A dip into the pool

Michigan State Roundup

Published November 1, 2004  | November 2004 issue

Upper Peninsula (U.P.) counties are breathing easier now that the state Legislature has authorized a new revenue sharing pool that involves early payment of county property taxes.

State revenue sharing dollars had traditionally come from state sales tax revenue, but $183 million in revenue sharing was eliminated from the state's 2005 budget, compelling local governments to find another way to maintain a steady revenue stream.

State revenue sharing constitutes major funding for most municipal governments; for example, the city of Marquette receives $2.1 million; Marquette County, $1.1 million; and city of Negaunee, $600,000.

By moving up the county property tax collection date, the state will create a reserve fund for municipal governments to tap into. Property owners will pay one-third of their county property tax next summer, with the rest due after the December bills go out. In 2006, two-thirds of the tax bill would be due in the summer and the remaining one-third in winter of that year. And by 2007, the entire amount would be collected in the summer.

While the fund is not meant to be a long-term solution to balancing the state budget, it will keep distribution levels at the current rate and allow communities to budget better.

Kathy Cobb