board of commissioners meeting. (Photos by the writer.)

Raman Patel, director of the county’s equalization department, told commissioners there was a 2.85% drop in taxable value this year. That’s an improvement over last year’s decline, when taxable value of property in the county fell 5.33%. It’s also a smaller decrease than was projected when preparing the county’s 2011 budget, which was built on the assumption of an 8.5% drop.

The impact on local taxing entities varies. The city of Ann Arbor saw a 1.21% drop, for example, while taxable value in Ypsilanti Township fell 11.39%.

The report also highlighted a shift in the county’s largest taxpayers. Just a few years ago, the top three taxpayers were Pfizer, General Motors and Ford. Now, they are Detroit Edison, McKinley Associates and Toyota.

The meeting also included a presentation of the 2010 comprehensive annual financial report, or CAFR. Kelly Belknap, the county’s finance director, highlighted the fact that the county ended 2010 with a $5.5 million general fund surplus – slightly more than the $5.3 million calculated to carry over into the 2011 budget. Mark Kettner from the accounting firm Rehmann Robson, which conducts the county’s audit, was also on hand to give a brief report on the 2010 audit.

In other business, the board approved an amendment to the brownfield plan for BST Investments in Dexter, and set two public hearings for their May 18 meeting related to brownfield plans that are being proposed: (1) Packard Square, a complex off of Packard Street on the site of the former Georgetown Mall; and (2) the LaFontaine Chevrolet redevelopment at 7120 Dexter-Ann Arbor Road in Dexter.

The board also authorized the office of the water resources commissioner to take court action in setting winter lake levels at Portage and Baseline lakes. The office operates the dam at Portage Lake that controls those levels.

During their time for communications, commissioners raised several issues, including: (1) a call to support the special education millage renewal, which is on the May 3 ballot; (2) discussions about consolidating the office of community development, ETCS (the employment training and community services department) and the economic development & energy department; and (3) what to do about the growing deer population.

Wednesday’s meeting began with a tribute to the long-time director of the Washtenaw Community Concert Band, Jerry Robbins.

Recognition for Jerry Robbins

Since 1998, Jerry Robbins has been conductor of the Washtenaw Community Concert Band, formerly the Ypsilanti Community Band. He was honored at Wednesday’s meeting for his work – Robbins is stepping down from the position. He’s been with the group since 1993, starting out as a trombone player until the previous director retired.

Jerry Robbins, long-time director of the Ypsilanti Community Band – now called the Washtenaw Community Concert Band – was honored at the April 20, 2011 county board of commissioners meeting.

Commissioner Dan Smith read a resolution honoring Robbins, commending him for revitalizing the program, ensuring its financial stability, and forming several other groups within the band, including chamber ensembles, jazz ensembles, and a “Town Band” that’s been invited to perform at the annual Association of Concert Bands convention. Smith also noted that Robbins had served in another leadership role – as dean of Eastern Michigan University’s College of Education from 1991 to 2004.

Joe Burke, an Ann Arbor resident and the county’s chief assistant prosecuting attorney, spoke about his experiences with Robbins in the band. Burke joined the band in the same year as Robbins. But while Burke said he was happy just to play his trumpet, Robbins wanted more. Robbins’ vision is that “music needs to be accessible to everyone in this county,” Burke said. It’s accessible to the public – all concerts are free – and accessible to players, because there are no auditions. Yet the quality of music is kept high, and the group has a lot of fun, Burke said.

The Chronicle observed both those aspects at a rehearsal of the band in November 2008:

When conductor Jerry Robbins took the podium for the rehearsal of the full band, he led the group through their material for the Dec. 11 concert, but it was not without frequent interruption for fine tuning, or even more general tuning. Robbins had told the musicians at the beginning of the evening, “Watch for frequent stops!” After several passes through a particularly difficult section in the Saint-Saens piece, he offered some encouragement: “This is the hardest piece of music I’ve ever put in front of you!”

…

On one occasion, a gentle reminder from Robbins that “accidentals hold through the entire measure” yielded incremental improvement and the encouragement, “It’s getting better each time through. It’s better.” But Robbins also made it clear that it needs some work before Dec. 11: “It’s still not right, and it’s not good enough.”

Burke invited the public to give Robbins a sendoff at a free concert on Thursday, April 28 at 7:30 p.m. at the Washtenaw Community College’s Towsley auditorium. “Come join us,” Burke said. “He’s a great guy.”

Financial Report, Audit

The meeting included several reports related to the county’s finances. Carla Sledge, Wayne County’s chief financial officer and past president of the Government Finance Officers Association, presented the county with a certificate of achievement for excellence in financial reporting for its fiscal year ending December 2009. The award is based on the county’s timely completion of its state-mandated comprehensive annual financial report, or CAFR. This is the 20th year that Washtenaw County has received a certificate of achievement. “You’ve done it again,” Sledge said.

Board chair Conan Smith noted that “our superb staff did this, in spite of the board of commissioners.”

Comprehensive Annual Financial Report (CAFR), Audit

Kelly Belknap, the county’s finance director, gave a brief report on highlights from the 2010 CAFR. [.pdf file of 2010 CAFR and link to county website with CAFRs from previous years.]

The general fund finished the year with a surplus of $5.5 million, she noted. It was slightly more than the $5.3 million that had been budgeted to carry over into 2011. As of Dec. 31, 2010, the county’s unreserved fund balance stood at $15.3 million. That represents 16.2% of the county’s annual general fund expenditures.

Belknap also provided more detailed handouts listing the county’s fund balances at the end of 2010, as well as its long-term liabilities – from bonds and other debt, and retirement benefits. Debt for the county has grown from $81.469 million in 2006 to $116.490 million at the end of 2010. The bulk of that relates to general obligation bonds, which totaled $75.565 million at the end of 2010, as well as a dramatic increase in delinquent tax notes, which grew from $12 million in 2006 to $26 million in 2010. [Excel files of fund balances and long-term liabilities]

Chart showing the county's state revenue-sharing reserve fund, which will be depleted in 2013. (Links to larger image)

Belknap reminded the board that the county’s state revenue-sharing reserve fund would be depleted in 2013. This year, the county plans to use $6.675 million from that fund, leaving a balance of $10.824 million.

Turning to the county’s bond ratings, Belknap reported that the county has an AA+ rating from Standard & Poor’s and an Aa2 rating from Moody’s. County staff met with representatives from Standard & Poor’s earlier in the day, Belknap said, to discuss the county’s delinquent tax bonding. It was a positive meeting, she said, and they’ll be receiving an updated bond rating soon.

At the board’s Feb. 16, 2011 meeting, county treasurer Catherine McClary had given a report on plans to fund delinquent taxes, and commissioners approved a request to bond for that purpose. From Chronicle coverage of that meeting:

McClary reported that the amount of delinquent taxes turned over to her office for collection has more than doubled in the past seven years. For the last two years, the county was not able to self fund the delinquent taxes. Last year, there was about $29 million in delinquent taxes, and she expects a small increase this year. But the request is to borrow the same amount as last year – an amount not to exceed $50 million. She commented that the figure “takes my breath away.” One change is that interest rates on the bonds will be higher this year than last year, due to the tightening credit markets.

McClary explained that every year, the treasurer’s office sets up a separate delinquent tax revolving fund, where money is deposited as the delinquent taxes are collected. If the county is unable to collect the taxes by year’s end, they charge back that uncollected amount to the taxing jurisdiction, charging them the same interest that’s charged for the bonds – last year, interest was around 2%, McClary said.

McClary characterized delinquent taxes as a leading economic indicator. For residential properties, it’s starting to level off, she said, but there are increases in commercial properties, and especially in undeveloped vacant land.

…

There is interest charged on the delinquent taxes, she said – 1% per month for the first year, and 1.5% per month for the second year, plus a 4% administrative fee. Those funds are also deposited into the delinquent tax revolving fund. When the bonds are paid off, any remaining money in the revolving fund is transferred to the county’s capital projects fund, to be used as the board and administration sees fit, McClary said. Last year, $5.5 million was transferred – double the amount that had been budgeted.

