Houghton County Board approves millage rate
HOUGHTON — The Houghton County Board approved a county millage rate of 6.2911 mills at its monthly meeting Tuesday.
County Equalization Director John Partanen discussed how the millage rate was derived at a Truth in Taxation hearing prior to passage of the millage.
The typical practice is to generate the millage for the next year by applying the millage reduction fraction to last year’s total — which would have been 6.271 mills, the amount approved after the rollback from 2015’s 6.3 mills. This year is different, due to a county millage renewal approved on Aug. 2, 2016.
“That gave us 6.3 millage to start with next year,” Partanen said. “Usually we don’t have to put the millage reduction fraction on if we get that vote and the expiration is in the same year that we’re doing the millage for. Since it was voted on in ’16, we’re in ’17 now, so we have to apply a millage reduction fraction to that 6.3 mills.”
The base rate is calculated by last year’s millage multiplied by last year’s taxable value, then dividing that by this year’s taxable value minus additions. That yielded a base tax rate fraction of .9897. That is multiplied by last year’s millage for a base tax rate of 6.20641.
After that, liquor and convention facilities taxes are added on, the base tax rate rises to 6.2062 percent.
The advertisement of the hearing the county was legally required to publish showed an increase of 37 percent, Partanen said. However, that is the increase over the base tax rate, not the county’s millage rate from last year. It represents a 0.3 percent increase over last year’s actual millage.
“I wish you could put in actual millage over last year,” he said. “It’s very deceiving that way.”
The 6.3 mills was multiplied by a millage reduction fraction of .9986, resulting in the 6.2911 mills.
The millage reduction fraction is the product of inflation and last year’s taxable value minus losses, multiplied by this year’s taxable value minus additions.
“The assessor puts those numbers in, each parcel, and we total all the losses and all the additions up,” Partanen said.