Poor Detroiters could see tax debt relief with new program

Candice Williams
The Detroit News

Low-income Detroit homeowners can have their delinquent tax bills forgiven under a new program designed to ease the burden for residents struggling to stay in their homes.

The Wayne County Land Bank Authority board approved an agreement with Wayne Metropolitan Community Action Agency  to coordinate the Quiet Title Exemption Program. Board member, Wayne County Treasurer Eric Sabree, voted against the move while board member Irma Clark-Coleman abstained.

Sabree has expressed concerns that the program may be illegal, saying he doesn’t believe judges can erase tax debt.

Wayne County Treasurer Eric Sabree speaks about the opening of new Financial Empowerment Centers to offer free counseling services to low-income Detroiters.

“I think it would be prudent and intelligent to wait for the attorney general to opine on this matter,” he said Thursday during the special board meeting.

Land bank staff have said that county lawyers have OK’d the program. Its goal is to give struggling homeowners a fresh start and to remain in their homes. According to the Treasurer's Office, nearly 34,000 Wayne County homeowners are on repayment plans.

Low-income Detroiters who qualify don't have to pay property taxes at all, but critics of the yearly property tax exemption application process have argued that many don’t realize that the property tax exemption is available and that applying for the exemption is cumbersome. 

Under the Quiet Title Exemption Program, owners who currently have a property tax exemption would be forgiven for past years they owe

A family of four qualifies for the tax break if their household income is below $26,104. Detroit is the only city that qualifies because it is the only one that offers a 100% poverty tax exemption.

Participants give temporary ownership of their homes to the Wayne County Land Bank. The land bank then would file a court case that would eliminate the debt and return the homes to their owners.

It will cost homeowners $500 to file the court case, called a quiet title.

The agreement Thursday includes input from local boards of review about which properties qualify for the program. In Detroit, board of review members are appointed by the City Council.

“If the board of review adopts a resolution approving the list of properties to go through clean title process indirectly, we’re getting the approval of the governing body and that gives me a lot of confidence,” said board member Gary Evanko.

The meeting was held in an effort to try to get a round of homes ready before Jan. 1, which is considered Tax Day. About 100 homes would be included in each round, officials said.

“We’d like to get started in 2019 to help people who have (property tax exemption) in 2019 …” said Daniel Rosenbaum, Wayne County Land Bank executive director. “We have to talk to our partners and decide if we have time to get this started this fall so that we can finish a round before Tax Day. If yes, we will, and if not, we’ll get started after March board of review meeting in 2020."

The next step would be for the Wayne Metropolitan Community Action Agency to approve the agreement with the addition of the board of review’s input. The agency had already approved an agreement without the board of review component.

The program is considered a stopgap until Lansing lawmakers change the law to allow retroactive property tax exemptions.


Twitter: @CWilliams_DN