At Wednesday’s meeting, Belknap commented on the reputation that Washtenaw County has developed in the financial community regarding its early completion of the CAFR. Two decades ago, it was typically finished in December – since 1997, the report has been done by April.

Belknap then turned the podium over to Mark Kettner from the accounting firm Rehmann Robson, which conducts the county’s audit. Kettner said he expected the 2010 CAFR would also receive an award.

As he has in years’ past, Kettner noted that the audit gives an unqualified – or “clean” – opinion about the county’s financial statements. It’s an opinion on those statements, he said, not an opinion about the county’s financial controls or conditions. He noted that the county plans to hire someone to do an internal audit, which will analyze those controls. [.pdf of Rehmann Robson audit management letter]

He suggested that commissioners look at the 10-year trending data that’s provided in the audit. In challenging times like these, he said, it’s especially important to be aware of financial trends.

Kettner said there were a few minor items that they reported to administration, who will be following up on them.

Financial Report, Audit: Commissioner Comments

Kristin Judge noted that there was some evidence of internal financial control issues cited in the audit, indicating the need for the internal audit the county will be conducting. She also said it would be helpful to have the issue of retirement benefit liabilities discussed in a future working session. Judge thanked Kettner for providing trend data. [.pdf of trend data from 2010 CAFR]

A sampling of that trend data includes:

• Total full-time employees in county government: 1,486 in 2001 compared to 1,381 in 2010 – a decline of 125 positions, or -8.4%
• General fund undesignated fund balance: $5.759 million in 2001 compared to $15.3 million in 2010 – a 165% increase.
• General fund revenues: $74.195 million in 2001 compared to $91.632 million in 2010 – an increase of 23.5%. General fund revenues reached a peak in 2007, at $99.476 million.
• Total outstanding debt for governmental activities (includes general obligation bonds, capital leases and loans): $38.45 million in 2001 compared to $76.65 million in 2010 – a 99% increase.

Wes Prater asked what formula is used to calculate the county’s liabilities from pending lawsuits. Kettner said there isn’t really a formula. The county is self-insured, he noted, and hires a third-party risk management expert to look at that issue. That person would analyze the liability by looking at claims against the county, compared to its history of litigation. For the audit, Kettner said they get a letter from the county’s corporation counsel, Curtis Hedger, which summarizes claims that are pending or that have been made, and whether those are covered. The auditors review that information and discuss with county management whether further disclosures are necessary, he said.

Prater then clarified that some of the fund balances had been consolidated in the report that commissioners were given. He said it would be helpful to have a footnote about that, so that it didn’t seem as though those funds simply disappeared.

Rob Turner asked whether Kettner had a recommended percentage for the county’s fund balance. Kettner said that the auditing firm didn’t make a recommendation, but that his personal guideline would be at least 10% of expenditures. If you go below that, it might be a reason for concern, he said. [According to the CAFR, the county's policy is not to fall below 8% of expenditures.]

Judge noted that the $15.3 million fund balance at the end of 2010 included the $5.5 million surplus that was already in the 2011 budget. So the actual fund balance is around $10 million, she said – or closer to 10% of expenditures. She said she just wanted to make people aware of that.

Judge then asked who is responsible for oversight when the county gives its full faith and credit to allow other local municipalities to issue bonds. How does that impact the county’s credit rating?

County administrator Verna McDaniel explained that after board approval, the administration monitors those bonds with its in-house counsel. Other counties have had problems with municipalities being unable to make bond payments, she said, but so far Washtenaw County has been fortunate. There is one situation that’s a concern, McDaniel noted, but they’re monitoring it closely.

[By way of background, Sylvan Township has been struggling with $12.5 million in bonds issued to build a water and wastewater treatment plant intended to serve future development. The plan was to use revenue related to that development – from connection fees to the system – to cover the bond payments. However, the economy soured and development hasn’t materialized. Last year, the county board approved a bond refunding in order to restructure the debt and lower the township’s bond payments.]

Calculating the County’s Taxable Value: Equalization Report

Commissioner Rolland Sizemore Jr. introduced Raman Patel, director of the county’s equalization department, by teasing him: “You’ve got three minutes!” The line, an allusion to the time allotted for public commentary, got a laugh from commissioners and staff in attendance – Patel’s detailed annual reports take considerably longer, and Wednesday’s was no exception.

Equalization: How the Equalization Process Works

The state-mandated equalization process runs throughout the year, as both the county and local assessors within each municipality examine the value of land and other property, such as buildings. Local assessors turn their findings over to the county, which then conducts independent assessments based on sales studies and physical appraisals. Next, the county’s equalization staff looks at how their findings compare with the local assessors’ findings. (The county has authority to request that local assessment rates be altered, if it considers them to be too high or too low.)

After this “equalization” occurs, the local municipalities send out notices to each property owner in their jurisdiction, stating each property’s assessed value as well as its taxable value. If property owners disagree, they can appeal that assessment. After appeals are ruled on, the county uses that data for its equalization report.

Taxable value is a state-mandated formula, and is the lower of two figures: (1) a parcel’s equalized (assessed) value, or (2) a capped value calculated by taking last year’s taxable value minus any losses (such as a building being torn down), multiplied by 5% or the rate of inflation (whichever is lower – this year inflation is 1.017%), plus the value of any additions or new construction.

If the property changes hands, taxable value is reset at its equalized value.

Taxable value is used when calculating taxes for the county, as well as its various municipalities and other entities that rely on taxpayer dollars, including schools, libraries and the Ann Arbor Transportation Authority, among others.

Equalization: Details of the 2011 Equalization Report

On Wednesday, Patel first covered the equalization process, then discussed implications for the county’s taxable value. [.pdf file of 2011 equalization report]

He began by noting that this is the county’s 53rd annual equalization report, and the 40th one that he’s worked on for the county. He introduced and thanked the department’s staff who were attending the meeting, and noted that one of them – Fran Patton – would be retiring soon after 17 years with the county. He also thanked the local assessors in each municipality and the local board of review for their work.

Patel reminded the board that they were being asked to approve the county’s equalized value, not its taxable value. The equalization report, after it’s approved, must be submitted to the state.

Highlights from the report:

• In 2011, the county’s overall equalized value dropped 4.82%, but that’s less of a drop than the 7.22% decline in 2010. The last time the county saw an increase in equalized value was in 2007, when it rose 4.23%.
• Some types of property saw greater declines than others. Commercial property showed a 9.5% drop in equalized value, while equalized value for industrial property dropped 11.82%. The value of residential property showed some signs of recovery, dropping 2.74% compared to a 5.69% drop in 2010. Residential property accounts for about 65% of all property in the county.
• The value of new construction over the past five years has dropped sharply, from $578.89 million in 2007 to $239.512 million in 2011.
• In years past, the largest taxpayers were Pfizer, General Motors and Ford Motor Co. Of those, only Ford remains in the top 10 list for 2011. Others are the real estate and property management firm McKinley Associates, Detroit Edison, Toyota, MichCon, Domino’s Farms, Briarwood Mall, International Transmission, Hyundai and Meijer.
• The Board of Review received 2,656 appeals of assessments, and granted 738 – for a decrease of about $13 million in taxable value. Forty-nine poverty exemptions were requested, and 31 were granted.

Patel noted that Washtenaw County is doing better than surrounding areas – Oakland, Genesee and Wayne counties all saw significantly sharper declines in property value. This county is somewhat insulated, he said, thanks to the stability provided by the University of Michigan and the area’s hospitals.

Patel also noted that the gap between equalized and taxable values is narrowing. This is important because when equalized value and taxable value are the same for a property – and if that property’s assessed value continues to fall – then its taxable value falls in tandem with that assessed value. And that means lower revenues for local municipalities. This year, 65% of property in the county – about 91,000 parcels – has equal taxable and assessed values.

