TIF Ballot Proposal Violates Law But Must Still Go to Voters, Says State

A ballot proposal requiring a public vote on all tax increment financing (TIF) plans in Traverse City violates state law in both its content and its length, according to a new opinion from the state attorney general’s office. That opinion prompted Governor Gretchen Whitmer to reject the proposed charter amendment this week. However, because the proposal is petition-initiated, state law requires it to still go to voters in November despite the governor’s objections – setting up a potential legal battle if the proposal passes.

City residents Fred Bimber and Karen Nielsen filed petitions in November in support of the charter amendment. The ballot language would add a section to the city charter stating: “We declare that tax increment financing ('TIF') plans shall be submitted to a vote of the people, since TIF plans divert local property tax revenue away from the general fund and basic city services such as police, fire, ambulance, streets and parks. Any proposal to create a TIF plan, or to modify, amend or extend an existing TIF plan, shall not be adopted or approved by the City or City Commission until after the proposal is submitted to and approved by a majority of the electors of the City at a regular election or at a special election held for that purpose.”

After City Clerk Benjamin Marentette verified petitioners had more than the 661 signatures required to put the issue to voters, city commissioners voted in January to put the amendment on the ballot. The amendment was then sent to the attorney general and governor, a mandatory review process that can sometimes take several months. In a July 1 email to Governor Whitmer, Assistant Attorney General George Elworth found multiple legal issues with the ballot language.

According to Elworth, the proposed amendment conflicts with the Recodified Tax Increment Financing Act and the Brownfield Redevelopment Financing Act, “which authorize local units, including cities, to participate in tax increment financing plans and projects. These acts contain no provision for voter approval of each determination by a city commission as to the extent and terms of the city’s participation or support of a proposed entity or project,” Elworth wrote.



https://www.traverseticker.com/news/tif-ballot-proposal-violates-law-but-must-still-go-to-voters-says-state/