Tlaib, activists call for state probe of tax overassessments in Detroit

Christine Ferretti
The Detroit News

U.S. Rep. Rashida Tlaib and local advocates are urging Gov. Gretchen Whitmer to investigate property tax overassessments in Detroit. 

U.S. Rep. Rashida Tlaib, center, attends a rally in Detroit last year to announce a class-action lawsuit against the city for the overassessment of home values for thousands of homeowners.

Tlaib, D-Detroit, said during a livestreamed town hall billed #BlackHomesMatter that advocates are seeking an end to "racialized property tax administration" in the country that is "set up against communities of color like ours." 

Organizers encouraged those tuned in to sign an online petition and send tweets to Whitmer demanding she investigate "illegally inflated" property taxes in Detroit. 

Tlaib joined Harvard University professor and activist Cornel West and the Rev. Dr. William Barber II, co-chair of the Poor People's Campaign, who were featured speakers.

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

"We're going to start having these town halls to speak the truth about what happened to thousands of our neighbors in Detroit, who lost their homes because they were denied their rights," Tlaib said. "Shame on those that continue to pretend this never happened."

Detroit completed a $10 million state-ordered reappraisal of all residential property in 2017 to correct its overassessment problem but, still, thousands of Detroiters faced foreclosure over back taxes.

Of the more than 63,000 Detroit homes with delinquent debt in fall 2019, 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 investigation revealed. 

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 fell short of providing meaningful relief, some council members and critics said. It sought to offset potential overtaxing from 2010 to 2013. 

Detroit Mayor Mike Duggan's administration crafted the ordinance that included eight programs to be funded with $6 million from the city's 2020 fiscal year budget. It would have provided residents potentially overtaxed with priority in affordable housing, home-buying discounts and job opportunities. The priority access would have been in place for impacted homeowners through 2024. 

Detroit City Council President Pro Tem Mary Sheffield, who has fought alongside the Coalition for Property Tax Justice, said the three-year span proposed was too limited. 

Law professor Bernadette Atuahene, a member of the coalition, has argued that the city was aiming to address tax issues between 2010 and 2013 to help Duggan, who took office in January 2014, "avert political responsibility."

Bernadette Atuahene, a professor at the Chicago-Kent College of Law, chants with protestors during a press conference at the Coleman A. Young Municipal Center, in Detroit on Feb. 13, 2020, to announce a class-action lawsuit against the city for the overassessment of home values for thousands of homeowners.

On Wednesday, Atuahene said that there's not a neighborhood in the city that hasn't been touched by the property tax foreclosure issue.

"We on the ground are calling this a hurricane without water, because of the extensive amount of displacement and disposition," said Atuahene who has co-authored studies of city foreclosures.

Atuahene said advocates want Duggan to create a fund to compensate Detroiters who were overcharged and that Wayne County should halt foreclosures until systemic property tax overassessments are fixed.

So far, the State Tax Commission and Whitmer have declined requests to investigate, she said. Whitmer's office did not respond to requests Wednesday seeking comment. 

Sheffield on Wednesday reiterated her past recommendation that a state task force is needed to "look at how we got here."

"We've got to get to the root of it," Sheffield said before the forum, adding that an agreement between the council and the administration on a proposal that will bring overtaxed homeowers relief is a priority.

The city administration said the gap between home prices and assessments was largely closed in 2014, when assessments were dropped by more than 20% by Duggan after he took office, despite property values increasing at that time.

Conrad Mallet Jr., who was appointed Detroit's deputy mayor in the spring, said Wednesday that he doesn't believe overassessments are still happening in Detroit but said assessments vary based on the neighborhood. If Whitmer believes Detroit could do more under a state-level partnership, he said, the city is open to those discussions. 

"If the state were to come in and reexamine what we're doing, they would find that we are doing more, that we are doing better and that the circumstances that they left us with when they left in 2017, is better than it was," he said. We're not anxious for any more state oversight but we're not concerned."

Mallett noted that the Michigan Tax Commission in 2017 relinquished its control over property reappraisals in Detroit and the city has seven property tax relief programs.