Council member wrong in opposing tax that would more fairly spread burden
An open letter to my Ward 3 representative, Councilman Stephen Kunselman:
It’s so good to know that you’ve always been and always will be opposed to a city income tax. I would hate to see the economic reality of a solution topic get in the way of your ideological dogma. It’s an Icarian position better suited to the pulpit than political governance.
You justify your opposition based upon the inequitable transfer of taxes from commercial properties to residents and non-resident working families. Yet you fail to discuss the inequity of the residential property tax burden on those same Ann Arbor residents, or that a city income tax would more fairly distribute the cost burden of police, fire, water, sewer, road, and traffic issues to those workers who enjoy such services in the course of their employment within city limits.
That property taxes would be reduced by the 6 mills currently dedicated to the city operating budget per the city charter further undermines your credibility as a fair minded leader willing to represent all your constituents. The ones you so readily omit from the equation of a city income tax, 44 of which lost their homes to property tax foreclosures in 2009, up from 11 in 2008.
I’m sure you have taken into consideration in your opposition for discussion whether or not any of those residents may have benefited from some property tax relief provided by a more equitable city income tax. Do you also support the uncapping of the Headlee Amendment? Maybe we can get some more foreclosures on the market.
I’m also glad you're keeping your “faith” based perception that the administration’s assertion of 70,000 commuters is inaccurate, flawed, and exaggerated instead of advocating an accounting of the numbers based on current data. You additionally see fit to accuse the current administration of a “borrow and build” policy when, as far as I can tell, is pretty much the same administration you were part of during your 2006-08 City Council tenure. You further indicate you will refuse to enter into discussions of a city income tax unless the administration meets your demands to “preach” a “stop the spending policy.” A little late on this issue I think.
What I would suggest Councilman Kunselman, as one of your forgotten residents, is that you represent all your constituents with a fair and open mind for the equal distribution of city expenses and operating costs enjoyed by all, non-resident workers included.
Your refusal to support a fact-based discussion of a city income tax with an argument filled with innuendo and ambiguity is not reflective of a political leadership role. I’m not asking you to change your narrow mindset; I’m asking you to give this resident a chance to make my mind up based on the facts of the issue, not your suppositions.
Frank G. Dalimonte Ann Arbor
Comments
Regular Voter
Mon, Feb 22, 2010 : 12:28 p.m.
Ann Arbor's been without adult supervision for a loooooong time, and now that the bills are coming due there's not enough money for the children and their buddy buddy mayor and playground tough guy administrator to bully the tapped out taxpayers to keep them in business as usual. When do mom and dad come home? Who will run in the fall and help lead us out of this self induced money pit? A less than 10 percent across the board pay/benefit reduction will fix it.
logo
Mon, Feb 22, 2010 : 11:50 a.m.
Actually Grateful, while I generally agree with the mayors direction, one problem I have with him is that he has been against the income tax for a long time.
a2grateful
Mon, Feb 22, 2010 : 10:04 a.m.
Too bad that the a likely majority of those effected by the income tax won't get to vote on its existence. If instituted, they will have no voice in what happens with their money. They will have no voice in policies of expenditure. This is exactly how team Hieftje loves to roll!
James S.
Mon, Feb 22, 2010 : 3:46 a.m.
Just a little thought for all you Ann Arbor people thinking youre going to get rich by taxing the employees of the University. I've been doing a little digging into the standing of the University and as I see it. The University is classified as a Municipality. (Along with Wayne State and Michigan State.) My understanding of a Municipality puts it like any other city in the state of Michigan. It seems that Ann Arbor is unable to place an income tax on the wages of the employees at the University. That would be like Ann Arbor trying to tax Pittsfield Township because their neighbors. Now I could be wrong? But it might be something people look into before trying to spend money you may never receive.
larry
Sun, Feb 21, 2010 : 10:13 p.m.
Tax, tax and more tax. I'm glad to see SOMEONE in government opposed to more taxes. Don't people realize that there are other alternatives, such as cutting spending? A private corporation or individual does not have the option to simply tax something to raise revenue -- they have to PRODUCE real wealth. When they can't, they CUT SPENDING. It's often their only option. Taxes stifle the productive and feed the unproductive government -- which produces NO wealth of its own.
braggslaw
Sun, Feb 21, 2010 : 7 p.m.
If people want to volunteer to give money to the city of Ann Arbor, knock yourself out. I believe it is time to controls spending and live within our means. The population of Michigan is going to continue to contract, we might as well get a good start now.
Hornet
Sun, Feb 21, 2010 : 5:42 p.m.
