Ken Schwartz, a Washtenaw County road commissioner, talks with Curtis Hedger, the county's corporation counsel, before the start of the Oct. 6 county board of commissioners working session. (Photos by the writer.)

This time, however, the board heard directly from representatives of the road commission: Ken Schwartz, a former county commissioner who’s now one of three road commissioners; and Roy Townsend, the road commission’s director of engineering. Schwartz was instrumental in identifying a 1909 state law that would allow the county board to levy a millage for road repair without voter approval.

But in presenting the proposal for a set of possible road projects throughout the county costing about $8.7 million, Schwartz backed off from advocating for a millage. Instead, he said the road commission was simply bringing forward a list of needed projects and the amount that it would cost to pay for them. It’s up to the board of commissioners, he said, to decide what funding source to use, or whether to act on the proposal at all.

Commissioners expressed a variety of concerns during the hour-long discussion. Board chair Conan Smith worried about “tax weariness,” indicating that other countywide millages might be in the offing. Yousef Rabhi was cautious about taking action that could jeopardize a street repair millage that’s on the November ballot in Ann Arbor.

Smith also broached the issue of possibly expanding the road commission board – a controversial topic that was last discussed seriously in 2010. Currently there are three road commissioners, and Smith wondered how often the small size caused concerns over violating the state’s Open Meetings Act.

The road repair proposal and related issues will almost certainly be taken up again. The board has pushed back consideration of the plan to its Dec. 7 meeting.

Other topics of the Oct. 6 working session included an update on the county’s fiscal “score card,” and a presentation by bond attorney John Axe about factors contributing to the county’s bond ratings. This report focuses on the road repair issue.

Road Commission Plan: Presentation

Ken Schwartz began by saying there were some misconceptions about what the road commission was asking for. They aren’t asking for any particular millage or funding mechanism, he said. [The map submitted by the road commission to the county clerk, showing the location of proposed road projects, is labeled "Proposed 2012 County Millage Projects for Washtenaw County Road Commission" – .pdf of map and .pdf of projects list]

The road commission is following Public Act 283 of 1909, which requires the commission to submit a plan of recommended road repairs and the cost to do the projects, he said. [.pdf of relevant section from Act 283, including summary by Lew Kidder of Scio Township.] Schwartz said he was there merely to report the road commission’s findings to the board, not to advocate for any particular funding. “That’s going to be up to you guys,” he said.

Some people have said the law is too old and doesn’t apply, Schwartz noted. But the road commission’s legal counsel believes the law is still valid. In general, county funding laws tend to be older, he said – counties dip back into the state’s history when looking at how they operate and fund projects.

Schwartz cited an advantage in using local funding for road repair: The county would have more control over how the money is spent. With federal and state funding, there are restrictions on what can be done, he said. For example, repair of a road using federal dollars might require reconstruction of adjacent ditches or widening of the road’s shoulders. Perhaps that work isn’t necessary, and could be curtailed to result in a less expensive project.

When the road commission staff originally put together a list of projects, Schwartz said, it was considerably smaller – in the $3-4 million range. But after considering it more fully, road commissioners felt that a broader plan would better serve the county. The projects identified by the road commission proposal come to about $8.7 million.

Roy Townsend, the road commission’s director of engineering, described some of the projects in more detail. He said the last time the road commission had presented this kind of plan – as far as their records showed – was in 1969, for road work associated with construction of the Washtenaw Community College campus on East Huron River Drive.

The staff looked at several different factors when selecting possible projects, Townsend said. Factors included the condition of the pavement, traffic volume, access for public safety vehicles, and connectivity. How much are the roads used as corridors between communities? Are the roads of economic or regional importance? Do the roads serve as business corridors? The staff also tried to propose projects that are dispersed equally throughout the county, Townsend said, so that communities get their fair share.

Also factored in is whether the project would be eligible for other funding, by partnering with local communities or leveraging other available money, he said.

