100k Detroit homeowners illegally taxed $600M still waiting to be compensated(metrotimes.com)
metrotimes.com
100k Detroit homeowners illegally taxed $600M still waiting to be compensated
https://www.metrotimes.com/news/detroit-illegally-overtaxed-homeowners-600m-theyre-still-waiting-to-be-compensated-29800877
36 comments
Property tax law has a logic all its own. You’ll find that in nearly every US jurisdiction assessed value is a percentage of market value, often a very small one. Saying it makes no sense is tilting at windmills, it’s just one of hundreds of legal fictions that sound silly out of the context they developed in. For example, most deeds to property identify the purchase price as “one dollar and other good and valuable consideration“, whatever the actual price was.
The important thing here is the injustice that was done to these people and the city’s refusal to make it right.
The important thing here is the injustice that was done to these people and the city’s refusal to make it right.
> You’ll find that in nearly every US jurisdiction assessed value is a percentage of market value, often a very small one.
That's definitely not the case in my municipality (North-East USA).
Tax assessments are as close to market value as you can get, considering that they are only being appraised every 5 years (I think, it may be 3 years). So there's obviously some lag if the market booms or busts. But overall it's pretty damn close to market prices and averages out over the long term.
That's definitely not the case in my municipality (North-East USA).
Tax assessments are as close to market value as you can get, considering that they are only being appraised every 5 years (I think, it may be 3 years). So there's obviously some lag if the market booms or busts. But overall it's pretty damn close to market prices and averages out over the long term.
I am also in the northeast and my assessed value is under 1% of actual market value. https://www.tax.ny.gov/research/property/equal/rar/index.htm
There are also many firms to dispute your assessment and lower your property tax bill. They do aggressive mass mailing and are able to claim very specific reductions. They then take a percentage (usually half) of first year savings.
There are also many firms to dispute your assessment and lower your property tax bill. They do aggressive mass mailing and are able to claim very specific reductions. They then take a percentage (usually half) of first year savings.
My property here is accessed at roughly market value. Partially because my state has the following law in the constitution
> Indiana property tax caps limit the amount of property taxes to 1% of property values for homesteads (owner-occupied), 2% for other residential property and farmland, and 3% for all other property
Previous places I have lived without this law, things worked differently.
> Indiana property tax caps limit the amount of property taxes to 1% of property values for homesteads (owner-occupied), 2% for other residential property and farmland, and 3% for all other property
Previous places I have lived without this law, things worked differently.
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As a somewhat related aside I find the use of mills and other archaic units in this space to be kept around for no other reason than to confuse people.
I'm guessing that it's a technicality. i.e. instead of saying "the property tax rate for a house with value X is Y*X", they say "the property tax rate for a house with value X is 2Y, but house value assessment for market-value X is X/2". Possibly because the 2Y legislation was difficult to change.
> At the end the tax you pay is still the same.
So, no. That is, IIUC, the tax rates are what they are based on the 50% assessment.
> At the end the tax you pay is still the same.
So, no. That is, IIUC, the tax rates are what they are based on the 50% assessment.
>> At the end the tax you pay is still the same.
>So, no. That is, IIUC, the tax rates are what they are based on the 50% assessment.
I don't get it. You admit that the tax rates would be higher (presumably 2x higher) to compensate for the 50% assessment, but claim that the tax won't be the same at the end?
>So, no. That is, IIUC, the tax rates are what they are based on the 50% assessment.
I don't get it. You admit that the tax rates would be higher (presumably 2x higher) to compensate for the 50% assessment, but claim that the tax won't be the same at the end?
The increase of the taxable value of residential properties is capped at 5% (or inflation if it is lower). When a property is sold, it resets to the assessed value.
The 2x factor increases the taxes paid by people who own properties with a taxable value less than the assessed value.
The 2x factor increases the taxes paid by people who own properties with a taxable value less than the assessed value.
Yes, that part is ridiculous.
