Stories indexed with the term ‘city income tax’

With results reported from six of the seven precincts in the city of Ypsilanti, voters overwhelmingly rejected two major proposals on the May 8 ballot: A city income tax, and a millage to pay off debt for the Water Street parcel. The proposed city income tax was voted down with 1,313 no votes (68%) to 625 yes votes (32%) from six precincts. The proposed Water Street millage failed 1,291 (67%) to 644 (33%).

At Aubree’s in Depot Town, volunteers who worked for SCIT (Stop City Income Tax) appeared more interested in the pizza provided by SCIT than in additional voting results, which as early as 9 p.m. were clearly in their favor. Peter Fletcher, spokesperson for SCIT, was not available for comment … [Full Story]

Editor’s note: On Jan. 31, the city council will begin a series of workshops on next year’s budget. The most recent status update from the city’s CFO, Tom Crawford, is that the city faces a $2.4 million shortfall if it does not reduce expenses. That figure assumes: (1) The city will receive around $2 million in parking revenue from the Ann Arbor Downtown Development Authority; (2) shared sales tax revenue from the state will continue at the same levels as last year; and (3) unresolved labor contracts will settle in a way that results in no increases to the wage structure, plus additional reductions equivalent to the cost savings the city would see if all employees were on the new health care plan.

The council has already convened two retreats on the budget – this report is a summary of those retreats.

Late last year, on Dec. 4, 2010, the Ann Arbor city council held the first of two budget retreats for the next year’s budget adoption process. The current 2011 fiscal year ends on June 30, 2011, and the council will need to finalize its FY 2012 budget in May. The council typically begins contemplating the next fiscal year’s budget at a retreat near the end of the calendar year.

Two days after the first retreat, at the Dec. 6 regular city council meeting, city administrator Roger Fraser and councilmembers recapped the event, with Stephen Rapundalo (Ward 2) describing it as the best retreat discussion on the budget since he’s been on the council. First elected to the council in 2005, Rapundalo has five previous budget seasons to compare against.

The December retreat agenda reflected two main items: (1) general economic conditions; and (2) a sustainable service delivery model. The grim condition of the state’s economy was a point that was also driven home by Kirk Profit – director of Governmental Consultant Services, the city’s lobbyist in Lansing – in a presentation to the council at their Dec. 6 regular meeting.

The second retreat, on Jan. 8, followed up with a focus on services. To prepare for the retreat, councilmembers had ranked various city services by priority.

At both retreats, councilmembers and staff took the opportunity to communicate a message to city labor unions, some of whom Rapundalo characterized as not yet having seen fit to “recognize economic reality.”

And as chair of the council’s labor committee, Rapundalo has said he’ll give updates at the council’s regular meetings on the status of labor negotiations. He started the updates at the council’s Jan. 20 meeting. The implicit message communicated by the first update: Ann Arbor’s labor unions aren’t making the kind of concessions they should reasonably make, given economic conditions.

This report features highlights of the discussion from both retreats – including issues like the city’s approach to fire and police protection, solid waste and composting, as well as possible replacement of the general fund operating millage with a city income tax.

At both retreats, city administrator Roger Fraser and key city staff did their best to frame the council’s conversation not as a question of what services to cut. Instead, they tried to get councilmembers to consider which services might be delivered in a different way. The sustainability of the service delivery model depends on how the city delivers those services to residents – ranging from employment of full-time city workers, outsourcing the work, or by not offering the service at all.

To frame the context of these comparatively brief retreat highlights, we first offer a look back to 1936, when the city delivered a sidewalk snowplowing service to its residents. How? Partly by hiring in teams of horses to do the job. [Full Story]

In his introductory remarks, Bill Kinley joked that this was the first mayoral debate – and possibly the last ever – held at University Commons, a condominium community for people over 55 that was founded by University of Michigan faculty. They’d have to see how it turned out, he said.

Kinley, a University Commons resident and local developer, moderated Monday’s event, which drew about 50 people to listen as incumbent mayor John Hieftje and challenger Patricia Lesko answered questions for an hour on a range of topics, from Argo Dam and Fuller Road Station to the city budget and possible income tax.

It’s the latest in a series of exchanges between the two candidates, as the Democrats head into next week’s Aug. 3 primary election. [See Chronicle coverage: "Ann Arbor Forums: The More, The Mayor-ier" and "Ann Arbor Dems Primary: Mayoral Race."]

After introducing the candidates, Kinley cautioned that the residents there are “a group of wordy people.” They know that “platform” and “platitude” derive from the French word “plat,” he said, “so if you can keep platitudes to a minimum, you’ll find the reception here is much more responsive.”

Each candidate was given two minutes to answer the question. The first person who answered was also given the option of an additional one minute response. Questions had been developed by Kinley and the program committee for University Commons. [Full Story]

Ann Arbor City Council Budget Committee (Jan. 19, 2010): Sometime within the next two months, Ann Arbor city councilmembers and Ann Arbor residents – or anyone, for that matter – can expect to start getting access to raw data files of all city financial transactions.

At a meeting of the Ann Arbor city council’s budget committee, the city’s chief financial officer, Tom Crawford, sketched a plan to start making available a wide range of raw data from the city, starting with numbers from the finance department. Crawford said he hopes to have a pilot in place by the end of February.

Budget committee members also discussed what the contents of a monthly statement should be that will now be provided to the committee and to the council as a body – such a report is required by the city’s charter.

