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HomeMy WebLinkAboutResolutions - 2002.09.19 - 27014MISCELLANEOUS RESOLUTION 102232 September 19, 2002 BY: Finance Committee, Sue Ann Douglas, Chairperson IN RE: BOARD OF COMMISSIONERS - 2002 COUNTY GENERAL FUND PROPERTY TAX AND PARKS AND RECREATION TAX RATES To the Oakland County Board of Commissioners Chairperson, Ladies and Gentlemen: WHEREAS the County has a fixed millage rate of 5.26 mills (voter approved 8/8/78) and a voter approved (8/8/00 - Term 2002-2011) 0.2500 mill for Parks and Recreation; and WHEREAS the Huron-Clinton Metro Parks Authority has requested the County to apportion a 0.25 mill property tax rate; and WHEREAS Michigan Law (MCL 211.34d(16) permanently reduced the County's Maximum Allowable Tax Rate to the 2002 "Headlee" rollback (Article 9, Section 31 of the Michigan Constitution) tax rate of 4.2886 mills, a Parks and Recreation maximum allowable tax rate of 0.2453 mill and a Huron-Clinton Authority maximum allowable tax rate of 0.2186 mill; and WHEREAS Public Act 42 of 1995, "Truth in Budgeting" Act, allows the County Board of Commissioners to hold a single public hearing as a prerequisite to both approval of the Property Tax Levy and Budget adoption, if the recommended property tax rate necessary to support the ensuing year's operating budget is included in the General Appropriations Act; and WHEREAS the Board of Commissioners, upon the recommendation of the County Executive, adopted Miscellaneous Resolution #98217 establishing a 1998 County Property Tax rate of 4.1900 mills, 0.273 mills less than the Maximum Allowable Tax Levy as constrained by State law, equivalent to a total tax reduction of $10.7 million in 1998, the tax rate of 4.19, unchanged for tax years 1999 through 2001, has resulted in total tax reduction of $9.6 million in 1999, and $7.9 million in 2000, and 6.5 million in 2001 respectively, for a four-year total taxpayer savings of $34.7 million; and WHEREAS the County Executive recommends that the County 2002 tax rate be set at 4.1900 mills, the same since 1998, 0.0986 mill below the Maximum Allowable Tax Levy as constrained by State law, equivalent to a tax reduction of $4.9 million, without jeopardizing the County's ability to deliver quality public services; and WHEREAS the Finance Committee recommends that the 2002 County General Fund Property Tax rate be set at 4.1900 mills, 0.0986 mill below the maximum allowable tax rate; the Oakland County Parks and Recreation Tax rate be set at 0.2453 mill, the maximum allowable tax rate; and the Huron-Clinton Metro Park Authority Tax rate be set at 0.2186 mill, the maximum allowable tax rate; and WHEREAS $212,411,059 is the estimated amount of the Fiscal Year 2003 County General Fund Budget to be raised by taxation based on the 2002 Taxable Value of all property located in Oakland County ($50,694,763,579) at the recommended rate of 4.1900 mills, together with the voted .2453 mill for Parks and Recreation of $12,435,425 and the 0.2170 mill for the Huron-Clinton Authority of $11,081,875. NOW THEREFORE BE IT RESOLVED that each Supervisor of the various townships and Assessing Officers of the several cities of Oakland County are authorized and directed to spread on their respective township or city tax rolls for the year 2002 the following tax rates to be applied to the 2002 Taxable Value of all property located within their respective jurisdictions: 2002 County Voted for Huron-Clinton General Property Tax Levy Parks & Recreation Park Authority 4.1900 Mills 0.2453 Mill 0.2170 Mill Chairperson, on behalf of the Finance Committee, I move adoption of the foregoing resolution. FINANCE COMMITTEE oal0).--/ 360 FINANCE COMMITTEE Motion carried unanimously on a roll call vote with Causey-Mitchell and Palmer absent. Vali 44 I L. BROOKS PATTERSON, OAKLAND COUNTY EXECUTIVE COUNTY MICHIGAN DEPARTMENT OF MANAGEMENT AND BUDGET Laurie Van Pelt, Director Edwin J. Poisson, Deputy Director September 12, 2002 To: Sue Ann Douglas, Chairperson Board of Commissioners Finance Committee Re: Recommended Oakland County 2002 Ad Valorem Property Tax Rate The Oakland County 2001 Ad Valorem Property Tax Rate of 4.1900 mills is included in the County Executive's FY2003 - 2004 Biennial Budget Recommendation to support County operations. The Board of Commissioners, upon the recommendation of the County Executive, adopted Misc. Resolution #98217 establishing a 1998 County Property Tax rate of 4.1900 mills, .273 mills less than the Maximum Allowable Tax Levy as constrained by State Law, equivalent to a total tax reduction of $10.7 million in 1998. The tax rate of 4.1900, unchanged for tax years 1999 through 2001, has resulted in total tax reductions of $9.6 million in 1999, $7.9 million in 2000, and 6.5 million in 2001 respectively, for a four-year total taxpayer savings of 34.7 million. The County Executive recommends that the County 2002 tax rate be set at 4.1900 mills, the same since 1998, 0.0986 mill below the Maximum Allowable Tax Levy as constrained by State law, equivalent to a tax reduction of 4.9 million, without jeopardizing the County's ability to deliver quality public services. If the Board of Commissioners adopts the foregoing recommendation, Oakland County, at 