Ripple effects of S.A.E.S.A.’s move to Old Ford Dealership

revised 6/15/2018

Relocating S.A.E.S.A. to the new site requires a zoning change from C2-highway commercial to tax exempt status. This change would drop the property’s 2017’s taxable value from $518,112 to zero dollars.

by Patrice Johnson

For every action, there is an equal and opposite reaction, so says Newton’s Third Law, and S.A.E.S.A’s proposed move from the Township Hall and fire barn into the Old Ford dealership is likely to trigger a flurry of a ripple effects.

From the Stockbridge Area Emergency Service Authority’s perspective, its purchase of 1009 S. Clinton and 4608 Green Road, better known as the Old Ford Dealership, offers a larger and safer space, better highway access, an opportunity to house fire and ambulance services under one roof, and energy efficiency.

But converting the two 6-acre plots from taxable to non-taxable status stands to waft approximately $6,000 a year out of the Village of Stockbridge’s tax coffers. Plus, it stands to quash growth prospects for a strategic hunk of prime commercial real estate.

You see, relocating S.A.E.S.A. to the new site requires a zoning change from C2-highway commercial to tax exempt status. This change would drop the property’s 2017’s taxable value from $518,112 to zero dollars.

In 2017, Stockbridge Township billed more than $34,011 in property taxes for the two parcels. The township was allowed to keep less than $400 of these tax dollars as they were divvied up to support a long list of local, county and state services. Converting the Ford dealership property to tax exempt status would flatline tax billings.

In 2017, Stockbridge Township billed more than $34,011 in property taxes for the two parcels. The township was allowed to keep less than $400 of these tax dollars as they were divvied up to support a long list of local, county and state services. Converting the Ford dealership property to tax exempt status would flatline tax billings.

Nearly $10,000, or 18 mills, has the potential to come out of Stockbridge Community School funding, except as Stockbridge Township Treasurer, Kris Lauckner pointed out, “Ours already receives its total amount (due to Enbridge) and has to send its over-collections to the state of Michigan. There is no loss to the school district with this sale.”

Lauckner said, “While this is a loss, at the same time, the [Eastbridge] condominiums have suddenly taken off and are selling; the old middle school will enter the tax roll; also, property values are going up due to increased sales prices. The Village received $6000 in taxes from Cappos—10 condos will cover that, and will have more water and sewage usage to help cover that bond. Also, the condos are new builds, and therefore do not affect the Headlee Amendment.”

Viewed from another perspective, converting the Old Ford Dealership to non-taxable at a time when the local economy is growing could largely negate the updraft in tax revenue that Lauckner anticipates.

Stockbridge Village Clerk Debbie Nogle expressed concern that the south end of Stockbridge would now be removed from the tax rolls and consist primarily of nonprofit parcels. Further, she said the move creates an unorthodox layout for village growth and development because it removes prime real estate from areas that would typically house commercial businesses. She said the Planning Commission is creating a long-term master plan, but this has yet to be finalized.

Village Council President Molly Howlett said the council will consider the issue of rezoning once it receives recommendations from the Planning Commission, which is awaiting ordinance review from an outside firm.

The sale to S.A.E.S.A. shows no contingency for zoning approval and was finalized March 8, 2018. But S.A.E.S.A. General Manager John Beck emphasized the property had been for sale a number of years.

Public records confirm a transactional past: In 1999, Jeffrey Cappo and Ieva Berglands, owner of multi-state Victory Automotive, Inc. purchased the property from Bob’s Ford and Old Kent Bank for $1.25 million. Six years later the mortgage was assigned to Sterling Bank & Trust, FSB for $950,000. Nov. 2015, the Michigan Department of Treasury placed a tax lien on the property for $672,496. Cappo et al paid off the lien in Feb. 2016. (See https://mi2laredo.fidlar.com/MIIngham/DirectSearch/.)

Stockbridge Township Supervisor C.G. Lantis voiced support for the move. “I am excited to see growth happening here in Stockbridge,” he said. “Seeing S.A.E.S.A. purchase the Ford building and making interior and exterior improvements—as people come into town, it will be impressive.”

Lauckner underscored the safety benefits of S.A.E.S.A.’s relocation to a new site. “Much worse would be if an emergency vehicle, while trying to exit a residential and school neighborhood, had an accident that was devastating to human life; that cost is unconscionable. There were many, many complaints over the years from people that lived around the firehouse.” She said she hoped the new location improved response times and multi-jurisdictional cooperation.”

Beck said S.A.E.S.A.’s purchase included 26,000 square feet of ADA compliant building space.

In comparison, according to Deborah Marshall of Glenn Brooke Realty, the vacated Hybroco location near the same Mich. 106 and 52 intersection has 20,000 sq. ft. available in two commercial buildings plus acreage. Its asking price is $200,000.

When asked if S.A.E.S.A. had considered the Hybroco location, Beck said that a purchase and remodel of that site would have incurred greater expense.

He said S.A.E.S.A’s purchase of the Ford dealership property required no voter approval because it plans to pay through its general funds.

“The first 10 years we saved up enough money for down payments,” he said, indicating that S.A.E.S.A. had put $150,000 down and reserved $200,000 for renovations. He said seller Jeffrey Cappo is acting as the bank and confirmed S.A.E.S.A. received tax revenues at 1.6 mills in the amount of $447,674 in 2017. The authority, he said, had committed to a 10-year mortgage at 3 percent interest with no balloon payment. Roughly, S.A.E.S.A.’s payments will run approximately $100,000 each year for the next 10 years.

In an ironic twist to the Butterfly Effect, S.A.E.S.A.’s removal of the two parcels from the tax rolls would sheer $800 to $1000 a year from its own tax funding.

 

 

 

Print Friendly, PDF & Email

Leave a Reply

Your email address will not be published. Required fields are marked *