Citywide News

Posted on: November 1, 2016

City to fight class-action raid of water fund

NOTE: Taylor believes that it is important to let its residents know about what could be a significant lawsuit against the City. As many residents may not be potential members of this class-action lawsuit, this website provides the best method for the City to advise its residents. 

The City of Taylor is aggressively resisting a class-action brought a legal firm that has targeted many area communities in the region. The same firm has filed similar lawsuits against other communities, including Dearborn, Ferndale, Royal Oak, Birmingham, Bloomfield Township and Westland, and has sought related information in two other communities (Canton and Livonia). 

“It appears that their overall strategy is to target municipalities that have properly planned and possess fund balances to adequately service their residents,” Mayor Rick Sollars said in response to the lawsuit. “We will not allow this lawsuit to distract from our greater vision of providing excellent services to the residents of the City of Taylor.” 

Kickham Hanley PLLC, which describes itself as “boutique” law firm in Royal Oak, filed the action in Wayne Court Circuit Court against Taylor in the name of Leonard S. Bohn. The lawsuit contends “illegal taxes” on three specific charges incorporated into the City’s water and sewer rates. 

The City maintains that: The charges in the lawsuit are frivolous. Customers are charged only their proportional share of the costs of the operation, maintenance and equipment replacement expenses. The City has employed the same rate-setting practice for a quarter of a century. The City has continuously acted responsibly and in the best interests of the water and sewer customers The rates have been approved in a transparent fashion by City Council, in public meetings and out in the open. The current rates could have been higher, but the City chose not to charge the full fair market value for services provided. 

Mayor Sollars pointed out that Taylor has a very comprehensive capital improvement plan in place that improves services to residents throughout the community. Every five years, Taylor updates a Capital Improvement Plan. The City’s most recent plan in November 2015 identified over $12M of necessary improvements required to the system. Taylor prepares for such improvements each year to avoid large assessments to residents. He also reminded residents that in the summer of 2014, one of the largest storms in the history of Michigan hit the area. 

As a result, about one hundred homes in Taylor flooded – compared to thousands upon thousands in neighboring communities. One of the reasons: Taylor flood-control system was well-prepared and well-maintained. In September, City Council approved an on-the-spot, emergency repair of a collapsing sewer line on Ziegler Street, at a cost of nearly $100,000 – again a reflection on the importance of proper funding. If Taylor’s water fund wasn’t properly funded, that emergency could have resulted in raw sewage backup into a large tract of residential homes. 

“We use our water and sewer fund in a proactive fashion for the benefit of our residents, and to guard against catastrophic occurrences.” 

The lawsuit contends that Taylor’s rates are higher than necessary to finance the actual costs of providing water and sewage disposal services; that the City has unlawfully included in its rates an additional charge that is used not to cover actual expenses on providing water and sewer services, but rather to fund the City’s general governmental obligations; and that the City includes in its rates an amount to cover the costs the City incurs for the public fire protection services provided by the water supply system. 

City of Taylor attorney’s Howard & Howard Attorneys PLLC called the lawsuit “frivolous” and will seek to get it dismissed. “The City has continuously acted responsibly and in the best interests of the water and sewer customers,” Howard & Howard stated in the City’s position of the court brief. City attorneys also took issue with the lawsuit’s claims that Taylor erred in arranging three short-term loans from the water and sewer fund. “…There is nothing illegal or improper about the loans,” the attorneys write in the brief. “The loans were approved by City Council and the loans benefited the water customers … (they) were repaid with interest.” 

If you are a member of the class, or are a potential member of the class, the City of Taylor is not permitted to discuss the case with you. We are required to notify you to contact your own attorney or contact Mr. Hanley, IN WRITING AND NOT BY TELEPHONE, at Kickham Hanley PLLC, 32121 Woodward Avenue, Suite 300, Royal Oak, MI 48073 or by e-mail to khtemp@kickhamhanley.com, 

Overview: A local law firm filed a class action lawsuit against the City of Taylor, which is currently pending in Wayne County Circuit Court. This case is one of several similar lawsuits filed against local municipalities relating to water and sewer rates. In each case, the same law firm, Kickham Hanley, PLLC, represents the class members. The class action firm has sued other cities including Dearborn, Westland, Ferndale, Royal Oak, Birmingham, and Bloomfield Township. Two others – Canton and Livonia – may face similar attacks in the near future. 

What does this class action challenge? Leonard S. Bohn v. City of Taylor challenges the City’s water rates and sewage disposal rates. 

The lawsuit contends: Rates at a level in excess of the rates necessary to finance the actual costs of providing water and sewage disposal services The City has included in its rates an additional charge that is used not to cover actual expenses on providing water and sewer services, but rather to fund the City’s general governmental obligations And that the City includes in its rates an amount to cover the costs the City incurs for the public fire protection services provided by the water supply system. 

What is the City’s Position? The City maintains that: The charges in the lawsuit are frivolous. Customers are charged only their proportional share of the costs of the operation, maintenance and equipment replacement expenses. The City has employed the same rate-setting practice for a quarter of a century. The City has continuously acted responsibly and in the best interests of the water and sewer customers The rates have been approved in a transparent fashion by City Council. Rates charged could have legally been higher but the City chose not to charge the full fair market value for services provided. Every five years Taylor completes a Capital Improvement Plan. The City’s most recent plan in November 2015 identified over $12M of necessary improvements required to the system. Taylor prepares for such improvements each year so it avoids large assessments to residents. 