4.1900 mills, will have the third lowest operating millage tax rate of the 83 counties in the State of Michigan. The tax rate computations required by the Headlee constitutional tax limitation amendment, "Truth in Equalization" Act, "Truth in Taxation" Act, and "Truth in Budgeting" Act are enclosed. In compliance with the "Truth in Taxation" Act, the Board of Commissioners may levy a millage rate up to the Adjusted Base Tax Rate 3.9600 mills without holding a Public Hearing. The Board has the further discretion of levying up to 4.2886 mills, after holding a Public Hearing and adopting a separate resolution specifying the "Increased Tax Rate." The Board shall not levy a tax rate in excess of the Allowable Tax Levy of 4.2886 mills without a referendum. EXECUTIVE OFFICE BUILDING 34 EAST • 1200 N TELEGRAPH RD DEPT 409 • PONTIAC MI 48341-0409 • (248) 858-2163 • FAX (248) 858-9172 Public Act 42 of 1995, however, simplifies the public hearing process by allowing local units of government to combine the required public hearings for the Property Tax Levy with that required for Budget Adoption provided the rates necessary to support the budget are included in the General Appropriations Act in compliance with the "Truth in Budgeting" Act, Public Act 41 of 1995. Therefore, the proposed resolution adopting the 2002 Property Tax Levy also amends the 2003 General Appropriations Act to incorporate the tax rate and related revenue necessary to support the 2003 General Fund/General Purpose Operating Budget. If you have any questions or need further information, please contact my office. Respectfully, Laurie Van Pelt, Director Dept. of Management & Budget OAKLAND COUNTY, MICHIGAN 2003 BUDGET 2002 TAX RATE COMPUTATION The property tax rate computation and setting of the County's Ad Valorm Property Tax Rate are impacted by several State statutes, including: The Headlee constitutional tax limitation amendment, adding section 211.34d of the Michigan Compiled Laws, subsequently amended by PA 539 of 1982, The "Truth in Equalization" Act, Public Act 213 of 1981 amending section 211.34 of the Michigan Compiled Laws, The "Truth in Taxation" Act, Public Act 5 of 1982, adding section 211.34e of the Michigan Compiled Laws, subsequently amended by PA 2 of 1986 (Convention Facility Tax) and PA 264 of 1987 (Cigarette Tax) Public Hearing Requirements for Local Units of Government. Public Acts 40, 41 and 42 of 1995 set forth the public hearing requirements for local units of government regarding budget adoption and property taxation to support budget appropriations. A capsule statement of the purpose of each statute as well as the computation of their respective rollback fractions are provided in attached Schedules I, II, III and IV. Prior to 1994, the Headlee and "Truth in Equalization" rollback were compound reductions based on the County's maximum authorized operating levy of 5.26 mills. Starting in 1995, the COMPOUND MILLAGE REDUCTION FRACTION (CMRF) is no longer required to be calculated. This is true because MCL 211.34d (16) states that, starting in 1994, the "Headlee" millage reduction PERMANENTLY reduced the maximum rate(s) authorized by law or charter. Starting in 1995, the current Millage Reduction Fraction (MRF) is all that is required. Headlee Rollback Millage Permanently Reduced 2002 Millage Reduction Fraction Headlee Authorized Levy Truth in Equalization Rollback Headlee Authorized Levy 2002 Sec. 34 Rollback Fraction Allowable Tax Levy 4.3259 mills 0.9914 4.2886 mills 4.2886 mills 1.0000 4.2886 mills Truth in Taxation Rollback The Truth in Taxation Base Tax Rate is computed against the millage actually levied in the immediately concluded fiscal year. 1 2001 Actual Tax Rate 2002 Base Tax Rate Fraction 2002 Base Tax Rate 2002 Adjusted Base Tax Rate 4.1900 0.9607 4.0253 3.9600 (See Schedule IV) The Board of Commissioners may levy a millage rate up to the Adjusted Base Tax Rate of 3.960 mills without holding a Public Hearing. The Board has the further discretion of levying an additional millage rate, up to 4.2886 mills, only after holding a public hearing and adopting a separate resolution specifying the Increased Tax Rate (See Page 9 for optional Public Hearing requirements under Public Act 42 of 1995). The Board shall not levy a tax rate in excess of the Allowable Tax Levy of 4.2886 mills without a referendum. 2 ** *** SCHEDULE I HEADLEE COMPUTATION COMPOUNDED MILLAGE REDUCTION FRACTION The Headlee Tax Limitation referendum amended Article IX of Michigan Constitution by adding Section 31 which, in part, specifies: "If the assessed valuation of property as finally equalized, excluding the value of new construction and improvements, increases by a larger percentage than the increase in the General Price Level from the previous year, the maximum authorized rate applied thereto in each unit of Local Government shall be reduced to yield the same gross revenue from existing property, adjusted for changes in the General Price Level, as could have been collected at the existing authorized rate on the prior assessed value." The tax limitation is computed by determining the Millage Reduction Fraction* (MRF) for the current year. PA 415 of 1994 changed the formula for calculating the MRF by substituting Taxable Value for State Equalized Value (SEV). The Millage Reduction Fraction is not permitted to exceed 1.0000. the new formula is computed as follows: (2001 Total Taxable Value-Losses) X Consumer Price Index 2002 Taxable Value - Additions = 2002 MRF (47.656,729,878 - 899,096.121 x 1.032)** = 0.9914 50,694,763,579 - 2,024,188,025 2002 MILLAGE REDUCTION FRACTION = 0.9914** PA 539 of 1982, effective March 30, 1983, changed the formula for computing the MRF by subtracting losses from the numerator rather than adding losses to the denominator. This makes the computation consistent with the formula used for "Truth in Taxation". 