CHARLOTTE, Mich. — The city of Charlotte is considering creating a special assessment district that would provide dedicated funding for the fire department.
Over the last decade, Charlotte has seen a decrease in property tax revenues, which Mayor Michael Armitage said are the primary source of income for the city.
Armitage said the city has not fully recovered from the 2008 recession and estimates it has lost about $4 million in total revenues in the years since.
"But the more immediate problem is that we have over several decades, promised pensions to a lot of individuals. A lot of city employees that worked and earned them, and we're obligated to pay them," he said. "And we have not been paying the proper amounts over the years into those funds."
Armitage said they're $11 million short of fully funding their pensions, the bill is coming due and the state has mandated they start fixing this issue.
A fire protection fund "will help resolve the issue by bringing additional funding dedicated to the fire department, which will ease the burden on our general fund so that we can free up dollars in our general fund," he said. "One so that we can start building our saving back up because we're critically low but two to start putting that money towards pensions."
The city wanted to protect public safety. The fire department was chosen after a consulting company did a financial analysis, and recommended the city move the fire department into a special fund.
Armitage said the department provides services to five townships.
The special assessment would affect residents' tax bills if passed. Armitage said, in the worst-case scenario, they're looking at up to four and a half mills.
"For somebody that owns a $200,000 house, that equates to about $450 a year," Armitage said.
The district would need to be approved by the City Council. If it doesn't pass, the city will need to make immediate cuts, Armitage said. They estimate three police officers and two firefighters would be cut.
"It would have to, unfortunately, come from public safety," Armitage said, "because...our clerk, for example, they have half the number of employees they used to."
A public hearing on the measure will take place Monday at 7 pm.
If you're looking to see how the special assessment would impact your tax bill, click here.
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