Thursday, January 27, 2011

Iron County Population Shrinkage

If you've attended the web page I recommended
in the previous article, you have been exposed to
some ideas about migration. That includes the
generally accepted premise that the most
monetarily aggressive individuals leave regions
that are economically less viable and migrate to
locations that hold better promise for opportunities.

That certainly is true of Iron County. The individuals
we lose are the ones we actually need to keep the
most. These are the people who, with the support of
friends and family, are most likely to be able to start,
or maintain, viable local businesses.

Just as important, if not more so, is the attracting
home of people, families too, who have successfully
acquired experience outside this region. They would
be the ones who could probably most successfully
import new ideas into our community.

Several years ago I proposed a project that would
have brought money, and people, into this community.
It was rejected, in the end, because our local gentry
were unable to figure out how they could personally
profit from the project, and bringing more people
into the community is generally frowned on. Heaven
forbid that new residents (such as myself) might not
see things exactly the same way as members of the
existing power structure!

We desperately need more people in Iron County,
people who work and earn and can move this community

Have you asked yourself lately what it is that the
Iron County Economic Development Corporation has
achieved for you and for your neighbors? What growth
in this community have you seen in the past 10, or 20,
or 30 years?

How about some input of ideas on how to help the
population, and the economy, of Iron County grow.

A new airport isn't the answer. A new airport would
benefit a few businessmen who are already doing all
the business they can locally. That's a no win project
with the "Airport Committee" being headed up by
the individual who stands to gain the most by the
county building a new airport for him.

So long as our population continues to shrink, there's
nothing we have to offer the economic world that
can't be had elsewhere. Growth begins with having a
well educated, think on their feet, workforce that is
eager and willing to work whenever required. We need
to stop giving the best economic gift we have to other
areas of the US. In Europe they used to call it "the brain
drain" because most of their best emigrated to the US
for better opportunities. Our situation is similar.

It looks like Iron County presently lacks the leadership
necessary to improve our economic situation. If I
were a member of the local leadership I'd get so mad
about the situation that I'd do something positive to
crack the shell of impassivity, and to drive progress
for this community.

Instead the local leadership sits back in their chairs
and promotes rumors like, "Bill Vajk is out to destroy
Iron River" because rumor mongering is easier for
them that doing something, anything, that actually
works towards progress.

Well your rumor is as much hogwash as the progress
you've managed to bring to this community.

Bill Vajk

Wednesday, January 26, 2011

about some numbers

The personal preference from the standpoint
of writing this newsletter is to avoid you-tube
and other similar presentations. How
ever one
came to my attention that is difficult/impossible
to ignore because the presentations are quite
well thought out and smooth.

I hope that everyone reading here will play
out the brief videos that the web page presents
because tomorrow I'll be writing a paper that
considers Iron County in light of the discussions
brought to us by Mr. Beck (and no, that's not
Glenn Beck.)

Bill Vajk

Monday, January 17, 2011

Term Limits

Representative Sharon Tyler (R) Niles, has introduced
a bill to put a constitutional amendment on the ballot
for the next general election that could allow the doubling
of the number of terms that Michigan legislators can
serve. (House Joint Resolution C.)

Currently the limits are 3 terms (6 years) for state
representatives and 2 terms (8 years) for state senators.

The measure is cosponsored by Reps. Greg MacMaster,
Peter MacGregor, Al Pscholka, Matt Lori, Kevin Cotter,
Kenneth Kurtz, Mike Shirkey, Mike Callton, Ken Yonker,
Gail Haines, Hugh D. Crawford, Kurt Damrow, and
Wayne A. Schmidt, all Republicans. There's one list
of "must replace immediately" politicians to be ousted
at the first opportunity.

It looks as though the Tea Party message of the last
election was not received by these legislators. In 1992,
Proposal B that imposes the term limits, was passed by
58.7 percent of the voters. What the public wants is
representation by fresh faces, eager to do the best for
their constituents, rather than prototypical jaded career
politicians who eventually burn out and become more
apt to see to their personal interests than those of the

This philosophy should expand to local governments in
Michigan as well.

The Soviet period philosophy had "people's judges"
appointed a year at a time for much the same reasons.
They did not want the judiciary becoming complacent
in their positions and amassing any significant personal
prestige and power. Common sense prevailed. The
understandings of their rule of law translated succinctly
in the courtroom absent all the superfluous technicalities
we are experiencing in the US today.

