City of Plymouth Proposed 2022-2023 Budget - Flipbook - Page 278
CRC Memorandum
property tax revenue. Tax yield is a result of a tax
rate applied to the tax base. One mill (a dollar of
tax for every $1,000 of taxable value) levied in the
City of Saginaw, therefore, will yield only about a
third of the amount per capita that the same mill
would yield in a community with the average tax
base. On the other hand, communities with above
average tax bases do not have to tax themselves at
a full mill to yield what communities with average
tax bases would yield.
Population Density. Local governments that serve
large numbers of people located in close proximity
to one another are called upon to provide more
services and services at higher intensity levels than
local governments that serve sparsely populated
areas. In densely populated places:
•
•
•
•
•
•
People’s actions are more likely to affect other
people.
More ordinances are adopted to control what
residents can do.
Planning and zoning actions are more significant.
Fire protection is needed not only to address a
structure that is on fire, but to prevent damage
from spreading to other structures nearby.
Public transit is important to mitigate congestion.
Higher traffic levels require an intensified police
role to manage the interaction between drivers.
Housing Density. The demand for local government
services also varies based on the number and density
of houses and other buildings in the jurisdiction.
Combinations of Tax Base and Service Demands. The
financial ideal for local governments is found when
they have large tax bases to serve sparsely populated
communities. Large tax bases would help them to
generate needed revenues at low rates. Sparsely
populated communities would have less demand for
local government services.
Chart 1 and Figure 1 shows that only about 11
percent of the local governments enjoy having high
taxable value per capita and low population density.
Chart 1 plots each local government’s taxable value
per capita against its population density. The vertical
blue line represents the average population density
of 175 people per square mile. The horizontal line
represents the average tax base, with $31,911 of
taxable value per capita. Each quadrant in the chart
is labeled (1 through 4).
Quadrant 1 (upper left) is the ideal with high taxable
value per capita and low population density. Quadrant 2 (upper right) is a favorable situation with high
taxable value per capita used to serve populations
with above average density. Local governments in
Quadrant 3 (lower left) should be able to manage.
They have below average tax bases, but their below
average population densities means that they are
called upon to provide few services. Quadrant 4 is
to be avoided. These local governments have below
average tax bases on a per capita basis, but their
above average population densities means that they
have higher service demands. More than a quarter
of the local governments are found in this quadrant,
but they serve half of the state’s population.
CRC Board of Directors
TERENCE M. DONNELLY, Chair
ALEKSANDRA A. MIZIOLEK, Vice Chair
NICK A. KHOURI, Treasurer
LAURA APPEL
MICHAEL G. BICKERS
BETH CHAPPELL
2
RICHARD T. COLE
JIM DAVLIN
DANIEL P. DOMENICUCCI
RANDALL W. EBERTS
SHERRIE L. FARRELL
EUGENE A. GARGARO, Jr.
JOHN J. GASPAROVIC
INGRID A. GREGG
JUNE SUMMERS HAAS
MARYBETH S. HOWE
GORDON KRATER
WILLIAM J. LAWRENCE III
DANIEL T. LIS
KRISTEN McDONALD
MICHAEL P. McGEE
PAUL OBERMEYER
KEVIN PROKOP
JAY RISING
KELLY ROSSMAN-McKINNEY
CANDEE SAFERIAN
CHRISTINE MASON SONERAL
TERENCE A. THOMAS, Sr.
THEODORE J. VOGEL
LARRY YACHCIK
