Did you hear the one about the non-profit that comes to a city council meeting to ask for taxpayer dollars to fund their private organization and the city council tries to give them taxpayer money because, you know, it’s a totally worthy cause? If not, come to the next council meeting when they are going to try to do it again!
The latest request comes from Clarkston SCAMP. Clarkston SCAMP runs a five-week summer camp (probably where the name comes from) for children and adults with special needs. (I’ve linked to their website here in case you want to donate to this worthy cause.)
SCAMP puts on the annual Clarkston home tour as a private fundraiser, and this year is supposed to be their final home tour. The event will be held on Saturday, May 31, from 10:00 a.m. until 2:00 p.m. and will give people inside and outside of town the opportunity to see the inside of a handful of historic homes. The owners of the private parking lot have offered to donate half the parking fees collected during the event to SCAMP, and a SCAMP spokesperson thought that was such a great idea, she asked our government to do the same. Specifically, she wants Clarkston taxpayers to donate 50% of the parking revenue collected for parking in government parking lots during the four hours of the home tour to SCAMP, with the amount to be determined after the event.
Ah, but there’s a slight problem with that. The private parking lot owners can do whatever they wish, but the pending SCAMP ask is for our city government to hand over public funds to their private charity – a charity that probably everyone agrees is a “nice” charity.
Paid parking was initially approved in April 2017. The August 28, 2017, city council meeting minutes expressly state that: “All parking revenue pays for expenses first then infrastructure, such as maintenance of streets, sidewalks and parking lots.”
I’m sure my sharp audience will instantly see what’s missing.
If you immediately noticed that there is NO provision to give away even one dime of parking revenue to a charitable organization simply because the city council likes them, then winner, winner, chicken dinner.
To add insult to injury, the SCAMP ask comes at a time when the city is going to blow out the budget to give all the office staff a raise because, rather than exploring the cost to contract for election services with another public body, the city manager claims he “has to have” the contract clerk (whose salary and benefit demands are higher than our current salary and benefit structure allows) as an employee. And if you give her a raise, well then gee whiz, you must give everyone else a raise. To justify the salary increases, the city council authorized up to $4,000 taxpayer dollars for a salary study that looked mostly at larger cities and didn’t consider what the majority of similarly sized Michigan cities, villages, and townships actually pay. Oh, and the cost for law enforcement is going up. And the cost for building code enforcement is going up, and we have to find a new code enforcement officer to go around and harass residents about their lawns because our current vendor is no longer going to be offering those services. Oh, and we’ll be paying more for legal services because the city attorney is finally leaving (though I suspect getting consistently good legal advice will be less expensive for the city in the long run). And let us not forget the sewer surcharge we’re all paying now because the city raided the funds that had been set aside for those types of repairs to pay for a city hall and Department of Public Works expansion – so when additional, anticipated sewer repairs are needed, we won’t have the money to pay for those expenses either.
If you haven’t figured out that this ends in a tax increase because our fiscally irresponsible city government spends every effing penny that comes in rather than setting aside any money to cover additional expenditures for a rainy day, then you’ve been living under a rock. And the city manager’s most recent report is apparently trying to soften you up to this idea when he says the finance committee will be “considering revenue improvement opportunities.” Since we also must find the money to pay for parking enforcement, parking lot repair, and road and sidewalk repair, why would anyone think it’s a good idea to give away any parking revenue to SCAMP, even if it weren’t prohibited by law? (Spoiler alert: it is prohibited.)
Our city council members seem to have the memory capacity of a gnat when it comes to what they can legally do with public funds. The SCAMP request is just the latest in a long line of asks from non-profits for taxpayer money to support their private organizations. I objected here – and directly to the council – when they were considering granting a permanent waiver of park usage fees to all 501(c)(3) charitable organizations so all these organizations would stop bothering council with their pesky requests to avoid the $200 resident (or $250 nonresident) user fee that everyone else has to pay to use a portion of Depot Park for a two-hour period to hold their private events. (Our city manager was particularly enamored with this proposal, since he’s the president and treasurer of the Clarkston Community Historical Society, an organization that he believes shouldn’t be asked to pay the $250 two-hour nonresident rate to occupy the park for an entire weekend so it can hold its private, Art in the Village fundraiser and has asked for fee waivers. I wrote about that here and here.) Several council members were enthusiastic about a proposal presented by Maggie Sans (councilmember Erica Jones’ roommate) for the latest iteration of the parking committee that would have forced taxpayers to split the cost of leases with participating businesses to rent dedicated parking spaces in a private parking lot so the employees of those private business can get “free parking.” (I wrote about here.) The city manager also has had a practice of not demanding 100% taxpayer reimbursement for our Department of Public Works employees’ overtime work to service and clean up after these private events – including his own private fundraiser for Art in the Village.
