NON-HOMESTEAD OPERATING MILLAGE
Voters will be asked to consider the renewal of a long-standing Non-Homestead Millage which generates operating revenue for SHPS. This millage is different from a bond in that is has NO tax impact on primary residences.
WHAT IS THE RENEWAL?
Michigan public schools are funded under a plan that was created when Proposal A was approved statewide by Michigan voters in 1994. The passage of Proposal A shifted a large portion of public school funding from local property taxes to an increase in sales tax and a state education tax on non-homestead property. Property that serves as a primary residence or a qualified agriculture property is exempt from this millage.
Under this plan created by the passage of Proposal A, public schools must levy 18 mills on non-homestead properties to receive the full State Foundation Grant funding. The first 18 mills were originally passed by South Haven voters in 1994.
Based on South Haven’s tax base, the 18 mills generate approximately $11.88 million dollars in funding for the District’s schools. The purpose of the Headlee millage is to restore any millage lost as a result of the required Headlee rollback which occurs when the school district’s tax base grows more than the rate of inflation. The additional mills can only be levied to the extent necessary to maintain the 18 mills
WHAT DOES THIS MEAN TO SOUTH HAVEN RESIDENTS?
On February 27, 2024, South Haven voters will be asked once again to vote on the state mandated 18 mills on non-homestead property. The renewal proposal is for a six-year millage renewal of the non-homestead 18 mills and an additional 1.6692 mills that may be used only to restore the 18 mills should Headlee rollbacks occur.
Voters should note that homesteads (primary residences and qualified agricultural property) are exempt. If the proposed 19.6692 mills are approved on February 27, 2024, homeowners will NOT see an increase in their property taxes on their primary residence. Without the non-homestead millage renewal, all of the District’s operating millage would be reduced to zero when the current millage expires in December 2024.
This is not a new tax, but rather a proposal for the district to continue to levy the 18 mills on non-homestead tax as it has since 1994. Approval of the millage would give the District the continued ability to collect full State funding for its schools which makes up approximately 49% of the operating revenue.
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