Community Forum - August 20, Topic: Inkster Public School 18 Mill Non-Homestead School Tax Renewal Vote

Transcription

1 Community Forum - August 20, 2015 Topic: Inkster Public School 18 Mill Non-Homestead School Tax Renewal Vote Objective: 1. Define Terms 2. Inform as to the use of the 18 Mill Non-Homestead tax 3. Inform as to who currently pays the 18 Mill Non-Homestead tax (geographic and type of taxpayer) 4. Inform as to who is likely to pay a Judgment Levy tax if 18 Mill Non-Homestead renewal vote fails Definitions 1. Emergency Loan - $ million borrowed by Inkster Public School Board from Local Emergency Financial Assistance Loan Board. Dated June Proceeds used to pay previously issued debt 2. Non-Homestead School Tax-Levy created as part of"proposal A" vote by state electorate in the early 1990's as part of property tax and school funding reform. 18 mills levied on non-homestead property only - which is generally defined as industrial, commercial and second homes. It is not levied on property used as the principal residence 3. Judgment Levy-A tax levied to pay for court judgment entered against the public entity. The millage rate is a function of the amount of the judgment and the total taxable value that exists within the boundaries of the pubic entity. Use of the 18 Mill Non-Homestead tax revenue 1. Repayment of the Emergency Loan principal and interest Who currently pays the 18 Mill Non-Homestead taxes? 1. Owners of commercial, industrial and non principal residence residential property only within the boundaries of the Inkster Public School District Who is likely to pay a Judgment Levy Tax if 18 Mill Non-Homestead renewal vote fails? 1. All property owners within the boundaries of the Inkster Public School District, including owners of property that is their principal residence. It has been estimated by Wayne RESA that this could be 7 mills What is the legal justification for the Judgment Levy if the Non-Homestead vote fails? 1. See attached Cognovits (Confession of Judgment) which is part of the Emergency Loan Transcript. See also attached PA 236 of 1961, Section Recovery of Judgment for Damages of School District

2 REVISED JUDICATURE ACT OF 1961 (EXCERPT) Act 236 of Recovery of judgment for damages against school district or intermediate school district. Sec (1) Subject to subsection (5), if a final judgment for damages is entered against a school district or an intennediate school district and is not removed to another court. the treasurer of the school district or intennediate school district shall certify to the supervisor of the township and assessing officer of the township or municipality in which the school district or intermediate school district is located and to the secretary of the school district or intermediate school district the date and amount of the judgment and the name of the person in whose favor it was entered. If the judgment is removed to another court, the treasurer shall certify it immediately after the final detennination of the judgment against the school district or intermediate school district. (2) Subject to subsection (5), if the treasurer fails to certify a judgment for damages as required by subsection (1), the person in whose favor the judgment was entered or the person's personal representative or assigns may file a certificate of the clerk of the court that entered the judgment that contains the information that should have been certified by the treasurer. (3) If a school district or intermediate school district against which a judgment for damages is entered is located in 2 or more townships or municipalities, a certificate under this section shall be delivered as provided in this section to the supervisor of each township and assessing officer of each township or municipality in which part of the school district or intermediate school district is located. ( 4) An ru.s.essing officer who receives a certificate of a judgment under this section sha11 proceed tu assess the amount of the judgment, with i11tcrest from the date of the judgment to the t1me when the warrant for the collection of the Judgment will expire, upon the taxable property of the school di!.trict or intermediate school distnct, placing 1t on the next township assessment roll m the column for school taxes. The amount of the judgment shall be collected and returned m the same manner as other taxes of the school district or intennediate school district. (5) This section does not apply to any of the following: (a) A judgment entered in an action to enforce a contract that the school district or intermediate school district was not authorized to enter into under the laws of this state. (b) A judgment entered in an action to enforce a contract to which the school district or intennediate school district is a party that provides for payment of money to a person other than this state, a public employee retirement system established by this state, or a state authority, if both of the following apply: (i) The school district or intermediate school district is subject to a consent agreement under section 8 of the local financial stability and choice act, 2012 PA 436, MCL (ii) The consent agreement does not require the school district or intermediate school district to obtain the approval of the state treasurer before the treasurer of the school district or intermediate school district certifies a judgment under this section. (c) A judgment entered in an action to enforce a contract to which the school district or intermediate school district is a party and to which all of the following apply: (i) The contract provides for 1 or more payments by the school district to a person other than this state, a public employee retirement system established by this state, or a state authority. (ii) The total amount of the payments required under the contract by the school district or intermediate school district is more than $100, (iii) The school district or intermediate school district failed to make a payment required under the contract to the person within 90 days after the date required under the contract. (iv) Either of the following applies: (A) Within the 90-day period under subparagraph (iii), the person entitled to the payment did not provide written notice to the board and superintendent of the school district or intermediate school district and the state treasurer of the school district's or intermediate school district's failure to make the required payment and the person's intent to stop providing goods or services under the contract. (B) After sending a notice described in sub-subparagraph (A), the person did not stop providing goods or services under the contract at the earliest time allowable under the contract. (6) The state treasurer shall transmit an electronic copy of each notice received under subsection (5)(c)(iv )(A) to the chairperson of the house education committee, the chairperson of the senate education committee, the chairperson of the house appropriations subcommittee on school aid, and the chairperson of the senate appropriations subcommittee on school aid. (7) The state treasurer and the school district or intermediate school district shall post an electronic copy of Rendered Monday, August 17, 2015 Page 1 Michigan Complied Laws Complete Through PA 130 of2015 Legislative Council, State of Michigan Courtesy of