But once you normalize for all of that, then, assessing at 85% is really like assessing for 170% which would be bad.
Also - in a situation of rapidly deteriorating home values, the state may be short sighted, in wanting to pay it's bills, trying to extract some value.
It's really sad because you generally don't see entire neighbourhoods go to nothing in most of the modern world.
But once you normalize for all of that, then, assessing at 85% is really like assessing for 170% which would be bad.
Also - in a situation of rapidly deteriorating home values, the state may be short sighted, in wanting to pay it's bills, trying to extract some value.
It's really sad because you generally don't see entire neighbourhoods go to nothing in most of the modern world.
I did a tour of Detroit back in 2011, shortly before one of their large house auctions all for unpaid property taxes. Some of these basically destroyed houses were being charge 400-600 a month in property tax. The city continuing to tax Detroit neighborhoods like this is one huge contributing factor to the decline of Detroit.
That's probably the tip of the iceberg of corruption and stupidity.
cardamomo(3)
Do I have the math right here? $600 million divided by 100,000 homeowners is $6,000 each on average, over 6 years' time is $1,000 per year overcharge on property taxes.
I'm wondering specifically about the foreclosure rate. Were the foreclosures strictly due to not paying the extra $1K per year? Or were they due to not paying any amount of tax due (including the bulk of it which was not an overcharge). The article doesn't say.
[edit]: now I re-read a bit, the article actually does not state how many total taxpayers were affected, only those that were foreclosed on. There is also one anecdote at the end about how one person was over-taxed $4,000.
I'm wondering specifically about the foreclosure rate. Were the foreclosures strictly due to not paying the extra $1K per year? Or were they due to not paying any amount of tax due (including the bulk of it which was not an overcharge). The article doesn't say.
[edit]: now I re-read a bit, the article actually does not state how many total taxpayers were affected, only those that were foreclosed on. There is also one anecdote at the end about how one person was over-taxed $4,000.
>The illegal, inflated property tax assessments resulted in an estimated 100,000 Detroiters, most of them Black, losing their homes to foreclosure.
Should be "contributed to," not "resulted in."
Many lower income Americans saw their dream of home ownership become a nightmare because they simply did not understand adjustable rate mortgages, or if they did, had faith in the argument that in 5 years years a booming economy would provide them with an income commensurate with the substantial increase in their mortgage payment.
The real estate bubble made people feel wealthier when their home values increased (which they were taxed on) but the expected rise in income never materialized. Worse, homeowners covered their shortfalls with revolving credit and home equity loans.
2010 was 12 years ago, but millions of Americans still suffer the consequences of the 2008,2009 financial disaster and may well continue to do so the rest of their lives.
Stories like this make me ill -- which was probably the intent.
Should be "contributed to," not "resulted in."
Many lower income Americans saw their dream of home ownership become a nightmare because they simply did not understand adjustable rate mortgages, or if they did, had faith in the argument that in 5 years years a booming economy would provide them with an income commensurate with the substantial increase in their mortgage payment.
The real estate bubble made people feel wealthier when their home values increased (which they were taxed on) but the expected rise in income never materialized. Worse, homeowners covered their shortfalls with revolving credit and home equity loans.
2010 was 12 years ago, but millions of Americans still suffer the consequences of the 2008,2009 financial disaster and may well continue to do so the rest of their lives.
Stories like this make me ill -- which was probably the intent.
>2010 was 12 years ago, but millions of Americans still suffer the consequences of the 2008,2009 financial disaster and may well continue to do so the rest of their lives.
True, but don't forget that some of those millions also received tax-free loan forgiveness and walked away from their under-water properties with relatively little harm (mainly emotional distress from being a debtor for a while and having to move).
True, but don't forget that some of those millions also received tax-free loan forgiveness and walked away from their under-water properties with relatively little harm (mainly emotional distress from being a debtor for a while and having to move).