Nobody ever made the mistake of claiming that the
soviets were stupid. In this they appear to have been
much smarter than we are. We have only to look at the
incestuous relationships between the various political
bodies in Iron County to understand the dangers of
allowing a small group to run local government over
long periods of time.

We, as a people, should establish term limits for every
elected office in the state.

Bill Vajk

Tuesday, January 11, 2011

New Iron County Airport

Roughly ten years ago, the populace of Iron County,
Michigan, let it be known that they wanted no part of
the county taking on a new airport. They did this by a
large representation at a County Board of Commissioners
meeting where they let their voices be heard. There was
no doubt about their wishes.

But our two main proponents wanting a new airport for
their own purposes, Messrs. Atanasoff and Oldenburg,
were not dissuaded from the pressures they've continued
to exert on the local political structure.

Oldenburg has a factory at 1520 W. Adams Street in
Iron River. He has his tax exemptions in place and things
are running smoothly for his business that has several
other locations in the region.

The Atanasoffs have a good sized facility at 303 Seldon
Road in Iron River, and has gas stations throughout
northern Wisconsin and the upper peninsula. Recently
Krist Oil, the corporation owned by the Atanasoffs has
started asking for a tax exemption for a tractor rebuilding

Both are viable, ongoing businesses in Iron County. Both
use airplanes for their corporate purposes. Neither has
given up on pressuring the county for a new, more luxurious,
airport funded by the public. There has been an occasional
mention in county board minutes about a new airport. In
fact, the county board set up an "Airport Committee" that
took the bit in its teeth, illegally appointed additional members
on its own, and failed to hold the public meetings required
by state law. This is what can generally be expected when
an arm of government cowtows to private interests rather
than complying with public interests. The existing committee
was dissolved by the County Board of Commissioners with
an eye to installing a new one, that will operate while complying
with state law, in January 2011.

Despite the absence of any formal County Board approval,
work on a new airport has apparently continued unabated.
It appears that Oldenburg's pilot recently visited the former
state prison in Iron River Township which has been reported
as a potential site for the proposed new airport.

There remain two problems. First, although it is proposed
that a new airport would cost the taxpayers nothing, there
is no plan in place to support ongoing expenses such as
maintenance without added taxation. The taxpayers in
Iron County will never stand for supporting a new airport
that is nothing more than a plaything for those wealthy enough
to own aircraft.

The second is that no satisfactory justification for building a new
airport has been offered by anyone officially involved with Iron
County. The only justification offered reads more like a cargo
cult mentality than anything real.

The two corporate entities that are interested cannot rationally
support an airport. There is no reason the public should support
one for them. When enough usage is demonstrated, a publicly
funded airport should be built. We have not reached that day.
Given our collapsing population and economy, that day doesn't
appear to loom in sight during this century.

Bill Vajk

Tuesday, January 4, 2011

Windsor Center - history and taxation issues

The Windsor Center is the former Middle School at
Iron River, Michigan. The building was built in 1929
and served, till recently, as a school. It became
surplussed because of a long term depopulation in
this part of the country.

I recommended demolition of this building. The
City of Iron River and the Iron County Economic
Development Corporation (EDC)thought it could be
made into some sort of community center along
with commercial rental properties. I was urging
that the citizens should be asked whether or not
this building should be reused as envisioned by
the few who seemed to think it a good idea.

However the powers that be plunged headlong into
creation of a consortium was that assembled to take
over the ownership and operation of the property as
a not-for-profit operation. The City of Iron River
and adjoining townships were asked to participate.
In the end, interest and participation was limited.

On March 31, 2010, the EDC held a meeting at the
Windsor Center. An excerpt from the local newspaper
had this to say:

"The tour followed a request from the Joint Public
Building Restoration Authority for financial support
from the EDC in funding an engineering feasibility
study to determine the “needs and wants” regarding
upgrading, renovating and remodeling the building.
U.P. Engineers agreed to conduct the study, at a
cost of $6,900.

"The EDC approved accepting a grant request from the
Building Authority."