Patel also talked about the possible impact of a corridor improvement authority (CIA) being considered for Washtenaw Avenue. [See Chronicle coverage: "What Does Washtenaw Corridor Need?"] There are about 600 parcels in the corridor between Ann Arbor and Ypsilanti, Patel said – if the corridor authority is approved, revenues to local taxing entities like the county will go down. However, he said, if a special assessment is used instead, property owners would pay the additional assessment and tax revenues wouldn’t be diverted.

Equalization: So What’s the Taxable Value?

The equalization report is used as the base for calculating taxable value – which determines how much tax revenue is collected by local municipalities. For 2011, taxable value in the county has fallen 2.85% to $14.08 billion. That’s an improvement over last year’s decline, when taxable value dropped 5.33%.

It’s also a smaller decrease than was projected when preparing the county’s 2011 budget. The budget was approved with a projection of $59.205 million in tax revenues. But actual revenues, based on 2011 taxable value, are now estimated at $62.878 million. [.pdf file showing 2011 taxable value for each taxing authority – including schools, libraries, etc. – in Washtenaw County]

Nearly all jurisdictions saw declines in taxable value. The sharpest drop was in Ypsilanti Township, where taxable value fell 11.39% compared to 2010. A few areas – including Salem Township, Webster Township and York Township – registered a modest increase in taxable value, but less than a half-percent. [.pdf file showing 2011 taxable values for municipalities, compared to 2010] [.pdf file showing 2011 taxable values for school districts, compared to 2010] [.pdf file showing 2011 taxable values for libraries, villages and authorities, compared to 2010]

Equalization: Commissioner Comments

Several commissioners had questions and comments after Patel’s presentation.

Conan Smith asked whether the county is likely to see an increase in assessment appeals from property owners. Patel said last year, appeals totaled about $1 billion in property value, and this year that number is closer to $900 million. Patel said it tells him there’s still a problem in the valuation.

Smith wondered whether the board should have a discussion about that process, to understand its potential impact on the budget. Patel noted that two years ago, Bob Guenzel – the county administrator at the time – asked him to form a committee and look at that question. That was how Guenzel developed the different projections of tax revenues. Patel reminded the board that they had chosen the worst-case scenario on which to base their budgeting – forecasting an 8.5% drop in taxable value for 2011. [See Chronicle coverage: "County Board: Plan for the Worst, Hope for the Best"]

Kristin Judge highlighted the impact of tax-capture districts – downtown development authorities (DDAs), tax increment financing authorities (TIFAs), and local development finance authorities (LDFAs). Because of taxes captured by those entities, the county receives $2.145 million less in tax revenues. She said when the county board is asked to approve these kinds of entities, the resolution needs to indicate what the impact will be on the county’s tax revenue.

Yousef Rabhi noted that the brownfield TIF they were being asked to approve that evening – for a BST Investments project in Dexter – did include a budget impact statement. He said that in cases like that, eventually the county would see additional tax revenues from the redevelopment.

Wes Prater pointed out that for tax-capture districts in local municipalities, the county has the option of opting-out – in that case, they would continue to receive full revenues. However, there’s a 60-day window to make that decision, and often they don’t get information about it in timely way, he said. As a result, he added, the long-term revenues that the county is missing “is really having an effect on the budget, I think.”

Rolland Sizemore Jr. asked that Rabhi – who’s chair of the board’s working sessions – add that topic for a future session.

Patel noted that it’s a political decision to be made, and that there’s no uniformity among jurisdictions about how to handle these tax-capture districts.

Prater said it’s been the county’s longstanding policy to do nothing – not to opt out. That’s ok, he said, if that’s what they decide to do. But it’s worth discussing.

Leah Gunn, who’s also a board member of the Ann Arbor DDA, noted that the Ann Arbor DDA was founded in 1982 and that the county opted in. The DDA captures only the value of new construction – beyond that, the added value of development goes back to the local taxing units, including the county. The county has benefited from that development and increased tax revenues over the years, she said.

Ronnie Peterson suggested inviting other local governments to participate in any working session they might hold on this issue. The purpose of these tax-capture districts is economic development, he observed – it’s not just a giveaway.

Commissioner Rob Turner, left, talks with Bob Tetens, director of the county's parks and recreation department, before the April 20, 2011 board of commissioners meeting.

Conan Smith drew attention to the decline in value for commercial and industrial properties – falling 9.5% and 11.82%, respectively. It’s a strong argument for maintaining investments in economic development, he said. He added that he wasn’t suggesting the county take the lead in that, but they needed to stay engaged.

Rob Turner observed that industrial businesses are often treated like the ugly stepchild, but it’s an important sector of the local economy. Auto suppliers in particular are struggling, he added, and it’s important to find ways to help them thrive.

Barbara Bergman told Turner that even though she’s a Birkenstock-wearing Ann Arbor commissioner, she understands that industrial businesses are important to the economy. Rabhi added that a symbol for industry is part of the county’s seal – it’s integral to who we are and who we’ve been, he said.

Several commissioners thanked Patel and his staff for their work on the equalization report, and gave them a round of applause.

Outcome: The board voted unanimously to accept the county’s 2011 equalization report.

Brownfield Projects

Several items during Wednesday’s meeting related to brownfield redevelopment projects.

Brownfield: BST Investments

The board gave initial approval to a brownfield plan amendment for the BST Investments redevelopment project, located at 2810 Baker Road in Dexter. Wednesday’s meeting also included a public hearing on the project – no one spoke, but board chair Conan Smith took the opportunity to pound his gavel with dramatic flair to open and close the hearing.

The BST project involves demolishing three buildings on the site and constructing a new commercial complex of three buildings. The $14 million project is estimated to retain 40 jobs and add 80 new jobs.

The revised plan was previously approved by the Washtenaw County brownfield redevelopment authority at its March 10, 2011 meeting, when the authority also approved an interlocal agreement to transfer tax increment financing (TIF) revenues from the Dexter Downtown Development Authority. The amended plan was approved on Feb. 28, 2011 by the Dexter Village Council.

An estimated total of $312,000 in local and state taxes will be captured for eligible activities, administrative costs, and the Washtenaw County Brownfield Redevelopment Authority Local Site Remediation Revolving Fund over a projected four-year period. Of this total, $24,000 will be used for the county brownfield program’s administrative fees, and $48,000 will go into the Local Site Remediation Revolving Fund. After the project is completed and all TIF activities are fulfilled, an estimated increase of $162,103 annually would be distributed among the Dexter DDA and other taxing jurisdictions. According to a memo accompanying the resolution, the Washtenaw County annual millage payment from the property would increase from roughly $5,397 to $14,222.

Commissioner Kristin Judge commented on the estimated increase in tax revenues. She noted that the county had several brownfield approvals coming up, and asked Raman Patel – the county’s equalization director – to comment on the impact to revenues. Patel said there is a short-term impact, but if the redevelopment is successful, “it’s better for us.”

Judge then said she knew the state legislature is considering a change to the brownfield tax credits, and wondered how that change might impact these projects. Brett Lenart from the county’s economic development and energy department fielded that question, reporting that there are no changes planned to the tax increment financing (TIF) aspect of brownfield redevelopment. What’s being considered are changes to the Michigan Business Tax credits that have been available for these projects, he said.

Commissioner Yousef Rabhi noted that BST was asking for TIF because they didn’t want to rely on getting state tax credits.

Outcome: The board unanimously gave initial approval the brownfield plan amendment request for the BST Investments redevelopment project. Commissioners will likely vote on final approval at their May 4 meeting.

Brownfield: Hearings for Packard Square, LaFountaine

Commissioners set two public hearings for their May 18 meeting related to brownfield plans that are being proposed for developments in the county: (1) Packard Square, a complex off of Packard Street on the site of the former Georgetown Mall, and (2) the LaFontaine Chevrolet redevelopment at 7120 Dexter-Ann Arbor Road in Dexter.

