Mike Duggan’s Land Value Tax plan

[km1125]

Good idea? Bad idea?

Sounds pretty good for a number of reasons. Don't think "developers" should be sitting on property while everyone else is spending to improve the area, only for those "developers" to reap the benefits of the improved area via the rising property values.

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Legislature breaks for year without passing Detroit mayor’s tax plan
BY: KEN COLEMAN - NOVEMBER 13, 2023 5:13 AM

The Michigan Legislature broke Thursday for the rest of the calendar year without passing Detroit Mayor Mike Duggan’s Land Value Tax plan (LVT).

The LVT is “a way for Detroit voters to decide whether to cut homeowners’ taxes by an average of 17% and pay for it by increasing taxes on abandoned buildings, parking lots, scrap yards, and other similar properties,” according to the city of Detroit website.

“We were in constant touch with the speaker’s office,” John Roach, Duggan’s spokesman, told the Advance on Friday “There was no time urgency to the LVT bill, since spring passage gives us plenty of time to put it on the November ballot. In light of the very few legislative days, the speaker proposed to take the LVT up first thing in January. We were fully agreeable to that timetable.”

The House failed in attempts last month to pass the legislation. Amber McCann, spokeswoman for House Speaker Joe Tate (D-Detroit), told the Advance on Thursday no more votes would be held this year on the plan, House Bills 4966–4970.

Under the proposed plan, 97% of Detroit homeowners would get a permanent property tax cut starting in 2025, if the state and local officials approve the legislation. The plan would then go to Detroit voters for approval.

Taxes on vacant land, however, would more than double from 85 mills to 189 mills to punish property owners who have allowed it to fall into disrepair, creating eyesores in Detroit neighborhoods.

“With this proposal Detroit will for the first time in decades have a property tax rate that’s comparable to Southfield, Warren, Grosse Pointe, Ferndale, Oak Park, and our neighbors. That is what we are trying to achieve,” said Detroit Mayor Mike Duggan.

State Rep. Stephanie Young (D-Detroit), the lead sponsor of the main bill, House Bill 4966, said the legislation will help homeowners realize savings. Her colleagues, Reps. Karen Whitsett (D-Detroit), Alabas Farhat (D-Dearborn) and Tyrone Carter (D-Detroit) are also sponsors of the package.

“We’re just trying to do something that hasn’t been done,” Young said during an August press conference in Detroit where the legislation was announced.

However, the Detroit-based Coalition for Property Tax Justice does not support the LVT.

It “does nothing about the city of Detroit’s systemic and illegally inflated property tax assessments,” the coalition has stated and its implementation would “dramatically increase the workload of the already overburdened Assessment Division, making illegal property tax assessments more likely.”

“Mayor Duggan must prioritize stopping the illegally inflated property taxes that still affect the city’s lowest valued homes,” said Bernadette Atuahene, a University of Wisconsin property law professor and member of the Coalition for Property Tax Justice. “The city of Detroit has overtaxed homeowners by $600 million and it’s time to get to the root of the problem. That’s what Detroit homeowners want and need.”

https://michiganadvance.com/2023/11/13/ ... -tax-plan/

[TC Talks]

Something needs to motivate commercial slumlords to redevelop or sell...

[Mega Hertz]

Capitalism, bayyyybeeeeee!

[MWmetalhead]

Great topic, km1125.

The mayor is correct in seeking solutions to reduce property tax burden of homeowners. He is also correct that slumlords are an issue. However, I would probably be a "no" vote on this legislation.

Increasing millage rates for vacant land is not going to magically spur development or cause vacant land owners to take better care of their property, as the mayor wrongly suggests. Vertical development requires market demand and access to capital. This proposal does neither. Want residents and business to stay or move into the city? Address the rise in crime. The Wayne County Prosecutor's Office is ridiculously underfunded.

This legislation as drafted would likely cause an increase in vacant land parcels falling into property tax forfeiture. The Detroit Land Bank would become well stocked if it isn't already.

Therefore, as a better solution, I would suggest stop handing out crony capitalism tax breaks to billionaires, persuade the legislature to permit a city sales tax in the entertainment district (I would suggest 2 or 3%), work with the county and state to increase funding for the Wayne County Prosecutor's Office, increase and actually enforce financial penalties for slumlords who allow their property to fall into disrepair. Then, reduce tax rates for homeowners.

[craig11152]

Capitalism, bayyyybeeeeee!

That is why so many americas risk their lives trying to sail to Cuba....or am I mixed up?

[TC Talks]

Therefore, as a better solution, I would suggest stop handing out crony capitalism tax breaks to billionaires, persuade the legislature to permit a city sales tax in the entertainment district (I would suggest 2 or 3%), work with the county and state to increase funding for the Wayne County Prosecutor's Office, increase and actually enforce financial penalties for slumlords who allow their property to fall into disrepair. Then, reduce tax rates for homeowners.

Were your privy to Snyder's Detroit deal making?

In a nutshell, many slumlords lack the skills to work the state programs such as Brownfield or Mi EDC programs.

Code enforcement isn't handled by the prosecutor, but code enforcement and city attorney.

[MWmetalhead]

I said prosecutor's office funding needs to be increased because criminals are being under-prosecuted. This situation deters (desirable) people and businesses from moving into the city.

I am fully aware property blight is a civil infraction, not a criminal matter.

[TC Talks]

I said prosecutor's office funding needs to be increased because criminals are being under-prosecuted. This situation deters (desirable) people and businesses from moving into the city.

I am fully aware property blight is a civil infraction, not a criminal matter.

Sorry for misunderstanding. Building in the exurbs would be safe and cheaper. I don't think that's a prospect for Detroit development.

[Round Six]

As I read all this, I'm curious why Duggan needs Lansing's permission to raise taxes. In the 'burb I live in, we have an assessor we elect every 4 years. Does every city and township ask Lansing before taxes go up?

I dunno. Is Detroit in some sort of receivership or special condition where they need permission while other municipalities don't?

[km1125]

I said prosecutor's office funding needs to be increased because criminals are being under-prosecuted. This situation deters (desirable) people and businesses from moving into the city.

I am fully aware property blight is a civil infraction, not a criminal matter.

I definitely agree that lowering and controlling crime would be a h-u-g-e step in getting more folks to invest and locate within the city boundaries.

But are they really underfunded? Is/would it be just throwing money at a problem? Are there other issues that need to be addressed rather than just the budget?

As I read all this, I'm curious why Duggan needs Lansing's permission to raise taxes. In the 'burb I live in, we have an assessor we elect every 4 years. Does every city and township ask Lansing before taxes go up?

I dunno. Is Detroit in some sort of receivership or special condition where they need permission while other municipalities don't?

I don't know all the ins-and-outs of it, but the state definitely has oversight to local taxation.