Income taxes on non-residents is truly taxation without representation since those who don't live in A2 would have to pay taxes to A2 but don't get to vote on the proposal. It will eventually have some impact with some businesses looking to move outside of A2. Businesses located in A2 not only bring rental revenue but also patrons for the local businesses which provide jobs. If you want to cut costs, let's focus some pressure on the generous pay & benefits government workers get from our tax dollars thanks to the AFSCME union's hijacking of our government.
Basic Bob
Sun, Feb 21, 2010 : 5:22 p.m.
Columbus, Ohio has 2.5% income tax on all residents and employees in the city. If you work outside of the city and pay less in withholding, you have to pay the difference to the city you live in. State College, PA has a 1.45% income tax for residents, 0.5% for nonresidents. Unlike Michigan, local income tax is common in those states. Most communities have reciprocity so residents who work in another city don't pay double.
Dalouie
Sun, Feb 21, 2010 : 4:18 p.m.
Your point is well taken Grateful. Very few want to pay more taxes, I don't either. The only reason I like the income tax idea is the six mill roll back. That would mean that most will break even and some will come out ahead. From the report I read on the city web site, it looks like the deduction can be set to lessen the burden on those who don't own a house and rents would come down in this competitive rental market. They might not in a hot market but that is probably still a few years away. Everyone, out of town workers included, would enjoy the benefits of stable funding and the big hole that so many Michigan cities are falling into. People should realize that as A2 goes, so goes the townships. Council should put it on the ballot and let the voters decide.
RU4A2
Sun, Feb 21, 2010 : 4:16 p.m.
Renter's move out of Ann Arbor?? Lets see. $100.00 a week pay check @1%= $1.00 a week. Current price of gas, about $2.50 a gallon. Come on Frazer, move into the city and pay A2 property taxes like the rest of residents.
a2grateful
Sun, Feb 21, 2010 : 4:05 p.m.
The great thing about wanting to pay more taxes is that YOU can, at any time. Write the City as many checks as you want, whenever you want. What stops anyone from doing this? Go for it!
Dalouie
Sun, Feb 21, 2010 : 3:35 p.m.
Sorry to interrupt your talking points but... Parkland: The voters of the city want more parkland and vote for it over and over again. A2 city water rate increases have been quite a bit lower than other places and they are building a new sewage plant. Art matters to people in A2 and again, it does not come out of the general fund. The city needs more parking, ask a downtown business person. But again you ignore that the DDA's money can only be spent downtown. The mayor and most of the council have already said, in this paper, that they would not fund a conference center. Do you actually read the articles on this site? The greenway arts center has to fund itself, they are looking for grants and it's for artists who can't afford space elsewhere. Are you talking about the two block historic district proposal on 4th and 5th Avenues? You are against that? Small potatoes. The city has done a good job, has not raised taxes and they are keeping the ball rolling on infrastructure. Cities don't replace a big bridge without state or federal money but A2 is going to do it this fall even if the outside funding does not come through. Bottom line. If you think A2 is not managing funds well what about Grand Rapids, Troy, Lansing, Ypsilanti, or the cities in Michigan that are even worse off. Are they all miss-managed? Or is it just A2?
a2grateful
Sun, Feb 21, 2010 : 3:13 p.m.
Disagree all day through August. There is nothing efficient about acquiring park land with no budget to maintain it. Folly Property tax collections lower? Collected service fees have skyrocketed to more than offset... Just check your waterbill. To claim otherwise? Folly Million dollar fountains? Folly Unneeded underground parking? Folly Public financing of private hotel development in a crashed commercial market? Folly Convention centers on sites of City-demolished affordable housing? Folly Municipally funded communes for wealthy artists? Folly Effective moratoria on private development that meets ordinance? Folly More tax dollars to Team Hieftje? Folly No thanks No more money for folly! : (
Dalouie
Sun, Feb 21, 2010 : 2:37 p.m.
I disagree with those here who repeatedly spout their negative campaign talking points. The city has been efficient. The city millage is lower than it was 10 years ago and over 40% of the land cannot be taxed. The city gets under 30% of the property taxes paid. (Look at your total school taxes to see why taxes are high.) The city has managed to keep needed projects on line without taking the money away from the operating budget. The city is doing the same work they used to do but with fewer people. The savings is up to $25 million per year. Look on MLIve at (Republican) Grand Rapids, they just cut 140 jobs, 36 in the PD and 21 in the Fire Dept. They are putting a tax increase on the ballot. Other cities are too. Every city in the state is going through the same thing. Many are putting tax increases on the ballot. Ann Arbor should do the same thing and give the voters a choice, more cuts or more revenue.
braggslaw
Sun, Feb 21, 2010 : 2:01 p.m.
