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August 7, 2018 Village Referendum Ballot Proposal 1

In an effort to provide information the Proposal #1 states:

  1. VILLAGE OF BEAR LAKE PROPOSAL TO APPROVE ORDINANCE NO. 10 OF 2017
    Shall Ordinance No. 10 of 2017, which provides for the appointment of the village clerk and village treasurer, and which was enacted by the Bear Lake Village Council October 18, 2017, be approved and take effect?

The Village has not posted any information on their Ordinance page for several years.

Ordinance 10 of 2017 does not exist – Ordinance #1 reads as follows:
https://bearlakemichigan49614.com/2017/11/30/village-clerk-treasurer-appointment-ordinance-ordinance-no-1-of-2017/

On October 18, 2017 at the Regular Village Council Meeting:

Appointment of elected positions, clerk & treasurer – Clerk McPherson reviewed ordinance to council. Motion to adopt ordinance to change clerk & treasurer positions from elected to appointed by Schroeder, seconded by McPherson. Motion carried.
Aye: Bass, Evans, McPherson, Ronning, Schroeder, Bair
Nay: none
Absent: Johnson

The following was published in the Manistee News Advocate on October 27:

NOTICE OF ADOPTION OF VILLAGE CLERK –
TREASURER APPOINTMENT ORDINANCE 
Ordinance No. 1 of 2017 
and the RIGHT OF REFERENDUM RELATING THERETO 
PLEASE TAKE NOTICE that pursuant to MCL 62.1 (3) the Bear Lake Village Council, at its regular meeting on October .ta , 2017, enacted Ordinance No. 1 of 2017, which provides for the appointment of the Village Clerk and Village Treasurer. 
RIGHT OF REFERENDUM. 
The Ordinance shall become effect­ive 45 days after its enactment without a vote of the electors, un­less a petition signed by not less than ten (10%) percent of the re­gistered electors of the Village is filed with the Village Clerk within 45 days after the date the Ordin­ance was enacted. If such a peti­tion is filed, the Ordinance shall not become effective unless ap­proved by a majority of the quali­fied electors of the Village at an election held on the question. 
This notice is given pursuant to the requirements of MCL 62.1 (4). Cindi McPherson, Clerk Village of Bear take 
VILLAGE OF BEAR LAKE 
Ordinance No.1 of 2017 
AN ORDINANCE TO PROVIDE FOR THE APPOINTMENT OF THE VILLAGE CLERK AND VILLAGE TREASURER. THE VILLAGE OF BEAR LAKE ORDAINS: 
Section 1. Establishment of Offices. 
As authorized by MCL 62.1 (3), the village clerk and village treasurer shall be chosen by nomination of the village presid­ent and appointment by a major­ity of the village council.
Section 2. Term of Offices. 
The term of office of the village clerk and village treasurer shall be two years, beginning on November 20 of each even ­numbered year and until a suc­cessor is appointed. The per­sons first appointed as village clerk and village treasurer under this ordinance shall have an ini­tial term of office commencing on November 20, 2018, or when the office becomes vacant, whichever occurs first. The per­sons appointed village clerk and village treasurer shall take and subscribe the oath of office and shall file it with the village clerk prior to taking office, together with the filing of any bond re­quired by law.
Section 3. Effective Date. 
This ordinance shall take effect 45 days after the date of its ad­option, unless a petition signed by not less than ten percent (10%) of the registered electors of the village is filed with the vil­lage clerk within such 45-day period, in which case this ordin­ance takes effect upon approval at an election held on the ques­tion of whether this ordinance should be approved. Notice of the delayed effect of this ordin­ance and the right of petition un­der this section shall be pub­lished separately at the same time and in the same manner as this ordinance is published in a local newspaper of general circu­lation. 
Section 4. Adoption. 
This ordinance shall be adopted by an affirmative vote of at least two-thirds (2/3) of the members of the village council. 
Section 5. Severability. 
If any section, provision or clause of this ordinance or the application thereof to any per­son or circumstance shall be in­valid, such invalidity shall not ef­fect any remaining portion or ap­plication of this ordinance which can be given effect without the invalid portion or application. 
Section 5. Publication. 
The village clerk shall certify to the adoption of this ordinance and cause the same to be pub­lished as required by law. Ordinance No.1 was adopted on the 18th day of October, 2017, by the Bear Lake Village Council as follows: 
Motion by: Schroeder Seconded by: McPherson Yeas: Bass, Evans, McPherson, Ronning, Schroeder, Bair Nays: None 
Absent: Johnson 
Cindi McPherson, Clerk 
Jeff Bair, President 
I certify that this is a true copy of Ordinance No. 1 that was adop­ted at a regular meeting of the Bear Lake Village Council on Oc­tober 18th , 2017 and published  in the Manistee News Advocate on October 27, 2017. 
Dated: 18 October 2017 Cindi McPherson, Clerk October 27, 2017 
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August 7, 2018: Village of Bear Lake Referendum Vote Proposal 2

