Dowagiac increases property tax millage in 2022-23 budget

Published 6:25 pm Wednesday, May 25, 2022

DOWAGIAC — The Dowagiac City Council on Monday hosted a public hearing on a property tax increase of .5763 mills as part of the 2022-23 fiscal year budget resolution. After discussion, the resolution passed with a 6-0 vote by council members. 

Dowagiac City Manager Kevin Anderson explained that because of the Headlee rollback, the city’s tax rate would roll back from 17.7361 mills to 17.5268 mills. With the millage increase, the city will see a revenue increase of 3.4 percent, or about $56,000, according to Anderson. 

“It’s certainly less than the rate of inflation, which is 8.3 percent,” Anderson said. “When it comes to the taxes we’re talking about tonight, about 60 percent of that is public safety, between fire and police.” 

Additionally, Anderson discussed the 2022-23 budget as a whole in a memo to council members. 

“The good news is that the City has been able to navigate through the many operational COVID-related issues of past two years and remained in a solid financial position,” said Anderson, in the memo. “The past two audits have shown small positive cash flows in the city’s major funds and has allowed the city to continue making capital improvements in spite of increasing costs. However, significant price increases for supplies and suppliers have started to impact our expenditures and it is becoming increasingly difficult to manage timelines and costs for construction and services. Like other challenges that have faced our city in the past, I fully expect that we will rise to the challenges and emerge stronger for our efforts.” 

Anderson said while portions of the general fund revenue streams are expected to improve, the total expected increase is expected to be less than the rate of inflation.  

“Constitutional State Shared Revenues are expected to rise slightly due to increases in state sales tax revenues, but legacy business tax credits will slow the growth of revenues available to municipalities for the next 2-5 years,” said Anderson, in the memo. “Taxable valuation of real property within the city of Dowagiac will remain relatively constant. New construction is taking place, but the timing of the improvements are unlikely to impact the budget until 2023-24.” 

Specific details of the city budget and tax millage can be found at cityofdowagiac.com in the May 23 council packet. 

In other business, council: 

  • Approved event requests for the Dowagiac Lions Club White Cane Week Fundraiser June 2-4, as well as a Vintage and Artisan Market July 30.
  • Approved a resolution allowing the city to apply for a $75,000 High Perform Grant related to the city’s Neighborhood Enhancement Program. The city was named a High Performer in round six of the NEP Grant program, giving them the opportunity for additional money.
  • Approved a resolution to accept a $394,818 proposal for a Beeson Street sewer project, as well as a Pennsylvania Avenue parking lot project.