Its Time to Again Consider Property Tax Appeals

Every year, the value of real property is assessed by the township, village, or city. On or before the first Monday in March, the property tax assessor compiles their roll of the properties in their assigned area. This roll contains the “true cash value” and the tentative tax value for each parcel of property. “True cash value” is near synonymous with fair market value, meaning the “price that could be obtained for the property at a private sale and not a forced sale.” MCL 211.27(1). “State equalized value” is one-half of the property’s true cash value.

Pursuant to MCL 211.24(c)(1), “[t]he assessor shall give to each owner or person or persons listed on the assessment roll of the property a notice by first-class mail of an increase in the tentative state equalized valuation or the tentative taxable value for the year. The notice shall specify each parcel of property, the tentative taxable value for the current year, and the taxable value for the immediately preceding year. The notice shall also specify the time and place of the meeting of the board of review. The notice shall also specify the difference between the property's tentative taxable value in the current year and the property's taxable value in the immediately preceding year.” Taxpayers disputing an assessment of property classified as commercial, industrial, or developmental can bypass the board of review and appeal directly to the Tax Tribunal, provided the appeal is timely. All other property classifications require a protest to the board of review in order to preserve the right to appeal to the Tribunal.

The assessment roll must be examined and reviewed by the board of review which is made up of appointed citizens from a township or city. The board of review meets on the Tuesday following the first Monday in March to examine the assessment roll. The meeting is open to the public. The board of review also meets on the second Monday in March to hear protests by taxpayers and must stay in session for at least 6 hours that day and for at least 6 hours during the remainder of the week. The governing body of the township or city may authorize alternate starting dates in March for the board of review, so it is always advisable to contact the township or city to confirm the time, place, and procedure for appearing at the board of review. The board of review also meets in July and December only to correct errors and hear appeals regarding homestead and qualified agricultural exemptions.

MCL 211.30(4) states “[a]t the request of a person whose property is assessed on the assessment roll or of his or her agent, and if sufficient cause is shown, the board of review shall correct the assessed value or tentative taxable value of the property in a manner that will make the valuation of the property relatively just and proper . . .” Written notification of the board’s decision is sent to the taxpayer after the board of review meeting. This notification informs the taxpayer of their right to appeal the decision to the Tax Tribunal, as well as the address of the Tax Tribunal and the deadline for filing an appeal with the tribunal.

The Tax Tribunal consists of 2 forums – the Entire Tribunal, and the Small Claims Division. Most appeals are made to the Small Claims Division which uses an informal hearing process to resolve appeals. There is no formal record of the hearing at the Small Claims level. The residential and Small Claims division handles appeals where the assessed property is exclusively residential and where there is not residential property whose taxable value or state equalized value is less than $100,000, or where the tax in question is less than $6,000. The Entire Tribunal is more complex with hearings that are much more formal and complicated.

To appeal to the Tax Tribunal, a petition must be filed by the taxpayer. Close attention must be paid to the filing deadlines based on the property classification. The petition must be filed on or before May 31 of the tax year involved for property classified as commercial, industrial, or developmental. For property assessment disputes involving agricultural, residential, or timber-cutover, the petition must be filed on or before July 31 of the tax year involved.

The petition must include the names and mailing addresses of the petitioner and the respondent and must identify the township or city where the subject property is located. A copy of the notice of the action taken by the board of review must also be included with the petition.

A petition to the tax tribunal is considered “filed” by one of four ways: (1) being postmarked on or before the deadline date; (2) being delivered in person on or before the deadline date; (3) given to a designated delivery service for delivery on or before the deadline date; or (4) e-filed through the Tribunal’s free, voluntary, online system . If the taxpayer elects to file the petition by mail, it must be certified. Copies of the petition must also be served on the assessor of the township or city being named as the respondent, the secretary of the local school board, and clerk of the county that may be affected.

The burden is on the taxpayer-petitioner to show that the assessment is incorrect. The petitioner must establish a theory for supporting what it believes to be the “true cash value” of the subject property. Depending on the classification of the property in dispute, the petitioner should consider producing the following types of evidence:

· The assessed values of comparable properties;

· Actual sales of comparable properties;

· A full list of a home’s building costs;

· Building or land use restrictions; and

· Appraisals

After the hearing, the Tribunal typically issues a proposed opinion and judgment informing the parties that they have 20 days from date of entry of the proposed opinion and judgment to notify the Tribunal in writing if they do not agree with the proposed opinion and judgment, with stated reasons. The Tribunal will review the case file, the proposed judgment and will then:

· Issue a Final Opinion and Judgment adopting the POJ as a Final Decision; or

· Issue a Final Opinion and Judgment modifying the POJ and adopting the Modified Proposed Opinion and Judgment as a Final Decision; or

· Issue an Order vacating the POJ and ordering a rehearing or such other action as is necessary and appropriate.

An appeal of a Tax Tribunal decision is one of right to the court of appeals and must be filed within 21 days of the entry of the tribunal’s final order.

The Gallagher Law Firm, PLC handles real property tax disputes and appeals for clients throughout the state each and every year. If you or your clients have questions or concerns regarding the appeal of a property assessment, please contact Craig S. Gerard at (517) 853-1510, csg@thegallagherlawfirm.com