On August 7, 2018 Village registered voters will see two Proposals on the Ballot called as the result of voters asking for a say on two items passed by the Village of Bear Lake Council. [The threshold is 10%. It is believed @25% of current registered voters signed]

In both Proposals the result will impact the financial position of both Village government and Village tax payers long into the future.

  1. For a full list of Manistee Proposals select the following link august_2018_official_list_of_proposals (1)
  2. VILLAGE OF BEAR LAKE PROPOSAL TO APPROVE ORDINANCE NO. 10 OF 2017
    See prior post by clicking here.
  3. VILLAGE OF BEAR LAKE PROPOSAL TO AUTHORIZE ISSUANCE OF MUNICIPAL SECURITIES
    Shall the Village of Bear Lake, Manistee County, Michigan, be authorized to issue municipal securities pursuant to Act 34, Public Acts of Michigan, 2001, as amended, in one or more series, in an amount of not to exceed Three Hundred Fifty Thousand Dollars ($350,000) for the purpose of acquiring and constructing a new department of public works building, together with site work, parking facilities, fixtures, furnishings, equipment, and all related appurtenances and related work?

The maximum number of years the municipal securities may be outstanding, exclusive of refunding, is thirty (30) years.

The Village intends to use water system revenues, park fund revenues, major and local street fund revenues and general fund moneys as the primary source of revenue to be used to retire the municipal securities. The municipal securities will be limited tax general obligations of the Village and no new taxes will be levied for their payment. The Village estimates that of its current Village millage levy, 0.193 mills (19.3 cents for each $1,000 of taxable value) will be allocated in the first year to pay the municipal securities and the estimated simple average annual amount of millage allocated to retire the municipal securities is estimated to be 0.5019 mills (50.19 cents for each $1,000 of taxable value).

The Village’s power to levy taxes to make the payments of principal and interest on the municipal securities is limited by applicable constitutional and statutory limitations on the taxing power of the Village and no new taxes are authorized to pay the principal of and interest on the municipal securities.


At this stage, being so close to the August 7 Election, the Village is constrained by MICHIGAN CAMPAIGN FINANCE ACT Act 388 of 1976

AN ACT to regulate political activity; to regulate campaign financing; to restrict campaign contributions and expenditures; to require campaign statements and reports; to regulate anonymous contributions; to regulate campaign advertising and literature; to provide for segregated funds for political purposes; to provide for the use of public funds for political purposes; to create certain funds; to provide for reversion, retention, or refunding of unexpended balances in certain funds; to require other statements and reports; to regulate acceptance of certain gifts, payments, and reimbursements; to prescribe the powers and duties of certain state departments and state and local officials and employees; to provide appropriations; to prescribe penalties and provide remedies; and to repeal certain acts and parts of acts.
(2) “Ballot question” means a question that is submitted or is intended to be submitted to a popular vote at an election whether or not it qualifies for the ballot.
 
169.206 “Expenditure” defined. 
Sec. 6. (1) “Expenditure” means a payment, donation, loan, or promise of payment of money or anything of ascertainable monetary value for goods, materials, services, or facilities in assistance of, or in opposition to, the nomination or election of a candidate, the qualification, passage, or defeat of a ballot question, or the qualification of a new political party. 
Bear Lake News will not render an opinion of how people should vote.
Rather these are the questions being raised by residents themselves.
1. Is the Village of Bear Lake sufficiently financially sound and resilient to shoulder both a 40 year $1.463m loan AND a $350,000 30 year loan to run concurrently?
2. As a qualifier, the requested amortized Bond schedule for the Water System loan not having been published, Bond payments for the Water system will be due twice year totaling $53,000 . The only prior document that explained how water rates would be raised to cover O&M, plus debt repayment is shown here.
The actual water loan interest rate is lower but the amount is higher.
[NOTE: No actual schedule following the May 15, 2018 Bond sale, has been published in spite of numerous requests]
This directly relates to Maintenance Building Bond payments because both will fall due at roughly the same time: March 1 and September 1.
Financing of the water system debt is based on total water revenue – how $7200 can now be also allocated to meet the Maintenance Building repayment is an unanswered question. Will this require raising water rates?
Following a lengthy and persistent FOIA campaign the actual Maintenance Building documents were received on June 30 following a direct appeal to USDA. You may read them here as PDFs
Here is the amortized repayment schedule for the ‘DPW’ Building.