By May, Second Wave Media reported:

"Development of the former West Iron County Middle
School into a thriving business and community center
is well underway, with new businesses moving in and
an engineering study planned for remodeling this month. "

At a City of Iron River open meeting on July 23, 2010, the
following activity appears in the minutes:

"Articles of Incorporation for the Windsor Recreation Authority
-Rick Commenator: The Joint Public Building Restoration
Administrative Board, which oversees the former WIC Middle
School building is in the process of forming a Windsor Recreation
Authority. The Authority will have the ability to seek millage to
operate, maintain and/or improve the public auditorium and
recreation facility. Commenator explained it is the objective of
the Authority to give voters the opportunity to voice their
approval or disapproval concerning the preservation of the
building by proposing a ½ mill for 5 or 10 years on the
November 2010 ballot. The three other participating
communities (Stambaugh, Bates, and Iron River Townships)
have adopted the Articles of Incorporation. Commenator
noted the WIC School District will not administer the
Recreation program next year."

In our opinion, that approval should have been sought at
the beginning, not so near the end that will result from
voter disapproval!

Last fall a flier was sent out offering educational
opportunities, entertainment, and commercial space
for rent. A request for millage was on the ballot in the
November 2010 election. All millage requests were
generally voted against in that election. The electorate
is quite obviously unwilling to pay additional property
taxes in order to support Windsor Center.

The results of the election have been posted on the Iron
County web page at:

And then the EDC announces:

"Two projects which will be taken off the EDC’s agenda
are the Crystal Manor/Crystal View Apartment project
and the Windsor Center support."

Now that the voters and the EDC have abandoned ship,
and the claim as made to the voters that Windsor Center
requires taxpayer support, what's going to happen to it?
Is the City of Iron River, along with participating three
townships, on the hook for whatever happens to the
property from now on?

Now to the issue that tweaked my interest in the Windsor
Center this time around.

The building has commercial, read "profit making"
businesses as tenants. The property is owned by a not
for profit entity. The rent for commercial space is,
in our opinion, artificially low considering the included
heat and utilities.

What is the tax status of the property. With all the
available vacant commercial properties in Iron County,
it seems that unfair competition is occurring if the
costs for commercial space rental fails to include
property and personal property taxes.

It seems to us that if tax abatements are sought by
the businesses leasing space at Windsor Center, each
of them ought to have gone through the process because
it appears that the building has been put to mixed
usage including retail space which is not subject to
tax abatements.

The process required to achieve tax exemptions is
nicely stated in plain English at:

The Midland MI text follows:

"The State of Michigan’s Public Act 198 of 1974 allows
local governments to grant tax abatements that reduce
both real and personal property taxes on new plants or
investments that rehabilitate obsolete facilities and
equipment. Historically, local governments in Midland
County have been pro-business, granting abatements
for the full twelve year period without terms for large
and small manufacturers.

"The abatement will reduce the amount of real and
personal property tax paid by the company for the
project by roughly 50 percent each or in the case of a
plant rehabilitation project, the obsolete SEV is frozen
and the investment on improvements is 100 percent
exempt from property taxes.

"Eligible businesses include industrial plants that
primarily manufacture or process goods or materials
by physical or chemical change. Related facilities of
Michigan manufacturers such as offices, engineering,
research and development, warehousing or parts
distribution are also eligible for exemption. Schools
are generally not affected due to the school foundation
grant. All or half of the State’s six mills for education
may be abated by the Michigan Economic Development
Corporation (MEDC) if the project warrants and is
approved by the MEDC.

"To receive tax abatement under P.A. 198, the eligible
business must complete a two-step process. The first
step is to file a written request with the local
municipality, before starting the project to be abated,
to establish an Industrial Development District or
Plant Rehabilitation District. After a public hearing,
the legislative body of the local municipality adopts a
resolution establishing the district.

"The second step for the business is then to file a
request with the local municipality to receive an
Industrial Facility Tax (IFT) Certificate, which
entitles the facility to exemption from ad valorem
real and/or personal property taxes for a period of
1 to 12 years. After a public hearing, the legislative
body of the local municipality adopts a resolution
granting the exemption. The approved application is
then submitted to the state of Michigan Tax
Commission and the Michigan Economic
Development Corporation for review and final
approval. Applications are due to the State Tax
Commission by October 31 to be eligible for
exemption in the following year. The State Tax
Commission is ultimately responsible for final
approval and issuance of certificates."

We will send Mr. Jeff Sabotta, the City of Iron River
assessor, a copy of this article with a request that he
provide us with the current tax status of the Windsor
Center since the tax status of that property is generally
unknown at this time.

We will publish his answer here as soon as it is received.

Bill Vajk

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