Now that voters have passed special millages for the Detroit Institute of Arts and the Detroit Zoo, all Dearborn residents must pay the tax.
However, money collected from areas within the city's Downtown Development Authority districts never gets to the DIA or the zoo. Instead, it’s kept locally to help fund the DDAs.
Leaders of nine communities have banded together to file a lawsuit in Wayne County Circuit Court, asking a judge to decide whether the practice is legal. The communities include Dearborn, Dearborn Heights, Wyandotte, Northville, Plymouth Township, Romulus, Taylor, Belleville and Van Buren Township.
The lawsuit was filed this month against Wayne County Treasurer Raymond Wojtowicz and the two taxing authorities set up to oversee the DIA and Zoo millages.
Wojtowicz said he’s convinced his interpretation is the correct one.
"I remain convinced the voice of the voters should be heard and these taxes should benefit the zoo and the art institute,” he said in a written statement.
Dearborn Mayor Jack O'Reilly told the Detroit Free Press that the idea isn't to sue for penalties.
"We're asking for a court to determine what the law says," he said.
But the state has already said that the cities are wrong.
Different Interpretations of Tax Law
According to state law, communities are permitted to establish specific development districts within their city limits. In Dearborn's case, there are two downtown development authorities—east and west. Increases in taxes for properties within those specific districts are captured by those districts to use locally.
According to the cities involved in the lawsuit, since the DIA millage and zoo millage weren’t in place when those development districts were originally formed, any money collected for those millages — or any millage in the future — can legally be kept locally.
Wayne County and the state disagree.
According to the zoo, both former Attorney General Mike Cox and current AG Bill Schuette informed the cities that they needed to stop keeping the funds.
The zoo millage rate is .1, while the DIA millage rate is .2. From Dearborn taxpayers, that would amount to around $340,000 and $680,000 in annual taxes, respectively. However, not all of that has made it to the zoo.
The Detroit Zoo reported in a position paper that the tax captures from "about a dozen" DDAs in Wayne County that would have gone to the zoo have totaled more than $750,000 since 2008.
Patricia Mills Janeway, communications director at the Detroit Zoo, said officials there have consulted with their legal counsel as well.
"We’re in ongoing dialogue with the Wayne County Treasurer’s Office, the State Attorney General and our legal counsel, and have been pushing hard to get the DDAs to follow the legal opinions of the AG and others. Most are in compliance," she said in a previous interview with Patch.
What Happens Next?
While voters in Oakland and Macomb counties also approved the zoo millage, only a handful of Wayne County communities have opted to hold onto a portion of the tax.
It isn't clear what would happen to the funds if the court rules against the cities' interpretation. Westland stopped collecting the funds, and Trenton officials already opted to return the money.
The zoo has requested that the money be returned.
The position paper from the zoo asserts that "the vast majority of voters who we've heard from have expressed embarrassment that some of their communities have taken the funds."
The paper urged residents to call on their cities to return the money.
What do you think, Dearborn? Should your taxes go to the zoo and the DIA, or should they stay locally? Tell us in the comments below.