Alpena City Council approves 1-percent administration fee on tax bills

Alpena, Mich. — Alpena City Municipal Council approved a 1-percent administration fee on all property taxes collected in the city on Tuesday night.

The resolution was unanimously passed by city council. All of the money collected by the fee is designated to assessing. The city usually pays for assessing, collecting, and appeals and review costs through the general fund.

City Manager Greg Sundin looks at the 1-percent fee as a way for the city to gain some compensation.

“These fees are restricted in use and cannot be used for other city purposes outside of those directly related to the preparation and collection of property taxes,” said Sundin. “It is estimated that the fee from both summer and winter taxes will generate at least $90,000 to $95,000.”

That $90,000 to $95,000 will go toward administrative costs in the clerks office, toward the contracted assessor, and anything related to the assessing and the collection of property taxes, both real and personal. General funds can now be used for other projects or lowering the budget deficit.

“Past councils have elected not to impose this fee, not wanting to add this cost to the taxpayer’s bill,” said Sundin. “As budgets continue to tighten, I believe we no longer have the luxury to forgo. This is an additional revenue source available to us.”

Due to a state statute, governing bodies that perform assessing as well as tax collection services can charge this fee. Currently, all townships in the county, outside of Sanborn and Wilson, assess the 1-percent fee.

Fees will be attached to things like water and utility bills. Sundin used the example of paying with a credit card at the clerk’s office.

“Whatever the tax bill is, so if it’s $1,000 in the summer, it is added on to that,” said Sundin. “It will be 1-percent of that $1,000, or in this case, it would be $10 that is added on to the bill.”