The Packard Square site plan, approved by the Ann Arbor planning commission in March, calls for 230 apartments and 23,790-square-feet of retail space in a single building. The project will entail an estimated investment of $48 million and is projected to create 45 new jobs. The brownfield plan would allow the developers to use tax increment financing to pay for environmental due diligence, contaminant removal, demolition, lead and asbestos abatement, site preparation activities and new public infrastructure development.

LaFontaine Chevrolet is redeveloping its site into a new LEED-certified Chevrolet dealership – an estimated $5.3 million investment that will include contamination removal, demolition, asbestos and lead abatement. The project is estimated to retain 74 jobs and add 50-100 jobs. The brownfield plan would allow the owner to use tax increment financing for contaminant removal and other environmental response activities, demolition, and lead and asbestos abatement.

Winter Water Levels for Portage, Baseline Lakes

Janis Bobrin, the county’s water resources commissioner, attended Wednesday’s meeting and spoke briefly about a request for the board to authorize her department to take action in Washtenaw County Circuit Court to establish winter levels for Portage and Baseline lakes, which are located in Washtenaw and Livingston counties. The court action would allow the water resources office to continue its current practice of lowering lake levels in the winter.

Her department operates the dam at Portage Lake that controls those levels. She noted that a detailed report was provided in a cover memo to the resolution. [.pdf of cover memo on winter levels for Portage and Baseline lakes]

She emphasized that the county is not incurring any costs for this action. The legal costs for obtaining a court order will be paid via a special assessment district that is already established by the court. There are 539 parcels in the special assessment district in Washtenaw County, which contains about 50% of the special assessment roll.

According to the cover memo, since the 1960s lake levels have been lowered 12-15 inches from November to mid-April, to minimize shoreline ice damage. However, there is no legal requirement for this lowering to occur – this fact was brought out in talks about the dam and lake levels with the officers of the Portage, Base, and Whitewood Homeowners Association (PBWOA).

Because the lakes are in two counties, both the Washtenaw and Livingston boards of commissioners must approve the legal action. Washtenaw County’s approval is contingent on approval by Livingston County – that county’s drain commissioner supports the action. State law requires that the levels be officially set by the circuit court, and because the Washtenaw County Circuit Court issued the original order establishing the normal lake level, it has continuing jurisdiction to set a winter lake level.

Commissioner Rolland Sizemore Jr. asked Bobrin whether she had consulted with the commissioner whose district includes the lakes. Rob Turner, who represents District 1, reported that Bobrin had talked with him about the issue.

Outcome: The board unanimously voted to authorize the office of the water resources commissioner to take court action establishing winter levels for Portage and Baseline lakes.

Appointments

Without discussion, commissioners voted unanimously to appoint Patricia Piechowski-Whitney to the county’s Dept. of Human Services board for a three-year term expiring Dec. 31, 2013.

Misc. Commissioner Communications

Several commissioner raised issues during the time set aside for items for current and future discussion.

Communications: Department Consolidation

Ronnie Peterson asked when the board would be holding a working session about consolidating the office of community development, ETCS (the employment training and community services department) and the economic development and energy department. Yousef Rabhi, who chairs the working sessions, said they’ll have that discussion in May.

Commissioner Ronnie Peterson, right, talks with Tony VanDerworp, head of the county's economic development and energy department.

Peterson said the citizens who serve on advisory boards for these departments should be included in the discussion, especially if the boards will also be reorganized. He indicated it would be good to discuss this reorganization in the public eye.

Conan Smith said at this point, there’s no plan to reorganize the boards – though the boards themselves might restructure their bylaws, if the county departments are consolidated. [The boards that would be affected by departmental restructuring include the workforce development board, the community action board, and the Urban County executive committee.]

Prater acknowledged the need for some adjustments – for example, it seems like it’s hard for members of the workforce development board to find time to attend meetings, even though they’re scheduled in advance, he said.

Prater also expressed concern over one project in particular that he felt hadn’t received sufficient input from the community action board. The Sycamore Meadows apartment complex in Superior Township, which is owned by a company based in Dallas, received federal funding via the county for renovations, he said. About $1.25 million was awarded to this project, which is owned by an out-of-state landlord and has about 260 units of mostly Section 8 housing, he said. There are problems with the landlord, Prater noted, and he felt that some residents have been abused.

Leah Gunn said she’s talked with Bill McFarlane, the supervisor for Superior Township, who has advocated for this project. McFarlane has been working with the landlord, who has paid for extra services like a part-time sheriff’s deputy to patrol the area. Any problems with the complex should be referred to McFarlane, she said.

Rolland Sizemore Jr. weighed in, saying he had toured the property and that the project was done well.

Prater noted that while an out-of-state company is getting funded, local homeowners who need help lowering their utility bills can’t get funding for insulation and other renovations. “That’s what upsets me,” he said.

Communications: Awards, Recognition

Kristin Judge pointed out that a recent report on program outcomes for children in Head Start showed that they were meeting and exceeding expectations in several areas. She also thanked Eastern Michigan University for their partnership with the county’s Head Start program.

Judge also congratulated Bob Tetens, director of the county’s parks & recreation department, for being honored with EMU’s Presidential Award for Community Partnership. He shared the award with Kirk Profit, Michael Hawks, Brenda Stumbo and Sabrina Gross, who collaborated on making improvements – including a new boathouse – at Lakeside Park on Ford Lake.

Communications: Literacy, Special Education Millage

Rob Turner gave a report from the first meeting he attended of the Literacy Coalition of Washtenaw County board. The group faces funding issues, he said, and is developing a fundraising campaign with the new slogan: “Invest in tomorrow – literacy today.”

In describing some of the group’s literacy programs, Turner noted that those efforts will become increasingly important as schools face state funding cuts. It’s especially important for special needs children, he said. Turner highlighted the fact that a millage renewal for special education funding in Washtenaw County is on the May 3 ballot. “Special needs” covers many things, he said, including autism and attention deficit disorder. As the father of two special-needs children, Turner said he’d personally seen how additional help they’d received because of programs funded by the millage have put them on track for college.

Turner said that he personally endorsed the millage, and urged the public to vote – noting that these types of elections tend to have very low turnout. The millage has made a big difference in his daughters’ lives, he said, and can help many other children in the county succeed.

Yousef Rabhi thanked Turner for calling attention to the millage, and said that he, too, endorsed it. It’s important for the community to come together on this, Rabhi said, and he also urged residents to get out and vote on May 3.

Also supporting the millage, Barbara Bergman emphasized that it’s a renewal, not a new tax – people have already been paying for this, she said.

Communications: Deer

Barbara Bergman brought up the issue of a large deer population in this area. They’re a safety hazard, she said, whether it’s spreading lyme disease or causing car accidents. Deer also cause problems for gardeners, Bergman said. “I feel I have a right to grow tomatoes and flowers.” She has tried throwing Irish Spring soap as a deterrent, as well as hanging sheets of fabric softener. Bergman said she was unsure what the county could do, but it was worth exploring.

Wes Prater noted that this likely fell into the jurisdiction of the state Dept. of Natural Resources. Both Conan Smith and Yousef Rabhi pointed to the possible role of the county’s parks & recreation department, particularly through its stewardship role under the natural area preservation program.

Rolland Sizemore Jr. pointed out that the deer have been here long before people. His comment prompted one of the commissioners to quip, “Not those deer!”

Misc. Public Commentary

Two people spoke during public commentary.

Kathleen Russell of Ann Arbor told the board that April is Parkinson’s Awareness Month – she suffers has the disease, and is an advocate for additional funding to find a cure. Parkinson’s Action Network in Washington, D.C. is lobbying for that as well, and Russell said she was pleased that the group has a strong delegation in Michigan.

Several commissioners responded to her remarks, praising her efforts and thanking her for coming to the meeting.