2001 increase of 3.2% in the Consumer Price Index reported by the United States Department of Labor. PA 145 of 1993 - Section 34d(7) - The State School Finance Act specifies that "For each year after 1993, a millage reduction fraction shall not exceed 1.0000." 3 1 SCHEDULE II "TRUTH IN EQUALIZATION" 2002 ROLLBACK FRACTION Public Act 213 of 1981, "Truth in Equalization Act," which applies to counties and other taxing authorities other than school districts, amended Section 211.34 of the Compiled Laws of Michigan so that the taxing jurisdiction would be restricted to an operating levy based on that unit's authorized valuation total rather than a full levy based on the State Equalized Valuation. The Act restricts the County to a levy rate for operating purposes which will yield no more revenue on the total State Equalized Valuation (S.E.V.) of the County than the maximum authorized millage rate would have produced if levied on the total County Equalized Valuation (C.E.V.). There is no provision for removal of the "Truth in Equalization" rollback other than by placing a valuation on County property equal to the State equalized level. Starting in 1995, the language of MCL 211.34 results in a different Rollback Fraction because taxes will be levied against Taxable Value, not SEV. The following is the formula for calculating the Truth in County Equalization Rollback starting in 1995. Total Taxable Value Based on CTV For All Classes Total Taxable Value Based on STV For All Classes - 211.34 Rollback 50,694.763,579 50,694,762,519 = 1.0000 2002 Sec. 34 Rollback Fraction = 1.0000 4 SCHEDULE III "TRUTH IN TAXATION" BASE TAX RATE FRACTION Public Act 5 of 1982 added section 211.24e to the Compiled Laws of Michigan which requires that any local unit of government which levied more than one mill in 2001 shall either reduce its 2002 levy rate to compensate for an increased tax base or advertise its intention to increase property taxes and hold a public hearing to allow for taxpayer intervention. No sooner than seven days after the public hearing, the governing body may then increase taxes by a vote of its members, provided that in no case can the levy rate exceed the allowable rate which results from the reduction required by the "Truth in Equalization" Act, Sec. 211.34, and the Headlee Amendment, Sec. 211.34d. It is important to note that the Base Tax Rate that results from application of the "Truth in Taxation" Act is based on the rate actually levied in the concluding fiscal year whereas the Headlee and "Truth in Assessing" rollbacks are based on maximum authorized operating rates regardless of the rate which was actually levied in the preceding year. The primary change in the formula beginning in 1995, due to implementation of Proposal A, is the incorporation of Taxable Value rather that SEV. The 2002 section 211.24e Base Tax Rate Fraction is computed as follows: 2001 Total Taxable Value - Losses 2002 Total Taxable Value - Additions = 2002 Base Tax Rate Fraction 47.656.729,878 - 899,096.121 50,694,763,579 -2,024,188,025 = 0.9607 2002 Base Tax Rate Fraction = 0.9607 5 SCHEDULE IV CONVENTION FACILITY ACTS: Public Act 106 of 1985, the "State Convention Facility Development Act", provides for a tax to be imposed on room accommodations in a qualifying convention hotel located in Detroit, Wayne, Oakland and Macomb Counties. The revenue generated under this act is dedicated to cover the debt service on the Cobo Hall expansion. Public Act 107 of 1985, the "Tourism and Convention Facility Promotion Tax Act", increases the tax on liquor sold to bar owners or retail outlets for consumption off the premises. The revenue is placed in the Convention Facility Development Fund. Distribution is: a. Cover any portion of the Cobo Hall debt service not covered by the hotel tax. b. The 80 counties outside the metro-Detroit are are then reimbursed 100% of the liquor tax collected in their counties. c. Balance of the funds is split between the City of Detroit and Wayne, Oakland and Macomb Counties in proportion to the level of liquor taxes collected. Under Act 106, counties share in the convention facility tax revenues generated by imposition of Acts 106 and 107 when these revenues exceed the debt service requirements for convention facilities. As a result, Oakland County has received the following amounts since 1988: Year Amount 1988 $ 692,768 1989 $ 17,257 1990 $ 248,441 1991 $ 385,708 1992 $ 465,043 1993 $ 445,745 1994 $ 494,404 1995 $ 881,553 1996 $1,117,698 1997 $1,580,314 1998 $1,743,260 1999 $2,051,418 2000 $2,487,955 2001 $2,873,478 2002 $3,277,454 2003 $2,589,042 (Est.) The 2002 actual revenue is $78,668 more than the original estimate and, therefore, must be added to the 2003 estimate of $2,589,042 for purposes of computing the total ($2,667,710) convention facility/liquor tax component of the 2002 truth-in-taxation adjusted base tax rate. Public Act 2 of 1986 amends the "Truth-in-Taxation" law to require counties to reduce their base tax rate by the estimated revenues (adjusted for the difference between prior year actual and prior year estimate) distributed under Acts 106 and 107. Counties may follow the truth-in-taxation public hearing process to use the revenues for increased spending, however, 50% of the revenue not used to reduce the millage rate is required to be used for substance abuse programs. 