The Board of Review meets in March of each year, to hear appeals related to property values and to consider poverty exemptions. To file an appeal for the Board of Review to consider, please obtain a petition or application at City Hall after receiving your Assessment Change Notice in mid-February. If you cannot personally appear before the Board of Review, you may submit your appeal or application via mail.
Assessments & Property Values
Since assessments and property values can be somewhat confusing, please take the opportunity to review the following information. In the early 1990s, the voters in Michigan amended the Michigan Constitution with Proposal A. In short, property taxes could not increase annually by more than five percent or the rate of inflation, whichever was less. Since the rate of inflation since the enacting of Proposal A, property taxes have increased only at the rate of inflation, however, never higher than the State Equalized Value.
Historical Property Values
Historically property values have increased markedly more than the rate of inflation until we experienced economic distress in recent years. For illustrative purposes, please see the graph to the left. Point 'A' is when Proposal A came into effect: a resident's property value (commonly called Assessed Value) was approximately the same as the property's Taxable Value.
Over time, the Assessed Value (the blue line) increased more rapidly than the Taxable Value (the red line), due to the constraints imposed by Proposal A, limiting any increase in the Taxable Value as mentioned above. At the height of the housing and property boom, the difference between the two values was significant, as illustrated by Points 'B' and 'C': homeowners were paying taxes on a value much lower than that actual value of their property for several years.
Reading a Report
Unfortunately, the housing boom faltered and the economy has soured, resulting in declining property values. Many property owners are confused and upset that, despite the apparent decline in their Assessed Value, their Taxable Value continues to rise. Again, for illustrative purposes, please refer to the graph to the right. The housing boom reached its peak at Point 'B,' with property owners paying taxes on that same property valued only a Point 'C.' As property values (the blue line) now decline toward Point 'D,' the Taxable Value (the red line) still continues to rise (toward Point 'E'), since it is still below the blue line. In fact, red line will never go above the blue line! In a worst-case situation, if the blue line continues to fall, when the red line meets the blue line, the red line will follow the blue line downward. The long-term effect of Proposal A, though, is that property owners have greatly benefitted by being taxed at a lower value than the true value of their property.
This tutorial hopefully offers a somewhat clearer picture of this confusing topic. If you wish to discuss property taxes in additional detail, please contact City Hall.
*Note: The State Equalized Value is the Assessed Value as certified by the State Tax Commission in May of each year. The numbers are the same unless a municipality is required to factor values by the State Tax Commission for falling short of 50% of market value.
View current property information here.
- Determine the assessable and taxable value of all real and tangible personal property within the City. The General Property Tax Act of the State of Michigan states that the taxable status of all real and personal property shall be determined as of each December 31st, which is deemed Tax Day.
- Maintain appraisal records and maintenance activities.
- Assist the City staff in understanding and answering general property tax questions.
- Review and research sales and property transfers.
- Prepare the assessment roll annually.
- Assist the Board of Review by providing sales data and answering questions.
- Receive and oversee the processing of Principle Residence Exemptions, Property Transfer Affadavits.
- Assist our residents and all property owners in regards to their assessment concerns.
- Process land division and combination requests.
- Defend assessment appeals at the Michigan Tax Tribunal.
Approval of Proposal A on March 15, 1994, brought significant changes to the property tax system. It, however, did not change the fact that all real and personal property must still be assessed at 50% of its true cash value. The two biggest changes of Proposal A were the requirement of the Assessor to calculate a property's "taxable and capped value" and the requirement of homeowners to file Homeowners Principal Residence and Property Transfer Affidavits forms. Property taxes are now calculated using a property's taxable value, rather than the assessed, or state equalized, value. You can access more information on Homeowners Principal Residence, Property Transfers, and other related property assessment information by visiting the State's Department of Treasury web site.
- The City Assessor utilizes various information when estimating the market or true cash value of a property. This information may include legal descriptions, property improvements, lot dimensions, age of home, and/or other buildings, land value, building square footage, and sale information. The Assessor does not create value. The value of your property is created by economic forces in the market of buyers and sellers. This information is all public information and can be obtained through the Assessor's Office.
- All property owners have the right to appeal each year the assessment and taxable values that are calculated and placed against their property. An appeal must be made to the City's Board of Review in March, in order to preserve the right to a further appeal to the Michigan Tax Tribunal.
- Assessors are always the first ones blamed for rising taxes. They do not establish millage rates nor decide how much taxes are to be paid. The Assessor's task is to estimate the fair market value of your property.
- Even though the City Assessor has a statutory duty to assess your property, she is also available to assist you in understanding how the system works. Please call City Hall if you have any questions.