$7 Million question; voters to decide Boyne City bond issue

Benjamin Gohs

News Editor

Boyne City voters will decide whether they want to pay for a 21-year, 2.26 mill millage to pay for Boyne City’s massive city facilities upgrade project.

The Boyne City Commission voted 4-1 on Tuesday Feb. 11 to submit ballot language to the Charlevoix County Clerk’s Office.

“I think that we should go forward for the May election,” said Boyne City Commissioner Tom Neidhamer.

Neidhamer addressed two members of the public who voiced concerns about what they felt was a rush to get the matter put on the May ballot, saying he felt city officials have discussed the matter at length in numerous public meetings.

“In regards to the public comments, I think we have done our due diligence and we have vetted those issues and we have most of the answers to your questions.”

The Boyne City Facility Improvements Bond Proposal is as follows:

“Shall the City of Boyne City, Michigan, borrow the principal sum of not to exceed Seven Million Dollars ($7,000,000) and issue its general obligation unlimited tax bonds, in one or more series, payable in not to exceed twenty-one (21) years, for the purpose of paying police, fire, ambulance, museum and City Hall operations, including site acquisition, demolition, site improvements and related infrastructure improvements? If approved, the estimated millage to be levied in 2016 is 2.69 mills ($2.69 per $1,000 of taxable value) and the estimated simple average annual millage rate required to retire the bonds is 2.26 mills ($2.26 per $1,000 of taxable value).”

Citizen comments

Boyne City resident Ken Allen addressed some issues he felt needed to be discussed. First, he said there doesn’t seem to be enough time to discuss the matter of the bond proposal before the city has it appear on the spring ballot.

“With the question of bond proposals … the notion of spending money, interest, to somebody to use money is just so antithetical to some voters that they’re not gonna to vote for a bond—doesn’t matter what the benefits of the project are, that’s just an issue.”
He added, “And, those smaller groups of voters are tend to be present in May and August. Larger groups of voters are always larger in November… The problem is the primary burden is on property owners—those are present and future property owners.”

Allen said he did feel the bond measure should go forward but that there should be more discussion on the matter first.

“I’d like to know how much money we’re going to save per year on labor if it’s going to be more efficient,” said Boyne City resident Don Smith… “Emergency service—how much are we going to save per year?”

He added, “With a bond issue of … 2.69 mills, how much of that, I’m wondering, is that subject to the DDA and the industrial park where they capture any increases in tax?”

Smith also asked what percentage of homeowners versus businesses will carry the burden of the proposed bond.

further discussion

Following the public comment portion of the meeting, Boyne City Commissioner Derek Gaylord made his own reservations known, acknowledging Smith’s concern about whether the facility fell within the scope of the DDA and its funding mechanism—a question he asked shortly after first being elected.

“Does this facility fall within the DDA? And, the answer to that is yes,” Gaylord said. “And, at that time I said well, when this moves forward with any way, shape or form, then the DDA definitely should be putting money into this project to help pay down the debt or build it in phases as I had presented throughout this process.”

He added, “So, that’s something that definitely needs to be part of the discussion and clarification potentially before we move forward.”

Gaylord also discussed combining his concept of pay-as-you-go with a bond measure if it is approved.

He also talked about concern over tax rates and how this will affect both homeowners and business owners.

“What is the urgency for putting it on the May ballot?” Gaylord asked.

Boyne City Manager Michael Cain said there is no urgency to put the measure on the ballot but it will give the commission the ability to go forward with the project as soon as the time is right. It also gives the commission time to make other plans if the measure were to fail.

Gaylord also discussed concern over how unexpected municipal costs and/or future state taxes might put the city in a tight financial situation while it also attempts to pay down a nearly $7 million debt.

“I think this is something we need to think very carefully about because there are far-reaching effects,” Gaylord said.

He added, “It’s been a long process from the dream state getting to this point. But, like anything, when you get closer to the finish line, the details matter, details are important because that’s when things and people become affected—when the ink’s on the paper.”

Gaylord said he remains in full support of the city facilities project but that he thinks there is no reason to rush into it.

Boyne City Commissioner Laura Sansom said discussions over the need for new city facilities has been going on for many years.

“I personally don’t like paying higher taxes, either,” she said… “But, at the same time, I’m going to say I think it’s a worthwhile project moving forward and we are in desperate need of either totally renovating this current facility—which probably wouldn’t be worth putting the money into—or doing a new city facilities that makes sense and works well for everyone in the community.”

Boyne City Commissioner Delbert “Gene” Towne remained in support of taking the matter before the people.

Boyne City Mayor Ron Grunch said making improvements to the city’s facilities began back in 2002-2003 when it was made one of the city’s top priorities.

“There has been a constant input where we’ve gone to the people where we’ve asked them what they wanted,” he said… “It’s what the people have asked us to do.”

Cain said regardless of whether the commission approved the matter to go to the May ballot, much more discussion will occur to ensure the project is undertaken in the most responsible manner possible.

Gaylord was the lone “no” vote.