The SCAMP give-us-half-your-parking-revenue-collected-during-our-private-fundraiser request was a discussion item at the February 24, 2025, city council meeting. Our soon-to-be-departed city attorney (gosh it makes me so happy to say that 🍾🥂🎉 and June can’t come fast enough) billed the city for a half an hour to review the meeting materials and also for two and a half hours to sit through that council meeting (that lasted only an hour and twenty minutes), for a total of $285. The city attorney is apparently aware the city can’t write checks to charitable organizations, since he told the council at the January 27, 2025, city council meeting that it couldn’t donate the $5,000 the Clarkston Area Youth Assistance program had asked for. Apparently, the city attorney lost his tongue a month later when the SCAMP give-us-half-your-parking-revenue-collected-during-our-private-fundraiser issue was discussed, and he’s apparently remained silent since that time since the giveaway is on the agenda again for Monday, March 10, 2025. The only difference between a direct ask for $5,000 and the equivalent of half of the parking revenue collected during a four-hour period is that we know the exact dollar amount of the first request but not the second. At the end of the day, both contributions would still require a check drawn from the city treasury and sent to private entity for a non-public purpose.
Since our city government seems to be enamored with the Michigan Municipal League (MML) I’m going to copy and paste some excerpts from publications available on the MML’s website for everyone to read. The publications are:
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- Fact Sheet, Municipal Expenditures, October 2016 (which includes information from the Michigan Department of Treasury)
- Determining Lawful Expenditures, January 7, 2002
- Municipal Expenditures, undated (last visited March 6, 2025)
Here are some quotes from these publications that are exactly on point:
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- “Municipalities are frequently requested to make donations to various worthy private organizations. Such organizations include chambers of commerce . . . community funds . . . and other educational, promotional, or benevolent associations. . . . [I]t appears clear from Michigan law that such donations are questionable expenditures of public funds.” [From publication #1, page 1.]
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- “May a Michigan city/village make a charitable donation, gift or contribution to service clubs, charities or public or private social service agencies? Generally, no. Such expenditures have been held not to be used for a public purpose. . . .” [From publication #1, page 1.]
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- “Local units of government in Michigan are only allowed to incur expenditures for a valid public purpose. The local unit is the steward of public resources, and they may not be used for a private purpose.” [From publication #1, page 2.]
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- “Charitable Donations to Non-Profit Organizations: Unless the payment is in exchange for the provision of a governmental service that the local unit could have provided itself, this is not a valid public purpose. . . . This prohibition includes churches, veterans’ organizations, community organizations, Little League, Boy Scouts, Big brothers/Big Sisters, etc.” [From publication #1, page 2.]
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- “Except as otherwise provided in this constitution, no city or village shall have the power to loan its credit for any private purpose or, except as provided by law, for any public purpose.” [From publication #2, page 1, citing the Michigan Constitution.]
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- “UNLAWFUL EXPENDITURES BY A GOVERNMENTAL UNIT: Contributions or appropriations which are not specifically authorized by the Constitution or State Statute cannot be authorized regardless of the worthiness of the cause. Examples [include] [c]ontributions to churches, veterans, non-profit organizations. . . . Donations, including use of property or equipment to Little League, Scouts, Big Brothers/Sisters. Donations to community organizations. [This is] not intended to be an exhaustive list of legal or illegal expenditures . . . ” [From publication #2, pages 8-9.]
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- “On many occasions municipalities are requested to make contributions or donations to various worthy private organizations. Such organizations include chambers of commerce . . . community funds . . . and other educational, promotional or benevolent associations . . . it appears clear from various court decisions and legal opinions that such donations are illegal expenditures of public funds.” [From publication #3, page 1.]
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- “[I]t it is generally agreed that municipalities have the power to expend funds only for a ‘public purpose.’” [From publication #3, page 1.]