3 a notice sent under subsection (5)(c)(iv)(A) on the internet website of the department of treasury and of the school district or intermediate school district, respectively. History: 1961, Act 236, Eff. Jan, 1, 1963:-Am. 1974, Act 297, Eff. Apr. I, 1975:-Am. 2013, Act 185, Imd. Eff. Dec. 13, Rendered Monday, August 17, 2015 Legislative Council, State of Michigan Page2 Michigan Compiled Laws Complete Through PA 130 of 2015 Courtesy of

4 UNITED STATES OF AMERICA STATE OF MICHIGAN CHARTER COUNTY OF WAYNE SCHOOL DISTRICT OF THE CITY OF INKSTER COGNOVIT Relating To EMERGENCY LOAN NOTE (General Obligation Limited Tax) Serles I SCHOOL DISTRICT OF nm CITY OF INK:STBR, Charter County of Wayne, State of Michigan (the "lnudj, has issued its Emergency Loan Note (General Obligation Limited Tax), 2012~13 Series i dated June 6, 2013, in the face principal amount of $12,474, (1he 0 Note"). acknowledging itself to owe and for value received promising to pay to the State of Michigan (the "SIIIW') the amounts, at the times and with in1erest thereon as specified in the Note. In the event of any non-payment of principal of or interest on the Note when due, the State bas the right to declare all amounts under the Note to be immediately due and payable, without notice or demand. The Issuer waives presentment. demand, notice of dishonor, protest and.. no.tice of non:pllyment with respect to the Note.. < ::._;~ \..,-_~:::.:! :,::J~:;.-(:~;:~~~--:~~~:.:~~:,_~~~-,,~-:~;.::~;-.~~~.:~,.:~.::N.~~-:~~-,~.--~y _.. )/'_:,::_.:;:.;'. ;~_'.\ > irrevocably and unconditionally autbori7.es the Attorney General of the State of Michigan,',_._.:.. '.'.<:,< : :-: including any liccoaed attorney wbo is a membor of the State of Michigan Department of Attorney General, to appear in any court of record of lhe State of Michigan at any time after arnoupts under the Note have become due and remain unpaid, whether by acceleration or otherwise. (a) based on this cognovit instrument and in accordance with Section 2096 of the Revised Judicature Act, Act No. 236 of the Michigan Publie Acts of 1961, as amended (the "RJA") (MCL ), to confess a judgment against the Issuer m favor of the State for the principal amount of the Note then due and with the interest thereon theo due as specified in the Note (collectively, the "A nts D~e and Unpaidj, {b) to consent to the State bringing an action to obtain a judgment against lhe Issuer for the Amounts Due and Unpaid baaed on this cognovit instrument and an attorney's confession of judgment and (c) to wai,,e prior notice of the judgment, the right to a trial on the indebtedness. and the right to an appeal from such judgment. The Inuer acknowled1es that if it does not pay any Amounts Due and Unpald under the Note on time, by signing this cognovft instrument: ft gfws up lu right to notice and court trlal with respect thereto, a court Judpient may be taken against It for the Amounts Due and Unpaid In accordance with aocb Section 209' without its prior knowledge, and the powen of a court can be used to collect the Amounts Due and Unpaid from it, including the P " to enter a Judgment whlch could be satisfied aaatnst the Issuer tn accordance with Section 6094 of the Revised Judicature Act, P1lblle Act 236 of 1961, as amended or any other applic.able law.

5 ln WITNESS WHEREOF, the Issuet, pursuant to a resolution approved by its Board of Education on May 2, 2013, has caused this.cognovit instrument to be signed in the name of the Issuer by the manual signature of its Superintendent, as of June 6, 2013, the Date of Original Issue of the Note. School District of the City oflnkster. :. :,.~......~.,~. ~. ::!,'...:;. '1. :.,~... : :-....,..-.:..:...,.., :_.: :-: :<: ->:\ i~. \\:<. =-' \->> _:: "--:: =i.>,:_, ::\>:\~i{\sf ;\:.>.:-:>.. :-::-~.. ~ ;_,. ;-. i\,:i<: -'::..,.-./(:::,\\::,:/S:;;i::: ::_ '. :: :.:_.. 2