Detroit Council OKs new fees for upscale neighborhoods

Christine Ferretti
The Detroit News

Detroit — The City Council on Tuesday approved a new levy for certain services in three upscale city neighborhoods.

The extra fees for the city’s Sherwood Forest, Palmer Woods and Detroit Golf Club neighborhoods, are permitted under an ordinance adopted by the council in 2014.

The petition-driven initiative is the first of its kind and allows neighborhoods to raise money from property owners to supplement certain services, as long as 51 percent within the district approve. The added fees will appear on the property owners’ summer tax bills.

The council gave the go-ahead after a lengthy debate that ultimately ended with the panel asking its legal staff to revisit the law. The council initially signed off on the three assessment plans in March.

In Sherwood Forest, property owners in the assessment district will pay $250 a year. In Palmer Woods, property owners will pay $495 annually, and Golf Club residents now have an annual $404 fee.

The controversial law has spurred lawsuits and left neighborhoods at odds over those who support the costs and others who don’t want to pay more for mosquito spraying, snow removal and security.

Each assessment runs for a minimum of seven years and property owners could face foreclosure proceedings if they fail to pay. The terms don’t sit well with some council members.

Councilwoman Mary Sheffield said she’d rather see a super majority, rather than 51 percent, voting in support of the added fee. It’s a move, she said, that would make her “feel a lot more comfortable.”

“We have to be very careful adding additional taxes to these communities,” added Sheffield, who voted against adding the new fees to the tax roll.

Additionally, President Brenda Jones and Councilman Scott Benson said they want protections for property owners who cannot cover the new costs that could leave them vulnerable to foreclosure.

“We will inevitably have someone who will not be able to pay the special assessment and will need some type of relief,” Benson said.

City Assessor Alvin Horhn said failure to pay would result in a lien on the property. But the law does not require the city’s treasurer to pursue foreclosure. Right now, the treasurer does not intend to allow properties with unpaid assessments to foreclose, he said.

Council members on Tuesday approved a motion asking policy staff to see whether protections against foreclosure can be added to the ordinance language and if amendments can be made to the percentage of property owners required to favor such a fee, among other things.

Prior to the vote, several residents voiced both support and some concern over the new fees.

Frustrated Golf Club neighborhood resident Nancy Turner claimed she didn’t get an opportunity to sign the petition. If she had, she would have turned it down, she added.

“I told her no more money,” Turner said of the request from a neighborhood organization leader. “I’m not interested in it. I don’t need that.”

But Nancy Varner, who serves on the Detroit Golf Club Homeowner Association Board of Directors, countered the assessment is fair and will improve the community.

“We strongly feel the (Special Assessment District) provides a reliable and an equitable process for the distribution of payments to support this program in our community,” she told the council.

In May, some residents in Sherwood Forest sued the city — and their own neighborhood association — to have the supplemental costs tossed out.

The case was dismissed Tuesday during a motion hearing in Wayne County Circuit Court, Detroit Corporation Counsel Melvin Butch Hollowell said.

The suit, and another formerly filed by neighbors in Palmer Woods, were dismissed in part because they were filed in the circuit court. Challenges to the levies should have been filed with the Michigan Tax Tribunal.

The assessments are allowed under a 2011 amendment to Michigan law for a city with a population of more than 600,000.

Detroit’s program was first approved in 2014, but an existing code — requiring 80 percent of residents within a district be current on their property taxes — proved unattainable and prevented groups from pursuing the effort.

Last spring the council voted to soften that code, lowering the requirement to 60 percent.