6 CIGARETTE TAX ACTS: Public Act 219 of 1987 increased the cigarette tax by four cents ($.04) per pack (2 mills per cigarette packaged 20 to a pack). The proceeds are deposited in its entirety to the "Health and Safety Fund" created by Public Act 264 of 1987. Of the total tax collected: a. 25% is distributed to the Department of Social Services (now Family Independence Agency) b. The first $16,000,000 of the remaining 75% is distributed to Wayne County. c. The balance is divided among the remaining counties based upon the most recent census. The State Department of Treasury originally estimated that 82 Michigan counties, excluding Wayne County, would share 5.3 percent of cigarette tax revenue (approximately $17,000,000) on a per capita basis using the decennial federal census figures. As a result, Oakland County has received the following amounts since 1989. Year Amount 1989 $2,335,583 1990 $2,194,033 1991 $2,210,837 1992 $2,078,173 1993 $2,006,736 1994 $1,604,090 1995 $1,258,810 1996 $ 994,709 1997 $1,144,903 1998 $ 767,028 1999 $ 921,107 2000 $1,176,549 2001 $ 926,520 2002 $ 993,127 2003 $ 621,540 (Est.) The 2002 actual revenue is $19,130 more than the original estimate and, therefore, must be added to the 2003 estimate of $621,540 for purposes of computing the total ($640,670) cigarette tax component of the 2002 truth-in-taxation adjusted base tax rate. Public Act 264, of 1987 requires a county to reduce its base tax rate for truth-in-taxation purposes by an amount determined by dividing the estimated cigarette tax revenue (adjusted for the difference between prior year actual and prior year estimate) by the TV vs. SEV state equalized value of the county. The cigarette tax revenue, to the extent not used to reduce the counties millage rate, must be used for the following purposes. A. 11/17 of the distribution to the county health department for public health prevention programs and services. This distribution is in addition to and is not intended as a replacement for any state or county payments to these health departments. 7 B. 5/17 of the distribution shall be used only for the operation, maintenance, or expansion of an existing county jail facility or juvenile facility; for the acquisition, construction, and equipping of a new jail facility or juvenile facility; or for court operations. C. 1/17 of the distribution is not restricted to specific purposes and is to be included with other County revenues budgeted by the Board of Commissioners. Total 2002 Taxable Value Unadjusted Base Tax Rate Unadjusted Revenue Base Less: Convention Facility Tax Revenue Cigarette Tax Revenue Adjusted Revenue Base $50,694,763,579 4.0253 Mills $ 204,061,631 2,667,710 640,670 $ 200,753,251 Adjusted Base Tax Rate Adjusted Revenue Base Total Taxable Value = $ 200,753,251 $ 50,694,763,579 3.9600 Mills 8 1 SCHEDULE V PUBLIC HEARING REQUIREMENTS FOR LOCAL UNITS OF GOVERNMENT Public Act 40 of 1995 - Budget Hearings for Local Government This Act amends the law that requires local governments to hold a public hearing on their proposed budget and to give notice of the budget hearing by publication in a newspaper of general circulation at least six (6) days before the hearing. The notice shall include the time and place of the hearing and state the place where a copy of the budget is available for public inspection. The notice must also include the following statement in its budget hearing notice, printed in 11-point boldfaced type: "THE PROPERTY TAX 1VIILLAGE RATE PROPOSED TO BE LEVIED TO SUPPORT THE PROPOSED BUDGET WILL BE A SUBJECT OF THIS HEARING." Public Act 41 of 1995 - Truth in Budgeting Act The Uniform Budgeting Act has been amended, adding Section 16, to require that the General Appropriations Act adopted by the legislative body of a local unit of government must set forth the total number of mills of ad valorem property taxes to be levied and the purposes for which the millage is to be levied. This subsection shall be known as and may be cited as "THE TRUTH IN BUDGETING ACT". Public Act 42 of 1995 - Notice and Public Hearing Requirements This Act specifies that if the taxing unit complies WITH SECTION 16 of the Uniform Budgeting Act, PA 2 of 1968, as amended by PA 41 of 1995, it need not comply with the notice and public hearing requirements of the truth-in-taxation section of the General Property Tax Laws and is exempt from holding a truth-in-taxation public hearing. 