Tax settlement delay for Midland

By John Kennett
Journalism 312

Monday, the Midland City Council believing the end was in sight to the 12-year-old tax appeal between the City of Midland and the Midland Cogeneration Venture, unanimously approved a $137 million settlement.

Unfortunately for both parties, the state of Michigan desired a say in the settlement.

Monday afternoon, the Michigan Attorney General’s office sent two motions to Jim Branson, Midland city attorney.

The first, filed jointly by the Michigan Department of Treasury and the State Tax Commission, is asking the City of Midland, and the MCV, to explain how the figures of the settlement were derived.

The City of Midland would contribute $36.2 million with Midland County adding $19.6 million.

Midland Public Schools, Midland County Educational Service Agency and Delta College would pay a total of $11.3 million.

Michigan’s portion of the settlement to MCV would be $60.2 million.

The settlement includes a credit of approximately $10 million to the MPS, Bullock Creek Schools, Midland County ESA and Delta College.

The credit would include an $8.3 million donation to the schools and $2 million in interest.

“The parties recognized the challenges our educational institutions face in these difficult financial times and the limited funding options available to them, so MCV agreed to assist them with their donations,” said MCV President Rod Boulanger.

The motions question whether the state should be receiving the same refunds as the other taxing jurisdictions.

The second motion asks for a ‘delay of consideration of settlement’ while both state agencies be given the opportunity for input into the settlement.

Midland City Manager Jon Lynch stated to the council that any delay in the settlement can be costly as $19,000 interest is accruing daily.

The settlement stems from a dispute regarding the assessment of MCV property tax values for the tax years 2001-2007.

MPS has already put on hold several capital improvement projects for the 2008 year due to the ongoing tax dispute, including new boilers at H. H. Dow High School, Plymouth and Parkdale elementary schools.

A settlement would avoid litigation scheduled to begin July 7.

Edited by Jason Baird and Justin Marr