Black homeowners are being overtaxed in Detroit and Wayne Co., complaints allege

Government officials in Detroit, Inkster, Highland Park and Wayne County have for years allegedly violated the federal Fair Housing Act by overtaxing primarily Black and low-income homeowners, according to complaints filed Thursday with the U.S. Department of Housing and Urban Development (HUD) and the Michigan Department of Civil Rights (MDCR).

“This problem of overtaxation is a national problem, and Detroit is merely ground zero for this national problem,” said Bernadette Atuahene, a leader at the Coalition for Property Tax Justice, the group that filed the complaints with HUD and MDCR.

City and county policies have resulted in the over-assessment of lower valued homes’ property taxes in Detroit, Inkster and Highland Park — the overwhelming majority of which are owned by Black residents, members of the Coalition for Property Tax Justice said at a press conference held Thursday. The coalition is made up of about a dozen grassroots organizations in Detroit. 

In turn, those over-assessments have led to homeowners being unable to pay their taxes and played a role in one in three Detroit homes falling into foreclosure since 2009, the coalition said. Coalition members cited a Detroit News investigation that reported the city had overtaxed homeowners by at least $600 million between 2010 and 2016.

Detroit Assessor Alvin Horhn said in an interview with the Advance that “there is no systemic over-assessment issue in Detroit.” He argued that Mayor Mike Duggan’s administration has, since taking over in 2014, worked to address issues with over-assessment that previously existed. Horhn noted that the city initiated a parcel-by-parcel reappraisal of all residential properties in 2014 — the first in nearly six decades — and the results of that reappraisal were put into effect starting in 2017.

“Mayor Duggan came in with a promise to fix those things, and he has,” Horhn said. 

“There are 220,000-plus homes in this city, and I wouldn’t dare tell you that every single one is assessed properly,” he added. “That’s why we have an appeals process.”

As a result of the citywide reappraisal, the assessor reduced assessments for approximately 70% of the city’s properties, which has made “things get better over the years,” Atuahene said.

But, she said, the issue of overtaxation has not disappeared. According to a 2020 study from the Center for Municipal Finance at the University of Chicago’s Harris School of Public Policy, average assessments in Detroit have fallen since 2016 but “the Detroit property tax burden still falls disproportionately on the city’s lowest-income homeowners.”

A 2018 study published in the Southern California Law Review found that between 2009 and 2015 the city of Detroit over-assessed between 53% and 83% of its residential properties.

Tahira Ahmad, a 63-year-old lifelong resident of Detroit, said she has “been overtaxed thousands of dollars by the city of Detroit.”

“I am paying these taxes from the only income I have, and that’s my Social Security disability income,” Ahmad said. “The ceaseless worrying and stress is almost unbearable.”

While Ahmad “appealed to the assessor’s office for years contesting the assessment,” “no one would listen to me or any of the thousands of overtaxed homeowners facing this injustice.”

In an effort to raise awareness around “this grievous situation,” Ahmad went on a hunger strike that lasted 62 days. It ended when she contracted COVID-19.

The foreclosures that have resulted from over-assessments have destroyed Black communities, Ahmad said.

“Foreclosures break cultural, family and political ties while destabilizing our communities,” she said. “It causes the loss of generational wealth and investment.”

In the complaints filed Thursday, Coalition for Property Tax Justice members said HUD and MDCR have a responsibility to “investigate the illegal over-assessments, overtaxation and foreclosures as violations of the Fair Housing Act and provide a pathway to restoration for those that have been impacted by this crisis.” 

In addition to calling for action from HUD and MDCR, coalition members are urging Gov. Gretchen Whitmer to address over-assessments by working with the State Tax Commission to, as Council Member Gabriela Santiago-Romero said, ensure that local governments that overtax residents are put on a “corrective action plan.”

“The over-assessment of property taxes is hurting our Black and Latinx homeowners,” Santiago-Romero said. “It is turning Detroit from a city of homeowners to a city of renters.”

Detroit City Council President Mary Sheffield said, “We’re ready for systemic change.”

“I join the Coalition for Property Tax Justice in calling on our Michigan Legislature, our State Tax Commission, and our state leaders to do more to help Detroit and stop the ongoing over-assessment of property taxes,” Sheffield said.

Overtaxation and subsequent evictions “puts families and communities at risk of devastation,” Sheffield added.