Opposing sides challenge each others' calculations on Ypsilanti income tax, Water Street retirement millage costs
Ypsilanti residents can find a calculator on the city’s web site that will determine what a proposed Water Street debt retirement millage and income tax will cost them if the measures are approved on May 8.
Now, Stop City Income Tax, a group opposed to the taxes, is offering its own calculator. And it's calculating that residents will pay far more than what is determined by the city's calculator.
That has Save Ypsi Yes, which supports both taxes but is not affiliated with the city, charging that SCIT is deliberately inflating the numbers to scare voters and is making “wild claims.” But Steve Pierce, who created the calculator for SCIT, says he is simply plugging in the numbers from the city’s five-year financial plan.The income tax and Water Street millage are essential components of a five-year plan that city officials say will stabilize the city’s financial situation and help it avoid deep cuts.
According to the city’s calculator, an average resident with a median income of $34,685 who lives in a home with a taxable value of $78,100 would pay an additional $317 annually if the income tax were approved.
That same resident would pay an additional $246 in property taxes in 2017 if the city levies half the Water Street tax.
According to the city's web site, that resident would pay an additional $563 in 2017, or approximately 11 percent above what Save Ypsi Yes says is that resident’s current level.
Pierce’s calculator on SCIT’s site finds that the same resident paying the 1 percent income tax would pay $326.85 from their income, but the large difference lies in what a Water Street millage would cost the resident in property taxes.
His calculations include the full 2017 Water Street levy of 7.1171 mills, which is what voters are being asked to approve. City Council approved a resolution to pay half the Water Street debt retirement millage if voters approve the measure. Although Council has promised to lower the tax, it can still levy the full amount.
Pierce said the lower rate is only good for five years, and it can fluctuate with the city’s financial needs.
“I think it can be reasonably argued that (the lowered millage) won’t go the full five years because they will have some problem they need to make up for,” Pierce said.
A feature on SCIT’s calculator also allows residents and business owners to choose whether or not their property is a homestead. Non-homestead properties must pay an additional 18-mill school operation tax.
The resident with a home value of $78,100 will pay $492 in property taxes in 2017 instead of $246 if asked to pay the full Water Street millage, according to the city's calculator.
But SCIT's figures are higher. According to Pierce's calculator, a resident living at their homestead with a home at the same value would pay an additional $1,188 in property taxes in 2017. Combined with the income tax, that same resident would pay an increase of $1,515, or 24 percent, from current levels.
According to SCIT's calculations, residents living in their home valued at $78,100 are already paying $4,909 in property taxes and that figure would jump 24 percent to $6,097.
For non-homestead property owners, Pierce calculates that property taxes will still increase by $1,188. But he has their current property tax payments at $6,315 and jumping 19 percent to $7,503.
Pierce said his figures also include increases in the police and fire pension millage, which are expected to increase and are part of the five-year plan.
Beth Bashert, director of Save Ypsi Yes, questioned Pierce's numbers. She said a check of a 2011 property tax bill on SCIT’s calculator show the current amount of property taxes being paid to be about 24 percent higher than it really is.
She charged that SCIT structured their calculator in such a way that it backs up claims that taxes will increase by as high as 30 percent, though Bashert says that isn't the case.
“I think it’s scaring people unnecessarily,” she said. “The tax proposals are reasonable, and (SCIT's) tax calculator intentionally inflates the numbers that most Ypsilanti taxpayers are going to face and it makes it hard for people to understand what’s going on.”
But Pierce said the numbers were accurate and he took everything out of the city’s five-year financial plan.
“(The increase) is a lot more and that’s what we’re hoping folks will be aware of — these tax increases are substantial,” he said.
Editor's note: The figure Steve Pierce used in his calculations has been corrected in this article.