Detroit City Council passes ordinance reforming the city's property tax system
A years-long effort to reform Detroit’s property tax system now has City Council approval.
The Council voted 6-3 on Tuesday to approve a new property tax ordinance. It includes information that will help homeowners see if the city is overtaxing them, and measures meant to determine whether property assessments are sound.
The reforms come in the wake Detroit’s devastating tax foreclosure crisis, which was driven in part by inflated assessments. From 2010 through 2016, the city overtaxed homeowners by an estimated $600 million, fueling displacement and blight that still haunt Detroit neighborhoods today.
Detroiter Erin Stanley, who also works for the Eastside Community Network, told Council members that her parents lost their home that way.
“I can't help but wonder how things might have been different if we had a more transparent, accessible and accountable property tax system,” Stanley said. “If my parents understood their assessment and that it was illegally high. Or if they had a clear path towards appeal, and if the system deciding if we could stay in our home or be displaced.
“But it's not about looking backwards. This ordinance will allow our city to move forward by providing a real systemic solution to our predatory property tax system. We are tired of being told to wait.”
Bernadette Atuahene, a law professor and member of the Coalition for Property Tax Justice who’s helped spearhead the reform efforts, said Detroit has greatly improved its assessment process in recent years. But she said data continues to show systematic over-assessment of many the lowest-value properties.
Atuahene said the ordinance addresses that by allowing the City Council to hire an independent evaluator to confirm assessment data is accurate and transparent. It also allows the Council to send those homes found to be over-valued directly to the city’s Board of Review, a process that normally has to be initiated by individual homeowners.
Mayor Mike Duggan’s administration opposed that provision. The city’s top lawyer, Conrad Mallett, told the Council that and some other parts of the new ordinance appear to violate state law and the city’s charter.
Among other things, “The proposed ordinance illegally reduces the role of the Chief Financial Officer in the administration of the property tax taxation assessment process,” Mallett said. “If a selection of an independent evaluator process is to be implemented, that process must function under the jurisdiction and the control of the Chief Financial Officer.”
Those claims drew a sharp rebuke from Atuahene, who called them a “ludicrous” attempt to quash key accountability measures.
“We're in a situation where Detroiters have been overtaxed by $600 million because there have not been proper checks and balances,” Atuahene said. “But what corporation counsel is coming before you today to say is let's weaken the main check and balance in the property tax reform ordinance, which is absolutely unacceptable.” She added that several of Detroit’s “premier public interest legal organizations” have reviewed the ordinance and found it complies with the law.
Duggan’s office acknowledges that systematic over-assessments were a problem in the past, but denies that inflated property tax bills are an ongoing problem. It says the city overhauled its assessor’s office and completed a thorough, parcel-by-parcel reassessment in 2017 to ensure that taxes reflect a property’s true value. The city has also taken other steps to dramatically reduce tax foreclosures, including making a property tax exemption for low-income homeowners more widely and easily available.
It’s unclear if the mayor’s office has an avenue to challenge the parts of the new ordinance that it disagrees with, or whether it plans to do so. Mayoral spokespeople did not respond to an email inquiry from Michigan Radio sent late Tuesday.