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You are Viewing an Archived IssuePosted: 03/20/13
Loss of tax revenue
impacts police HQ decision
by CHRIS GRAYA potential loss of revenue and an analysis of costs have led the Village Board of Trustees to set aside plans for moving village operations to different buildings.
Observer Staff Writer
At its March 18 meeting, the board decided against moving forward with investigating plans to move the Romeo Police Department from its current location to one of three potential sites, saying it simply cannot afford it at this time.
The board made its decision after hearing from Steve Mellen, Macomb County director of equalization, and his predictions for the village's potential loss of a third of its revenue due to personal property tax reforms.
Mellen, a Romeo resident, said with the elimination of personal property for businesses beginning in 2014, the village stands to lose 33 percent of its tax revenue over three years. He said this equates to a $24,000 loss in the first year and $750,000 more in 2016.
"There's a lot of things on the horizon," he said. "You're talking almost $800,000, it's a chunk of change."
He said if the village raised taxes to recover the loss, it'd equate to $300 to $400 a year for residents.
Mellen said voters will decide in August 2014 on whether a portion of the" use tax" — a sales tax on purchases made from outside the state — would be used to reimburse communities that lose more than 2.5 percent due to the reforms.
In addition, he said legislators have passed a law stating special assessment districts could be levied by local governments on industrial and commercial properties in 2016 to reimburse police and fire costs.
Village President Mike Lee said Romeo is one of the hardest hit by the legislation, and that only five counties will be affected by the changes. About 23 counties will be minimally affected.
"It'll fly right straight through the state because it doesn't affect (other counties)," he said.
With this in mind, the board discussed its decision to spend no more than $1,500 to draw up plans for the Village Hall and the fire hall on S. Rawles Street for potential police department locations. The board has also considered the department's proposal to move into the vacant WBRW Channel 6 studio on Morton Street.
Village Clerk Marian McLaughlin said she didn't have an actual cost, but said after speaking with professionals discovered it would be more than the allotted $1,500.
"We have to be careful of looking at all cost cuts and start looking at revenue generators," she said.
Additionally, she said if the board didn't vote on moving the department at the March meeting, the department would go forward with installing the new 911 system at its current location.
Trustee Russell Rinke said as much as trustees would like to help out the department and the village office, the board wasn't ready to make a decision.
"I just don't think we're in a financial position to do any of those things," he said.
Police Chief Greg Paduch said the new system is scheduled for delivery in April with training for staff in May, with the system up and running in June. If the village decides to move the department to another location, the cost to move the system would be up to $10,000.
Following the meeting, Paduch said the department's main priority was a new 911 system and not a new building, but expressed concern for the studio remaining vacant.
"Possibly we'll look at it in the future," he said. "I would just hate to see the building continue to sit there empty, as it has for the last couple of years."