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Detroit to delay assessment notices amid surge of requests for tax help

Christine Ferretti
The Detroit News

Detroit — The city is postponing the mailing of its 2021 property tax assessment notices amid an influx of applications for property tax assistance. 

Detroit officials on Friday said the decision to begin mailing the notices on Jan. 25, a week after originally anticipated, was made following a 20% surge in applications for the city's Homeowners Property Tax Assistance Program, or HPTAP. The city, in a news release, said it's working to ensure each application is reviewed and that property tax exemptions are granted to eligible Detroit homeowners. 

Protestors attend a press conference at the Coleman A. Young Municipal Center, in Detroit, February 13, 2020, to announce a class action lawsuit against the city for the over assessment of home values for thousands of home owners.

Beyond the delay in mailing the 2021 assessments, the City Assessor's Office also is extending the time for appeals of assessments to the Board of Review from Feb. 1 through Feb. 22, 2021, officials noted. 

"By taking these steps, the city is ensuring that the rights of property owners are respected and preserved and that those Detroiters who have requested assistance with their property taxes receive the assistance," the city said in the release. 

Over the past six years, Detroit officials say, property tax foreclosures have been reduced by more than 90%.

The statutory Jan. 15 deadline for the winter tax bills will not be extended, officials said.

The Board of Review and the Office of the Assessor will contact outstanding HPTAP applicants who do not receive an exemption to remind them of the deadline.

The city expanded property tax exemptions for homeowners last January to help more residents avoid foreclosure. 

Since then, the tax assistance program has included 25% exemptions, making a family of two earning $25,703 or a family of four earning $31,930 eligible for a reduction. Previously, homeowners could qualify for a 100% exemption or a 50% exemption on their property taxes based on their income. 

The city said despite challenges brought on by the COVID-19 pandemic, the program remains a key tool in helping residents keep their homes. The city created an online application process that's served 1,700 residents and conducted field visits to pick up or drop off application paperwork, officials said. 

Office of the Assessor staff also made more than 2,000 phone calls in November and December to remind residents of the 2020 deadline to return applications. From Dec. 7-15 the Office of Detroit's Chief Financial Officer, Office of Assessor and community partners assisted more than 1,200 Detroiters with the applications at TCF Center, the city added. 

Foreclosure has been an ongoing crisis in Detroit.

The city overtaxed homeowners by at least $600 million after it failed to accurately bring down property values in the years following the Great Recession, according to a January 2020 investigation by The Detroit News.

Detroit completed a state-ordered reappraisal of all residential property in 2017 to correct the problem but, still, thousands of Detroiters faced foreclosure over back taxes.

Of the more than 63,000 Detroit homes with delinquent debt as of last fall, more than 90% were overtaxed, by an average of at least $3,700, between 2010 and 2016, according to calculations by The News. The debt owed on about 40,000 of those homes is less than the properties were overtaxed over those seven years, The News found. 

Detroit's City Council this fall narrowly rejected a resolution to give residents potentially overtaxed before 2014 priority in affordable housing, home-buying discounts and job opportunities because a majority of members said the proposal didn't go far enough. 

The plan — opposed by tax justice groups and several council members who argued it fell short of providing meaningful relief — sought to offset losses from 2010 to 2013.

The resolution included eight preference programs to be funded with a one-time $6 million appropriation of surplus dollars from the city's 2020 fiscal year budget.

The City in partnership with Wayne County also passed the Pay As You Stay (PAYS) program to assist eligible homeowners with delinquent property taxes to keep their home.

Detroit homeowners enrolled in the HPTAP with delinquent property taxes also were enrolled into the PAYS program, which helped eliminate interest, penalties and fees associated with delinquent taxes, and enrolled them into an affordable payment plan to keep their home.

The PAYS program accepted 5,022 Detroiters through Dec. 20, 2020, to assist with lowering delinquent property taxes.