Town is taking an excessive amount of of our millage cash

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The headquarters of the Detroit Public Library on Woodward Avenue in Detroit on Saturday, March 18, 2017.

Detroit Public Library leaders say too much of their voter-approved millage is being diverted to the city’s Downtown Development Authority, which is above a 5% cap set in the electoral question that voters will ask when the millage is renewed approved by the library in 2014.

Library officers and staff said during a virtual meeting on Tuesday that tracking represented 12% of Millage’s sales in 2020 and is estimated to be 11% in 2024 and 2025. These amounts will come at a time when the COVID pandemic has already temporarily closed most of its branches.

“We’re not a big bite out of anyone’s budget and why someone bites and takes even more of us is just – I’ve already said it – objectionable,” said Russ Bellant, president of the Detroit Library Commission, the government’s library body, told the Free Press on Friday.

The Downtown Development Authority said in a statement earlier this week that the amount of taxes recorded goes up and down with property values. The recording of the additional real estate tax revenue by the DDA is legally permissible and the “language in an election initiative cannot replace state law”.

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Local governments and their development agencies in the city center can collect part of the property taxes for economic development projects under state law. This process, known as tax increase funding, allows authorities to collect increases in property tax revenue in a given area in order to develop the area or fund certain projects. Incremental taxes can be captured by According to the Citizens Research Council of Michigan, taxes, school taxes, county taxes, and taxes are collected for libraries and parks.

The Detroit Downtown Development Authority, headed by Mayor Mike Duggan, is a public agency founded in the 1970s designed to support private investment and business growth to boost business activity in downtown Detroit. According to its website, the DDA is funded from grants, contracts, loan interest and recorded tax increases for approved developments.

In 2014, the Detroiters voted to extend the Detroit Public Library’s operating mill for 10 years. The language of choice indicated that “5% of the taxes levied may be collected by the Detroit Economic Growth Corporation tax-raising authorities, as required by law.”

Jo Anne G. Mondowney, executive director of the Detroit Public Library, said during the meeting Tuesday that the amount of revenue from collecting library mills annually is above voters approved since 2017. Over the past 22 years, the Detroit Public Library’s stake in the Millage tax record has totaled $ 48.5 million in revenue for economic development projects in the city of Detroit, Mondowney said during the meeting.

The library operations are funded primarily through a tax of $ 4.63 million, which is about $ 230 for a home with a taxable value of $ 50,000.

Mondowney said approximately 89% of the library’s revenue comes from their millage. Tax registration reduces the library’s ability to reopen libraries and provide services, Bellant said. Out of 21 libraries, only six branches are currently open. They were closed because of the COVID-19 pandemic.

“We can’t run 21 stores on a budget it no longer supports, and that means reduced neighborhood services, that is, stores that have literacy programs where kids go after school until their parents come and pick them up. ” Bellant said.

In 2019, there were approximately 3 million visits to branches of the Detroit Public Library, according to a recent budget analysis. The library provided public access to more than 1,000 computers, and more than 250,000 children, adolescents and adults participated in community programs prior to the COVID-19 pandemic.

In February, the Detroit Library Commission approved a resolution to set up a special committee to inform Detroiters of the tax levies, calling them an “unauthorized diversion” of their millage. The meeting on Tuesday was the first information event for the residents.

“If (the public sees) stores are closed, they think why is that? We voted for Millage,” said Bellant. “We have to tell them. We don’t want to be complicit in the silence that millions of their dollars are diverted every year, and we’re silent about it.”

Because these tax records are based on property tax values, the amount collected can change from year to year, said Eric Lupher, president of Michigan Citizens Research Council.

The DDA said in its statement that in 2013, “the library did not properly or timely refuse the registration according to the law”. Instead, the DDA and the library agreed to enter into an agreement with the library on the sharing of taxes in relation to tax increase revenue generated in the expanded area of ​​the development area (i.e., the area east of Woodward that surrounds the LCA) sharing agreement , Since 2014 the library has received tax increases in the area of ​​the life cycle assessment, which the DDA would otherwise have been entitled to receive. “

A library official instead pointed out 2017 and the DDA’s agreement to bring the Detroit Pistons to Detroit. That year, Governor Rick Snyder signed bills to exempt local libraries from tax hike funding agencies that levy taxes. Mondowney said the Detroit Public Library was essentially “worked out of the opt-out” when the DDA expanded its district boundaries to fund the move of the Detroit Pistons downtown.

The DDA said that “all current and future tax increase revenue recognized by the DDA is pledged for the repayment of bonds” and that “the DDA does not divert any other recognized revenue under applicable law and due to restrictions in the DDA’s bond filings can raise tax revenue to the library for operational support. “

Lupher says bonds, which can take 20 or 30 years to repay, underscore the ongoing nature of the downtown development agency’s tax collection process, which can frustrate businesses like libraries.

“It’s supposed to end when these bonds are paid, but the reality is that the DDA is still issuing bonds or keeps developing things to invest in and it never stops,” he said.

John Mogk, a professor at Wayne State University’s Law School whose research has focused on city law and economic development policies, said the reason why tax increases were funded is so that the recorded property revenues go back into the district and back up Can promote development of the country area.

However, according to Mogk, local governments could ask if tax collection is needed.

“From the point of view of local governments,” Well, we know that the income generated can be used productively for us to serve our public purpose, and when it is not available we are severely hampered in doing our work “Said Mogk.

The author of the Free Press, Christine MacDonald, contributed to this report.

This article is part of the Detroit Free Press partnership with Detroit Documenters, a citizen journalism project to raise awareness of public gatherings. The program trains and pays highly committed citizens to oversee public gatherings. Learn more at detroit.documenters.org.

Nushrat Rahman handles economic mobility issues for the Detroit Free Press and Bridge Detroit as a corps member with Report for America, an initiative of the GroundTruth project. Make a tax-deductible contribution to support your work at bit.ly/freepRFA.

Contact Nushrat: nrahman@freepress.com; 313-348-7558. Follow her on Twitter: @NushratR. Sign up for Bridge Detroit’s newsletter. Become a subscriber to the Free Press.