Wayne County Won't Take Back Tax Payments From Homeowners

Detroit Eviction Defense and Moratorium Now! Coalition demonstration outside the state office building in Detroit's New Center against the lack of relief for people facing tax foreclosure. The picket was held on March 21, 2013. (Photo: Abayomi Azikiwe), a photo by Pan-African News Wire File Photos on Flickr.

July 9, 2013 at 1:00 am

Wayne County won't take back-tax payments from homeowners

Christine MacDonald
The Detroit News

Detroit— Delinquent taxpayers trying to save their homes from foreclosures have been turned away this month by the Wayne County Treasurer who won’t take their money.

That’s because of a new policy that gives local communities and the state a month to decide if they want to buy the properties. That’s infuriated residents like Kathleen Butler, 62, of northwest Detroit, who showed up last week to pay her $700 bill but instead left empty-handed.

“I was going to pay it,” said Butler, who fell behind on her taxes on the home she’s owned for 37 years because of medical problems. “A whole lot of people weren’t expecting the rules to change. It’s horrible. I don’t think the city wants my house.”

Treasurer Raymond Wojtowicz had been letting owners pay their bills and retain their properties up to the September and October foreclosure auctions. But that caused too many problems, said county treasury officials, who are required by law to allow communities and the state to take possession of any foreclosed properties they want several weeks prior to the auction.

The new policy blocks owners in foreclosure from paying during July. Deputy Treasurer David Szymanski said taxpayers can still save their properties come Aug. 1, if the local communities and state don’t want them.

“While we try to help taxpayers as much as possible, there are limits to what we can do,” Szymanski wrote in an email. “Those who waited this long to pay their taxes will now have to wait to see if the government divisions exercise their right of refusal.”

But for cash-strapped communities, such as Detroit, collecting more cash is urgent. A series in The News found that 2011 taxes were paid on only 53 percent of Detroit parcels as of January 2013. Approximately $246.5 million in taxes and fees went uncollected for 2011 at that time, of which $131 million was due to the city.

“Why would they turn my money down?” asked Roderick Coleman, 46, an east-side resident who tried to pay $510 of his $1,500 tax debt last week. “I was floored.”

For most delinquent owners, foreclosure becomes official on the March 31 following three years of unpaid taxes. The county doesn’t have to let the taxpayer redeem the property after that deadline, but Wojtowicz has used his discretion to extend the window for owners to save their properties.

More than 20,000 foreclosed properties in Wayne County are expected to be up for sale beginning in September.

Wojtowicz said his office is taking the names of taxpayers interested in clearing their bills and will contact them in August if they want to remove the properties from auction.

The treasurer implemented the new policy after an incident last year when Dearborn Heights officials wanted to take control of a foreclosed commercial building on South Beech Daly in late July before the auction but were turned down by Wojtowicz.

The treasurer’s staff said they couldn’t give the property up because the county had reached a payment plan with the owner to recover the delinquent taxes. But Dearborn Heights officials argued that deal was reached after the foreclosure was official. The city sued the treasurer earlier this year in Wayne County Circuit Court but lost the case. Dearborn Heights officials said they are preparing an appeal.

Detroit officials said they aren’t interested in taking the vast majority of foreclosed properties. They may acquire a few vacant properties in areas where they have planned developments, but that’s it, said Karla Henderson, a city group executive of planning.

“We want to keep families in their homes,” Henderson said. “We aren’t in the property management business.”

Coleman, who has owned his home for three years, is still worried. “What determines whether they’d pick it up or not?” Coleman said. “I am scared if they look at it and have somebody who wants it and they give it to them. I haven’t been sleeping not knowing.”

If a local community wants a foreclosed property, officials generally have to pay the county the amount of back taxes owed and have a “public purpose,” officials said.

Officials with other cities, such as Dearborn and Westland, said they are reviewing the list and if they take any properties, they will likely be vacant ones in neighborhoods they are trying to bolster.

Westland Mayor William Wild said his city generally buys about a dozen properties a year, slating houses for rehabilitation or demolition.

“Then we have a little bit more control over the property ... to promote home ownership rather than rentals,” Wild said.

Dearborn assistant corporation counsel Licia Yangouyian said she took about three calls recently from worried owners who wanted to save their properties but were turned away. She said she understands their concern but “they have had ample opportunity to make these payments.”

Deaborn is reviewing its foreclosed properties and generally takes five to 10, she said.

Other county treasurers also use their discretion to accept payments from owners after the foreclosure deadline, including Macomb. But Oakland County Treasurer Andy Meisner said his office works with taxpayers only under select circumstances after the deadline, such as if they can prove they didn’t get foreclosure notices.

“After April 1, that’s a different discussion,” Meisner said. “They’ve missed a critical deadline.”

cmacdonald@detroitnews.com
(313) 222-2396

From The Detroit News: http://www.detroitnews.com/article/20130709/METRO01/307090020#ixzz2YWXYAAPQ