The five most expensive of the 38 projects are:

1. Miller Avenue: 0.87 miles from Maple to Newport ($957,000)
2. Dexter Road: 0.78 miles from Huron to North Maple ($858,000)
3. Ellsworth Road: 2.3 miles from State Road to I-94 ($851,000)
4. Ann-Arbor Saline Road: 0.6 miles from Eisenhower to west of Lohr ($781,000)
5. North Territorial Road: 4 miles from Sutton to Tower ($701,250)

In addition to roadwork, the project list includes $100,000 for culvert replacements countywide, and $130,000 for roadside cleanup. An additional nine projects are also listed that could be done if the original road repairs cost less than anticipated, freeing up money for other work.

Road Commission Plan: Board Discussion

Questions from county commissioners covered a range of topics during their hour-long discussion. This report organizes their comments and questions thematically.

Road Commission Plan: Board Discussion – Location, Equity

Wes Prater asked whether the road commission was trying to locate projects in all communities. Roy Townsend said that was the goal – if there weren’t projects directly in a community, there would be one nearby. For example, no road repairs are proposed for Dexter, but there’s a project adjacent to the village. The staff also tried to pick projects that were located on borders between jurisdictions, Townsend said, or that cross multiple jurisdictions.

Prater asked specifically about whether there were any projects in Milan. No, Townsend said – the closest one is on Willow Road, from Platt to Gooding.

County commissioner Yousef Rabhi, left, talks with Roy Townsend, director of engineering for the Washtenaw County road commission.

Ken Schwartz said that if you looked at the statute, the intent is to do this kind of plan every year. Over a period of years, the geographic equity would be more apparent, he said. In devising this one-year plan, the staff looked at the countywide road system, Schwartz explained, and tried to pick roads that are used by multiple communities. Grove Road in Ypsilanti, for example,  is a major corridor between Ypsilanti and Ypsilanti Township, and there’s no other current funding available for road improvements there.

Prater noted that the city of Ann Arbor accounts for about 34% of the county’s taxable value. A substantial amount of any countywide millage would come from Ann Arbor, and he hoped the road commission would make it equitable for the city’s taxpayers. Townsend said at first city staff thought they’d use any available funding for the East Stadium bridges project, but later decided to target other projects. The largest road repair on the list – $957,000 for Miller Avenue, between Maple and Newport – is in Ann Arbor. Another example of an Ann Arbor project is the $858,000 proposed repair of Dexter Road, between Huron and Maple.

In response to another question from Prater, Townsend said that some of Ann Arbor’s projects would be managed by the city, while others would be handled by the road commission, which would bid out the work to contractors.

Yousef Rabhi asked how the projects in Ann Arbor had been identified. Townsend said the road commission had met with representatives from each community, to get input about priority projects. Often, these were projects that are already included in a community’s capital improvements plan (CIP). [According to Ann Arbor city staff, the Miller Avenue project (between Maple and Newport) is currently planned for construction in 2013, assuming Ann Arbor voters renew the street repair millage in November. Chronicle coverage of that project from 2009: "Miller Avenue to Be Resurfaced and More"]

Dan Smith observed that the road commission has clearly put a lot of thought into this plan. He’s driven down North Territorial and agreed that it’s in need of repair. He asked Schwartz to elaborate on the issue of equity, pointing to the section of Act 283 that calls for apportioning the spending of millage revenues in accordance with each community’s equalized (taxable) value.

Schwartz said the concept of equitable apportionment is based on the statute, and that the road commission’s reading of the law is that the projects need to benefit the entire county.

Dan Smith said it seemed that sections 224-20B and 224-22 of Act 283 gave the county the option of asking voters to approve a millage or to bond for the purpose of road repair. He also asked whether Schwartz’s understanding of Act 119 of 2011 was that the county could use its general fund surplus on roads – assuming a surplus is available. Schwartz said his understanding is the county can use its general fund surplus in any reasonable way.

