ISHPEMING - The city of Ishpeming is planning an appraisal of the Bell Hospital/LifePoint assets in Ishpeming in anticipation of putting them on the tax rolls.
The Ishpeming City Council at a special meeting Friday unanimously approved hiring MR Valuation Consulting LLC - at a cost not to exceed $35,000 - to do the appraisal.
The city of Marquette hired MRVC to appraise the value of Marquette General Hospital after it was acquired by Duke LifePoint last September. This was "a significant factor" in Ishpeming's decision to hire MRVC to do the Bell appraisal, said Jon Kangas, interim city manager and Department of Public Works superintendent.
The Ishpeming City Council recently approved hiring a consulting firm to do an appraisal of Bell Hospital/Lifepoint property in the city, including Bell Hospital building shown above. The appraisal is in anticipation of putting the property on the tax rolls. (Journal file photo)
"The firm seemed like they were very experienced in this type of valuation," Kangas said.
Part of Marquette's decision to use MRVC was the company's success in defending its appraisals in court. Kangas said this was also a factor in Ishpeming's decision.
"There's certainly the concern that if you hire a firm with less experience that you don't have the quality of defense if it comes down to it," Kangas said. "You always hope that you don't need to go to court, but obviously you're asking an entity that has previously been tax free to now pay a tax, and obviously they want that tax to be as affordable as possible."
Kangas said the city is not concerned about the potential of Bell/LifePoint to challenge the property appraisal in court.
"This kind of thing happens, so you pretty much have to assume that risk," he said.
Kangas said the other option would be to intentionally under-appraise the property, which he said is not the right thing to do.
"You have to have a proper appraisal in order to properly assess the property," he said.
Kangas said any estimates of the tax revenue the hospital will generate are at this point very preliminary and "unqualified," and therefore he declined to name a dollar amount.
Once the taxes are collected, Kangas said the city will only see about a third of the tax money. The rest of the money will go to Marquette County and the Ishpeming School District, depending on the millage rates of each.
Also at Friday's meeting, the council decided to stop the city's appeal of a Michigan Employment Relations Commission decision and to approve a change order for renovations of the lower level of the Ishpeming Carnegie Library.
Zach Jay can be reached at 906-486-4401.