Property owners in Ypsilanti are another step closer to footing most of the city’s streetlight bill and costs for installing new lights.
By a vote of 4-1, the City Council Tuesday night approved a “resolution of necessity” for a special assessment streetlight district that would impose a flat fee on residents and businesses to pay the city’s DTE bill and pay for new LED street lighting.
But officials stressed the fee is not a new tax — it’s a fee residents will pay the city in return for a service, they said.
As the city struggles to balance its budget over the long term, the fee would bring in an additional $400,000 annually to pay for lighting.
Mayor Paul Schreiber, Council Member Ricky Jefferson, Council Member Pete Murdock and Council Member Dan Vogt voted in favor of it. Council member Brian Robb voted against.
If the new fee gets final approval as proposed, a parcel owner will pay an estimated $98 in fiscal year 2014 and $92 in fiscal year 2015. That figure will drop to $84 through fiscal year 2020 and $67.51 through fiscal year 2031.
“There is a big demand on us to do this. We will be the first in the state to convert all our lights from sodium vapor to LED,” said City Manager Ralph Lange.
Those estimates do not include projected increases in the cost of electricity, though Lange noted that the city will be using much less electricity.
Switching to LED lights will cut the city’s electric bill from $515,000 annually to an estimated $400,000 annually. The conversion from current lighting to LED will take place over the next two years and will cost approximately $555,000, which will be amortized over seven years.
Costs for conversion to LED along with operation and maintenance will be divided equally and assessed among 4,812 of the city’s 4,951 parcels. The city will pay for 23 percent of all capital costs and operating and maintenance costs in the first year and 20 percent after.
Lange said the tax runs through 2031 because that is when Water Street debt should be retired and the city will be in a better financial position.
“We’re not taking it one second more than we need it,” Lange said.
Water Street refers to property the district bought up hoping to attract mixed-use development. The plans never materialized, and the city has been saddled with debt from the property.
Officials previously thought Eastern Michigan University’s parcels couldn’t be exempt, but City Attorney John Barr determined they are actually exempt.
Brian Robb
Council Member Brian Robb raised concerns that "arbitrarily" exempting Highland because they use very few lights will open the door for other residents to challenge the fee based on the same reason.
“Doesn’t it make it easier for people to ask if we are assessing this in a fair manner?” he asked. He and Council Member Pete Murdock also asked about the methodology for assessing and whether a flat tax was the fairest way to charge residents.
Murdock said he has already heard residents with two streetlights on their street breaking down their cost of operating the lighting with the new fee.
Alternate suggestions to a flat fee have included billing by lot size or charging a higher fee for businesses in commercial zones that use more streetlights.
“This is the fairest, cleanest way to do it and not overburden anybody. If you do the division, it keeps it under $100 for everyone," Lange said.
City Planner Teresa Gillotti said it would be easy to charge higher fees for businesses that benefit from large amounts of lights in Depot Town, for example, but it would be more difficult in areas where a residential property is near a commercial property. That would lead to questions over whether or not an adjacent residential propery really benefited from the lights.
“It was hard to make it clean outside of downtown and depot town areas,” she said.
Residents will have a chance to weigh in on the fee. If property owners representing more than 50 percent of the expected cost of the assessment file objections, the project may not proceed without the affirmative vote of four-fifths of all of the council members.
The timeline for approving the proposed district is as follows:
- Aug. 6: A first public presentation on the plan.
- Aug, 20: A public hearing regarding objections and review by the council.
- Sept. 3: A second public hearing regarding objections and confirmation by City Council.
Officials are also touting the environmental benefits of LED lights. The switch will save 500 metric tons of carbon emissions annually and is in line with the city’s climate action plan.