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Contact Information:
Edward S. Kisscorni, CPA
290 Suncrest Court, SW
Grandville, MI 49418

Office: 616/233-0667
Cell: 616/443-6730
Fax: 616/233-0667




Tuesday, November 30 2010

Sewer Connection Fee Was Not An Unlawful Tax

In Petoskey Investment Group, L.L.C. v. Bear Creek Township, Michigan Court of Appeals, Nos. 292811 and 294122, November 18, 2010, a township's sewer connection fee constituted a permissible fee rather than an unlawful property tax in violation of the Headlee Amendment to the Michigan Constitution.  The fee was not intended to raise general revenue, but rather was calculated to cover the cost of additional sewer system capacity. 

The improvements to the sanitary sewer system at issue benefited only users connected to the system, not the general public.  The evidence also showed that the connection fee was proportionate to the taxpayers' impact on the sewer system's capacity.  Further, the connection fee was not compulsory for all because it was imposed only on those who chose to connect to the sewer system.  Therefore, the fee was voluntary.

Posted by: Ed Kisscorni AT 01:05 pm   |  Permalink   |  0 Comments  |  Email
Tuesday, November 30 2010

Corporate Officer Remained Liable Despite Delegation of Authority

In Gilbert v. Department of Treasury, Michigan Tax Tribunal, No. 328819, May 13, 2010, released November 3, 2010, the president of a Michigan restaurant chain was liable for unpaid sales and withholding tax as a corporate officer because his signature appeared on relevant tax returns and checks during the relevant period.

Though the taxpayer claimed that health problems led him to delegate corporate responsibility to others, a corporate officer cannot avoid liability by delegating authority to a non-officer.

Furthermore, though the business assets were sold, the sale did not lessen the taxpayer's liability. The taxpayer failed to submit any evidence that a statutory exception arose that would have resulted in successor liability.

Posted by: Ed Kisscorni AT 01:03 pm   |  Permalink   |  0 Comments  |  Email
Monday, November 29 2010

Taxpayer Failed to Present Evidence of the Property's True Cash Value

In Lansing Towers v. City of Lansing, Michigan Court of Appeals, No. 292756, November 16, 2010, an appeal of the Michigan Tax Tribunal's (MTT) judgment rejecting a taxpayer's challenge to a city's assessment for the 2006 property tax year, the Michigan Court of Appeals held that the taxpayer presented no evidence of the property's true cash value for the tax year.

The taxpayer argued that the MTT should have made an independent determination of the true cash value of the property. However, the MTT's duty to make its own independent determination of true cash value applied only when a taxpayer met its burden of going forward with the evidence.

Although the taxpayer believed that the MTT could have extrapolated the 2006 value from the taxpayer's 2005 appraisal figure, the taxpayer's counsel did not argue that point before the MTT. The taxpayer's counsel did provide some calculations for 2006 in his post-hearing brief, but neither the taxpayer nor its counsel was qualified as an appraiser and there was no evidence that the taxpayer's manipulation of the figures was valid. Moreover, the taxpayer did not explain whether the 2006 value should have been extrapolated up or down from the 2005 figure, and by how much.

The appellate court also concluded that the MTT's decision to exclude the testimony of a property maintenance manager about the repair and maintenance projects that needed to be done on the property was not an abuse of discretion. The evidence chiefly supported the taxpayer's case, but it did not rebut the city's expert testimony.

Posted by: Ed Kisscorni AT 01:01 pm   |  Permalink   |  0 Comments  |  Email
Monday, November 29 2010

Mowing Costs Were Properly Assessed as Part of Property Tax Bill

In Calhoun County Treasurer v. Swafford, Michigan Court of Appeals, No. 293272, November 16, 2010, the Court of Appeals ruled that taxpayers were properly assessed mowing expenses by a city as part of their local Michigan summer property tax bill because it was their duty to destroy the noxious weeds and female box elder trees growing on an unpaved strip of a city street abutting their two vacant parcels of property.

The unpaved strip of real property was located between the taxpayers' two vacant parcels and the blacktopped portion of the city street. The streets in the subdivision plat were dedicated to the public pursuant to statute rather than by common law.

At issue in this case was whether the city owned the unpaved strip such that the taxpayers had no duty to destroy the noxious weeds and female box elder trees growing on the unpaved strip. The taxpayers maintained that if properly considered under statutory dedication principles, the city was the owner of the strip of land and consequently they could not be held responsible for mowing it.

When the public had an easement in a street, the owners of land abutting the street were presumed to own the fee in the street to the center. Accordingly, the taxpayers owned in fee the rights to the street that were not held by the city. Under these circumstances, the court concluded that, for purposes of the applicable local ordinance, the taxpayers were the owners of the unpaved strip of the city street that abutted their two lots and were under a duty to destroy the noxious weeds and female box elder trees growing on the unpaved strip. Further, a state law clearly authorized the city to assess any expenses incurred by the city to destroy weeds when the property owners failed to do so, to assess any expenses incurred by the city to the property owners, and to create a lien against the property in the amount of the expenses.

Posted by: Ed Kisscorni AT 12:58 pm   |  Permalink   |  0 Comments  |  Email


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