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City of Novi proposing Capital Improvement millage
Millage would allow City to invest in needed capital improvements without taking on long-term debt
July 7, 2016

NOVI, MI - The City of Novi is proposing a Capital Improvement Program (CIP) millage to residents on the August 2 ballot that, if approved, would allow the City to invest in new and enhanced facilities and equipment.

The 1.0 mill tax would generate an estimated $3.2 million annually, or a little more than $32 million over the course of 10 years. If the City were to propose a bond instead of asking for a millage, the City would pay off the bonds over a period of 15 years with interest, making the total cost for the same projects $40.2 million.

The City also has two debt millages coming off the tax rolls – the expiration of the 2002 debt mills of .3250 and 2010 debt mills of .3374. If the CIP millage is approved, the summer 2017 tax rate would be 10.5376 mills, a net millage increase of .2376 mills. Even with the millage, Novi’s tax rate would remain among the lowest in Oakland County.

Some examples of CIP projects include:

Lakeshore Park Pavilion & Activity Center: Replacing the 50-year-old camp building with a new facility that will accommodate expanding summer camp opportunities, serve as a multi-purpose use for programming, host classes and be an election polling location for residents in that area of the city. ($5.5 million)

DPS Expansion/Improvement Project: The current facility lacks space for vehicles, equipment, materials and personnel. Project calls for a 28,000-square-foot expansion of the main DPS building, creation of 2,400-square-feet of covered outdoor storage, reconstruction of pavement, conveyor system for salt dome and automated truck wash. ($7 million)

Land Acquisition & Replace Fire Station #1: Station is in need of significant renovations and repairs to service a 21st century fire department. City is looking to forge a public/private partnership to develop a new station on the first two floors of a new facility and a private entity filling the remaining floors. ($5.5 million)

Fire Department Ladder Truck Replacement: Replacing the 2001 ladder truck with a new truck with a six-person cab, 1,500-gallon per minute pump with foam capabilities and 100-foot ladder. ($1.8 million)

ITC Community Sports Park Trail: Developing a 3,709-linear-foot non-motorized trail through ITC Community Sports Park. The trailhead and trail will tie into the proposed ITC corridor regional trail to the north and Maybury State Park regional trail system to the south. Trailhead will include bike racks, park benches, signage and information kiosk. ($439,637)

Novi’s current CIP plan includes more than $97 million in total projects over the next six years. This $97 million includes water, sewer, roads and drain projects that are budgeted for out of other funds. This millage will not be used those items and also cannot be used for operations or payroll.

If the millage is approved, the The net impact - the total city millage would increase from 9.95 mills to 10.5376, an approximate annual property tax increase to the owner of a home having a true cash (market) value of $250,000 (taxable value of $125,000) would be $125.

“The City has been very good stewards of public funds, and recently the City Council lowered the millage rate to 9.95 mills making Novi the lowest taxing full-service city in Oakland County and one of the lowest in Michigan,” explains Novi City Manager Peter E. Auger.

Novi Mayor Bob Gatt notes, "Certain capital improvement items cost so much that it is nearly impossible to budget for. A new fire truck costs nearly $750,000. Improvements to our DPS yard where the equipment is stored that takes care of our streets costs millions of dollars. And, improvements to our City jewel called Lakeshore Park on the South shore of Walled Lake also costs millions of dollars. These capital improvements will make all of our property values go up, will provide better and safer services to the community, and will keep Novi the modern, growing and world class city that it is."

Mayor Gatt went on to explain, "City Council has lowered your taxes twice since I have become Mayor and next year, two small debts will fall off the books that will result in the 1 Mill tax increase we are asking for now seem like almost nothing. I urge every Novi homeowner to follow my lead and vote YES on the August ballot for a capital improvement millage that the City is asking for."

Council member and Mayor Pro-Tem David Staudt opines, "City Council has worked hard to reduce debt, stabilize our fund balance and set an overall millage rate that is one of the lowest in Michigan. All funds generated by this millage will be used for capital improvements and equipment, none will be used for outside interest or operating costs. The ten year term of the millage provides taxpayers with a clear understanding of the cost of their investment in the City.”

Council Member Wayne Wrobel stated, "I fully support the request for the mileage increase. As Novi continues to age and grow, the need for new or additional capital improvements will continue to increase if we continue to want to provide the residents of the city with the same or greater levels of service they are currently provided. Asking for a millage instead of proposing a bond will save Novi Taxpayers approximately $8,000,000 in interest. This millage will allow Novi to continue to follow the "pay as you go" philosophy that it uses today. If the millage passes, Novi will still have one of the lowest property tax rates in Oakland County as well as the State Of Michigan."

We asked other council members their opinion on this also, but no others replied despite repeated requests.

Novi residents are invited to come share an ice cream cone with city administrators at a pair of public information meetings on Thursday, July 14 regarding the proposed millage. The meetings will take place at 6pm at Fire Station #1 at 42975 Grand River Avenue and at 7:30pm at Lakeshore Park at 601 S. Lake Drive.

For more detailed information on the August Primary Election, visit the Novi City Clerk's website page, here.