Thomas Partridge addressed the board during three of the four opportunities for public commentary. He urged commissioners to work on behalf of the most vulnerable in the community – the elderly, disabled, families, public employees and school teachers, who are all being unfairly attacked by Gov. Rick Snyder’s administration, he said. Partridge asked the board to bring a resolution of support for the recall effort against Snyder, saying the recall should be extended to everyone in Snyder’s administration.

Later in the meeting, Partridge noted that he had just returned from speaking at the Ann Arbor Public Schools board of education meeting, held a few blocks away at the Ann Arbor District Library. As he had there and at the previous night’s Ann Arbor city council meeting, Partridge said this month is important for people of all religious faiths. He posed the same question to all these governing groups, he said – in setting their priorities, they should ask what Christ would do, or what other religious leaders would support with regard to housing, transportation, health care and other services for the vulnerable.

As she did at the board’s April 6 meeting when Partridge made this same point, commissioner Barbara Bergman responded by saying she took umbrage at being asked to act in light of one religion.

During his final speaking turn, Partridge raised concerns over medical marijuana, objecting to its legalization and saying that residents need protection from an expanded drug trade – marijuana is still illegal under federal law, he noted. He also called on the board to form a review panel to oversee law enforcement and emergency responders in the county.

Present: Barbara Levin Bergman, Leah Gunn, Kristin Judge, Ronnie Peterson, Alicia Ping, Wes Prater, Yousef Rabhi, Rolland Sizemore Jr., Conan Smith, Dan Smith, Rob Turner.

Next regular board meeting: Wednesday, May 4, 2011 at 6:30 p.m. at the county administration building, 220 N. Main St. The Ways & Means Committee meets first, followed immediately by the regular board meeting. [confirm date] (Though the agenda states that the regular board meeting begins at 6:45 p.m., it usually starts much later – times vary depending on what’s on the agenda.) Public comment sessions are held at the beginning and end of each meeting.

For 2011, taxable value in the county has fallen 2.85% to $14.08 billion. That’s an improvement over last year’s decline, when taxable value dropped 5.33%. It’s also a smaller decrease than was projected when preparing the 2011 budget. The budget was approved with a projection of $59.205 million in tax revenues. But actual revenues, based on 2011 taxable value, are now estimated at $62.878 million.

Taxable value is determined by a state-mandated formula, and is the lower of two figures: (1) a parcel’s equalized (assessed) value, or (2) a capped value calculated by taking last year’s taxable value minus any losses (such as a building being torn down), multiplied by 5% or the rate of inflation (whichever is lower – this year inflation is 1.017%), plus the value of any additions or new construction.

In 2011, some types of property saw greater declines than others, according to the report. Commercial property showed a 9.5% drop in equalized value, while equalized value for industrial property dropped 11.82%. Residential property value showed some signs of recovery, dropping 2.74% compared to a 5.69% drop in 2010.

This brief was filed from the boardroom in the Washtenaw County administration building, 220 N. Main St., Ann Arbor. A more detailed report will follow: [link]

Also at Wednesday’s meeting, commissioners authorized the issuance of up to $405,000 in bonds for a porous pavement project on Sylvan Avenue in Ann Arbor – the Ann Arbor city council had approved a construction contract for the project at their April 19 meeting. The city is working with the county’s water resources commissioner on this effort. If successful, it could pave the way for more porous resurfacing of local roads.

In the category of the local agricultural economy, the board honored the Horning family of Manchester for their work as progressive dairy farmers – Earl Horning in turn invited the public to a June 26 “Breakfast on the Farm” event. “We’d like our city friends to come and visit us,” Horning told commissioners.

Equalization Report

At the board’s April 14 administrative briefing, when commissioners got a first look at the April 21 meeting agenda, county administrator Bob Guenzel gave them some good news: The much-anticipated equalization report would show a decrease in the equalized (assessed) value of property in the county, but the decrease would be less than forecast. That is, their budget forecast was on target – they wouldn’t have to make additional cuts in 2010 due to less-than-expected tax revenues.

Last Wednesday, Raman Patel – director of the county’s equalization department – delivered the news officially. A 7.2% drop in equalized value was not as bad as the 7.5% decrease that county officials had budgeted. The approved 2010 general fund budget projected revenues of $62.9 million – in fact, revenues will be closer to $64.67 million, Patel told commissioners. They’ll have about $1.7 million “extra to play with,” he said.

How the Equalization Process Works

The state-mandated equalization process runs throughout the year, as both the county and local assessors within each municipality examine the value of land and other property, such as buildings. Local assessors turn their findings over to the county, which then conducts independent assessments based on sales studies and physical appraisals. Next, the county’s equalization staff looks at how their findings compare with the local assessors’ findings. (The county has authority to request that local assessment rates be altered, if it considers them to be too high or too low.)

Chart showing Washtenaw County equalized and taxable values. (Links to larger image)

After this “equalization” occurs, the local municipalities send out notices to each property owner in their jurisdiction, stating each property’s assessed value as well as its taxable value. If property owners disagree, they can appeal that assessment. After appeals are ruled on, the county uses that data for its equalization report.

Taxable value is a state-mandated formula, and is the lower of two figures: (1) a parcel’s equalized (assessed) value, or (2) a capped value calculated by taking last year’s taxable value minus any losses (such as a building being torn down), multiplied by 5% or the rate of inflation (whichever is lower – this year inflation is 0.997%), plus the value of any additions or new construction.

If the property changes hands, taxable value is reset at its equalized value.

Taxable value is used when calculating taxes for the county, as well as its various municipalities and other entities that rely on taxpayer dollars, including schools, libraries and the Ann Arbor Transportation Authority, among others.

Details of the 2010 Equalization Report

On Wednesday, Patel noted that this is the county’s 52nd equalization report – he has assisted with 39 of them. [.pdf of equalization report]

This year, Patel and his staff are recommending that the county’s equalized value be set at $16.253 billion – a drop of $1.2 billion, or -7.22% from 2009. The taxable value is calculated at $14.496 billion, a drop of $815.522 million or -5.33%.

Other highlights from this year’s report:

• The assessed value of residential property – which accounts for 64.4% of all property in the county – dropped by 5.69%, while commercial property values fell 4.09%. The most staggering decline came in the industrial classification, which dropped 37.29%.
• All jurisdictions are seeing declines in taxable value. The city of Ypsilanti and Ypsilanti Township took the hardest hit, with taxable value falling 10.93% and 12.26%, respectively. The smallest drops were in Ann Arbor Township (-0.85%) and York Township (-0.08%).
• The value of taxable new construction has fallen sharply over the past five years – from $613.8 million in 2006 to $328.6 million this year.

Patel also noted that the gap between equalized and taxable values is narrowing. This is important because when equalized value and taxable value are the same for a property – and if that property’s assessed value continues to fall – then its taxable value falls in tandem with that assessed value. And that means lower revenues for local municipalities.

Equalization: Commissioner Comments

Leah Gunn said that “even though it’s bad news, it’s good news.” She recommended setting aside the additional funds, rather than spending them. Barbara Bergman agreed, saying “let’s put it in the bank.”

Mark Ouimet said the report is pretty much what he expected, and that they’ll likely see negative numbers for years to come. Responding to a question from Ouimet, Patel said the decrease in commercial property value will likely continue for several years. Ouimet described a scenario in which property owners refinance: If the appraisal for their refinancing comes in lower, then neighboring property owners will use that as a comparable to challenge their own property’s assessed value, hoping to lower their taxes, too.

Patel reported that there are currently appeals pending from last year at the Michigan Tax Tribunal on $900 million in property values – the assessed value is being challenged by the owners. Every year, he said, appeals will no doubt continue.

Ouimet speculated that residential values have likely bottomed out, but commercial properties will probably continue to decline in value. Patel agreed, but said that Washtenaw County was in better shape than others, thanks to the universities and hospitals. Ypsilanti and Ypsilanti Township were hurting because of the GM plant closure – the eastern side of the county is also influenced by what’s happening in Wayne County, he said.