Wow! why is the focus on raising taxes and not cutting expenditures? Everyone else in Michigan is responding to reduced revenue by cutting spending. I see no reason to exempt the city of Ann Arbor.
a2grateful
Sun, Feb 21, 2010 : 1:59 p.m.
Three sure things: 1) Death; 2) Taxes; 3) More of the same team Hieftje folly with more taxes, w/less City protection and service There is a mammoth credibility issue with the current administration. They have not been trustworthy fiduciaries to the general public. Maybe different leadership could help change the debate. Until mayor, council, and DDA agendas change, they most likely won't receive another dime. : (
AlphaAlpha
Sun, Feb 21, 2010 : 1:09 p.m.
Agreed. The sooner, the better.
logo
Sun, Feb 21, 2010 : 1:01 p.m.
The voters should have an opportunity to decide this. Put it on the ballot.
AlphaAlpha
Sun, Feb 21, 2010 : 12:47 p.m.
Well, there will likely be some double posting today... There are a several huge concerns regarding a proposed income tax. First, Plant Moran based their study on 75,000 (!) non residents working in town. PM says UM has 20,000 of those, the 55,000 additional jobs is an estimate. 55,000 additional non resident workers? Think about that. Careful estimates suggest the actual number is lower. This is important. 55,000 is a guess, provided to PM by the city administrator, who favors an income tax. With fewer workers than estimated, revenues would not meet expectations, a 'surprise' which would cause another 'crisis', requiring additional action. Second, the tax shift would not be revenue neutral; the city claims it needs more revenue, that means higher net taxation. The brief property tax drop Proposal A created? Long gone. Third, perhaps most significantly, new taxes of any kind are very difficult to enact during periods of economic downtrends. Council should know this; perhaps they do and all of this debate is a diversion? Not one Michigan city has enacted an income tax in the time since citizen approval for it became required. This fact is profoundly important to the discussion. There is no reason to expect that it is different this time.. There is a growing perception that city workers, as a class, are becoming a privileged group, with wages and benefits substantially greater than the average citizen's. As demonstrated elsewhere on this site, the average city employee is compensated at nearly twice the rate as the average US civilian. This causes many citizens to be quite reluctant to increase their net contribution to city revenue. Council would do well to address the expenditure issues now; they appear remarkably irresponsible proposing a solution with little chance of success.
scole
Sun, Feb 21, 2010 : 12:42 p.m.
No, Bloomington definitely does not have an income tax. The constant argument about the university not paying taxes runs on and on and on there too. But, having lived there and now in the Ann Arbor area, after growing up in a rural area, I can tell you that everything that either of these towns have is due to the school. Take the U of M out of AA or IU out of B'ton, and you've got Saginaw or Jackson, praying that GM or GE (pick your favorite local slowly dying economic engine) waits one more year to finally fire the last few people that actually make a living. No one outside of a big university town is debating fountains vs. police/fire right now. They're debating police/fire vs. nothing. And apparently here fountains win. If the rest of the midwest wasn't in so much pain, they'd point and laugh. I love the things this area offers, but maybe we could put the fiddle down and do some hard work for awhile, then fiddle again when things get better (they will!)
Grumpy
Sun, Feb 21, 2010 : 11:45 a.m.
Does Madison, WI have an income tax? Or for that matter, any other Big 10 town with large swaths of land off the tax rolls such as Columbus, Bloomington or W. Lafayette, IN, Champaign, State College, PA, or Iowa City? The reason for our high taxes is UM right? However, that may also be the price we pay for our town not being in the gutter like other rust belt towns.
logo
Sun, Feb 21, 2010 : 11:25 a.m.
It seems to me that city government does have its fiscal house in order; at least as much as other Michigan cites. Take a look around. Then factor in that 43% of the land can't be taxed and the city only gets 27% of the property taxes we pay. One of the good points made in this letter is that a council member should not be dismissing ideas without all the facts. If he needs more information, he should ask for it before grandstanding and going for the sound bite. Property taxes would go down if an income tax passed. A six mill reduction would mean most homeowners would break even and over time rents would go down. Senior's who own homes would probably make money if their incomes were not too high. Why would a business move if they got a six mill property tax break. But anyway for A2 the huge payoff would be finally getting something back from the University. The city has done a lot to cut the cost of government but that won't be enough, cities across the state are going out for tax increases this year. An income tax or Headlee override should be put up for a vote and let the people decide.