"Walking away" was literal in many cases. I remember seeing homes with a pile of "all our belongings" in the driveway scheduled for removal by contracted help loading dumpsters. Toys, bikes, exercise equipment, couches, headboards, etc.
A huge pile after the family walked away 5 days prior. It's one thing to talk about it, it's quite another to watch the dumpster get hauled away with handlebars sticking out the top.
A huge pile after the family walked away 5 days prior. It's one thing to talk about it, it's quite another to watch the dumpster get hauled away with handlebars sticking out the top.
The subtitle is much more important than the title:
> An estimated 100,000 Detoiters lost their home to foreclosures because of over-assessments
> An estimated 100,000 Detoiters lost their home to foreclosures because of over-assessments
Were the foreclosures due strictly to the over-assessments, or due to not paying any property tax at all?
Article 25 of the declaration of human rights says that people have the right to shelter.
It's so odd that in the 21st century, we still believe that some people somehow deserve their poverty, because we would rather listen to economical indicators rather than seeing people being homeless.
Countries might be modern and developed to reduce poverty, but there are still societal beliefs that some people should not be helped. I'm happy I don't live in the US, because I would probably be homeless or an addict if I did, and there would be hordes of people claiming it's "survival of the fittest" and that it's fair game, because life involves competition, which is a fallacy of nature.
The nazis actively promoted social darwinism, and the nazis are gone, but sometimes I feel like social darwinism is alive.
It's so odd that in the 21st century, we still believe that some people somehow deserve their poverty, because we would rather listen to economical indicators rather than seeing people being homeless.
Countries might be modern and developed to reduce poverty, but there are still societal beliefs that some people should not be helped. I'm happy I don't live in the US, because I would probably be homeless or an addict if I did, and there would be hordes of people claiming it's "survival of the fittest" and that it's fair game, because life involves competition, which is a fallacy of nature.
The nazis actively promoted social darwinism, and the nazis are gone, but sometimes I feel like social darwinism is alive.
Reminds me of how Flint, Michigan people got their pipe water replaced with lead-polluted Flint river water, and the water systems have not been fixed to this day (there was some work, but much remains to be done), nor have the people responsible been charged with any serious offenses. And IIANM, they're not getting healthcare for their lead-exposure-related condition either.
Anyway...
> Most of the surveyed residents prioritized cash payments as compensation. But that’s likely not going to happen because Mayor Mike Duggan’s administration insists that state law prohibits the city from providing cash payments or tax credits to any of the overtaxed residents.
1. I doubt it.
2. Even if that were state law, the mayor must uphold his federal and state constitutional obligations in spite or this law.
> Activists say they disagree and are calling on Michigan Attorney General Dana Nessel to give her legal opinion.
We're talking about 100,000 people. If they just twiddle their thumbs and expect some government lawyers to side with them, they'll probably be waiting a whole lot longer. They should organize, lay siege to city hall and the mayor's house, and threaten further escalation, until the money is deposited in their accounts and whatever other additional measures have been taken.
Anyway...
> Most of the surveyed residents prioritized cash payments as compensation. But that’s likely not going to happen because Mayor Mike Duggan’s administration insists that state law prohibits the city from providing cash payments or tax credits to any of the overtaxed residents.
1. I doubt it.
2. Even if that were state law, the mayor must uphold his federal and state constitutional obligations in spite or this law.
> Activists say they disagree and are calling on Michigan Attorney General Dana Nessel to give her legal opinion.
We're talking about 100,000 people. If they just twiddle their thumbs and expect some government lawyers to side with them, they'll probably be waiting a whole lot longer. They should organize, lay siege to city hall and the mayor's house, and threaten further escalation, until the money is deposited in their accounts and whatever other additional measures have been taken.
> replaced with lead-polluted Flint river water,
XKCD386: The river water was not lead-polluted. The river water replaced Detroit sourced water which had been treated with orthophosphate, which inhibits corrosion. Without the corrosion inhibitor lead was leached from water pipes (largely in lateral lines and in people's homes).
