Michigan's Charter Township Law

Michigan's Charter Township Law
(April 2000)

Because each state is unique, there is much we can learn by studying local government structures elsewhere -- especially by examining laws affecting town government operations in other midwestern states, which have roughly similar economies and governmental systems. At last year's Wisconsin Towns Association (WTA) annual convention in La Crosse, town officials learned about local government issues -- and solutions -- in the neighboring State of Michigan. Larry Merrill, Deputy Executive Director of the Michigan Townships Association, focused on his state's "Charter Township" law, which features provisions similar to reforms under consideration by WTA leaders in Wisconsin. The following information is largely based on his talk and a subsequent conversation with him.

The Michigan Charter Townships Act was enacted in 1947, and has been significantly amended several times since. It allows "general law townships" with at least 2,000 residents that meet certain service criteria to adopt charter status. Townships cannot design their own charter terms -- they must adopt a uniform set of standards (though some flexibility is allowed within this prescribed framework). Michigan townships can adopt charter status only if they meet statutory criteria adopted in 1978: 1) Has state equalized value of at least $25 million; 2) Has a minimum population density of 150 persons per square mile; 3) Provides police, fire, solid waste disposal, and water and/or sewer services by contract or some other method; and 4) Has a comprehensive zoning ordinance or master plan that complies with statutory guidelines.

Charter townships and general law townships are similar in organization and powers in most respects, except for three areas: 1) In charter townships, Michigan's equivalent of the town chairman or town administrator are given greater control over the day-to-day operations of the town; 2) Charter townships enjoy boundary protection against most contested annexations; and 3) Charter townships have enhanced taxing powers.

The enhanced powers of the chairman or administrator are similar to the "strong mayor" concept, except that the chairman has no veto power. Charter towns also do not have an annual town meeting (a change Wisconsin town officials have expressed little support for). Merrill notes that even general law towns in Michigan have the option of eliminating the annual meeting and that this is becoming a more common practice. He adds that the practical powers of electors at the annual meeting is limited to setting salaries -- they do not exercise the broader powers permitted under Wisconsin law.

The feature of Michigan's charter town law of greatest interest to many Wisconsin town leaders is the boundary protection it affords. Charter towns are generally immune from contested annexation, although townships chartered after 1978 are subject to limited forced annexations ordered by the state boundary commission, primarily to allow more regular borders.

Michigan's charter townships have been major catalysts for economic growth -- largely because of their low taxes and efficient services. Although charter townships have enhanced taxing powers, most keep their tax rates are well below those of neighboring cities. Wisconsin town officials can benefit from Michigan's experience by, for example, drafting statutory provisions that avoid ambiguities that have resulted in litigation in Michigan.

Michigan's townships share some important characteristics with their Wisconsin counterparts. They have a strong heritage of governmental efficiency and they have felt the pressure of urbanization and aggressive annexation policies. But there are also important differences between the annexation procedures in Wisconsin versus Michigan towns.

Unlike Wisconsin, Michigan cities have what amounts to unilateral annexation powers. Cities can initiate an annexation on their own, subject to review by a three-member Michigan State Boundary Commission. Merrill reports that the commission, which is appointed by the Governor, has sometimes revealed a pro-city bias in the past. In more recent years, the body has been more even-handed. Town residents can seek a referendum only in instances where an annexation would affect more than one hundred residents. Some cities have attempted to bypass this referendum provision by initiating a series of annexation petitions involving fewer than one hundred residents in each area. In recent years, the boundary commission has ruled that such initiatives must be consolidated into a single petition, thereby safeguarding the referenda option for town residents. Unlike Wisconsin, an annexation petition initiated by a property owner cannot include an equivalent amount of adjacent land. Merrill notes that because owner-initiated petitions involve only property owners who seek annexation, townships rarely resist such efforts.

Michigan state law allows townships and cities to enter into contracts to share both services and tax revenues ("tax base sharing"). The goal is to promote "win-win" outcomes. Yet the most striking difference between Michigan and Wisconsin law is the option for towns to obtain charter status.

WTA Position on Annexation
WTA Position on Land Use
WTA Position on Home Rule