Source: Sherman Publications

NOTA could request tax to offset loss of federal grants

by CJ Carnacchio

December 25, 2013

It appears voters in Oxford, Addison and Orion townships could be asked to approve a millage to fund the North Oakland Transportation Authority (NOTA) in the August 2014 election.

In light of the looming elimination of all its federal funding in 2015, NOTA officials are investigating the possibility of requesting 0.3-mill property tax to finance its operations.

“I think we are in a position where we have to do this and make that attempt,” said Leonard Village President Mike McDonald, who serves on the NOTA board.

One mill equals $1 for every $1,000 of a property’s taxable value. A home with a taxable value of $50,000 would be assessed $15 annually with a 0.3-mill levy, while a home with a $100,000 taxable value would be assessed $30 per year.

Right now, NOTA relies on receiving $386,799 in federal New Freedom and Job Access and Reverse Commute (JARC) grants to help keep 13 minibuses and vans on the road Monday through Friday. On Saturday and Sunday, NOTA runs one and two vehicles, respectively.

NOTA provides low-cost transportation to senior citizens, disabled individuals and low-income folks living in Oxford, Addison and Orion townships along with the villages of Oxford, Lake Orion and Leonard.

The agency charges $1 each way for rides within the three townships and $2 each way for destinations outside the townships, but still within NOTA’s 223-square-mile service area.

“The population that we serve is the most vulnerable and we’re able to help them become independent by getting them to their doctor appointments, work and shopping,” Gustafson said. “We’re able to give them the freedom to meet their needs and enjoy their life by going to the senior centers and getting their hair done. To me, it’s giving freedom back to these individuals that may not have it if we weren’t here.”

NOTA’s federal revenue is combined with the $211,688 in local contributions it receives annually from the three townships and three villages it serves.

Oxford and Orion townships are the largest contributors at $84,153 and $104,871, respectively.

Addison Township gives $15,976 to NOTA, while the villages of Oxford and Lake Orion annually contribute $3,382 and $2,926, respectively. Leonard contributes $380.

But, according to NOTA Director Lynn Gustafson, the federal government changed the way its funds transportation.

The New Freedom and JARC grants have been eliminated and the new transportation funding program that’s replacing them is not available to NOTA.

NOTA will have federal funds to cover its operations in 2014, but not after that.

If these federal grant funds are not somehow replaced, Gustafson said NOTA would be forced to “cut the fleet significantly.”

“We currently run 13 routes (Monday through Friday). We probably would have to cut it down to six routes,” she said. Each route represents a NOTA vehicle on the road.

“I would really hate to see a cut in service because I know the need is so great,” Gustafson said. “I would hope that the people in the communities can recognize how great the need is. I would hope the community would back us.”

McDonald said it’s important that NOTA do a “good job” explaining to the public the need for a millage and “what the reality of the situation is for this authority.”

“I think if we do that job and we do it right, that we’ll be successful,” he said.

Having a dedicated millage for NOTA would give it a stable funding source, instead of constantly relying on grants.

“Our grants, currently, are year-to-year and so it’s very hard to forecast our future and make long-term plans when we don’t have funding that is guaranteed every year,” Gustafson said.

Before anything could be placed on the ballot, NOTA officials must iron out details such as how much millage to request and how many years to levy it.

The 0.3-mill amount being considered right now would yield a total of $691,176 in revenue from the three townships. This would effectively replace the $598,487 that NOTA currently receives in federal funding and contributions from the six local governments.

NOTA officials are also calculating how much millage would be needed to replace just the federal funding, while continuing to receive contributions from the municipalities.

They’re also looking at how much millage would be needed to possibly reinstitute the two bus routes that were cut at the beginning of this year.

Another question to settle is should the millage language be written in such a way that the tax must be approved by voters in all three townships in order to be levied (an all-or-nothing type approach) or should it be levied in only the townships that approve it and those that don’t would have to make up the difference either from their own coffers or possibly through increased rider fares for their residents.

Because NOTA has no taxing authority, the decision of whether or not to place a millage request on the ballot would be up to the Oxford, Addison and Orion township boards.

“I know these are tough decisions, but I don’t think we have a ton of alternatives at this point,” Gustafson said.