> nor have the people responsible been charged with any serious offenses
https://en.wikipedia.org/wiki/Flint_water_crisis#Criminal_pr...
XKCD386: The river water was not lead-polluted. The river water replaced Detroit sourced water which had been treated with orthophosphate, which inhibits corrosion. Without the corrosion inhibitor lead was leached from water pipes (largely in lateral lines and in people's homes).
> nor have the people responsible been charged with any serious offenses
https://en.wikipedia.org/wiki/Flint_water_crisis#Criminal_pr...
> Fifteen criminal cases have been filed against local and state officials,[17] but only one minor conviction has been obtained, and all other charges have been dismissed or dropped.
But the guy with authority (local elected mayor, not the state emergency manager) and the engineers/technicians/??? who made the choice not to use corrosion inhibitor, which actually caused the problem, haven't been charged (or the Glasgow guy get let off?) to go after political targets instead and state people who failed to properly detect the mess the locals created.
But the guy with authority (local elected mayor, not the state emergency manager) and the engineers/technicians/??? who made the choice not to use corrosion inhibitor, which actually caused the problem, haven't been charged (or the Glasgow guy get let off?) to go after political targets instead and state people who failed to properly detect the mess the locals created.
> and the engineers/technicians/??? who made the choice not to use corrosion inhibitor, which actually caused the problem
As dreadful as it was-- that choice hardly seems likely to be a crime. Negligent sure, but where is the criminal intent? "muhaha I'll make everyone sick!" hardly.
In an event like flint I'd expect the only crimes to be attempts to cover it up, not the event itself. ... and it seems like the the desire to prosecute the people "at fault" caused them to give immunity to the people who actually committed crimes.
As dreadful as it was-- that choice hardly seems likely to be a crime. Negligent sure, but where is the criminal intent? "muhaha I'll make everyone sick!" hardly.
In an event like flint I'd expect the only crimes to be attempts to cover it up, not the event itself. ... and it seems like the the desire to prosecute the people "at fault" caused them to give immunity to the people who actually committed crimes.
Criminal intent? Probably not. Criminal negligence? I'd hope so.
From reading the filings in Walters v. Flint it appears to me that they hired an outside engineering firm to plan their switchover and that firm failed to warn them of any urgent need for corrosion control.
The outside engineering firm argues that they didn't warn flint because they assumed flint would be using corrosion control.
When it became clear that there were serious water quality issues, flint hired another outside engineering firm to review and monitor their system and make recommendations and the second engineering firm failed to identify the lack of corrosion control as a safety issue. They basically said 'you could add phosphates to reduce complaints about discolored water, but you're still going to get lots of complaints about discolored water'.
To me it seems like a lot of the root cause was that they knew and expected the river water source would have serious cosmetic issues, but they felt forced into it. When things started going wrong they kept treating it as cosmetic issues (and it sure sounds that by count most of the complaints they had were cosmetic issues) even though the water was actually unsafe.
With two outside water engineering firms, on top of the city's own staff not catching this... I think the explanation has to be more complicated than someone being criminally negligent.
The outside engineering firm argues that they didn't warn flint because they assumed flint would be using corrosion control.
When it became clear that there were serious water quality issues, flint hired another outside engineering firm to review and monitor their system and make recommendations and the second engineering firm failed to identify the lack of corrosion control as a safety issue. They basically said 'you could add phosphates to reduce complaints about discolored water, but you're still going to get lots of complaints about discolored water'.
To me it seems like a lot of the root cause was that they knew and expected the river water source would have serious cosmetic issues, but they felt forced into it. When things started going wrong they kept treating it as cosmetic issues (and it sure sounds that by count most of the complaints they had were cosmetic issues) even though the water was actually unsafe.
With two outside water engineering firms, on top of the city's own staff not catching this... I think the explanation has to be more complicated than someone being criminally negligent.
