What Dowagiac potentially loses in personal property tax (PPT) revenue equates to three to four more full-time positions, City Manager Kevin Anderson said Monday.
“Cassopolis is going to get hit hard, and it’s going to hurt,” agreed Village Manager Meg Cluckey.
Gov. Rick Snyder told a statewide gathering of local municipal officials Oct. 6 in Grand Rapids that “the goal is not to harm you. The reason we bring up the personal property tax is to make you more competitive.”
Snyder’s pronouncements that personal property tax will not be eliminated overnight have stopped short of promising a dollar-for-dollar replacement.
Lansing lawmakers are talking in broad “concepts” about making business taxes fairer and more competitive, but for now the bottom line is local officials lack a “firm proposal,” Anderson said. “All signs point to major revisions to the system being made before the calendar year ends.”
According to the Michigan Municipal League, the PPT makes up more than 50 percent of the taxable value of some Michigan communities.
The average Michigan community gets about 11 percent of its revenues from personal property tax. MML pegs Dowagiac at 12 percent.
MML figures show $73,593, or 13.49 percent, for Cassopolis and $7,347, or 6.65 percent for Edwardsburg.
In the past decade or so, state lawmakers cut more than $4 billion in revenue sharing.
to local communities, causing deep reductions in police and firefighter levels and other basic services such as road repair and maintenance, lawn mowing for safety and snow plowing.
Cluckey quoted an IBM white paper which suggested the 100 largest cities, given the magnitude of real estate losses, could see tax revenues disintegrate 12 percent a year for five years.