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- Factors to consider when deciding whether something is a public purpose: “Whether the benefit is available on equal terms to the entire public in the locality affected; whether the service or commodity supplied is one needed by all or by a large number of the public; whether the enterprise bears directly and immediately, or only remotely and circumstantially, upon the public welfare; whether the need to be met in its nature requires united effort under unified control, or can be served as well by separate individual competition; whether private enterprise has in the past failed or succeeded in supplying the want or in eradicating the evil; whether, insofar as benefits accrue to individuals, the whole of society has an interest in having those individuals benefited; whether a proposed extension of governmental activity is in line with the historical development of the Commonwealth and with the general purpose of its founders; whether it will be necessary to use public ways or to invoke the power of eminent domain; whether a special emergency exists, such as may be brought about by war or public calamity.” (This language comes from a Massachusetts case and was quoted by the Michigan Supreme Court; citation omitted; bolding in original.) [From publication #3, page 1-2.]
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- “Generally a public purpose has for its objective the promotion of the public health, safety, morals, general welfare, security, prosperity, and contentment of all the inhabitants or residents within the municipal corporation, the sovereign powers of which are used to promote such public purpose. . . The right of the public to receive and enjoy the benefit of the use determines whether the use is public or private. (Court citation omitted; ellipses in original.) [From publication #3, page 2.]
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- Questions to consider when determining a public purpose:
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- “Is the purpose specifically granted by the Constitution, by statute or by court decision? Absent a specific grant of authority by law, the expenditure should be analyzed under the remaining questions.
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- Is the expenditure for a public purpose? When analyzing this question try and identify who will be the primary beneficiary. Is the benefactor a private organization or a public organization? Is the expenditure for the public’s benefit and welfare? If the primary benefit is to the public, then the courts have generally held that the expenditure is legal.
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- Is the city or village contracting for services for which the city is legally authorized to provide? [If the answer is yes, then is] the operation or service under the direct control of the city? If the city does not directly control, or have an oversight provision governing the expenditure, it will likely be deemed illegal.” [From publication #3, pages 2-3.]
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- “The Michigan Supreme Court has ruled that a city cannot give away funds or other property even for a public purpose, without express statutory authority.” (Court citation omitted.) [From publication #3, page 3.]
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- “If the purpose for which the funds are expended is public in nature, but the operation is not under the control of the city or village which is making the contribution, it may nonetheless still be an illegal expenditure.” [From publication #3, page 4.]
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- “There has been no relaxation in the rule that municipalities are forbidden to expend funds for the purpose of making a donation to any private purpose. This remains true regardless of whether that purpose will incidentally benefit some or all of its citizens. All charitable donations, gifts and contributions to service clubs and agencies . . . are specifically forbidden.” [From publication #3, page 5.]
Since the SCAMP give-us-half-your-parking-revenue-collected-during-our-private-fundraiser is a request for funds to be spent for a wholly private purpose and not a public one, the answer to this request must be a resounding NO.
If the city council wants to give away taxpayer resources to charitable organizations, it has to ask Clarkston voters to authorize those freebies through a change to the Clarkston charter. MCL 117.4k of the home rule city act states: “Each city in its charter may provide for the appropriation and allocation of public funds to a public or private nonprofit institution engaged within the city in the provision of civic, artistic, and cultural activities, including but not limited to music, theater, dance, visual arts, literature and letters, architecture, architectural landscaping, and allied arts and crafts, to the general public.” Since Clarkston voters have never authorized giving taxpayer resources to charities, all giveaways of this nature are unlawful under Michigan law (discussed in the MML publications quoted and linked above) and the charter. And, even if the charter were to authorize such contributions, it is questionable whether SCAMP engages in “civic, artistic, and cultural activities” that are open to the general public. So, it might not qualify for contributions even if the voters approved giving away their tax dollars to nonprofits. And why would they vote for that when they are now taxed at the maximum rate the city can impose, and the city complains it doesn’t have enough money to provide essential governmental services? But I digress. The point is that there is no legal basis for the city to give away taxpayer funds to a private charity, no matter how deserving.
I’m honestly not sure how to get this through our elected officials’ thick skulls, but clearly, telling them what the law is has not been effective. This issue can be resolved once and for all with a lawsuit that requests a permanent injunction forcing the city to follow the law with regard to expenditures of public funds for private purposes, but why on earth should that be necessary when they have an attorney sitting through every public meeting – that we are paying for – who should be telling them what the law is?
Do the right thing, city council. If you, as an individual city councilmember believe SCAMP is a worthwhile charity, then put your money where your mouth is and write them a personal check. However, since our taxpayer funds are not a personal piggybank from which you can make magnanimous donations, you cannot write a city check to SCAMP because these funds would not be expended for a public purpose.