9 L-4029 ORIGINAL TO: County Clerk(s) COPY TO: Equalization Department(s) COPY TO: Each township or city clerk This form Is issued under authority of MCI Sections 211.24e, 211.34 and 211.34d. Filing is mandatory; Penalty applies. Michigan Department of Treasury, STC 614 (2-02) (2) (3) (4) (8)** (6) (7) (8) (9) (10) (11) (12) (1) Prepared by Oakland County Equalization Telephone Number (248) 858-0752 Title of Preparer Tax Standards Specialist Date 2002 TAX RATE REQUEST (This form must be completed and submitted on or before October 1, 2002) MILLAGE REQUEST REPORT TO COUNTY BOARD OF COMMISSIONERS County 2002 Taxable Value of ALL Properties in the Unit as of 5-28-02 OAKLAND 50,694,763,579 Local Government Unit For LOCAL School Districts: 2002 Taxable Value of Non-Homestead and COUNTY OF OAKLAND Non-Qualitied Agricultural Properties if a millage is Levied Against Them. You must complete this form for each unit of government for which a property tax is levied. Penalty for non-filing is provided under MCL Sec 211.119. The following tax rates have been authorized for levy on the 2001 tax roll. PLEASE READ THE INSTRUCTIONS ON THE REVERSE SIDE CAREFULLY 2001 2002 2002 Millage Millage Millage Millage Rate Current Year Millage Rate Sec 211.34 Maximun Requested Requested Expiration Authorized Permanently Millage Permanently Millage Allowable to be to be Date of Purpose of Date of by Election, Reduced by Reduction Reduced by Rollback Millage Levied Levied Millage Source Millage Election Charter, etc. MCL 211.34d Fraction MCL 211.34d Fraction Levy* July 1 Dec. 1 Authorized Voted Operating 08/08/78 5.2600 4.3259 0.9914 4.2886 1.0000 _ 4.2886 Voted Parks & Rec 08/08/00 0.2500 0.2475 0.9914 0.2453 1.0000 0.2453 As the representatives for the local government unit named above, we certify that these requested tax levy rates have been reduced, if necessary to comply with the state constitution (Article 9, Section 31), and that the requested levy rates have also been reduced, if necessary, to comply with MCL Sections 211.24e and 211.34. and, for LOCAL school districts which levy a Supplemental (Hold Harmless) Millage, 380.1211(3). O Clerk O Secretary O Chairperson D President Signature Type Name Date Signature Type Name Date * Under Truth in Taxation, MCL Section 211.24e, the governing body may decide to levy a rate which will not exceed the maximum authorized rate allowed in column 9. The requirements of MCL 211.24e must be met prior to levying an operating levy which is larger than the base tax rate but not larger than the rate in column 9 =goal otraquir ** IMPORTANT: See instructions on the reverse side regarding where to find the millage rate used in column (5). FORM L-4028 COUNTY AND VILLAGES 2002 MILLAGE REDUCTION FRACTION COMPUTATIONS VALUATION WITHIN OAKLAND COUNTY TAXING AUTHORITY 2001 TAXABLE 2002 TAXABLE LOSSES TAXABLE ADDITIONS 2002 2002 2002 TAXABLE M.R.F. B.T.R.F. T.I.A. Oakland County Oakland County Parks & Recreation Huron-Clinton Metro Authority VILLAGE Beverly Hills Bingham Farms Franklin Holly Lake Orion Leonard Milford Ortonville Oxford Wolverine Lake 47,656,729,878 47,656,729,878 47,656,729,878 450,486,204 175,783,100 213,169,920 106,543,710 88,255,510 11,125,650 193,025,425 34,418,610 110,717,451 124,179,040 50,694,763,579 50,694,763,579 50,694,763,579 475,451,614 184,093,707 229,353,010 113,074,910 95,254,160 11,314,730 199,724,765 36,221,570 118,735,340 130,550,070 899,096,121 2,024,188,025 0.9914 0.9607 1.0000 899,096,121 2,024,188,025 0.9914 0.9607 1.0000 899,096,121 2,024,188,025 IC* IC* IC* 2,557,180 4,958,660 0.9825 0.9520 1.0000 4,215,510 6,392,277 0.9964 0.9655 1.0000 823,740 7,877,590 0.9895 0.9588 1.0000 1,158,430 3,179,910 0.9897 0.9590 1.0000 1,176,803 3,941,930 0.9842 0.9536 1.0000 374,370 111,680 0.9904 0.9597 1.0000 5,179,470 3,376,694 0.9873 0.9567 1.0000 214,960 469,230 0.9873 0.9567 1.0000 2,364,330 5,540,120 0.9879 0.9572 1.0000 409,830 1,287,880 0.9881 0.9575 1.0000 5/16/02 Page 1 of 1 855 (Rev. 5-21) STATE OF MICHIGAN John Engler, Governor r- DEPARTMENT OF TREASURY Douglas S. Roberts, State Treasurer MICHIGAN DEP 'PDC ACI711V RE C611-1F7) OCT 3 02001 EQUAL IZ AT IO N 61.V1/SION BULLETIN NO. 9 INFLATION RATE OCTOBER 22, 2001 DATE: October 22, 2001 TO: Assessors Equalization Directors FROM: State Tax Commission RE: INFLATION RATE FOR USE IN THE 2002 CAPPED VALUE FORMULA AND THE 2002 "HEADLEE" MILLAGE REDUCTION FRACTION (MRF) FORMULA A) Inflation Rate Used in the 2002 Capped Value Formula The inflation rate, expressed as a multiplier, to be used in the 2002 Capped Value Formula is 1.032. (The inflation rate for 2001 calculations was also 1.032.) The 2002 Capped Value Formula is as follows: 2002 CAPPED VALUE = (2001 Taxable Value — LOSSES) X 1.032 + ADDITIONS The formula above does not include 1.05 because the inflation rate of 1.032 is lower than 1.05. B) Inflation Rate Used in 2002 "Headlee" Calculations The inflation multiplier of 1.032 shall ALSO be used in the calculation of the 2002 "Headlee" Millage Reduction Fraction required by Michigan Compiled Law (MCL) 211.34d. STATE TAX COMMISSION P.O. BOX 30471 LANSING, MICHIGAN 48909-7971 Phone: (517) 373-0500 Fax: (517) 241-2621 COMMISSION MEMBERS Mark A. Hilpert, Chairperson Lesley F. Holt Robert Lupi Dennis W. Platte, Secretary www.treasury.state.mi.us 11,1 , JOHN ENGLER GOVERNOR _ STATE OF MICHIGAN DEPARTMENT OF TREASURY LANSING DOUGLAS B. ROBERTS STATE TREASURER ECEIVED AUG 26 2002 i..LAND COUNT), L.