A rough calculation show a total interest payment of @$204,500.
These were posted to the Village web site a week later under a new tab ‘DPW Building.’
A reminder that a Petition to hold a Referendum vote on this matter was submitted and accepted on May 14, 2018 in time to be placed on the August 7 Primary Ballot. [The Village placed a display ad for the Notice to Issue Bonds in the Manistee News Advocate on April 2, 2018.]
A transcript of the history, Minutes and request concerning a replacement Maintenance Building is available here.DPW_History [names have been redacted]
An alternative option exists which could dramatically reduce the interest paid – financing locally and guaranteeing the loan through a Special Assessment levy – the mechanism used by Bear Lake Township to finance its fire vehicles.
This option was suggested in past communications.
A reader has commented that the current fiscal operations in the Village seem to be based on constantly amending the Operating Budget with little effort to rebuild reserve funds – a trend reported by the Michigan Department of Treasury.
While this may be legal – once a loan agreement has been entered into with the federal government – default or late payment is no longer an option.
Headlee Amendment Article IX, Sections 25 to 34 of the Michigan Constitution are often referred to as the “Headlee amendment”.
These provisions, adopted by the voters in 1978, constrain growth in property taxes. The Headlee amendment does the following:
1. Requires that, if the base of a tax is broadened, the tax rate be reduced to levy the same amount of tax revenue as was received on the prior base.
2. Prohibits a local government from levying any new tax (one not authorized by law or charter in 1978) or increasing the rate of a current tax without voter approval.
3. Limits the annual growth in property tax revenue due to increases in taxable value (excluding new construction and improvements) to the rate of inflation in the prior year. Under the “Headlee rollback”, if the increase in taxable value would cause the tax revenue to grow by more than the rate of inflation, then the millage rate must be reduced to a level that results in revenue growth of not more than the rate of inflation. These limits do not apply to millage levied for the repayment of voter-approved bonds.
The Village is currently operating at the allowed property tax level. Water and Park revenues, in addition to the often unreliable level of State Road funds, are the only additional sources of revenue.
Do reserve funds exist to cover unexpected bills, other than the fund required by USDA as part of the Water System loan agreement? Having now received the design and billing documents for the proposed Maintenance Building, several duplicate billable services seem to overlap with those already covered by the Water Project? Does the Village need 2 pickups, 2 blade trucks? What plans are in place for the previous Village Hall?
It has been stated that these projects are vital to making this community flourish and thereby improve the future for our children. Why then are so many businesses currently for sale?
Village voters will approve or decline to take on this level of debt. Our children and their children will still be paying for the decision made on August 7, 2018.
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August 7, 2018 Village of Bear Lake Referendum Vote Proposals

On August 7, 2018 Village registered voters will see two Proposals on the Ballot called as the result of voters asking for a say on two items passed by the Village of Bear Lake Council. [The threshold is 10%. It is believed @25% of current registered voters signed]

In both Proposals the result will impact the financial position of both Village government and Village tax payers.

  1. For a full list of Manistee Proposals select the following link august_2018_official_list_of_proposals (1)
  2. VILLAGE OF BEAR LAKE PROPOSAL TO APPROVE ORDINANCE NO. 10 OF 2017
    Shall Ordinance No. 10 of 2017, which provides for the appointment of the village clerk and village treasurer, and which was enacted by the Bear Lake Village Council October 18, 2017, be approved and take effect?
  3. VILLAGE OF BEAR LAKE PROPOSAL TO AUTHORIZE ISSUANCE OF MUNICIPAL SECURITIES
    Shall the Village of Bear Lake, Manistee County, Michigan, be authorized to issue municipal securities pursuant to Act 34, Public Acts of Michigan, 2001, as amended, in one or more series, in an amount of not to exceed Three Hundred Fifty Thousand Dollars ($350,000) for the purpose of acquiring and constructing a new department of public works building, together with site work, parking facilities, fixtures, furnishings, equipment, and all related appurtenances and related work? The maximum number of years the municipal securities may be outstanding, exclusive of refunding, is thirty (30) years. The Village intends to use water system revenues, park fund revenues, major and local street fund revenues and general fund moneys as the primary source of revenue to be used to retire the municipal securities. The municipal securities will be limited tax general obligations of the Village and no new taxes will be levied for their payment. The Village estimates that of its current Village millage levy, 0.193 mills (19.3 cents for each $1,000 of taxable value) will be allocated in the first year to pay the municipal securities and the estimated simple average annual amount of millage allocated to retire the municipal securities is estimated to be 0.5019 mills (50.19 cents for each $1,000 of taxable value). The Village’s power to levy taxes to make the payments of principal and interest on the municipal securities is limited by applicable constitutional and statutory limitations on the taxing power of the Village and no new taxes are authorized to pay the principal of and interest on the municipal securities.

