|
Based on questions we have received at City Hall this week, I (City Administrator Greene) wanted to share information.
City Finances - State Corrective Action Plan
All mandated reporting to the state is public records and can be found on the Michigan Treasury Local Government Document Search Site.
Every year, if findings or deficiencies are identified during the audit process, the City is required to submit a Corrective Action Plan (CAP). The City's 2024 CAP was submitted to the State on January 2, 2025, and can be found utilizing the link above. These findings were discussed during the City's FY 23-24 audit presentation on December 16, 2024.
Specifically, for the “actual expenditures” item each year, the City does its best job to complete budget amendments that represent the status of the City. However, there are times when after the budget amendments are completed and the fiscal year ends (June 30) we receive outstanding invoices that end up exceeding the budgeted amount in line items, or during the audit process the auditors require the City to change the accrual date on a payment. This causes a "finding" or “deficiency” during the audit process, it is reported to the state, and the City responds with a Corrective Action Plan. For this past year, the material difference that was noted in the financial statements was for Administration. This was primarily for the “Employee Sick Leave Payroll Accrual” that accrued the payment in FY 25 back to FY 24. Although the cash was paid out in July, the expenditure needed to be accrued back to the period in which that employee retired. The reason we had a payout in July, was at the time of the employee's retirement we agreed to split their payout over two fiscal years in an attempt to limit the financial impact to the City in one given fiscal year. Unfortunately, the auditing methodology disagrees. This deficiency does not change the fact the City added to its General Fund – Fund Balance this past year.
MI Community Financial Dashboard
If you want to see some snapshots of the City's Finances, check out the MI Community Financial Dashboard. It shares data going back to 2010 and you can track trends based on what is going on in the City. For example, in 2021 you will notice the City having revenues of over $15 million and expenses of $10 million. This was due to approved infrastructure bonds being issued to the City. In 2023, expenses exceed revenues by $3 million. This was the City completing and paying for those bond projects. In our most recent year (2024), City revenues were $9.78 million and expenses were $9.74 million.
Public Act 33 - Police & Fire Protection
Q: What is Public Act (PA) 33?
A: In Michigan, "Public Act 33" refers to a law that allows municipalities to establish special assessment districts and levy special assessments to fund police and fire protection services, essentially meaning property owners within a designated area contribute extra funds on their property taxes to cover the cost of these services within their community; the process involves creating a special assessment district, holding public hearings to determine the assessment amount, and then incorporating the levy into property tax bills.
You can find additional information on MCL - Act 33 of 1951 by clicking here.
Q: How does Lathrup Village qualify for this Special Assessment District?
A: This act applies to townships and adjoining townships and incorporated villages and qualified cities. In the act, if a reference is made to "townships," that reference applies to townships and incorporated villages and qualified cities. If a reference is made in this act to township boards, that reference applies to township boards and the legislative bodies of incorporated villages and qualified cities (i.e. City Council).
As used in the act, "qualified city" means a city with a population of less than 15,500.
Q: If the City Council approves implementing PA 33, how much will my taxes increase?
A: Based on the recommendation from the Finance Review Committee, the City is currently estimating a 3.1 mill increase (NOTE: this is still subject to approval from the City Council). This is subject to change based on the updated taxable value numbers that our assessors will finalize after the March Board of Review. Every property in the City is different, but we have a tentative special assessment roll that you can review and see what the potential impact on your property could be.
Q: If approved at the recommended rate, how much revenue will it bring into the City?
A: Approximately $560,000 would be collected via this special assessment to offset Police & Fire Expenses.
Stay tuned for future Finance Review Committee meetings as they dive deeper into the education behind this recommendation.
| 
