Reference Desk Include

Questions and Answers about the 2018 Street Bond to appear on the Nov. 6, 2018 ballot

1. Why do we need a street bond?
The amount of funds budgeted annually for street repair and replacement, approximately $550,000 per year, is not sufficient to keep pace with the rate at which streets are deteriorating. At present, 46.5% of Northville streets have a “poor” rating … which means that we are repairing streets when they get closer to the “replacement” condition. This is a very expensive way to maintain streets. It also results in people driving on streets that are more likely to develop potholes and crumbling conditions.

2. How much will I need to pay for the street bond?
The estimated millage to be levied beginning in 2019 would be 0.9787 mills (98¢ per $1,000 of taxable value). That would be used for the issuance of a $3,050,000 Street Improvement Bond, paid for over 10 years ($50,000 of that amount covers the cost of issuing the bonds). The average residential taxpayer has a taxable value of $139,943, which amounts to an increase of $137 on their 2019 City tax bill. That increase would continue for a total of 10 years.

3. Will new property development share in the cost?
Any new development in the City will pay its share of the bond once the property is on the tax rolls at its new value. If there is any new development, this will reduce the amount of tax paid by existing property owners over the 10-year bond period. In addition, developers would be responsible for most of the cost of street improvements (new traffic signals, turn lanes, passing lanes) directly resulting from the development.

4. How will the Street Bond change the way streets are repaired?
The City currently spends approximately $550,000 per year to repair streets. Bond funds will be able to bring most street conditions up to “good” before they deteriorate to a condition that requires costly reconstruction. Engineers and financial analysts have determined that reconstructing failed streets later is much more expensive than repairing and resurfacing streets now. The total costs of maintenance and street reconstruction are projected to be $2.5 million lower over the following 15 years, if the bond issue passes, than if the City continues to spend funds in its present manner. (Refer to Engineer’s chart of poor/fair/good streets.)

5. How will the bond money be allocated?
The bond funds would be combined with the City’s existing street millage and $1,050,000 from reserve funds to finance an infusion of $6.25 million into street repairs and replacement over the next four years. After spending these initial funds, the City would continue to use its existing street millage (currently 1.68 mills), which generates about $550,000 annually, to repair and maintain the improved street system. (See financial chart showing infusion.)

6. How do we know that the money from the bond issue will be spent on streets?
The wording of the ballot language stipulates that funds from the bond issue must be used “to pay the cost of acquiring and constructing street improvements throughout the City, consisting of paving, repaving, grading, resurfacing, reconstructing and improving streets, including curb, gutter, sidewalk, drainage and related improvements.”

7. Why isn’t the City planning on doing more?
We realize that no one wants to pay additional tax. So, the City put together a plan that will significantly impact our streets and ask for less than 1 mill in additional taxes. It is important to remember that this plan, while measurably improving streets, will not bring all streets to good condition.

8. How will Northville determine which streets will be repaired?
Our engineers will objectively select the streets to be repaired, based on the condition at the time, using the Pavement Surface Evaluation and Rating (PASER) system, and Roadsoft software. The overall condition of the streetway network (OCI) and practicalities – such as traffic volumes, scheduling close repairs together, and not obstructing alternative routes – will factor into the plan.

9. How do we know that repairs will last?
The City will implement a new quality assurance and quality control program which will include:
having one engineering firm design and supervise all street improvements; requiring materials to come from certified plants and pits with certified mix designs; sampling and testing the materials used; and hiring trained professionals, independent of the contractor, to conduct a field inspection.

10. How are other communities handling street repairs?
Canton is proposing a millage of 1.45 over 20 years on the township’s Aug. 7 ballot. In 2014, Royal Oak voters approved a 10-year, 2.5-mill tax increase to upgrade local streets. See details here. In 2016, Ann Arbor renewed a street, bridge and sidewalk millage, and bridges of up to 2.125 mills for five years (2017-2021). See details here. Brighton is asking for a 4.34 mill increase to repair and maintain roads on the August ballot. See details here.

11. Why doesn’t the new increase in the statewide gas tax cover our City’s street repairs?
The state tax on unleaded gasoline increased from 19 cents to 26.3 cents per gallon on Jan. 1, 2017. It will eventually add $1.2 billion a year to fix the state’s deteriorating roads and bridges. Transportation officials warn the higher taxes won’t translate into better streets for years to come and also because the program is not fully funded. Michigan won’t be spending the full additional $1.2 billion annually on streets and bridges until 2021 if the money is available. (reference: Detroit News)

12. How much did the City of Northville receive from the statewide gas tax increase (Act 51)?
In 2018, Northville received an additional $38,354.68, This slight increase helps to offset street maintenance costs, like patching and snow plowing, but isn’t enough to cover street repair or reconstruction.

13. I pay a lot of taxes to the City. Why isn’t it enough to cover street repair and maintenance?
Of the total Wayne County tax bill paid by homeowners, only 36% is retained by the City. The other 64% is distributed to other taxing jurisdictions for items such as county operations, schools, parks, library and debt. Northville residents who live in Oakland County only see 40% of their taxes retained by Northville. The City can only budget the revenue received from the current street improvement tax levy. That millage rate is subject to reduction each year due to Headlee. When it was first approved, the millage was established at 1.92 mills. Over the past 21 years, it has declined to 1.6841 mills. Meanwhile, costs for street construction continue to rise.

14. What is the difference between this bond request and the request made in 2015?
The ballot language of this bond issue requires that all bond funds must be spent on street repairs.
The estimated millage required for this bond issue is 0.98 mills over 10 years, the last proposal asked for 2.25 mills over 15 years. That millage failed.

15. Please state your question if it does not appear in this Q&A, direct it to the City Manager.



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