Road Commission Plan: Board Discussion – Funding

Conan Smith said he had some concerns about “tax weariness” in the county. He wanted to make sure they had a thorough conversation in the context of other needs, such as human services. He noted that some state legislators are concerned about pre-Headlee laws that allow counties to levy taxes without government approval. Washtenaw County does that with Act 88 to support economic development and agriculture, and the Veterans Relief Act to support services for indigent veterans. Smith said he didn’t want to poke the legislature in the eye with a road millage, but he wasn’t afraid of them, either.

Ken Schwartz again said he wasn’t advocating for a millage or any particular funding mechanism. The board could do a pre-Headlee levy, or the county could issue bonds for the work. Another option would be to ask voters to approve a millage.

Yousef Rabhi expressed concern about jeopardizing the millages that Ann Arbor voters will be asked to approve in November – 2 mills for street repair, and 0.125 mills for sidewalk repair. That’s over $9 million that Ann Arbor residents will be paying, he said. The city has decided to pay for its streets with a voter-approved millage, Rabhi said, and it seemed like that could be an effective strategy for other jurisdictions, too.

Dan Smith also asked why other communities wouldn’t work with the road commission to levy a millage within each community’s jurisdiction, based on their individual needs. He noted that it does happen in some jurisdictions. Schwartz said it’s up to each township or village. Bridgewater Township, for example, levies a millage for that purpose. Some communities also use special assessments to pay for specific road projects, he said.

Townsend noted that townships don’t have responsibility for major roads that run through their jurisdictions – that’s the county’s job. The plan put forward by the road commission takes a regional approach, he said, targeting major roads. He also observed that in Michigan, about 20 other counties have some kind of countywide millage for road repair.

Saying he wasn’t asking for a commitment, Dan Smith wondered if the road commission intended to bring forward a plan like this again next year. Schwartz indicated that would be likely. Even if the 1909 law the commission is citing weren’t on the books, he said, it would be good policy for the road commission to make a presentation on the condition of the county’s roads and bridges. That way, the county board can understand which projects need to be addressed. No matter how those projects are funded, it’s better for residents when the county board and road commission have a better relationship, he said.

Dan Smith said it’s hard to come to grips with using this law, since the world has changed so much since 1909 – one year after the Model T was invented, he noted. The law predated the state’s gas tax, state highways and the Headlee Amendment, among other things. Schwartz replied that it’s a policy decision the board needs to make, as to whether this approach works for the county. He noted that Ypsilanti levies a millage for road repair, and it’s still not enough to fix the city’s deteriorating streets.

Schwartz also noted that Act 51 revenues – the road commission’s main source of funding – have been decreasing since the early 2000s. [The road commission is funded primarily through Public Act 51 gas taxes and vehicle registration fees. Its 2011 budget is about $16.5 million, and employs about 130 workers. In Washtenaw County, the road commission is responsible for maintaining all the public roads outside of cities and villages, which pay for their own street repair and construction.]

Prater asked about the road commission’s five-year capital improvements and preventative maintenance plans. Townsend reported that the five-year capital improvements plans (adopted in 2010, for the years 2011-2015) identifies about $30 million in projects that are funded through federal grants or other sources. However, he said, there are another $90 million in unfunded projects throughout the county, including work needed on bridges and culverts. He estimated the total needs for the county at roughly $250 million.

Road Commission Plan: Board Discussion – Economic Impact

Conan Smith asked if the road commission had an estimate about how many local jobs this work would create. The rule of thumb for federal recovery act dollars is that $90,000 of investment creates one job, he said. If that’s the case with this project, they’d be creating more than 80 solid jobs for a year. He asked whether the road commission had a local hiring policy as part of its bid process. No, Schwartz said, noting that there are limited suppliers for some of the asphalt work. There’s only one asphalt paving plant in Washtenaw County, for example.

Some government contracts require that contractors hire a certain number of local workers, Conan Smith noted. He asked if the road commission would consider that. It’s a possibility, Schwartz said – those are the kind of details that would need to be worked out. Smith said his general sense is that the county has the opportunity to create jobs, but he wanted to see that benefit accrue to local residents who are hurting now.

