EASTPOINTE — The Eastpointe City Council unanimously approved a citywide special assessment district Oct. 15, setting up the assessment in the process.
Financial Director Randy Blum said the assessment would help the city cover the cost of the streetlights throughout the city.
“We pay almost $400,000 per year to DTE, plus related administrative costs, from the general fund,” Blum said. “By funding these costs with a special assessment, it is less money which is charged against our drastically reduced property tax revenues for city operations.”
Blum said the assessment would raise approximately $429,067, costing residents and commercial parcels approximately $31.18 starting on the winter tax bill. The city will also have to send a mailing to everyone within the assessment district, which would cost around $44,000, he said.
City Manager Steve Duchane said the city’s tight finances from the decline in property values over the past few years led the council to consider a special assessment to maintain the current lights, as well as begin upgrading some to newer LED technology. The current revenues collected are not enough to cover the cost of maintenance, he said.
“We hope to start early next year,” he said. “We’re working with the regional development office, which has done some community upgrades. Up in Roseville, they’ve replaced some streetlights with LEDs with the assistance of a grant, and that’s what we’ll be doing, too.”
LED lights are “substantially more efficient” than the city’s existing high-pressure sodium bulbs or old mercury vapor lamps, Duchane said, so in the long term, the city could save money in electricity from DTE, as well as help reduce carbon emissions. He said the project required a stable revenue source, which the assessment provides, and should get underway in early 2014.
All told, the city currently spends about $32,000 a month on its streetlights, Duchane said. Replacing the existing lights with LED bulbs could save the city an estimated $10,000 a year, he said.
The assessment is in place for three years, at which time Duchane said City Council would need to renew it. It will also provide officials the chance to make adjustments to how much money is collected.
“At that time, we will have some of the costs reconsidered,” he said. “We may have the additional LED cost reductions in place, and we’ll have a new look at the DTE energy bills, so we’ll see how it goes together.”
One benefit to the city of using a three-year assessment is that the city needs to do a mailing to residents one time in that period, as opposed to annually, which Blum said would be the case if it had been done as an indefinite assessment.
With the city facing red ink for the 2016 fiscal year due to a precipitous drop in property tax revenue in the past few years, Blum said this would be some help to the city.
“This is just one more small tool to keep us afloat a little longer,” Blum said.
Mayor Suzanne Pixley said this apparently is not the first time the city has had a lighting assessment, commenting during the meeting that while going through an old newspaper from the 1970s, she saw that Eastpointe — then East Detroit — had a special lighting assessment. She said it presumably expired at some point.
According to a press release from the city, the special assessment was first brought up in April as part of budget talks, and a public hearing for the assessment was held June 18. No one spoke against the assessment at the public hearing or at the Oct. 15 meeting.
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