Reference Desk Include

Questions and Answers about the 2018 Street Bond

1. Why do we need a roads millage?
The amount of funds budgeted annually for road repair and replacement, approximately $550,000 per year, is not sufficient to keep pace with the rate at which roads are deteriorating.

At present, 46.5% of Northville roads have a “poor” rating … which means that we are repairing roads when they get closer to the “replacement” condition. This is a very expensive way to maintain roads. It also results in people driving on roads that are more likely to develop potholes and crumbling conditions.

2. How much is the millage?
The estimated millage to be levied beginning in 2019 would be 0.9787 mills (98¢ per $1,000 of taxable value). That would result in issuing a $3,050,000 Street Improvement Bond, paid for over 10 years ($50,000 of that amount covers the cost of issuing the bonds). The average residential taxpayer has a taxable value of $139,943, which amounts to an increase of $137 on their 2019 City tax bill. That increase would continue for a total of 10 years.

3. Will new property development share in the cost? Any new development in the City will pay its share of the bond once the property is on the tax rolls at its new value. If there is any new development, this will reduce the amount of tax paid by existing property owners over the 10-year bond period.

4. How will the Street Bond change the way roads are repaired?
The City currently spends approximately $550,000 per year to repair streets. Bond funds will be able to bring most street conditions up to “good” before they deteriorate to a condition that requires costly repairs. Engineers and financial analysts have determined that reconstructing failed streets later is much more expensive than repairing and resurfacing streets now. The total costs of maintenance and street reconstruction are projected to be $2.5 million lower over the following 15 years, if the bond issue passes, than if the City continues to spend funds in its present manner. (Refer to Engineer’s chart of poor/fair/good streets.)

5. How will the bond money be allocated?
The bond funds would be combined with the City’s existing street millage and $1,050,000 from reserve funds to finance an infusion of $6.25 million into street repairs and replacement over the next four years. After spending these initial funds, the City would continue to use its existing street millage (currently 1.68 mills), which generates about $550,000 annually, to repair and maintain the improved street system. (See financial chart showing infusion.)

6. How do we know that the money from the bond issue will be spent on streets?

The wording of the ballot language stipulates that funds from the bond issue must be used “to pay the cost of acquiring and constructing street improvements throughout the City, consisting of paving, repaving, grading, resurfacing, reconstructing and improving streets, including curb, gutter, sidewalk, drainage and related improvements.”

7. Why isn’t the City planning on doing more? We realize that no one wants to pay additional tax. So, the City put together a plan that will significantly impact our roads and ask as little as possible from taxpayers. It is important to remember that this plan, while measurably improving roads, will not bring all roads to good condition.

8. How will Northville determine which streets will be repaired?
Our engineers will objectively select the streets to be repaired, based on the condition at the time, using the Pavement Surface Evaluation and Rating (PASER) system, and Roadsoft software. The overall condition of the roadway network (OCI) and practicalities – such as traffic volumes, scheduling close repairs together, and not obstructing alternative routes – will factor into the plan.

9. How are other communities handling road repairs?
Canton is proposing a millage of 1.45 over 20 years on the township’s Aug. 7 ballot. In 2014, Royal Oak voters approved a 10-year, 2.5-mill tax increase to upgrade local streets. See details here. In 2016, Ann Arbor renewed a street, bridge and sidewalk millage, and bridges of up to 2.125 mills for five years (2017-2021). See details here. Brighton is asking for a 4.34 mill increase to repair and maintain roads on the August ballot. See details here.

10. Why doesn’t the new increase in the statewide gas tax cover our City’s road repairs?
The state tax on unleaded gasoline increased from 19 cents to 26.3 cents per gallon on Jan. 1, 2017. It will eventually add $1.2 billion a year to fix the state’s crumbling streets and bridges. Transportation officials warn the higher taxes won’t translate into better streets for years to come and also because the program is not fully funded. Michigan won’t be spending the full additional $1.2 billion annually on streets and bridges until 2021 if the money is available. (reference: Detroit News)

11. How much did the City of Northville receive from the statewide gas tax increase (Act 51)?
In 2018, Northville received an additional $38,354.68, This slight increase helps to offset street maintenance costs, like patching and snow plowing, but isn’t enough to cover street repair or reconstruction.

12. How do we know that repairs will last?
The City will contract with a single engineering firm to supervise all road projects over the bond’s life. This will insure continuity and a high construction standard. Maintaining streets in a strategic manner – such as sealing cracks and sealing the surface during preventive maintenance – will help insure that our streets reach their optimal lifespan. Repairing (or replacing) streets only when they are in poor or fair condition will leave the City in a perpetual “put out the fire” mode. Through preventive measures and replacement of the most worn streets, the City will be able to maintain a roadway network considered to be in good condition.

13. Please state your question if it does not appear in this Q&A, direct it to the City Manager.

 

 

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