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Sidewalk Improvement Bond Proposal Information

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Sidewalk Improvement Bond Proposal Information




FROM THE DESK OF THE CITY MANAGER:

We have received many questions and comments about the Sidewalk Improvement Bond Proposal that will be on the November 7, 2017 Election ballot.  This notice will attempt to provide information and calculations to show why the City Council discontinued the previous $25 fee sidewalk program and decided to place this item on the ballot for the voters to decide.

The City was able to complete 40% of the City sidewalks during the ten years of the $25 sidewalk assessment from 2007-2016.  Council looked at the estimate to complete the City with that program and the numbers showed that it would take close to 20 more years to complete the sidewalk program. That was not acceptable to City Council, so the decision was made to place a ballot question on the November 7, 2017 ballot to complete the 60% of the City that remains over the next 5 years.  The estimated millage for the bond issue in 2018 is estimated to be .28 mil. That would be $15.68 in taxes to an average taxable value home in Clawson of $56,000. The average over the term of the bond repayment is estimated to be .58 mil. That would be $32.48 in taxes. The best way to show that the bond is the more cost effective way to complete the sidewalk program is to compare the cost of the former sidewalk fee of $25 to the bond option.

The estimate to complete the sidewalk program under the former program of $25 per year is 20 years.  20 years x $25 = $500.00 of additional cost.

The sidewalk program through the bond issue would be completed in 5 years and the repayment of the bonds would be in 11 years. With an average tax amount of $32.48 x 11 years = $357.28.

On average, the bond cost would be $142.72 lower in total than the $25 fee and would be completed in 5 years rather than 20 years.  Also the payments will end in 11 years.

Obviously if your taxable value is higher, you pay more toward the program, but that is the case for all taxes that a resident pays. This program would allow the City to finish the program through the 60% of the City that has not received sidewalk repairs and complete the entire City in five years. Also, everyone will pay a share of the cost including the businesses in Clawson. 

Another reason that our City Council chose to place the sidewalk bond option on the ballot is because the debt millage overall is estimated to continue to go down. So, even though these bonds would be repaid over the following eleven years, the overall debt millage will continue to drop. What that means is that your tax payments for debt will continue to drop each year.  Then, in two years there are two bond issues that will be paid off so the debt payment on your taxes will drop even further. The Council wanted to be sure the overall impact of this sidewalk bond would be minimal and with the anticipated drop in debt millage will allow that to happen.

Although some residents have already had their sidewalks replaced and perhaps may think - why would I pay for others sidewalks when mine have already been fixed? The simple answer is, because everyone in the City has already paid the same fee and 60% of the residents have not had their sidewalks replaced yet. Many residents in support of completing the sidewalk program via the bond sale have said that everyone benefits with good sidewalks throughout the entire City.  There are other items on taxes that not everyone gets a direct benefit from, yet these projects make the City a better place to live as a whole.

If you have further questions please feel free to contact me at 248-435-4500 ext. 111 or via email at mpollock@cityofclawson.com.

Thank you,


Mark Pollock
City Manager

 

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