Kristin Judge asked about new classification guidelines, which shifted 259 parcels in the county from the industrial to the commercial classification. The value of properties in the industrial classification plummeted 37.29%, with losses from the closing of the Pfizer site, the GM plant in Ypsilanti Township and other businesses. Judge asked whether the loss to commercial value was actually greater. Yes, Patel said – if those 259 properties had remained classified as industrial, the drop in commercial value would have been a lot worse.

Conan Smith said the lower-than-expected decline was great news, showing they had been appropriately conservative on the revenue side. But it’s only half the picture, he cautioned – they still have to accrue all of the savings they forecast on the expense side of the 2010 budget. Already they’ve learned from the county treasurer that interest income is significantly down, he said. Departments within county government were asked to forecast their expenses, “but that’s a prediction,” Smith said, and could turn out to be too optimistic.

Smith cited ongoing negotiations with townships and the sheriff’s department over the police services contract, and the shortfall they still have to deal with related to added staffing for the jail expansion, which opens this summer. There’s also the looming loss of state revenue sharing, he noted, which could wipe the extra revenue off the map, he said. He urged the board to approach this “slight windfall” with caution.

Porous Pavement for Sylvan Avenue

Commissioners voted on a resolution authorizing the issuance of up to $405,000 in bonds, backed by the county’s “full faith and credit,” for a project to install porous asphalt pavement on Sylvan Avenue in Ann Arbor. It’s part of the Allen Creek drain project, and water resources commissioner Janis Bobrin was on hand to take questions from the board.

This project was previously discussed at the Oct. 5, 2009 meeting of the Ann Arbor city council. From Chronicle coverage:

Pulled out of the consent agenda for individual consideration by the council was an expenditure for $54,271 to pay for engineering services (from Fishbeck, Thompson, Carr & Huber, Inc.) connected to the Sylvan Avenue permeable pavement project. Permeable pavement allows storm water to filter straight through the surface. The surface parking lot where the old YMCA building stood at Fifth Avenue and William is paved with permeable pavement.

Sylvan is a short one-block-long street running east-west, nestled into the upside down ”V” formed by State and Packard streets, near Yost Ice Arena. Nick Hutchinson, who’s a civil engineer with the city, fielded questions from Margie Teall (Ward 4) in whose ward Sylvan Avenue is located.

The reason Sylvan was chosen, he said, was that it had suitable soil underneath, it was flat, and there were existing drainage problems. He was asked first by Teall about maintenance, a question that was followed up with a specific question from Mayor John Hieftje about the possible need to vacuum the pavement to maintain its permeable properties. Hutchinson explained that it was more a matter of running a street sweeper an extra time per year over the street as opposed to vacuuming it. He also noted that during the winter, no sand – just salt – should be spread on the street.

The extra cost of permeable pavement, he explained, came mostly from the extra cost of the asphalt itself, not from the street reconstruction activity. So the extra cost for this project, he said, was not significant, given the 800-foot length and narrowness of the street.

The project should be finished, Hutchinson said, in spring 2010.

More recently, at its April 19 meeting, the Ann Arbor city council also approved a construction contract with ABC Paving Co. for $343,875. The project’s budget is $481,245, funded by the city’s street reconstruction millage ($159,983) and the stormwater maintenance fund ($321,442). The stormwater funding portion of the project will be repaid from the bonds secured by the office of the county’s water resources commissioner.

At Wednesday’s meeting of the county board, Jeff Irwin characterized it as a great project, and asked how these kinds of things get initiated. There’s a lot of talk around Ann Arbor about porous pavement, he said, and he wondered how this particular project got picked. He got a laugh by saying how he often sees the implementing of porous pavement by neglect – referring to potholes.

Bobrin said the Sylvan Avenue project was part the broader Allen Creek stormwater initiative, which includes work underway at West Park and Pioneer High School property. [See Chronicle coverage: "West Park Renovations Get Fast-Tracked" and "Drilling for the Drains"] The idea was to take a comprehensive approach to managing an “ultra-urban” creek, Bobrin said.

Working with the city of Ann Arbor road engineers, they chose Sylvan in part because it’s a short street, Bobrin said. The technology is new, and engineers wanted to see how well it would work. She said if it goes well – in terms of longevity and maintenance – they’d likely see more porous pavement used.

Though this project was government-initiated, Bobrin pointed to a project on Easy Street that was prompted by residents there. That road was repaved with paving cobbles, and was more expensive than porous asphalt.

Leah Gunn noted that the porous pavement on the Fifth & William parking lot was a project of the Downtown Development Authority. [Gunn is a DDA board member.] There’s a sign on the lot that explains the benefits of the material, she said, “so stop by and take a read!” Bobrin said it was amazing to see it on a rainy day, as the water drains through the pavement. It also makes the lot less icy in the winter, because there’s no standing water.

Wes Prater wondered about the soil under the pavement – if it’s not designed well, in the winter the water might get trapped and frozen just beneath the pavement, he said. Bobrin agreed that the design is crucial. They’ll have a sand under-drainage base so the water won’t get trapped, and additional water quality treatment beneath that. [According to a cover memo accompanying the resolution, the base will include an underlying sand filter and swirl concentrator to remove oils, sediment and phosphorus from runoff in the road.]

Prater also said he’d heard that this technique reduces road noise – was that true? Bobrin thought so, but said she wasn’t sure, since that’s not an aspect of the project that she’s examined. [Reduction in road noise was a benefit of porous pavement touted by a resident during public commentary at the Ann Arbor city council's April 19, 2010 meeting.]

Outcome: Approval of the bonding authority passed unanimously.

Drug Discount Program

Commissioner Jessica Ping proposed a resolution authorizing the county to enter into a contract with CVS/Caremark for their drug discount program, which would be made available to residents. This program has been discussed for several months and has been a contentious issue for some commissioners.

From Chronicle coverage of the board’s Sept. 2, 2009 meeting:

In July, three commissioners – Kristin Judge, Jessica Ping and Wes Prater – attended a conference of the National Association of Counties (NACo) in Nashville. While there, they learned of a drug discount program offered by CVS/Caremark, and they asked a representative of that business to make a presentation about the program to the full board.

At Wednesday’s meeting, Steve Rohm from CVS/Caremark told commissioners that 1,250 counties nationwide participate in the drug discount program. If Washtenaw County participates, cards would be offered to any resident not covered by insurance – there’s no enrollment, fee or registration required, no age limitations or limits on usage. Residents would take the card to participating pharmacies to get some type of discount on their prescription drugs. The discounts would be set by each pharmacy – Rohm said that consumers typically get around a 22% savings. Pet prescriptions are also covered, he said.

Responding to a query from commissioner Jeff Irwin, Rohm said that for each prescription filled using the discount card, CVS/Caremark receives a small transaction fee that’s been pre-negotiated with the pharmacies. He said he did not know the amount of that fee.

Kristin Judge said that she had checked with Ellen Rabinowitz, executive director of the Washtenaw Health Plan, to see if the discount drug card would in any way negatively impact the county’s current plan, and found that it would simply give residents another option. She said that at the NACo conference, she asked commissioners from other counties that were already participating in the plan whether there was a downside to the program – they all told her it was a great benefit. There’s a new kind of person who needs help, Judge said – people who have worked all their lives and never relied on government aid, but who now find themselves out of a job. They’re still reluctant to ask for help, so this discount card, which doesn’t require registration, would be perfect for them, she said.

Commissioner Jessica Ping said that the city of Saline is already participating in the program, through its membership in the National League of Cities. She said her sister, Alicia Ping, who’s a member of the Saline city council, would be willing to answer any questions they might have about the program.

Judge said she’d be supporting the county’s participation in the drug discount program. She also indicated that NACo would be offering similar programs for dental and vision coverage in the future.

On Wednesday, Ping said the program would be a great asset to the community, and urged commissioners to support it.