What you're describing is a dilution of responsibility. The first firm didn't do their due diligence, and assumed that Flint was doing something it wasn't. The second firm didn't do their due diligence, and simply overlooked the lead issue. I don't find this to be terribly convincing; it sounds like the both firms should be on the hook, because they both failed. As water engineers, they should be on top of this stuff. That two firms failed doesn't demonstrate that they shouldn't be responsible, it means that the city hired two incompetent firms which individually assumed and then neglected their responsibilities.
Well, first, intent does not mean desire; and you can intend due to a desire of something else.
So, for example, suppose I'm a driver who takes a bribe so that I expose my passenger to a sniper somehow. I had no desire for my passenger to die - I just wanted the money, but - in some legal systems anyway - it can be argued that I intended the natural consequences of my actions.
Alternatively, even if I have not "intended", I have certainly gone beyond negligence. The commonly-recognized middle level of criminal responsibility is _recklessness_:
https://en.wikipedia.org/wiki/Recklessness_(law)
There's something inbetween, which
So, for example, suppose I'm a driver who takes a bribe so that I expose my passenger to a sniper somehow. I had no desire for my passenger to die - I just wanted the money, but - in some legal systems anyway - it can be argued that I intended the natural consequences of my actions.
Alternatively, even if I have not "intended", I have certainly gone beyond negligence. The commonly-recognized middle level of criminal responsibility is _recklessness_:
https://en.wikipedia.org/wiki/Recklessness_(law)
There's something inbetween, which
>But the guy with authority (local elected mayor, not the state emergency manager)
doesn't the emergency manager have more authority than the elected mayor? How much did the mayor know and how much power did he have?
>and the engineers/technicians/???
1. the plant manager was prosecuted
2. what's the point of prosecuting non-managerial employees? Did they participate in the cover-up? Were they supposed to predict what was going to happen?
doesn't the emergency manager have more authority than the elected mayor? How much did the mayor know and how much power did he have?
>and the engineers/technicians/???
1. the plant manager was prosecuted
2. what's the point of prosecuting non-managerial employees? Did they participate in the cover-up? Were they supposed to predict what was going to happen?
According to the linked Wikipedia article, the water department was under the authority of the elected mayor at the time, despite an emergency manager still involved in other affairs.
Slap on the wrist. If my job was to get you spinach, and I am an expert in that area, and I chose to use animal waste for fertilizer, shouldn't I be held responsible for giving people e-coli if I don't take standard precautions?
Slap on the wrist. If my job was to get you spinach, and I am an expert in that area, and I chose to use animal waste for fertilizer, shouldn't I be held responsible for giving people e-coli if I don't take standard precautions?
Indeed, the lead came from the pipes, but - the river water was such that by the time it got to people's faucets, it became polluted. So, you've split a valid hair.
> https://en.wikipedia.org/wiki/Flint_water_crisis#Criminal_pr...
So, the city manager hasn't been charged; the prosecutor quashed the prosecutorial team's suggestions of serious RICO charges in favor of minor ones; Snyder is charged with "neglect of duty"; etc.
I also wonder whether Governor Whitmer may not have some responsibility for inaction during her time in office, although I don't know nearly enough US law to make stronger claims here except her failing her public, moral responsibility IMHO.
> https://en.wikipedia.org/wiki/Flint_water_crisis#Criminal_pr...
So, the city manager hasn't been charged; the prosecutor quashed the prosecutorial team's suggestions of serious RICO charges in favor of minor ones; Snyder is charged with "neglect of duty"; etc.
I also wonder whether Governor Whitmer may not have some responsibility for inaction during her time in office, although I don't know nearly enough US law to make stronger claims here except her failing her public, moral responsibility IMHO.
Why is this even a thing? Is it some sort of feel good measure to placate mathematically illiterate voters? The clause is pointless. If everybody's property is assessed at 50% of market value, then property tax rates would have to be 200% to make up for it. At the end the tax you pay is still the same.