Kienda Ivy with the Wayne County Treasurer's Office talks to Anthony Keys, who owes $4,470 in taxes on a home he bought at an auction. (David Coates / The Detroit News)
Detroit— Anthony Keys clutched an extra large Ziploc bag full of papers Tuesday at the Wayne County Treasurer’s Office and hoped to keep his house.
The 55-year-old Detroiter’s white aluminum-sided bungalow is one of 22,700 properties the county soon could seize because of unpaid taxes. The homes were bought at auctions of tax-foreclosed properties, and the treasurer has filed notice that it will reclaim them if new owners don’t pay up.
On Tuesday, Keys and more than 400 others attended the first of two hearings, which are their last chance to get on payment plans before treasury officials ask a judge to seize the homes on Aug. 15. Another hearing is scheduled today with sessions starting at 9 a.m. and 1 p.m. at the treasurer’s offices at 400 Monroe.
A $4,470 bill is overwhelming for Keys, a former scaffold builder who said he is living on Social Security disability payments. He left the hearing with a payment plan, but said he’s not sure how he’ll get $700 by month’s end to make the first payment.
“I didn’t know (the taxes) would be due so soon,” said Keys, who bought the east side house two years ago from a friend who purchased it at the county’s 2012 auction. “I am worried I am going to be homeless.”
Chief Deputy Treasurer David Szymanski said he’s sympathetic but his office must collect property taxes for government to function. Seized homes likely would be transferred in January to the Detroit Land Bank.
“How do I justify to the regular taxpayer that they are subsidizing their neighbor’s services?” Szymanski asked. “A lot of these are people who really can’t afford to own a home.”
County officials hope the legal action deters land speculators. Now, they are able to buy tax-foreclosed homes for as little as $500 apiece and collect rental income for three years without paying taxes until they are foreclosed again.
More than $80 million was owed as of last month and represented about 78 percent of the 29,000 properties auctioned by county treasury officials since October 2011. The vast majority are in Detroit.
The crackdown is expected to be challenged by some bulk buyers.
“If this practice is allowed, I believe that it will stifle purchasers at these auctions and therefore defeat the very purpose of the General Property Tax Act, which is to place property back into productive use,” wrote Brad Aldrich in an email. Aldrich, an attorney who represents several auction buyers, plans to file a legal challenge.
Sharee Fenderson of Detroit attended the hearing to try to save three houses she bought for about $15,500 at auction last year, including two large homes in the Boston Edison neighborhood. About $11,000 in taxes is due on the homes.
Fenderson said the homes are stripped shells that she’d like to rehab. But she said she needs more time.
“They want you to hurry up and fix it up and hurry up and pay taxes,” Fenderson said. “It is going to take us six months to clean it out. ... Give people a chance.”