East Lansing Income Tax Proposal Struggles to Find Support

Lansing Regional Chamber urges measure be pulled from the November Ballot

The Lansing Regional Chamber of Commerce (Chamber) is calling on the East Lansing City Council to withdraw a proposal for a new city income tax from the November ballot.  The request is backed by findings released by the Chamber from a recent voter’s poll that suggest a narrowly uneven percentage of voters stand in favor of the proposed tax measures. The poll of East Lansing voters, conducted by Denno Research, shows just 41 percent of East Lansing voters are in favor of the income tax proposal, while 32 percent of voters are opposed. Those numbers strongly suggest the income tax plan has little prospect of being approved.

Proponents of the proposal state that the additional revenue is needed to fix roads, provide public safety and fix East Lansing’s long-term budget problems, and that the property tax reduction will be a bigger tax cut for residents.

Opponents of the proposal state East Lansing is already one of the highest taxed cities in Michigan, and  the income tax plan will discourage future economic investment, jobs and young families in the city.

“Historically, we know that proposals like this should have at least 50 percent support at this stage to have a chance to gain voter approval,” said Denno Research President Dennis Denno. “Especially when one considers that only 10 percent of East Lansing voters strongly support the income tax, you have to conclude the ballot proposal faces serious challenges.”

A previous survey conducted by the Chamber showed that 72 percent of Chamber members believe the city income tax is not necessary, and 85 percent of those members are opposed. The East Lansing City Council has until the second week of September to withdraw the income tax proposal from the November ballot.  In an Aug. 14 letter to the East Lansing City Council, the Chamber urged the income tax proposal be pulled from the ballot and that all sides involved “work together to find solutions that are in the best interests of our community, economy, businesses and residents.”

“Michigan State University (MSU) has indicated a willingness to provide additional support directly to the City of East Lansing in lieu of an income tax,” said Chamber President and CEO Tim Daman. “East Lansing City Council would be well advised to consider a resolution with MSU in moving forward, so everyone involved can focus on creating a climate where businesses can succeed and help the city grow.”

As East Lansing’s largest entity, MSU urged a withdrawal of the proposal while suggesting providing assistance to create a sustainable situation for businesses to expand. Only time can tell what influences such a proposed action can play in the outcome. Residents and business owners alike remain optimistic.

Joe Ford, co-owner of Netvantage Marketing in East Lansing, said the proposal will be a major hindrance to the city’s ability to recruit and retain top talent for companies of all sizes, including small entrepreneurial firms. This has been a long-standing issue for the region as, to the public eye, it’s maintained an incubator for the development of students; many take their talents and resources elsewhere in search of a more viable career paths.

 “There are many Netvantages across East Lansing and hopefully many more to be started and developed that would call the city home, said Ford. “However, imposing this income tax solution is not conducive to a strong, thriving business climate.”

The following is the actual wording and results from the Denno Research poll:

This was a survey of likely 2017 general election voters in East Lansing, conducted by Denno Research. 400 respondents were surveyed from August 12-15, 2017, with a margin of error of plus/minus 5 percent. The participation was stratified based on census data and past voter behavior.  A screen was employed to include only those participants who said they intended on voting at the polls or by absentee ballot in the November 2017 General Election. Numbers are rounded and may not equal 100 percent.

Do you think things in the City of East Lansing are moving in the right direction or moving in the wrong direction? 

Right Direction – 46%

Wrong Direction – 24%

Other/Unsure/Do Not Know – 30%

What is the number one issue facing East Lansing?  (OPEN ENDED)

City budget issues – 22%

Downtown development/overdevelopment – 19%

Income tax/property tax vote – 11%

Taxes are too high – 7%

Roads – 6%

Issue with public schools – 3%

Housing issues – 2%

Relationship with MSU – 2%

Parking – 1%

Other –  11%

Do not know – 17% 

Of the following issues, which is the number one issue you would like to see East Lansing city leaders address? 

Improving East Lansing’s infrastructure, including roads and sidewalks – 38%

Dealing with the city budget and legacy costs – 29%

Schools – 7%

Rental properties – 7%

Relationship with MSU – 4%

Jobs and the economy – . 3%

Neighborhoods – . 3%

Public safety – 2%

Improving parks and trails – 1%
Do not know – . 7%

This proposal will:  

Create a 1 percent city income tax for residents working in the city and a half-percent for people who work in East Lansing but don’t live in the city. Property taxes will be lowered by four mills.           

Do you strongly support, support, oppose or strongly oppose this proposal?

 Total support – 41%

Strongly support – 10%

Support – 31%

Total oppose – 31%

Strongly oppose – 14%

Oppose – 17%

Do not know – 28%

Do you strongly support, support, oppose or strongly oppose creating a city income tax and lowering property taxes?

Total support – 42%

Strongly support – 9%

Support  33%

Total Oppose – 34%

Strongly oppose – 16%

Oppose – 18%

Other/Unsure – 24%

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