Leah Gunn began the discussion by reading a statement that outlined her objections to the plan. [.pdf file of Gunn's statement] She cited concerns over reports of deceptive business practices and violations of HIPPA (the Health Insurance Portability and Accountability Act). Gunn said she hasn’t seen a copy of the contract, and based on news reports that she’s read, she doesn’t want the name of Washtenaw County associated with the program in any way.

Barbara Bergman, who’s been a vocal critic of the plan, also read a prepared statement, laying out many of the same concerns. [.pdf file of Bergman's statement] She asked for an update from Curtis Hedger, the county’s corporation counsel, on questions she’d asked him to pursue with NACo and Oakland County, which already offers the drug discount program.

Hedger said he’d spoken with Oakland County’s legal counsel, who’d told him they thought CVS/Caremark was a good company and they’d made no changes to the contract used by NACo. Hedger was unable to reach anyone at NACo, but said his research showed the organization had started it as a pilot program in 2004. At that time, NACo had issued a request for proposals (RFP), and ultimately awarded the bid to Caremark. The program was offered initially to 17 counties, then offered to all NACo members in 2005. Caremark was acquired by CVS in 2007.

Wes Prater said he’d heard a lot of rhetoric, but hadn’t seen one iota of information from other commissioners that had anything to do directly with the drug discount program. The savings for residents were considerable, he noted, and many counties nationwide already offer it. The county wasn’t going to incur any cost, he added, saying “Come on, folks – let’s be reasonable.” It was important to offer help to low-income residents without health insurance, he said.

Rolland Sizemore Jr. asked a series of questions, eliciting the fact that there was no limit on the number of residents who could use the card, that most large drugstores and many independents accept it, and that the county would be able to terminate the contract. Hedger said that they can terminate it by giving 60 days notice before the end of the contract’s term, at the end of May. An initial one-year contract would be automatically renewed for one-year increments, unless the board took action to terminate.

Hedger also explained that the county wouldn’t be charged for a “basic” marketing plan provided by CVS/Caremark, but there would be a cost if the county chose to customize its marketing. It wasn’t clear exactly what kind of customization was offered, or what the cost would be.

Ping said nothing that had been presented was sufficient to prevent the board from moving forward to offer this plan. It won’t cost the county, she said, and if they don’t like it, they can pull it. One of the reasons that the county is a member of NACo is because of programs like this, she said, and they should take advantage of it.

Kristin Judge said for her, it was about the residents: “I’m going to do anything I can to help the residents of Washtenaw County.” Commissioners she’d talked with in other counties that already offered the program described it as a “no brainer” and wondered why Washtenaw County hadn’t done it sooner. If the board approves it, Judge said she’d personally deliver cards to schools, libraries, doctors’ offices, homeowner associations and other venues to make sure residents had access to the program. She said she appreciated the concerns of other commissioners, but that she had spent considerable time researching the program and felt it was worth offering.

Jeff Irwin had some lingering questions. He wondered whether CVS/Caremark could collect personal information from a customer’s prescription, when they used the discount card to fill it. Hedger said he’d talked with the CVS/Caremark attorney, who told him that information was collected in aggregate – that is, none of the individual prescription information is given to CVS/Caremark. Reports from pharmacists indicate how many prescriptions of a certain type are filled, for example, but not the names of customers.

Irwin said he wasn’t sure he was comfortable signing off on a program that collected even aggregate information, given the company’s track record of mishandling personal information. He wasn’t sure the discounts outweighed that concern. He also didn’t like the fact that CVS/Caremark required exclusivity, aside from grandfathering in the county’s existing health plan. He said he wasn’t thrilled with the termination clause either, but the exclusivity arrangement was more onerous. What if another program came along that offered an even better deal?

Irwin offered an amendment that would allow the county to offer other plans in the future, if they wanted.

Hedger clarified that the exclusivity applied only to programs that the county might offer, not to other discount programs like those offered by the Ann Arbor Area Chamber of Commerce.

Prater said Irwin’s amendment seemed designed just to draw out the process. According to the county’s health department, he said, an estimated 11% of the local population doesn’t have health insurance. That equates to about 33,000 people who need relief, and he urged his colleagues to support the program.

He moved to call the question on the motion to amend – a parliamentary move that requires eight votes. The motion to call the question failed, gaining support only from Prater, Judge, Ping, Ouimet and Sizemore.

Irwin returned to the question of exclusivity, saying he thought it was “weird” that the CVS/Caremark representative, Steve Rohm, had told the board that the company would require exclusivity, but wouldn’t enforce it. He felt it indicated a willingness on the part of CVS/Caremark to soften its demands. It’s not in the county’s interest to agree to exclusivity – it’s only in the interest of CVS/Caremark, Irwin said. If they can get a better deal out of the company, they should try.

Citing the bad economy, Sizemore said he wanted to get the program started.

Judge said she’s spent many hours researching the program, and couldn’t imagine that within another year – the term of the contract – a better program will come along. “It’s only one year for a contract that cost the county zero dollars,” she said. The energy spent on opposing the CVS/Caremark program could have been spent finding a better one, Judge added, but that didn’t happen.

Judge also pointed out that the county surely has other exclusive arrangements with businesses – like Verizon, for the county’s cell phones. Bergman responded, saying she assumed that contracts with companies like Verizon went through an RFP process, with competitive bids. That was not the case with CVS/Caremark, she said.

Bergman also thanked Judge for the time she put into researching this program, but noted that it was Judge’s choice to do so. Bergman took offense at the suggestion that other commissioners didn’t work as hard, saying that was disingenuous.

Outcome: The amendment to change the contract language failed, supported only by Barbara Bergman, Leah Gunn, Jeff Irwin, Ronnie Peterson and Conan Smith.

Speaking to the main motion – authorizing the contract with CVS/Caremark – Smith said he’d vote against it. He was uncomfortable with the company’s business practices, and didn’t want to support something that had caused such consternation among commissioners. He was concerned that the business didn’t disclose its profit model, that a disproportionate amount of funds go toward CEO compensation, and that some of the county’s professional staff have expressed discomfort with the deal. He didn’t like the exclusivity requirement, and he didn’t like ceding the county’s authority to NACo in selecting the company.

More importantly, Smith said, was that there are times when the benefit to the individual is outweighed by the harm to the community – WalMart is an example of that, he said. And with the federal health care reform that’s recently passed, there may be relief on the way. All of these factors “suggest to me that we should let this one go.”

Prater said he took issue with the fact that so many county residents are being ignored – some are going without their next meal, and commissioners really should have more compassion for them.

Bergman allowed that perhaps the county should be more aggressive in marketing its own drug discount plan. She said a better strategy would be for CVS/Caremark to simply slash its prices across the board. The drug discount program is a way to get people into their store, where they’ll buy other things, she said.

Outcome: The resolution authorizing approval of the CVS/Caremark contract for a Washtenaw County drug discount program passed, with dissent from Barbara Bergman, Leah Gunn, and Conan Smith. Commissioners will take a final vote on the resolution at the May 5 board meeting.

Drug Discounts: Public Commentary

Eric Sturgis told commissioners that he previously lived in Oakland County and had taken advantage of the CVS/Caremark program, which had saved him about 20% off prescriptions. He understood the concerns that had been raised, but felt that those concerns should be weighed against what’s best for the individual. If a better program comes up, they should pursue it. As Democrats, he said, anytime they can help people, they should do it. He said he was glad to see that the Republicans were on board this one time. [Commissioners Ping and Ouimet are the only Republican commissioners.] He said he knew all commissioners worked hard.

Audrey Tisdale, who works for the county, said that Washtenaw United Way offered a drug discount program – called FamilyWize – that doesn’t require signing a contract. She urged the county to look into that as an alternative.

Drug Discounts: Commissioners Followup

Judge said she never stated that other commissioners didn’t work hard – she knew that they did.

Irwin responded to the comment about pursuing a better program if it came along. There already is a better program, he said – the county’s own prescription plan, which offers deeper discounts. The only difference is that you have to sign up for it, and it doesn’t cover pet medications. Other than that, it all comes down to marketing, he said. If the county eventually decides to put money into marketing a drug discount plan, he hoped the county would spend it on the plan that saves more money.

