Michigan, Superior street assessment delayed
MARSHALL — A proposed street assessment that was already waiting while officials were talking over possible changes to Marshall assessment policies will be held off a while longer.
This week, Marshall City Council members opted to wait on certifying the assessment for street improvements affecting Marshall’s industrial park.
The move would give the city time to get an appraisal of the commercial and industrial properties benefiting from the construction, council members said.
In September, the council held a public hearing on proposed street assessments for street and utility construction on Michigan Road and Superior Road. Property owners were being assessed for about $552,000 out of a total project cost of around $1.25 million. However, there were only six properties being assessed for the project — all of them commercial or industrial properties. The city also received appeals from some of the businesses being assessed.
The assessment hearing was tabled until Oct. 23, so the council’s Ways and Means Committee could consider a proposal to update Marshall’s assessment policies on commercial and industrial property.
“Tonight is not the hearing,” Marshall Mayor Bob Byrnes said at Tuesday’s city council meeting. “Tonight the discussion really is on, is there going to be a change proposed to the current policy?”
Marshall Public Works Director Glenn Olson said the Ways and Means Committee and city staff worked on a formula for determining a maximum assessment for commercial or industrial properties. The formula takes a commercial or industrial lot’s square footage, divided by the median Marshall residential lot size of 10,000 square feet, and multiplied by the maximum residential street assessment of $5,500, and factors for wider street width and greater strength. Olson said the median residential lot size was determined after working with the city assessing department and investigating residential lot sizes in Marshall.
Using the formula for a maximum assessment would take the amount of money assessed to property owners in the industrial park down to about $522,000.
“We are not recommending a change to the policy, but we’re making a recommendation to do a procedural change for the maximum assessment, which really parallels the maximum residential assessment we have now,” said council member John DeCramer.
“We felt it was a good solution we could implement in a short period of time,” said council member Glenn Bayerkohler.
“But evidently we still need to look at our overall assessment policy, as to how we do it . . . it could be a long process.”
The council did still have objections to the street assessments. Pete Halverson, manager of Pete, LLC, said he didn’t think the city’s assessment policy was lawful. Under state law, the assessment had to be limited to the benefit to a property in increased market value, he said. The amount that Pete, LLC was being assessed by the city was likely much more than that benefit, he said.
Olson said the city did have alternatives. It could leave assessment for this project unchanged, use the recommended assessment calculation by setting a policy adjustment, or it could make other changes as the council deemed it necessary.
Marshall City Administrator Sharon Hanson said another possible option for the city would be to do a preliminary appraisal on the project.
“It has a potential to avoid court. It could provide the city some strength in negotiations if that’s where we end up, and it could help determine the policy,” Hanson said. “Right now, we’re putting our best foot forward, but maybe we need some additional information through an appraisal.”
Byrnes said the city likely wouldn’t be able to do that kind of appraisal before the hearing picked up again Oct. 23.
The city could delay certifying the assessment to allow for more time.
“I’m very much in favor of delaying it for a year, and doing this right,” said council member Craig Schafer. Holding off on the assessments for Superior and Michigan Roads might be “a little bit painful between now and next year, because we’re gonna have bond payments and stuff that are due,” but it would be worth it in the long term, he said.
“I think we need to look at the entire policy of what we’re doing” in the long term, before going back to the assessments, Bayerkohler said. “I want a consistent policy.”
At the same time, Bayerkohler said it was important that the city didn’t overreact in its response, and be as economical as possible.
“We want to make sure we’re going to come up with a good solution that doesn’t cost a lot of money.”
Council member James Lozinski said he thought appraising the street project would be helpful, even if there are later challenges to the city’s assessments.
“If it gets challenged in court at that time, we’ve done our legwork,” Lozinski said.
Lozinski moved that the city go forward with a project appraisal for the Superior and Michigan Road construction, and delay certification of the assessments.
Council members voted in favor of the motion, with DeCramer abstaining.
Byrnes said the Oct. 23 hearing would likely be a short one, based on the council’s actions Tuesday.