At this stage, being so close to the August 7 Election, the Village is constrained by MICHIGAN CAMPAIGN FINANCE ACT Act 388 of 1976

AN ACT to regulate political activity; to regulate campaign financing; to restrict campaign contributions and expenditures; to require campaign statements and reports; to regulate anonymous contributions; to regulate campaign advertising and literature; to provide for segregated funds for political purposes; to provide for the use of public funds for political purposes; to create certain funds; to provide for reversion, retention, or refunding of unexpended balances in certain funds; to require other statements and reports; to regulate acceptance of certain gifts, payments, and reimbursements; to prescribe the powers and duties of certain state departments and state and local officials and employees; to provide appropriations; to prescribe penalties and provide remedies; and to repeal certain acts and parts of acts.
(2) “Ballot question” means a question that is submitted or is intended to be submitted to a popular vote at an election whether or not it qualifies for the ballot.
 
169.206 “Expenditure” defined. 
Sec. 6. (1) “Expenditure” means a payment, donation, loan, or promise of payment of money or anything of ascertainable monetary value for goods, materials, services, or facilities in assistance of, or in opposition to, the nomination or election of a candidate, the qualification, passage, or defeat of a ballot question, or the qualification of a new political party. 
Although the Act was qualified by the O’Meara 2016 opinion the following still applies:
• Public facilities and resources can be used for public forums and public education on candidate elections and ballot questions provided the public resources are not used to influence the outcome of the election and views of all candidates and views of both supporters and opponents of a ballot question are treated equally. 
PENALTIES
A person who knowingly violates this section is guilty of a misdemeanor punishable, if the person is an individual, by a fine of not more than $1,000.00 or imprisonment for not more than 1 year, or both, or if the person is not an individual, by one of the following, whichever is greater:
(a.) A fine of not more than $20,000.00 or
(b.) A fine equal to the amount of the improper contribution or expenditure.

In this Part One of Two we will look at Proposal One.
For a previous discussion of this item see this posting:
https://bearlakemichigan49614.com/2017/11/30/village-clerk-treasurer-appointment-ordinance-ordinance-no-1-of-2017/

Village tax payers have asked for a chance to vote on a decision that permanently takes away their right to vote to Elect or Recall these two positions.

As the notice of the Ordinance, passed October 18, 2017 was only published once in the News Advocate and is nowhere on the Village web site, Village tax payers have now had adequate time to consider this change.

Pros
The rationale for proposing this change in Village Government is the stated belief by the current Council that someone elected to these positions may not have the necessary administration or financial management skills to properly do the job. In addition, as the electorate could choose a different candidate every two years, this could result in disjointed institutional records.

Cons

  1. These 2 positions currently account for almost 1/3 of all collected property taxes. The Village has already contracted with a CPA to ostensibly ‘assist’ with financial reporting.
    BY FOIA the following 2017 W3 return was received:
    16052018 PDF
    In viewing the current remuneration for these two positions it is difficult to see where changing the nature from elected to appointed would save any money.
  2. Under this Ordinance neither appointees would be required to be village residents. 
  3. If there is concern that an elected Clerk or Treasurer, (neither are voting positions), may not possess sufficient skills to perform the duties – the same standard should be applied to elected Village Council positions that do have voting/financial decision making privileges.
  4. An appointed Clerk and Treasurer would serve at the pleasure of the Council, opening the appearance of political/personal favor or leaving the appointee open to political/personal interference. 
  5. Yet to be resolved are multiple employment and human resources questions. Would they be employees or contractors
  6. Will these be ‘at will’ positions? Meaning that they could be dismissed without cause. Equally an employee could resign at any time.
  7. As the Ordinance states, these will be two year appointed positions, a new person could be, in theory, be appointed every two years – invalidating the rationale of the desire for continuity.
  8. Changing the position affects withholding and benefits and becomes subject to all labor and fair employment laws.
  9. A comprehensive Job Description, hours of performance, manner of posting and interviewing candidates, insurance and Bonding costs has not been presented.