Bergman noted that there was someone who typically spoke during public commentary time who had not been there for several weeks. She said she wished him well, for whatever reason he was absent, adding, “I frankly look forward to seeing him again.” [She was referring to Thomas Partridge, who is a regular speaker during the public commentary time at meetings of the county board, Ann Arbor city council, AATA and other public entities.]

Smith jokingly told Sturgis that the Republican caucus was planning to hold a puppy killing later that night to make up for their support of the drug discount program.

Road Commission Expansion

Conan Smith moved a resolution setting a public hearing on May 19 on expanding the Washtenaw County Road Commission from three members to five. He told his colleagues that it wasn’t a decision on whether to expand – setting the public hearing was just a way to start the conversation. [The county board is responsible for appointing the road commissioners to six-year terms. Currently serving are David Rutledge, Douglas Fuller and Fred Veigel.]

Commissioners Leah Gunn, Barbara Bergman and Jeff Irwin all supported the resolution, saying they were also in favor of expanding the road commission.

Wes Prater, who has previously served as a road commissioner, said he opposed the resolution. It would add to the cost of the commission, he said, with no increase in revenues. In fact, roads are deteriorating because the commission is operating at revenue levels that are as low as they were in 2001, he said. State legislators need to find a way to adequately provide funding for roads – he noted that five local communities are now paying for road repair on their own, either by levying new taxes or taking money from the general fund.

The road commission still had issues, he said, but relationships between management and the unions have improved, and things are on the right track. He noted that the road commission expects to be certified soon to ISO 9000 and ISO 9001 standards – the first road commission in the state to do that. Overall, the commission is doing good work, Prater said.

Kristin Judge weighed in, saying she thought the road commission should eventually be expanded to five members, including representation from the western part of the county and Pittsfield Township. However, she was concerned about the timing. She wanted more discussion about how they’d handle the cost of additional salaries, for example. Judge described herself as being a strong critic of the road commission before she was elected, but since then she’d seen the entity be more responsive to her constituents’ concerns, and she appreciated that.

Jessica Ping echoed Judge’s comments, and said she didn’t think the timing was right. She also praised the road commission’s responsiveness to issues raised in her district.

Saying he wasn’t opposed to expansion in principle, Ken Schwartz said he thought that setting a public hearing was putting the cart before the horse. He moved to table the motion until the board’s May 19 meeting.

Outcome: The motion to set a May 19 public hearing on possible expansion of the road commission was tabled, with dissent from Bergman, Irwin, Ouimet and Smith.

Road Commission: Public Commentary, Commissioner Response

Eric Sturgis spoke briefly, thanking Smith for proposing the public hearing and saying he didn’t see anything wrong with that.

Responding to his comment, Judge said they should have the public hearing after they get more information on the proposed change.

Smith noted that state law requires that they hold a public hearing first – the intent is to get information and gauge interest from the public before setting policy. It’s a lengthy process from hearing to appointment, he said.

At this point, Prater charged that Smith was speaking out of order. Smith said he was responding to a citizen who spoke on the issue during public commentary, which is allowed. He continued by saying that if they want to engage in this process and not defer to the next board, they needed to start the process. [There will be at least some turnover on the board this year – commissioners Mark Ouimet and Jeff Irwin are not running for re-election, and are vying instead for seats in the state House of Representatives.]

Misc. Reports, Presentations, Public Hearing

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Dairy Farmers of the Year

The Horning family of Manchester were honored for their work as “progressive dairy producers.” They were recently named Michigan State University Dairy Farmer of the Year. Their six-generation family dairy business, which started in 1877, now has 360 milk cows, 410 head of young stock and 700 acres of cropland.

Earl and Diane Horning were on hand to accept the board’s resolution of appreciation – it was read by Jessica Ping, who represents District 3, which includes Manchester in southwest Washtenaw County. Earl Horning said it was a humbling experience to work with the state’s dairy farmers. He noted that they had been featured in a Kroger commercial, and that the grocery chain was a very friendly company. The Hornings also invited commissioners to attend a June 26 Breakfast on the Farm event they’ll be hosting, which shows people how the farm operates. “We’d like our city friends to come and visit us,” Horning said. The farm is located at 11855 E. Pleasant Lake Rd. in Manchester.

Following the presentation, Conan Smith remarked that he had grown up next to a farm, and that his first jobs were baling hay and milking cows. He suggested that all commissioners should be made to do farm work.

Area Agency on Aging

Barbara Bergman passed out brochures from the Area Agency on Aging 1-B, with information about support services that would help people live on their own, rather than in a nursing home.

Head Start Imagination Library

Kristin Judge invited commissioners and the public to the April 30 kick-off of the county’s Head Start Imagination Library, from 10:30 a.m. until noon. Kids up to five years old who are enrolled in the program receive a free book in the mail each month. Initially, the program will serve children in the Ypsilanti area (within the 48197 and 48198 zip codes). They need to raise another $493,000 to serve the rest of the county, Judge said. She also noted that during the festivities, she’ll be reading aloud from the book, “The Little Engine That Could.” The event will be held at the Washtenaw County Head Start building, located at 1661 Leforge in Ypsilanti.

Aerotropolis

Bob Guenzel reported that the Detroit Region Aerotropolis is up and running – the entity aims to develop the area surrounding Detroit Metro and Willow Run airports in Washtenaw and Wayne counties. Nine governments – including Washtenaw County, Ypsilanti and Ypsilanti Township – have joined, Guenzel said, and they’ve received inquiries from several other communities who might be interested in joining, which he said is positive. He noted that he currently serves as the county’s representative on the entity’s board, and that commissioners will have to appoint a replacement, hopefully at their May 5 meeting. [Guenzel is retiring in mid-May as county administrator.]

Tony VanDerworp serves as staff support for the county’s aerotropolis work, and gave a quick update. The group is working on revisions to its master development plan to include the element of transit, he said. They’ve also issued a request for proposals (RFP) for marketing. They’re hoping that the state legislature passes the Next Michigan Development Act, which would allow the aerotropolis and similar entities to offer tax abatements and set up tax increment financing (TIF) districts. Another committee is working specifically on marketing of the Willow Run Airport.

Rolland Sizemore Jr., the board’s chair, said that he and Verna McDaniel – who’ll be replacing Guenzel – will bring a resolution on a new appointment for the next board meeting.

Ronnie Peterson asked whether the aerotropolis bylaws prevented Guenzel from remaining as the county’s representative – he was told they don’t. In that case, Peterson said, he’d be urging Guenzel to stay on that board. Guenzel knows the history of that effort and has a lot of respect from the other partners involved, he added.

Treasurer Reports

Wes Prater said he’s like to receive monthly reports from the county treasurer, Catherine McClary. The board hadn’t seen a report from the treasurer in quite some time, he said.

Public Hearing on Urban County Annual Plan

The board held a public hearing on the Washtenaw Urban County‘s annual plan for 2010-11, which must be submitted to the U.S. Dept. of Housing and Urban Development (HUD). [See Chronicle coverage: "Urban County Allocates Housing Funds"]

No one spoke at the hearing. [.pdf of Urban County 2010-11 annual plan]

Present: Barbara Levin Bergman, Leah Gunn, Jeff Irwin, Kristin Judge, Mark Ouimet, Ronnie Peterson, Jessica Ping, Wes Prater, Ken Schwartz, Rolland Sizemore Jr., Conan Smith

Next board meeting: The next regular meeting is Wednesday, May 5, 2010 at 6:30 p.m. at the County Administration Building, 220 N. Main St. The Ways & Means Committee meets first, followed immediately by the regular board meeting. [confirm date] (Though the agenda states that the regular board meeting begins at 6:45 p.m., it usually starts much later – times vary depending on what’s on the agenda.) Public comment sessions are held at the beginning and end of each meeting.