Residents and landowners in Holly will be paying higher taxes so the village can stay solvent and prevent a takeover by the state.

Facing a deficit of over $600,000, the village council voted unanimously, 6-0, to approve a special assessment millage to balance the budget before June 20 as required by state law. President April Brandon was absent.

The one-year, 4-mill assessment is for “all lands and premises” in the village and equals $4 per $1,000 of taxable value. It will raise $658,710 in revenue.

“The reason why we are looking at a special assessment rather than a vote, is because in order to get the money in to finance our village and in order to get a balanced budget which we are legally obligated to do, we have to get everything into the state by June 20,” said Village Manager Tim Price. “Even if we had found out about this on our first day in office, there would have been no time for a special election to put this on a ballot.”

“This is literally a tourniquet to stop the bleeding at this point,” said Trustee Amber Kier, who chaired the meeting in place of Brandon.

Price said the problem has not been with the village spending beyond their means but a lack of revenue.

The village’s millage rate has decreased over the past 43 years due to Headlee Rollbacks, which was established in 1982 to protect home owners by limiting the amount of property tax increases.

The millage rate has dropped to 11.32 mills for fiscal year 2025, while inflation and need for public services have escalated, according to Price, who took over as village manager in January. The assessment will appear on village residents’ tax bills next month.

“The can has been kicked down the road progressively for 43 years,” Price said. “This (assessment) is not going to answer all the financial questions right now, this just gets our heads above water. It allows us more time to develop some more strategies in order to meet these responsibilities.”

Holly resident Amber DeShone told the board the new assessment is happening too quickly.

“This increase with barely a month to prepare would be devastating for us,” said DeShone. “This will add $361.32 (to our expenses) with only a month to prepare. It feels rushed, it feels thoughtless and it feels unfair.”

Price said previous councils had borrowed money from the village fund balance to keep from going into a deficit and ignored warnings from their auditor Plante Moran.

“If you look back at previous meetings in previous years, such as 2020, this (budget deficit) information was presented to them (during audits) at the time and they were told they were facing this kind of environment and council chose not to do anything at that time,” said Price. “There was no sense of urgency for it and I don’t know why that is.”

Trustee Kier read a statement from Brandon.

“We (the council) did not create this problem, we inherited it,” said Brandon. “The deficit was hidden, though we don’t think it was intentional. None of us knew about it until this year.”

She added, “Now this council has to make a difficult decision, either cut essential services like fire and police… or we can raise taxes on residents that are already struggling.”