Conan Smith said he doesn’t see it as a road project – he sees it as a jobs project. It’s important to keep that value in mind as they have a conversation about this proposal, he said.

Schwartz reported that the road commission is working with the sheriff’s office to develop a program using inmates for road cleanup. The road commission would pay for sheriff’s staff to handle oversight of the work, he said. Details are still being worked out.

The road commission hears the county board loud and clear about the importance of these projects to stimulate economic development, Schwartz said. Almost all the projects on the list are roads that handle buses, heavy trucks or high traffic volume, so every dollar spent will help reap additional dollars, he said.

Road Commission Plan: Board Discussion – Expansion of Commission

Conan Smith brought up the issue of the size of the road commission’s board. It currently has three members. Smith noted that in the past, the county board had talked about expanding the road commission board to five members. The county board appoints road commissioners, and has authority to increase or decrease membership. That issue had been controversial, he noted. [Most recently, those efforts had been championed in 2010 by former county commissioner Jeff Irwin, a Democrat who now serves as a state representative for District 53. See Chronicle coverage: "Effort to expand road commission doesn't gain support"]

Smith observed that Ken Schwartz had seen both sides – he was a former county commissioner, and had been appointed to the road commission after losing his seat in District 2 to Republican Dan Smith in November 2010. He asked for Schwartz’s insight into the question of expanding membership on the road commission board.

Schwartz said he hadn’t given it much thought, but he could see merits to either a three- or five-member board. It might be helpful to have more members, he said. There are times when only two commissioners can attend a meeting, and he indicated that more input would be useful.

Smith then asked how often the road commissioners ran into difficulties with the state’s Open Meetings Act. Schwartz contended that if members are only sharing information – and not deliberating – then there’s no OMA requirement that prevents them from meeting. Nor would they have to provide public notice for such a meeting, he said.

Road commissioners are scrupulous about not deliberating if the meeting isn’t public, Schwartz said, and they try very hard to avoid even the appearance of an OMA violation. A five-member board would make it easier to do that, Schwartz said.

Prater noted that in the past he had served as a road commissioner too, and said it’s extremely hard not to slide into deliberations when two road commissioners are talking. One of them might suggest doing something, he said, and the other one would weigh in, perhaps by saying it’s a good idea. He said he’d like to talk about expanding the road commission to five members.

Present: Barbara Levin Bergman, Ronnie Peterson, Wes Prater, Yousef Rabhi, Dan Smith, Conan Smith, and Rob Turner.

Absent: Kristin Judge, Leah Gunn, Alicia Ping, Rolland Sizemore Jr.

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Map of road work proposed by the Washtenaw County Road Commission for Ann Arbor and Ypsilanti. Other work is proposed throughout the county. The proposal asks the county board to levy a road millage to pay for the work. (Links to larger image.)

The topic emerged at a Sept. 8 working session of the county board of commissioners, which would need to authorize the millage before it could be levied. The issue was not on the agenda, and was discussed late in the meeting.

Wes Prater brought up the issue of a possible road millage during the time set aside for items for current or future discussion. He said he’d received an email indicating that the road commission planned to ask the board to levy an 0.6 mill tax, and he wanted more details. The millage, if authorized, would raise about $7 million for more than three dozen proposed road projects.

County administrator Verna McDaniel reported that she and Curtis Hedger, the county’s corporation counsel, had met with road commissioner Ken Schwartz and Roy Townsend, the road commission’s director of engineering, regarding a possible county millage. Road commissioners believe the millage could be levied under Public Act 283 of 1909. Because that act pre-dates the state’s Headlee Amendment, it could be levied by the board and would not require voter approval.

The staff and board of the road commission have been discussing this proposal at their public meetings as well as privately with elected and appointed officials throughout the county, including county commissioners. At least one of those private meetings may have violated the state’s Open Meetings Act.