-ALIIATION DIVISION August 22, 2002 Mr. Thomas A. Law Chairperson Oakland County Board of Commissioners 6766 Glenway Dr. W. Bloomfield Hills, MI 48322 Dear Mr. Law: TRI-COUNTY CONVENTION FACILITIES TAX/4% STATE-WIDE LIQUOR TAX Distribution for 2003 Counties share in the tri-county convention facilities tax levied under Act 106 of 1985 and the 4 percent liquor tax levied under Public Act 107 of 1985 when those revenues exceed the debt service requirements for convention facilities. Public Act 2 of 1986 requires the State Treasurer to annually certify an estimate of revenues to be received by counties under Act 106. The estimated amount of the convention facility/liquor tax distribution to Oakland County from FY 2001-02 collections is $2,589,042. The actual distribution to counties will be made in February 2003. Reduction in Base Tax Rate for 2002 Truth-In-Taxation Hearing Purposes Counties are required to use the estimate to reduce their base tax rate for 2002 truth-in-taxation hearing purposes under Public Act 2 of 1986. The law also requires that the estimate is to be adjusted by the difference between the estimated and actual distribution for the prior year. The difference for Oakland County between the actual last distribution and the Department of Treasury estimate of the last distribution is $78,668. Therefore, the amount of the convention facility/liquor tax distribution that is to be used to reduce the Oakland County base tax rate for 2002 truth-in-taxation hearing purposes is $2,667,710. TREASURY BUILDING • 430 WEST ALLEGAN STREET • LANSING, MICHIGAN 48922 www.michigan.govitreasury • (517) 373-3200 11 Page August 22, 2007 CIGARETTE TAX, HEALTH AND SAFETY FUND ACT Distribution for 2003 Counties share in the revenues from 4 cents of cigarette tax under Public Act 264 of 1987, the Health and Safety Fund (HSF) Act. The estimated amount of the HSF Act distributions to Oakland County in 2003 is $621,540. Reduction in Base Tax Rate for 2002 Truth-in-Taxation 1-learinE., Purposes The estimated HSF distribution for 2003 is adjusted by the difference between the actual and estimated distribution during 2001. This difference for Oakland County is $19,130. Counties are required to use this adjusted amount of $640,670 to further reduce their-base tax rate for 2002 truth-in-taxation hearing purposes, under Public Act 264. Healthy Michi.aan Fund Article IX, Section 36 of the Michigan Constitution (Proposal A) earmarks 6 percent of tobacco taxes for public health programs, in additiOn to the HSF revenue. Some county health departments will be obtaining funds from this source, in addition to the HSF distribution estimated in this letter. SUMMARY INFORMATION The total amount from liquor and cigarette tax distributions that Oakland County must use to reduce their base tax rate for 2002 truth-in-taxation hearing purposes is $3,308,380. Counties may follow the truth-in-taxation hearing process to use the revenues for increased spending, but 50 percent of the convention facility/liquor tax revenue not used to reduce their millage rate is required by Public Act 2 to be distributed to the county's designated substance abuse coordinating agency for substance abuse programs. All o f the HSF Act revenues not used to reduce their millage rate must be spent as specified in that act. A Property Tax Division bulletin which explains the required calculations of Act 2 and Act 264 has been distributed to your county treasurer and is available upon - request. Sincerely, esok-,c7e4.44t..- Howard Heideman Director of Tax Policy Analysis Office of Revenue and Tax Analysis cc: County Treasurer County Equalization Director County Executive/Administrator/Controller/Coordinator 1g T Augus t7I5 00-2 - , GARY C. BARTSCH. Director JAMES J. BRESCIAMI, Deputy Director DAVID L. WAHL. Controller 'MICHAEL G. MAGEE, Secretary Ad'rninistrative Offices 13000 High Ridge Drive • P.O. Box 2001 • Brighton, Michigan 48116-8001 Telephone: (810) 227-2757 or 1-800-47-PARKS • Fax: (810) 227-8610 Web Site: http://www.metrooarks.com • E-Mail: Mail@metroparks,com COMMISSIONERS ROBERT W. MARANS, Chairman JOHN C. HERTEL, Vice Chairman JAMES YOUNG, Treasurer JACK BRANDENBURG JAMES CLARKSON WILLIAM E. KREGER RE: 2002 Huron-Clinton Metropolitan Authority Tax Levy As is our usual custom at this time of the year, we are advising of the ad valorem tax for the Huron-Clinton Metropolitan Authority. The levying of these taxes are required by State of Michigan Act 147 of the Public Acts of 1939 Section 7. This levy has been computed in accordance with the provisions of Act 35 of the Public Acts -of 1979 (Headlee Amendment) which amended Section 211.34 (d) of the Compiled Laws of 1970. We are providing your County with Form L-4029 the Millage Tax Rate Request Report for the County Board of Commissioners. The Authority is a five-county (multi-District) taxing jurisdiction and, as such, our Millage Reduction Factor (MRF) is calculated over the entire five counties. For the 2002 levy the Authority is subject to a Millage Reduction Fraction of .9927. This rate is then applied to our 2001 permanently reduced maximum