By Mary Drier
Staff Writer
TUSCOLA COUNTY — Denmark Township water projects — both past and proposed current ones, continue to be an area of conflict… so much so that there is one lawsuit pending and other legal action could be coming in this water war.
Tuscola County currently has a lawsuit pending against the township because the county pledged its “full faith and credit” to financially back the previous water project so the township could get a better interest rate.
However, once the assessment to finance the project was determined, residents balked at the cost; which was nearly double to about $17,000. Some residents took the issue to the state tax commission.
That water project was abandoned by the township board after the Michigan Tax Tribunal ruled in favor of township residents on the assessment being excessive, which left the township without a special assessment district to pay the bills that had been incurred for it.
Between preliminary engineering, legal fees, and other associated costs in developing the previous water project before it was abandoned, about $395,000 in costs were incurred.
When the township abandoned the first water project, it became the county’s responsibility to pay that money back. The county filed a lawsuit last year to recover that money. A possible way to cover that debt would be for the county to allow the county to levy a special millage over the entire township, which could be up to 5 mills.
In the meantime, the township board started other water projects with plans to roll that $395,000 debt from the first project into the second one.
During Monday’s Tuscola County Board of Commissioners meeting, Denmark Township Clerk Charles Heinlein explained the new water project is moving forward and with that the financial issue from the first water project should be resolved in that.
“We acknowledge we owe the debt. We are working with the USDA (United States Department of Agriculture) who is involved with this project, attorneys, and feel (the county’s) legal action shouldn’t have happened,” said Heinlein. “We are trying to look out for the residents by any means possible outside of an additional tax.”
However at the commissioners’ meeting Thursday, resident Gary Johnson contended rolling the cost of the first water project into the cost of a second one can’t be done.
“It’s not legal. In 33 cases, the Michigan Tax Tribunal ruled that Denmark Township is not entitled to allocate the preliminary costs of the water project as a special assessment in these circumstances,” said Johnson. “Denmark Township has not changed the circumstances by intending to finance the preliminary costs of the 2010 water project with the new 2013 water project.”
The 2010 water project included only one special assessment district with miles of pipeline and no dead ends. The 2013 project calls for four separate special assessment districts with fewer lines of pipeline, fewer assessable parcels, and about four dead ends.
“Though Denmark Township may be able to utilize parts of the engineering and survey from the 2010 project for the new 2013 water project, there is no defined legal way to allocate only those costs which directly relate to the 2013 water project because the 2013 water project special assessment districts, assessable parcels, and engineering design are significantly different,” said Johnson.
“In addition, the Michigan Tax Tribunal noted that the Denmark Township Clerk’s office in 2010 failed to send the proper notice to property owners along with neglecting to publish a meeting notice in the newspaper for the 2010 water project as required by law.”
For those reasons and more, Johnson and some others feel the $395,000 bill should be spread over the entire township with a special millage.
Mary Drier is a staff writer for the Tuscola County Advertiser. She can be reached at drier@tcadvertiser.com.