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Court of Appeals reject prior ruling on Mackinaw City water tax increase

Mackinaw City Municipal Building on May 14, 2024
Michael Livingston
Mackinaw City Municipal Building on May 14, 2024

The Michigan Court of Appeals says Mackinaw City was justified when it raised residents' water bills to pay for infrastructure replacements.

The 2-1 decision came down May 23 but the dispute goes back to 2018.

That’s when the village council voted to raise water bills by 2 percent and increase rates for customers who use more than 50,000 gallons per quarter.

The reasoning was because state environmental regulators told Mackinaw City it was in violation in a 2017 letter for not having enough water storage to account for emergencies.

“The Village needs to expand upon its current water storage capacity,” the now-renamed Department of Environmental Quality wrote. “It is not of sufficient capacity to provide for the fire flow needs of the service area while continuously maintaining acceptable pressure levels throughout the system. The Village council will need to increase revenue to address the water storage capacity deficiency.”

Part of addressing that “storage capacity deficiency” would involve building a new water tower.

After the vote in the village council, the Mackinac Area Tourism Bureau, which represents many local hotels, filed suit saying that decision should’ve been left up to the voters.

“The large hotels require the community to have a large capacity for flows and fire protection,” according to the Michigan Rural Water Association, the organization that helped the village develop a new rate structure for the village.

While a lower court first agreed with the Tourism Bureau, the Court of Appeals panel reversed it, saying projects like a new water tower are critical to providing service year-round.

While less than 1,000 people live in the area year-round, the village has a system to accommodate summer tourism.

The decision from a panel of judges comes as many communities in the region look for ways to replace aging water infrastructure.

Both the City of Cheboygan and Mackinac Island recently replaced their wastewater treatment systems with help from state funding. Both of those upgrades also involved a rate increase in their respective communities.

Michael Livingston covers the area around the Straits of Mackinac - including Cheboygan, Charlevoix, Emmet and Otsego counties as a Report for America corps member.