The board responsible for hearing property tax appeals in the city is asking Detroit’s City Council to consider moving up the deadline to apply for a property tax relief program.
The shift from December to October would shorten the timeline to apply for the program in 2023. But Willie Donwell, director of the board, said that the change would give the City of Detroit’s Property Assessment Board of Review more time to address the large number of applications that come in without required documents. A city council standing committee Wednesday heard a presentation about the recommendation.
The Homeowners Property Tax Exemption (HOPE) program — meant to keep Detroiters at risk of foreclosure in their homes — reduces or exempts qualifying homeowners from property taxes for the current year based on household income.
The deadline change would give the board time to review applications and correct problems, to make sure that people have an opportunity to save their home, Donwell said.
“The number of applications received by the Board of Review has grown tremendously over the years,” Donwell told the council committee. “The growing of the numbers of applications submitted by applicants at the end of the year is creating a stress on the process.”
Donwell suggested changing the deadline to apply to Oct 1. Currently, the last day to submit an application is Dec. 11. The board processes applications and makes a decision three times a year − in March, July and December. The last day to apply for HOPE bumps up against when the Board of Review must complete its work by the end of the year, Donwell explained.
“There’s a definite issue as it relates to the Board of Review completing its work on time and the impact of it not being done,” he said.
The HOPE program received 18,555 applications in 2022 — a 54% increase from about 12,000 in 2020. More than 2,500 applications poured in between Nov. 1 and the December application deadline and more than half had missing information. Those required documents include IDs, deeds and income details. There were more than 4,600 denials last year. Some rejected applicants did not own the property or submitted incomplete applications.
“When a deficient application is submitted on — just using last year as an example, on December the 12th — the Board of Review does not have the time to contact that person to help them through the process, if that application is deficient, no matter how deserving we feel that person might. We can only make a determination on what is there,” Donwell said.
Not being able to complete the board’s work on time disrupts other agencies as well, he said, including city and county treasuries.
HOPE is a path into other relief programs. People who qualify for HOPE may also be eligible for the Wayne County Treasurer’s Pay As You Stay program (PAYS), which reduces back tax debt. Those with the property tax exemption and in PAYS are also eligible to get their delinquent property taxes eliminated through another program called the Detroit Tax Relief Fund.
The HOPE program has, in the past, come under scrutiny from those claiming the application process has been burdensome and there was a lack of awareness about the program.
A survey by Quicken Loans Community Fund in 2019 found that of the 25,000 homeowners in Detroit behind on paying their property taxes, 55% indicated they were unaware of the program, formerly referred to as the HPTAP tax exemption.
The American Civil Liberties Union of Michigan and the City of Detroit in 2018 reached a settlement after the ACLU sued Detroit, claiming the city’s poverty tax exemption system was hard to apply for and not advertised enough. The city agreed to create a more “streamlined” application process and mail notices about the program to homeowners every year.
Donwell suggested a City Council resolution for a deadline adjustment by early February, to make needed changes and so that people are notified.
Councilmember Fred Durhal III, who chairs the Budget, Finance & Audit Committee, said he recognizes the increase in workload during a small window of time to review and process applications. He said he sees a benefit in the date change.
“We’ve got to give folks enough opportunity to be able to get the assistance that they need,” Durhal said during the committee meeting.
He told the Free Press on Thursday that discussions are still in a preliminary stage, and that he tentatively supports the change so long as it can be done constitutionally and within the guidelines of the Detroit charter. The new timeline can help ensure “nobody gets left behind,” Durhal said.
Councilmember Gabriela Santiago-Romero said Wednesday during the committee meeting that she also supports changing the deadline.