millage of .2186 mills, yielding a 2002 permanently reduced millage rate of .2170. Accordingly, we are requesting you to levy .2170 mills for Metropark development and operations. For your information, this will produce a levy of $11,000,763.70 based on a final 2002 Taxable Value of $50,694,763,579. If there are any communities in your county that prepare their own tax bills, we kindly request that a copy of this L-4029 form be forwarded to them. If you are unable to do this, please advise so we can contact those communities directly. Under the reimbursement provisions of the Single Business Tax Act., $106,699.99 will be added, based on the 1975 exempt inventory valuation of $477,191,347. In total, $11,107,463.69 will be due from Oakland County for Authority operations. We kindly ask that this matter be given the proper consideration at your County Board of Commissioners apportionment meeting in October. Thanking you in advance for your cooperation. Should there be any questions or a need for additional information, please contact the undersigned. Sincerely, David L. Wahl, Controller Enclosure Fi" 04 , A.FIVE UlUall4AKREPoTIDN'..tALITIaliAta NivoTanomnati fitcoOtKEE„NakiltaXWANtiLOAYILE/,,cotITtia'S? m DELHI • DEXTER-HURON • HUDSON MILLS • HURON MEADOWS - INDIAN SPRINGS • KENSINGTON • LAKE ERIE LOWER HURON • METRO BEACH • OAKWOODS • STONY CREEK • WILLOW • AND WOLCOTT MILL METROPARKS (2) (3 ) (1 ) (6) (10) (8 ) (7) .2170 1.0000 .2170 N/A • 2170 1h)ne Telephone Number 810-227-2757 Date Title of Preparer I P .a areri by Controller 8/8/02 n •n•. 1,o111 oa -1y01 rvluL Sections 211.24e. 211.34 and211.34d. Filing clatory, Penally applies. 2002 TAX R1-k IT REQUEST (This form must be completed and submitted on or before October 1, 2002) ORIGINAL TO: County Clerk(s) COPY TO: Equalization Departmeri COPY TO: Each township or city clerk L-4029 MILLAGE REQUEST REPORT TO COUNTY BOARD OF COMMISSIONERS County 2002 Taxable Value of ALL Properties In the Unit as of 5-28-02. Oakland 50,694,763,579 *** Local Government U0 Huron—Clinton For LOCAL School Districts: 2002 Taxable Value of Non-Homestead and Non-Qualified Agricultural Metropolitan Authority Properties If a mIllege Is Levied Against Them. You must complete this form for each unit of government for which a property tax Is levied. Penalty for non-filing Is provided under MCL Sec 211.119. The following tax rates have been authorized for levy on the 2002 tax roll. (4) (8)** PLEASE READ THE INSTRUCTIONS ON THE REVERSE SIDE CAREFULLY. (11) (12) Source Purpose of Mfliage Date of Election MIllage Authorized by Election, Charter, etc. 2001 MIllage Rate Permanently Reduced by MCL 211.34d 2002 Current Year Millage Reduction Fraction 2002 MIllage Rate Permanently Reduced by MCL 211.34d Sec. 211.34 Millage Rollback Fraction • Maximum Allowable MIllage Levy " Millage Requested to be Levied July 1 MIllage Requested to be Levied Dec. 1 Expiration Date of Mtiage Authot Ized et 147 Public Cap Impr • Act of 1939 & Operations 11/40 .2500 .2186 .9927 As the representatives for the local government unit named above, we certify that these requested tax levy rates have been reduced, If necessary to comply with the state constitution (Article 9, Section 31), and that the requested levy rates have also been reduced, if necessary, to comply with MCL Sections 211.24e, 211.34 and, for LOCAL school districts which levy a Supplemental (Hold Harmless) Millage, 380,1211(3). Clerk Et Secretary gg- Chairperson Prasident * Under Truth In Taxation, MCV4Vtion 211.24e, tfle govefning body may decide to levy a rate which will not exceed the maximum authorized rate allowed in column 9. ill() requirements of MCL 211.24e hiust be met prior to levying an operating levy which Is larger than the base tax rate but not larger than the rate In column 9. IMPORTANT: See Instructions on the reverse side regarding where to find the mIllage rate used In column (5). n___ tA -V7 101 1A7 107C C U rIF narennal in-upnt-nria.c in nnir-1.-1,-,A Date Michael G. Magee 8/8/02 Date Signature Type Name Signature a Type Name Robert W. Marans 8/8/02 Instructions For 2002 Tax Rate Request Miliage Request Report To County Board Of Commissioners These instructions are provided under MCL Sections 211.24e (truth in taxation), 211.34 (truth in county equalization and truth in assessing), 211.34d (Headlee), and 211.36 and 211.37 (apportionment). Column 1: Source. Enter the source of each millage. For example, allocated millace, separate millace limitations voted, charter, approved extra-voted millage, public act no., etc. Do not include taxes levied on the Industrial Facilities Tax Roll. Column 2: Purpose of millage. Examples are: operating, debt service, special assessments, school enhancementmillage, sinking fund millage, etc. A local school district must separately list operating millages by whether they are levied against ALL PROPERTIES in the school district or against the NON-HOMESTEAD AND NON-QUALIFIED AGRICULTURAL group of properties. (See State Tax Commission Bulletin No. 4 of 2002 for more explanation.) A local school district may use the following abbreviations when completing Column 2: "Operating ALL" and "Operating NON-HOME". "Operating ALL" is short for "Operating millage to be levied on ALL