It’s expected that Townsend and Schwartz – a former county commissioner, who was instrumental in finding this possible funding source – plan to make a presentation at the county board’s Sept. 21 meeting. The county currently levies two other taxes in this pre-Headlee category, though they are for considerably smaller amounts: (1) 0.05 mills to support economic development and agriculture; and (2) 0.025 mills to support services for indigent veterans. Both were also put forward by Schwartz when he served on the county board. A final vote on renewal of those two millages will occur at the Sept. 21 meeting.

McDaniel said she asked Hedger to seek advice on the road tax from the state’s attorney general. The county needs to look at the statute carefully, she said, to determine what the board’s rights are.

Road Commission: Some Background

The county road commission is a public entity, funded primarily through Public Act 51 gas taxes and vehicle registration fees. Its 2011 budget is about $16.5 million, and employs about 130 workers. In Washtenaw County, the road commission is responsible for maintaining all the public roads outside of cities and villages, which pay for their own street repair and construction. In Ann Arbor, for example, voters will be asked in November to renew a five-year street repair millage of 2.0 mills.

In addition to handling repair and reconstruction for about 1,650 miles of roads, the road commission maintains more than 100 bridges and 1,000 culverts in the county. It also has a contract with the Michigan Dept. of Transportation to handle maintenance for 580 lane miles of state “trunkline” roads that run through the county, including Washtenaw and Michigan avenues. During winter months, road commission workers handle snow removal, salting and sanding on county roads and state trunklines.

The road commission has its own governing board of three commissioners. Currently, road commissioners are Doug Fuller (chair), Fred Veigel (vice chair) and Ken Schwartz. The county board of commissioners appoints the road commissioners, but has no authority over the road commission’s budget or activities.

But county commissioners in the past have attempted to address what they saw as problems with the road commission, including a lack of responsiveness and overly-weighted representation from the eastern side of the county. In early 2010, Jeff Irwin – who served a decade as county commissioner for District 11 in Ann Arbor before being elected as state representative in November 2010 – pushed to expand the number of members on the road commission. The board began that process by setting a public hearing for possible expansion, after vigorous debate. The hearing was held in June 2010. After another lengthy and sometimes heated discussion, the board majority voted to end the process, with dissent from Irwin and Conan Smith.

Road Millage: Public Act 283 of 1909

At their Aug. 16, 2011 meeting, road commissioners passed a resolution approving the 2012 Road Improvement Plan “consistent with Public Act 283 of 1909″ and authorizing the county highway engineer to present the plan to the Washtenaw County board of commissioners for consideration. [.pdf of the relevant section from Act 283. The document includes a summary written by Lew Kidder of Scio Township, who refers to the section as "one long, James Joyceian paragraph."]

The road improvement plan outlines 41 projects that could be paid for with millage funds. [.pdf of proposed projects] The list includes:

• Ann Arbor-Saline Road, from Eisenhower to eastbound I-94
• Ann Arbor-Saline Road, from Waters/Lohr to Eisenhower
• Ellsworth, from State Street to I-94
• Huron River Drive, from Bird to Foster
• Miller Road, from Maple to Newport
• Scio Church Road, from Wagner to I-94

The Aug. 16 resolution did not explicitly refer to a millage. However, the minutes of the Aug. 16, 2011 road commission working session – held prior to the regular meeting – indicate that the topic of a millage was discussed:

Commissioner [Ken] Schwartz stated that he had discussions with several County Commissioners and county representatives that seemed to be supportive of this proposed millage plan. The [Road Commission] Board was in agreement that Roy Townsend and Commissioner Ken Schwartz should present this plan to the County Board in September.

Schwartz was appointed to the three-member road commission by the county board of commissioners in December 2010, after he lost a November 2010 re-election bid in District 2 to Republican Dan Smith. While on the county board, Schwartz was instrumental in identifying two other pre-Headlee statutes. Among its many provisions, the Headlee Amendment requires voter approval of local government tax increases that weren’t authorized before November 1978, when Headlee was adopted.

Because of those two pre-Headlee statutes, the county board now levies taxes in support of: (1) economic development and agriculture (Act 88); and (2) services for indigent veterans (Indigent Veterans Relief Act). Those millages, which also do not require a vote by the public, received initial approval at the county board’s Sept. 7, 2011 meeting. A vote for final authorization will be taken on Sept. 21. If given final approval, the millages would be levied in December 2011.

