Brighton City Council discusses mill levy adjustments amid Gallagher repeal

The Brighton City Council held a study session on May 13, 2025, focusing on the financial mechanisms and oversight of metro districts within the city. Key discussions revolved around the revenue-raising powers of these districts, particularly concerning property taxes and special assessments.

Metro districts primarily rely on property taxes for their operations and debt obligations. They can also levy special assessments, but such actions require city council consent. Currently, Brighton has not received any requests for special assessments, but discussions are anticipated when such requests arise. The council emphasized the importance of transparency, noting that metro districts must adhere to open meeting laws, maintain budgets, and submit annual reports to the city.

A significant topic was the adjustment of mill levies in response to changes in residential assessment rates. The council discussed the implications of the Gallagher Amendment's repeal, which previously dictated the ratio of residential to commercial property tax assessments. With the new legislative environment, the residential assessment rate is now subject to fluctuation, which could impact the revenue generated by metro districts.

The proposed changes to the service plan include mandatory adjustments to the mill levy based on the residential assessment rate, ensuring that revenue remains stable despite legislative changes. This adjustment aims to protect bondholders from potential revenue shortfalls due to fluctuating assessment rates.

Council members expressed concerns about the oversight of metro districts, particularly regarding their financial practices and compliance with service plans. While the city has limited enforcement mechanisms, there is a provision for a quinquennial review of authorized but unissued debt, allowing the city to evaluate the districts' financial health periodically.

The meeting concluded with a consensus on the need for the proposed changes to the service plan, which would enhance the city's ability to manage the financial implications of metro districts while maintaining a degree of oversight. The council aims to ensure that the financial structures in place are robust enough to adapt to future legislative changes without compromising the city's fiscal stability.