Northville, Plymouth Leaders Worried About PPT Revenue Loss

Cities expected to feel effects of personal property tax phase-out beginning in 2014.

Plymouth and Northville could feel the pinch of lost revenue from the phased-out elimination of the Personal Property Tax, leaders from both cities said Monday during a joint meeting in Northville between the municipalities' leadership and state legislators. 

In Michigan, the PPT refers to a tax on commercial and industrial equipment and furniture that is captured by municipalities. Gov. Rick Snyder signed a lame-duck session bill in 2012 to repeal the PPT over 10 years, but the law will take effect for small businesses—which constitute much of Plymouth and Northville's respective business bases—in 2014. The phase-out begins in 2016 for larger manufacturers.

By repealing the tax, towns such as Plymouth and Northville are left wondering how to make up the lost revenue. 

Northville faces a loss of $59,113, while Plymouth stands to lose $38,580 in PPT revenue in 2014, officials told Rep. Kurt Heise and Sens. Patrick Colbeck and Mike Kowall on Monday at Northville City Hall.

The state legislators all agreed the PPT places a burden on businesses.

"(The PPT) disincentivizes businesses investing in equipment," Colbeck said.

"I think that everybody is in agreement that the PPT is a burdensome tax," Rep. Kurt Heise, R-Plymouth, told the local leaders. "It thwarts job growth, deters business expansion."

Heise said details still need to be worked out in replenishing the revenue lost by the PPT phase-out, and voters will decide in August 2014 on the creation of a statewide authority to allocate the replacement funds, while local municipalities can impose an essential services assessment—to help fund police, fire and EMS services.

Heise said the loss of PPT funds also will affect downtown development authorities, public library districts and, to a smaller extent, school districts. 

City officials from both Plymouth and Northville said that well-funded DDAs have been crucial in fostering vibrant small business climates in downtown Northville and Plymouth, and said neither town could afford to cut much more from their respective budgets. 

"We're really concerned when we see numbers in our situation," Northville Mayor Chris Johnson said. "We're not able to cut police and fire anymore."

Joe Horenkamp March 18, 2013 at 09:55 PM
You work for a salary right? Well if a private company can come in, open a school, attract customers, do the same or better job at a lower cost and a profit for those that run the school then why would anyone object to that? We need schools private or otherwise, charter, whatever, that specialize in the arts, automotive, wood working, electricians, mechanics, etc. Those that don't fit into one of these can opt for a public school. Programming kids for college that don't want to go to college makes no sense, and bores the kid. We need to get rid of the Dept of ed and get the government (and the unions) out of the education business. JMHO
sine-of-the-times March 18, 2013 at 10:06 PM
There are reasons why they'll do it cheaper, and you know it, or else you wouldn't keep ragging on the issue. Those things are not what holds people up, it's what cheapens us and you know it. Until then, the future will have the last word Joe...
Jerry Grady March 18, 2013 at 10:16 PM
Denise I have put kids thru Charter, Public, and Private Schools. I sat on the board of all three as well. I could go on and on, but at the end of the day, each school and each student requires a different approach. Some kids do better in Charter, some in Public and some in Private. The Charter I sat on was non-profit and educated the children for under 5,000 a child and they had some of the highest MEAPs in the Ann Arbor Area. Our teachers were paid a fair wage and comparable to the public teachers. We also were responsible for paying into the health and Pension for those teachers. Doesnt mean a thing to me unless our kids are educated and can go on to lead productive lives and be good for our society. Teachers deserve to be paid as they are educating our children for the future. But it takes a village, and by that I mean the most successful schools are not because of money, they are because the teachers and parents work hand in hand to educate the student. The parents understand that the teachers can only teach when the parent supports the teacher.
Keith Yancy March 18, 2013 at 11:40 PM
Thanks for proving my point, Joe. Perfect. Why should I attack you when you do such a great job of proving my point yourself? Enjoy your monologue.
The Truth March 19, 2013 at 01:17 AM
It is interesting to see folks fall in love with their own arguments. Joe and Denise are two excellent examples. The truth is between them.


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