Road Millage: County Board Discussion

At the Sept. 8 county board working session, Rob Turner – the board’s liaison to the road commission – reported that he’d been invited to lunch earlier this year with road commissioners Schwartz and Doug Fuller to discuss the millage issue.

This news prompted board chair Conan Smith to quip that the lunch had violated the Open Meetings Act. [Though joking, Smith's statement may have been accurate. With only three members on the road commission, two members constitute a quorum. The Open Meetings Act is violated if two road commissioners deliberate towards a decision on road commission business and their meeting has not been properly noticed as open to the public.]

Turner continued, saying Schwartz had found that the 1909 law requires the county road commission to present a report on its needs to the county board, including a request for funding. The road commissioners expressed a desire to do that, Turner said. After that meeting with the road commissioners, Turner said, he discussed the issue with Hedger and McDaniel. It was determined that Hedger would do research to see if the state’s gas tax legislation superseded the 1909 law.

However, Turner said, road commissioners have subsequently decided to move forward, without waiting for the county to weigh in. So in August the road commission passed a resolution to make a request at the county board’s annual meeting in September. Turner noted that the board doesn’t have to act on the road commission’s request – they have options.

Conan Smith said the road commission has a robust plan that needs to be shared. The plan seems to focus on projects at the boundaries between jurisdictions, he noted, and their prioritization process is worth hearing. The legalities are also interesting, Smith said. While he’s sorry the issue has been “sprung” on them, at the same time it’s fascinating.

Prater noted that there’s legislation pending in Lansing that would repeal Act 88 (the economic development millage), though it’s been held up in committee. He suspected that when people get wind of this road millage, there’ll be efforts to stop that, too.

In a phone interview this week with The Chronicle, Hedger said he’d had an informal conversation with an assistant state attorney general, who didn’t know of any other county that had passed such a millage. Hedger said he’d also called around to several other counties and road commissions in Michigan, and hadn’t found any place that levied this kind of millage. However, he said it would be premature for him to give advice on the matter before anything had been proposed.

Reached by phone this week, Schwartz told The Chronicle that the state law has been overlooked for decades, but that it remains in effect and makes it mandatory for the road commission to present a road improvement plan, with an estimate for the amount to fund that plan through a millage. A cap on the amount that can be raised is based on the size of the county’s taxable property value – for Washtenaw County, the cap is 1 mill.

The plan that Schwartz and Townsend expect to present to the county board recommends an 0.6 mill tax, which would raise about $7 million. The road commission’s current budget is about $16.5 million. Schwartz said the primary road commission funding, received via the state, hasn’t kept up with labor and material costs. Many roads in the county are in bad shape, he said, but the road commission lacks resources to repair them.

Many of the proposed projects span multiple jurisdictions, Schwartz noted, which often makes the work trickier to coordinate and fund. Examples include Ann Arbor-Saline Road near the I-94 interchange – parts of that stretch are the responsibility of the city of Ann Arbor, the Michigan Dept. of Transportation, and the road commission. As another example, a section of Grove Road in Ypsilanti, which is a feeder route into Ypsilanti Township, is seriously degraded, Schwartz said, but Ypsilanti doesn’t have the funds to pay for repair.

The millage would be collected countywide, but spent on projects in proportion to a jurisdiction’s taxable value, Schwartz said. He noted that unlike funding for things like human services, road repair is clearly measurable – commissioners can simply go out and drive the roads to see what kind of condition they’re in.

Schwartz also indicated that the work would likely be contracted out – the road commission doesn’t anticipate using the funds to hire permanent staff.

Like Hedger, Schwartz said he didn’t know of any other Michigan county that was levying this millage. He said the last time it was levied in Washtenaw County was in the late 1960s or early 1970s, for work that included roads around Washtenaw Community College, which opened its Huron River Drive campus in 1970.

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