Jenna Thom
Sun, Feb 21, 2010 : 10:49 a.m.
Many of you have missed the point of the letter. The point is that Kunselman has refused to consider one of the many options that are available to the city WITHOUT looking at the facts. He made a decision based on personal bias, misinformation and speculation. Why not at least keep an open mind until you heard all the information. I, for one, do not like it when elected officials make decisions without gathering facts and I agree with much of what Mr. Dalimonte has said. Mr. Kunselman, you do represent all the residents, whether they are pro-income tax or con- income tax. Obviously you cant please both sides, but to make a blanket statement that you are a definite NO before all the facts are in is not professional and causes me to question you ability to lead this city as a qualified councilperson.
johnnya2
Sun, Feb 21, 2010 : 10:45 a.m.
"Add on a 1% tax and watch renters in A2 move to Saline and properties on the outskirts of A2. " You may be right, BUT there is one thing that would also happen. Rents would come down in Ann Arbor and go up in those other locales. (Econ 101 Supply and demand theory). If you rent in Ann Arbor goes down, you will make that choice to live there even with a 1% tax. Those who USE the city but do not pay for it (UM employees) will then be forced to help pay for the infrastructure. If you think taxes are the major factor in jobs, you really do not understand what is important to business. More cars are built in Ontario than Michigan. The taxes in Ontario are SIGNIFICANTLY higher than Michigan. They are also higher in Illinois, New York, Massachusetts.
mmggttnn
Sun, Feb 21, 2010 : 10:36 a.m.
Frank, you are so right with your insightful comments. An Amended Headlee amendment will further exacerbate our city property taxes, which are already too high and unaffordable. The City Income Tax would distribute some of the burden to out-city people who work in the city, and give ALL city property owners a significant property tax reduction. Businesses will not leave the City of Ann Arbor because they can reduce their property taxes and/or negotiate lower rents. How can any city property owner want higher property taxes, and not have out-city employees contribute? If the University does not contribute a fee to the city, our best option is to pass a city income tax. The worst resolution of this issue is to further raise city property owners' property taxes such that we city property owners carry the entire burden. City Council, it is your job to better explain the city income tax idea. It is misunderstood by many people.
Moose
Sun, Feb 21, 2010 : 10:34 a.m.
I would probably do a bit better if there was a city income tax. I'm not against an income tax, but such a move brings its own problems and they have not been fully explored or discussed. But that's not the point, it's not all about me. It's about the city, that I love and want to continue to be a vital and enjoyable place to live, getting its fiscal house in order before asking anyone for more money. Show us that you can make the tough decisions and take care of the necessities before spending on the feel good stuff (like a fountain). Show us that you value the city's assets more that its bureaucracy.
Jody Durkacs
Sun, Feb 21, 2010 : 10:12 a.m.
This is not an "open letter" but a rant full of insults, some thinly veiled, some not. I am a Ward 3 resident and I fully support Councilman Kunselman's stance in this matter. The city has been too big for its fiscal britches for many years now, and he is 100% on the mark for shining a light on this issue. Hopefully the other council members will start to see the light, but I doubt it. As Einstein said, "We can't solve problems by using the same kind of thinking we used when we created them." Regardless of how you see his previous tenure on the council, Steve appears to be trying a new kind of thinking. It is a simple truth that, especially in times of recession, spending on non-essential projects HAS to be cut. I advise the rest of the council and the mayor take notice, lest they find themselves out of jobs come election time.
A2_Jim
Sun, Feb 21, 2010 : 8:10 a.m.
The basis for income taxes is flawed - it stems from the collective idea that the products of one's life efforts are not ones own but in fact that a portion is rightfully some one else's. Taxing property is not far removed - the effect is to put alleged property ownwer's in the position of non ownership but rather lease holders beholden to the government. With these taxes it is impossible to work or own property without the sanction, blessing or permission of the government. Try not paying these burdens and the government with deprive you of you possessions, freedom, and liberty to pursue your own happiness. Stick to your guns Councilman Kunselman!
stunhsif
Sun, Feb 21, 2010 : 8:03 a.m.
Frank, take off your rose colored glasses. Your property taxes will never go down and you will be paying 1% more in taxes. How about we reduce spending. As you noted, a lot of folks are hurting right now and there are very few who can afford to pay more right now. Add on a 1% tax and watch renters in A2 move to Saline and properties on the outskirts of A2. Yeah, it will raise money but only because U-M employees will have to pay.