The other main point addressed by the budget committee was raised by city administrator Roger Fraser, who suggested to councilmembers that they owed it to the community to put the question of a city income tax before the voters. Fraser said they had a responsibility to float the question, regardless of what their personal feelings were on the issue.

The meeting was also attended by Mayor John Hieftje, who is a member of the city council, but no longer part of the 5-member budget committee – the council reorganized its committee structure at its Dec. 21, 2009 meeting. Hieftje participated in deliberations on the question of when a city income tax ballot question might feasibly go on the ballot. [Full Story]

Ann Arbor Downtown Development Authority (Sept. 2, 2009): In the last year, Ann Arbor’s Downtown Development Authority has moved three major projects from planning and approval phases towards actual start of construction.

For starters, visitors to downtown Ann Arbor will likely have noticed some of the new wayfinding signs that have already been installed over the last couple of weeks.  They’ll also have encountered the lane closures along Division Street, that has Eastlund Concrete pouring bumpouts as part of the Fifth and Division streetscape improvement project. And in mid-October, The Christman Company expects to start digging the massive hole at the Library Lot for the Fifth Avenue underground parking garage.

The DDA board meeting on Wednesday reflected this shift from planning to execution and monitoring: It was heavy on updates on how projects were faring in the field.

But in addition to the project updates, there was still room for planning ahead. For example, the board received a preliminary briefing on the impact of a possible city income tax on the DDA’s revenue – a $700,000 hit. The board also put a bit of time into discussion of its role in transportation. Plus, the board completed some unfinished business from its annual meeting in July by selecting a treasurer (Russ Collins) and confirming its selection of a chair (John Splitt). [Full Story]

Ann Arbor City Council work session (Aug. 13, 2009): Towards the end of the city council’s Thursday evening work session on a possible city income tax, city administrator Roger Fraser asked the council for some direction. Here’s what he wanted to know: Should city staff place an item on the council’s Aug. 17 agenda that would allow the council to put the tax before the voters in November?

In response to Fraser, Marcia Higgins (Ward 4) said she wanted more dialogue on the exact percentage of the tax to be levied, even if the ballot language specified “up to 1%.” Carsten Hohnke (Ward 5) followed by saying it was clear that his colleague, Sandi Smith (Ward 1) had requested additional case-study scenarios for individuals and that he himself had wanted some cross-checking of commuter numbers with the city’s transportation staff. “We don’t do the community any favors by taking the conversation to the next level without more information,” Hohnke said. Sabra Briere (Ward 1) then advised that she thought an emotional reaction could be addressed, if people first became more knowledgeable – she herself had had problems correctly interpreting the charts in the city income tax study.

Finally, Tony Derezinski (Ward 2) declared, “Let’s cut to the chase. I think there’s a consensus we should not have it before us on Monday.” And no one disagreed with him.

Barring surprise, then, the Aug. 17 council meeting will end without the council authorizing the placement of a city income tax on the November ballot. That will be the last opportunity council has to make such a decision. It’s therefore almost certain that the ballot in November will not include a question on a city income tax for Ann Arbor. Based on council discussion during the work session, a city income tax will, however, eventually be given serious consideration as a May 2010 ballot issue.

In light of the prospect of a May 2010 ballot question, it’s worth noting the kinds of issues councilmembers raised with Fraser and the city’s CFO, Tom Crawford. We’ve also folded into this report an account of a recent meeting sponsored by the Ann Arbor Area Chamber of Commerce about the proposed tax. [Full Story]

A “preliminary” version of an income tax feasibility study prepared by Plante & Moran in July 2009 is now available for perusal by Chronicle readers.

Although Ann Arbor city staff continue to work with the consultant on the report, The Chronicle is making the preliminary version available to the public for two reasons: (i) any differences between the preliminary version and the final version should reflect the possible back-and-forth city staff had with the consultant, and (ii) given the upcoming League of Women Voters debate on July 22, we deemed it important that city council candidates have equal access to the report in order to prepare for possible debate questions. One of our suggested questions focuses on how candidates would evaluate a possible city income tax.

Links to the body of the report (with searchable text) as well as a scanned image of the complete report with appendices appear after the break. [Full Story]

Following the directive from councilmembers during a regular meeting, as well as at a city council budget retreat, to update the most recent study of a city income tax for Ann Arbor, the 2004 Ann Arbor Income Tax Study has been disseminated by Tom Crawford, chief financial officer for the city of Ann Arbor. But the 2004 study was by no means the first such effort to analyze the impact of a city income tax on Ann Arbor.

In 1997, a similar effort was undertaken by the University of Michigan School of Public Policy. Chronicle reader and Stopped.Watched. correspondent Vivienne Armentrout lent her perfect-bound copy of that 73-page document to The Chronicle, which we’ve scanned and converted to a 4 MB .pdf file: [1997 Ann Arbor Income Tax Study]. [Full Story]

At Ann Arbor city council’s recent budget retreat, during a priority-setting exercise in which councilmembers went around the table naming a top priority for them in the coming year, Leigh Greden said he wanted to see a thorough assessment of the possibility of a city income tax. Councilmember Stephen Rapundalo had made a request at the Jan. 5 city council meeting that staff dust off the 2004 income tax study and begin to update it with current information.  Tom Crawford, chief financial officer for the city of Ann Arbor, has now disseminated the 2004 Ann Arbor city income tax study [2.5 MB .pdf]. [Full Story]