How is the City Proceeding? The City is confident it will prevail in the current lawsuit. In order to properly maintain and operate the system, financial reserves are critical. Future rates will likely have to rise to recover from the costs of defending this lawsuit and any damages that may result. Providing clean drinking water and a stable water and sewer infrastructure is expected of city governments. 

Why is the City Choosing not to Settle? The City believes there is no factual or legal merit to the claim. What are the Long-Term Effects on the City? The City’s water rate structure was put in place to make sure the City is properly funded not only to maintain and operate the system but to improve it and recover from any major problems. Any lower funding could put the entire system at risk. 

What Are Some Misconceptions About the Case? This case is not related to the water meter updates, which were necessary. It is not related to any flooding issues. It is completely unrelated to lead pipes. 

What if I Want Out of this Class Action? You may opt out of the lawsuit. The court order provides that class members who wish to exclude themselves from the lawsuit may write to “Class Counsel,” stating that they do not wish to participate in the lawsuit and that they wish to retain their right to file a separate action against the City. This request for exclusion must be postmarked no later than November 14, 2016 and mailed to: Kickham Hanley PLLC, 32121 Woodward Avenue, Suite 300, Royal Oak, Michigan 48073. 

What if I Have Additional Questions? If you are a member of the class, or are a potential member of the class, the City of Taylor is not permitted to discuss the case with you. We are required to notify you to contact your own attorney or contact Mr. Hanley, IN WRITING AND NOT BY TELEPHONE, at Kickham Hanley PLLC, 32121 Woodward Avenue, Suite 300, Royal Oak, MI 48073 or by e-mail to khtemp@kickhamhanley.com.

Facebook Twitter Google Plus Email

Other News in Citywide News

Taylor Michigan CERT Logo

P.E.P. Talks to begin in January 2018

Posted on: December 8, 2017
green-for-life-environmental logo

Avoid contaminating your recyclables

Posted on: October 23, 2017
street sweeper

Fall street sweeping to begin October 2

Posted on: September 26, 2017

MDNR launches tree awareness campaign

Posted on: September 26, 2017

Tree trimming scheduled

Posted on: September 5, 2017

2017 PASER study ranks City's streets

Posted on: August 9, 2017
movies in park

Summer Festival kicks off Thursday!

Posted on: June 21, 2017
taylor-h2o web

Pool, splash field are now open

Posted on: May 26, 2017
orange barrel

Pardee, Goddard to undergo roadwork

Posted on: April 18, 2017
Lakes of Taylor 17 green

Podcast: Golf is in the air!

Posted on: April 13, 2017
Thomas Bonner.jpg

Former police chief to be laid to rest

Posted on: February 24, 2017
new website 1.jpg

City rolls out new website

Posted on: January 23, 2017
drugs.jpg

Townhall meeting to focus on drug use

Posted on: January 23, 2017

No charges filed in shooting of dog

Posted on: January 8, 2017

Snow emergency declared on December 16

Posted on: December 20, 2016

Recreation center offers The New Fit U

Posted on: December 20, 2016

Snow emergency declared December 11

Posted on: December 20, 2016

DPW trucks are ready for first snow fall

Posted on: December 20, 2016

Podcast discusses important holiday events

Posted on: December 20, 2016

DPW makes note of important dates

Posted on: December 20, 2016

True Meaning of Christmas Dinner scheduled

Posted on: December 20, 2016

Eureka Road renovations are complete

Posted on: December 20, 2016
winter festival route 2.png

Get ready for Taylor Winter Festival

Posted on: December 20, 2016

Eureka roadwork begin Allen and Racho ends

Posted on: December 20, 2016

Major road repairs expected near school

Posted on: December 19, 2016

$95,000 grant to improve Heritage Park

Posted on: December 19, 2016

Hayes-Pine intersection to be closed

Posted on: December 19, 2016

School superintendent discusses millages

Posted on: December 19, 2016

Work on Mortenview is delayed

Posted on: December 19, 2016

Operation Gratitude ongoing at Lee Dental

Posted on: December 19, 2016

VP nominee to speak in Taylor

Posted on: December 19, 2016

Construction to begin on Mortenview

Posted on: December 19, 2016

Podcast, TV show discuss lawsuit

Posted on: December 19, 2016

Road work to continue throughout fall

Posted on: October 24, 2016

Testing could cause water discoloration

Posted on: October 24, 2016
Howard Noble artists rendering web.png

Howard Noble Park to get new playscape

Posted on: October 24, 2016

Election inspectors are needed

Posted on: October 24, 2016

Beech Daly construction continues

Posted on: October 24, 2016

Clerk's office offers expanded hours

Posted on: October 24, 2016

The Jungle Book in scheduled Friday

Posted on: October 24, 2016

Work to begin on Lorne Street

Posted on: October 24, 2016
lazyboy web 1.jpg

La-Z-Boy joins Eureka Way!

Posted on: October 24, 2016

Fire could cause water problems

Posted on: October 24, 2016

DTE Kiosk Network available to residents

Posted on: October 24, 2016
keith boc.jpg

Keith Boc named DPS director

Posted on: October 24, 2016

Work begins on Empire Street

Posted on: October 24, 2016

Public hearing on water main project

Posted on: October 24, 2016

Water main work is planned

Posted on: October 24, 2016
meadows work 2 web.JPG

Taylor Meadows renovation is under way

Posted on: October 24, 2016

Rain hampers JLWS final weekend

Posted on: October 24, 2016