PROPERTIES in the local school district" such as Supplemental (Hold Harmless) Millages and Building and Site Sinking Fund Millages. "Operating NON-HOME" is short for "Operating Millage to be levied on NON-HOMESTEAD AND NON-QUALIFIED AGRICULTURAL PROPERTIES in the local school district" such as the 18 mills in a district which does not levy a Supplemental (Hold Harmless) Millage. Column 3: Date of Election. Enter the month and year of the election for each millage authorized by direct voter approval. Column 4: Millage Authorized. List the allocated rate, charter aggregate rate, extra-voted authorized before 1979, each separate rate authorized by voters after 1978, debt service rate, etc. (This rate is the rate before any reductions.) Column 5: 2001 Millage Rate Permanently Reduced by MCL 211.34d ("Headlee") Rollback. Starting with taxes levied in 1994, the "Headlee" rollback permanently reduces the maximum rate or rates authorized by law or charter. The 2001 permanently reduced rate can be found in column 7 of the 2001 form L-4029. For operating millage approved by the voters after May 31,2001, enter the millage approved by the voters. For debt service or special assessments not subject to a millage reduction fraction, enter "NA" signifying "not applicable". Column 6: Current Year Millage Reduction Fraction. List the millage reduction fraction certified by the county treasurer for the current year as calculated on 2002 Mil/age Reduction Fraction Calculations Worksheet, form L-4034. The millage reduction fraction shall be rounded to four (4) decimal places. The current year millage reduction fraction shall not exceed 1.0000 for 2002 and future years. This prevents any increase or "roll up" of millage rates. Use 1.0000 for millages approved by the voters after May 31, 2002. For debt service or special assessments not subject to a millage reduction fraction, enter 1.0000. Column 7: 2002 Millage Rate Permanently Reduced by MCL 211.34d ("Headlee") Rollback. The number in column 7 is found by multiplying column 5 by column 6 on this 2002 form L-4029. This rate must be rounded DOWN to 4 decimal places. (See STC Bulletin No. 11 of 1999.) For debt service or special assessments not subject to a millage reduction fraction, enter "NA" signifying "not applicable". Column 8: Section 211.34 Millage Rollback Fraction (Truth in Assessing or Truth in Equalization). List the millage rollback fraction for 2002 for each millage which is an operating rate. Round this millage rollback fraction to 4 decimal places. Use 1.0000 for school districts, for special assessments and for bonded debt retirement levies. For counties, villages and authorities, enter the Truth in Equalization Rollback Fraction calulated on STC form L-4034 as TOTAL TAXABLE VALUE BASED ON CEV FOR ALL CLASSES/TOTAL TAXABLE VALUE BASED ON SEV FOR ALL CLASSES. Use 1.0000 for an authority located in more than one county. For further information, see State Tax Commission Bulletin No. 4 of 2002. For townships and cities, enter the Truth in Assessing Rollback Fraction calculated on STC form L-4034 as TOTAL TAXABLE VALUE BASED ON ASSESSED VALUE FOR ALL CLASSES/TOTAL TAXABLE VALUE BASED ON SEV FOR ALL CLASSES. The Section 211.34 Millage Rollback Fraction shall not exceed 1.0000. Column 9: Maximum Allowable Millage Levy. Multiply column 7 (2002 Millage Rate Permanently Reduced by MCL 211.34d) by column 8 (Section 211.34 millage rollback fraction). Round the rate DOWN to 4 decimal places. (See STC Bulletin No. 11 of 1999.) For debt service or special assessments not subject to a millage reduction fraction, enter millage from Column 4. Column 10/Column 11: Millage Requested to be Levied. Enter the tax rate approved by the unit of local government provided that the rate does not exceed the maximum allowable millage levy (column 9). kmillage rate that exceeds the base tax rate (Truth in Taxation) cannot be requested unless the requirements of MCL 211.24e have been met. For further information, see State Tax Commission Bulletin No. 4 of 2002. A LOCAL School District which levies a Supplemental (Hold Harmless) Millage shall not levy a Supplemental Millage in excess of that allowed by MCL 380.1211(3). Column 12: Expiration Date of Millage. Enter the month and year on which the millage will expire. G. William Caddell, County Clerk Resolution #02232 September 19, 2002 Moved by Douglas supported by Dingeldey the resolution be adopted. AYES: Crawford, Dingeldey, Douglas, Galloway, Garfield, Gregory, Law, McPherson, Melton, Middleton, Moffitt, Moss, Obrecht, Palmer, Patterson, Sever, Suarez, Taub, Amos, Appel, Causey- Mitchell, Coleman. (22) NAYS: None. (0) A sufficient majority having voted therefore, the resolution was adopted. 1.774------oolcs Pat elistf22f1ELe 1 HERE:11,;"1„1" Iti nrw() RESOLUTION Y22:2-/2-7 Date STATE OF MICHIGAN) COUNTY OF OAKLAND) I, G. William Caddell, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and accurate copy of a resolution adopted by the Oakland County Board of Commissioners on September 19, 2002, with the original record thereof now remaining in my office. In Testimony Whereof, I have hereunto set my hand and affixed the sepOof the9t5unty of Oakland at Pontiac, Michigan this 19th day of September, 2002.