Walled Lake residents and business owners alike showed up in droves to protest the City Council’s consideration of dissolving the Walled Lake Downtown Development Authority (DDA) on Tuesday, June 5.
Tension was high as a number of community members took the floor to denounce any move to shut down the DDA.
DDA Board of Directors member Bennett Lublin asked the council to table the motion to revisit the DDA budget numbers again.
“I think we can figure out a way to make Council happy and the DDA is here to work with you, especially when the non-city taxing authorities are paying the ticket,” he said.
Tony Lacera, owner of Eagle Graphics, opposed any measure to dissolve the DDA at the meeting.
“This is an important issue and I want to be put on record on my feelings,” Lacera said. “If they are so concerned about money, why give up the money from Oakland County?”
Protestors were unsuccessful in dissuading a majority of the City Council from approving the first reading of an ordinance to dismantle the DDA, as City Council members John Owsinek, Bob Robertson, Bill Sturgeon and Mayor Pro Tem Linda Ackley voted for its passage.
“We’re facing a lot of debt here,” Sturgeon said. He cited a pension plan that is underfunded by 61 percent and a water department that is losing $500,000 a year.
Owsinek added that Walled Lake is taking captured money from other taxing entities.
“We’re putting Walled Lake on the backs of other communities,” Owsinek said.
Mayor Bill Roberts and City Councilmen Dennis Yezbick and Casey Ambrose, who is also the DDA Board chairman, voted against the measure.
“If you want more detail, then ask us,” Ambrose said. “What is this all about? I don’t see it as a situation with money. If it’s personal, say its personal, but to lose money from outside sources is ludicrous to the people and businesses in this community.”
Ambrose and Roberts said that dissolving the DDA would be moving the city backward, not forward.
“We’re finally bringing in business. This isn’t the time to stop, but keep going,” Ambrose said.
“I do feel this is a step backwards,” Roberts said. “The DDA is the best savings account the city has to do projects.”
The audience agreed with Roberts and implored the City Council to reconsider.
“I’m disappointed in Sturgeon, without broadening the discussion of what’s broken with the DDA,” Lacera said.
Daryl Ramsey, owner of Melvin’s Hardware, questioned the prudence of shutting down the DDA when it stands to rake in $170,000 this year from other taxing authorities.
“I didn’t know the city was wealthy enough to turn away these funds,” Ramsey said.
Subsequently at a budget meeting on Monday, June 11, the City Council approved the DDA budget proposal after making several changes.
“The business community showed up on behalf of the DDA and it may have had some sway,” Ambrose said. “It’s a good sign that the budget was approved.”
The DDA budget expenditures for 2012-13 are now pegged at $629,250, including reimbursing the city $392,600. The DDA will now assume more financial responsibility for the reconstruction of the Pontiac Trail/Maple Road intersection: $112,000 instead of $80,000.
The executive director’s $63,600-per-year position was reduced to a $50,000 job in a part-time capacity.
Another $60,000 will be reserved from the fund balance for tax tribunal appeals, a liability the city would assume if the DDA is dissolved.
The DDA fund balance is projected at $424,632.
Total revenues for the DDA are pegged at $583,700, of which $170,000 comes from non-city taxing authorities such as Oakland Community College; Oakland County; Oakland County Parks and Recreation; and the Huron-Clinton Metropolitan Authority. Revenues are gained through property taxes via tax increment financing (TIF), which is often referred to as “capturing” tax revenue ordinarily destined for other taxing units. For example, if the base year total taxable value of property in the DDA district is $1 million, and the second year it’s $1.25 million, the DDA is permitted to “capture” the property tax revenue collected on the increase in total taxable property value of $250,000 to pay for DDA projects. The other taxing units would receive only the tax revenue on the initial $1 million in taxable value.
A second reading on the ordinance to dissolve the DDA is scheduled for Tuesday, June 19.