Macomb Township, Shelby Township, Utica
Macomb waits for approval of court cost-sharing agreement
Posted June 12, 2013
MACOMB TOWNSHIP/SHELBY TOWNSHIP/UTICA — Officials from Macomb Township are hoping that the other entities connected to the 41-A District Court will sign a cost-sharing agreement that determines how revenues will be divided if a new court facility is constructed in Macomb.
The Macomb Township Board of Trustees unanimously approved the agreement at its May 22 meeting. Among other things, it states that once the proposed court building opens, Macomb would become the new funding unit for the court and would be paid all of the fines and costs generated by tickets issued in Macomb other than those that violate state law. Meanwhile, Shelby Township and Utica would each be paid one-third of the fines and costs from tickets written in their respective communities, while the remainder would go to Macomb.
According to Macomb Township Clerk Michael Koehs, this arrangement is similar to that of the current 41-A District Court, in which Shelby receives all of the revenue from tickets written in Shelby and two-thirds of the revenue from those issued in Macomb and Utica.
The cost-sharing agreement also has to be signed by officials from Shelby and Utica and by Judge Michael S. Maceroni, chief judge of the 41-A District Court. At press time, that had not yet occurred.
Shelby Township Supervisor Rick Stathakis said that his office had received the document, and Shelby’s attorneys were currently reviewing it. He noted that Macomb officials have given Shelby a deadline of July 18 to approve the agreement, which would need to be supported by the full Board of Trustees.
Utica officials also have not yet taken any action on the agreement, as of press time. According to City Clerk Beth Ricketts, the item has not been placed on any upcoming city agendas.
However, as Larry Dloski, attorney for Macomb Township, stressed to the board on May 22, “If all those entities do sign it, there’s still nothing in the agreement that binds Macomb Township to absolutely have to construct the court. In fact, there’s a provision that says (you do not have to do it). … So it’s absolutely at the option of the township, period.”
Koehs pointed out that if the agreement is approved by all parties, it would remain in operation over the period in which bonds are issued to pay for the proposed court building, which would likely be 20 to 25 years.
“As long as there is still a balance due on the financing of the new district court, this agreement would still be in effect,” he said. “It may or may not continue after that, but we just want to make sure that we’re dotting all of our i’s and crossing all of our t’s with it.”
On May 8, the board voted to hire the governmental accounting and auditing firm Plante Moran to update a financial study of the 41-A District Court that was first conducted in 2010. Plante Moran representatives estimated that the study would take six to eight weeks to complete and cost the township between $13,500 and $15,500. But as Koehs noted, the new cost-sharing agreement must be approved before Plante Moran moves forward with this study.
“We’re not going to buy something if we don’t know what they’re selling,” Koehs explained. “We need to be sure that when we sew up this contract, we sew it up tight.”
These latest developments have occurred in response to the recent support of an interlocal agreement between Macomb and Shelby that spells out how the two municipalities would finance the post-employment benefits of the 41-A District Court’s current employees. When the Shelby Township Board of Trustees approved the agreement on March 5, it gave Macomb Township a six-month window in which to make a decision about whether to construct a new court.
According to Stathakis, the decision to move the 41-A District Court to Macomb would be “a win for everyone” — especially for Shelby.
He pointed out that the township’s retiree health care liabilities have steadily increased every year and have now accumulated about $5 million in debt. If the court moves to Macomb, he explained, it would result in positive net revenue of about $115,000 per year for Shelby, which would allow the township to chip away at its overall debt. If the court stays in Shelby, however, it would result in a revenue loss of about $358,000 per year.
“We’ve got to stop the bleeding,” Stathakis said. “I believe that creating new debt and adding to our legacy costs is a step in the wrong direction for Shelby Township. This is just a simple arithmetic problem, and we’ve solved it. Now the ball is in their (Macomb’s) court.”
While previous plans had included the possibility of building the courthouse in Shelby, Stathakis believes that this is no longer an option for the township.
“If we were to build a new court here, we would only have two options: raise taxes or cut services, and neither one of those is a reasonable choice,” he said. “I believe that things are on the right track now, and we’re ready to move forward with this (building the new court in Macomb).”
Koehs, though, remained cautious. While he was confident that Macomb officials would be able to reach a decision on the court by Sept. 5, he stressed that they cannot be depended on to solve the problems of other communities.
“We’re not going to jeopardize our township and our finances just to help them (Shelby) out — not if this is just some runaway operation,” he said. “We will try to do what we can to improve the services of the 41-A District Court, but we will not do it to the detriment of Macomb Township.”
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