The Current State of Detroit’s Property Tax Issues
For several years now, Detroit’s commercial and industrial property owners have taken on significant tax burdens. Studies have demonstrated that commercial and industrial property owners in Detroit pay more in taxes than property owners in just about any other large American city. It’s a problem that is adversely affecting Detroit as it emerges from bankruptcy.
The Fall of Detroit
Detroit was once a thriving city with many commercial and industrial concerns. Many people were employed in manufacturing, earning good incomes that enabled them to become homeowners. Detroit had high rates of home ownership. When the economy tanked in 2008, that all changed.
Factories closed down, and jobs moved elsewhere. So did the people, with Detroit’s population shrinking to 700,000. Commercial and industrial property owners were forced to abandon or sell their property. The city struggled financially, finally declaring bankruptcy in 2013.
The Resurgence of Detroit
Signs of growth are on the rise, and new businesses are moving in. Entrepreneurs are snapping up commercial and industrial properties at low prices. However, these purchases come with huge property tax bills.
Couple those bills with the cost of rehabilitating the property, and owning commercial and industrial structures becomes really pricy. Years of neglect and being at the mercy of vandals have left Detroit’s commercial properties in a state of decay. Investors buy the property, then invest considerable capital in rehabilitation. All the while, they must pay property taxes at rates that are the highest in the nation.
Despite being required to pay exorbitant amounts in property taxes, owners aren’t necessarily getting what they pay for. Detroit’s police and fire services continue to be understaffed and underfunded. The city still struggles with maintenance and repair on important utility issues. All of these factors combine to drive down the overall value of Detroit’s commercial and industrial properties, yet tax rates remain sky high.
Much of this is because the city just doesn’t have adequate resources to properly and accurately reassess property values. This, combined with an ongoing budgetary crunch, combine to keep the city asking for more in taxes than it should. City government officials are working on reassessing values, often lowering them by between five and 20 percent. Unfortunately, this is a slow and difficult process.
The story of Detroit’s high property taxes goes back to the years after World War II when considerable numbers of people left the city. Raising the tax rates was the natural response to the smaller numbers of taxpayers. It may be that today’s city leaders will look at decreasing tax rates as well as working toward properly assessing property values.
Property Tax Help
For now, the best thing that Detroit’s commercial and industrial property owners can do is to work with Assessment Technologies. With their assistance, owners will stand a much better chance of achieving an accurate assessment of their property’s value. Let Assessment Technologies help your organization spend less money on its property taxes so it can put more of its resources into growing the business. It’s revenue that’s good for your company and good for Detroit.