Water shutoff pause, poverty tax exemption bills get Whitmer's OK

Beth LeBlanc
The Detroit News

Gov. Gretchen Whitmer on Tuesday signed legislation that would continue a water shutoff moratorium through March 31, extend the duration of poverty tax exemptions and change the way communities handle tax foreclosure sale profits. 

The water shutoff bill ensures that through March 31 no public water sources can shut off service to residents because of nonpayment. The law, spurred in part by pandemic hardships, also requires that every effort be made to restore water service to customers previously cut off because of nonpayment. 

Gov. Gretchen Whitmer on Tuesday signed several bills that would prohibit water shutoffs for nonpayment, extend poverty tax exemptions and clarify procedures for county tax foreclosure sales.

The bill does not remove a resident's obligation to pay for water or reduce the amount of money a resident owes for water.

"This legislation, spearheaded by Sen. Stephanie Chang, will help ensure every Michigander can wash their hands and give their child a glass of water at the dinner table," Whitmer said in a statement Tuesday. "My administration will continue working to ensure clean water for all Michiganders, and I look forward to partnering with everyone who wants to get this done.” 

Whitmer also signed legislation that would allow communities to extend poverty tax exemptions so that yearly renewals aren't necessary. 

The legislation, prompted in part by long lines at Detroit City Hall during a pandemic, would apply to people who had received an exemption in 2019 or 2020 and extend it through 2021. The bill also would extend by three years the exemption for seniors on a fixed income who receive one between 2021 and 2023. 

Under the legislation, if a person was found later to be ineligible for an exemption, the individual would be subject to repayment of the tax with interest. 

Two other bills signed by Whitmer would amend the law to create a process for claiming surplus proceeds from county tax foreclosure sales. 

The bills bring state practice in line with a historic Michigan Supreme Court decision in July, in which justices ruled unanimously that counties cannot sell tax foreclosed property at a profit without compensating the individual from whom the property was taken.

The Michigan Supreme Court case dates to 2011, when Uri Rafaeli owed $8.41 in delinquent taxes on a rental property; the amount owed had grown to $285 due to penalties and interest in 2014 when Oakland County foreclosed on Rafaeli's Southfield home. The county sold the home for $24,500 and kept the excess proceeds. 

The county also foreclosed on Andre Ohanessian's home, on which he owed $6,000 in overdue taxes. His home was sold for $82,000 after tax foreclosure.

Whitmer also signed a bill Tuesday that would extend allowances for public bodies to meet electronically while still maintaining compliance with the Open Meetings Act.