Putnam: $90 more for police, fire unfairly targets low-income Lansing Twp. homeowners

LANSING TWP. – The idea of tax fairness is missing in action in cash-strapped Lansing Township, where officials want to levy a flat amount on homeowners to pay for sorely needed police and fire equipment.

Every homeowner would be dinged $90 a year for five years, no matter the value of their homes. The proposed assessment is down slightly from an earlier plan to assess $95 per house.

That means owners of lower-income housing in flood-prone Urbandale on the township’s east side would pay the same as those enjoying higher-end housing in the Groesbeck or Waverly areas.

“I can’t afford to pay that,” said Ester Shipman, who lives on West Kalamazoo Street on the township’s west side. The 71-year-old retiree began to cry while attending a Tuesday township board meeting.

She lives in a 939-square-foot home with an assessed value of $42,400 and is on a fixed income.

But some township officials say a house is a house.

“It doesn’t matter to me if the house is worth $500,000 or $20,000. It’s irrelevant. If the house is on fire, the house is on fire,” township Trustee Tracie Harris said at the same meeting. She pointed out that the amount is just $7.50 a month, about the same as a trip to McDonald’s.

I don’t agree. A flat assessment for all means you are taking a bigger share away from those who can least afford it, such as Shipman, who survives on less than $1,300 a month.

And there’s more value to protect with the pricey homes. It’s a little like saying a canoe and a battleship are the same because they’re both boats. That ignores the fact that you need a far bigger extinguisher to put out a fire on the battleship.

The township board has tried to inject more fairness when it comes to applying the assessment to commercial and industrial property. The first go-round at the proposed assessment had mom-and-pop stores paying the same — $350 a year — as the big tenants at Eastwood Towne Center, including Wal-Mart, Sam’s Club and NCG Theatre.

After some vocal feedback, there’s a new proposal to assess businesses $300 to $1,000 based on square footage. But charging $1,000 on a large business while assessing $90 on Ester Shipman still seems out of whack. Shipman is a retired licensed practical nurse who took care of her developmentally disabled son until his death last year at 38.

No one has questioned the need for new equipment for the township's police and fire departments — the assessment would generate about $2 million over five years — but residents have rightly asked about the lack of planning in the township, which has struggled with its decision to help finance a retail development, The Heights at Eastwood, which is located north of Eastwood Towne Center.

Related:

The Heights: As Eastwood grew, Lansing Twp. debt spiraled

Timeline of the Heights at Eastwood

Up to 500 new apartments proposed at The Heights

The Lansing State Journal last year reported that the Heights had so strained the borrowing capacity of the township that a 1988 fire truck, years past its expected lifespan, couldn’t be replaced through the usual method of bonding.

Another potential stream of revenue also is tied up in The Heights. Lansing Board of Water & Light customers in the township have been paying a 5% franchise fee on their electric bills since 2012 – a fee that generates $617,000 a year, according to the BWL.

That money could more than pay for the necessary new equipment and other township needs. Instead, the township pledged its BWL revenue toward repaying bonds sold to finance The Heights.

And with little wiggle room on its millage levy —  the township is near the roughly 10-mill cap under law — the board turned to a special assessment, a tool that’s more commonly used to fund capital improvements that benefit specific taxpayers, such as sidewalks and streetlights.

Mike Selden with the Michigan Township Association said special assessments for police and fire service are a common practice. Basing it on a flat assessment is not unheard of, but it is less common, he said.

More:Michigan State: We 'ran out of time' to reach income tax deal with East Lansing

The Michigan Court of Appeals in 2013 ruled that a similar assessment in Williamstown Township was allowable under the law. A property owner there had argued that it should be based on a property's value.

Legal or not, the Lansing Township’s plan is regressive, a concept that only one trustee, Adam DeLay, seems to recognize. DeLay asked township employees to come up with a three-tiered plan for homeowners based on the size of the home for the board to consider.

It still won’t be the same as assessing the costs based on housing values, which is the basic principle of millage rates, but it would be a little less regressive.

Township officials are inching slowly toward more fairness. With a vote set for Oct. 17, they should start running to embrace the concept.

Otherwise, it’s simply unfair.

“To pay $90 a year is going to be a hardship,” Shipman told the board. “I can’t even afford to go out for a cup of coffee.”

Judy Putnam is a columnist with the Lansing State Journal. Contact her at (517) 267-1304 or at jputnam@lsj.com. Follow her on twitter @judyputnam,