Board of Review

*SEEKING ONE BOARD OF REVIEW MEMBER*

The Board of Review meets approximately seven (7) times per year. The dates for 2016 are Tuesday, March 8; Monday, March 14; Thursday, March 17; Friday, March 18; and one more day in March to finalize the tax roll; Tuesday, July 19; and Tuesday, December 13. All meetings are held at the Municipal Center beginning at 9:00 AM and may go as late at 5:00 PM, except for the March 17th meeting, which is from 6:00 PM – 9:00 PM. Training opportunities are available and attendance is strongly encouraged for members throughout the year. Cost, meals, and mileage are paid in advance and/or reimbursed.

The term is January 1, 2016 through January 1, 2017. Members are compensated $500 for March, $50 for July and $49.99 for December.

Any person interested in being considered for an appointment to the Board of Review must submit a letter/email of interest to the Fort Gratiot Charter Township Board of Trustees. ([email protected]) Letters/emails of interest must be received no later than Wednesday, November 25, 2015 to be considered. The appointments will be made no later than the December 16, 2015 Board of Trustees meeting.

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The Fort Gratiot Township Board of Review is made up of four people: three members and an alternate. The members are Susan Alderman, Jodi Smith and alternate member Mike Vanover. Below are the dates the BOR will meet in 2015 and the answers to some frequently asked questions.

If you have questions regarding your Notice of Assessment or to schedule an appointment with the BOR, you may contact our assessing department during regular business hours.

Click here to view assessing records. On the left of the Access My Gov Fort Gratiot page, click Assessing Search. A bar near the top of the page will appear. Enter the address of the property you are searching for and click SEARCH on the right. On the next screen click the property address and you will be taken to the Record Details page.

2015-2016 BOARD OF REVIEW MEETING DATES

Tuesday, December 15, 2015, 9:00 AM
Clerical errors and mutual mistakes of fact – No Appeals

Tuesday, March 8, 2016, 9:00 AM
Organizational – No appeals heard

Monday, March 14, 9:00 AM – 12 PM & 1 PM – 4 PM
BY APPOINTMENT Appeals Only – No Corrections

Thursday, March 17, 6 PM – 9 PM
BY APPOINTMENT Appeals Only – No Corrections

Friday, March 18, 9 AM – 12 PM
BY APPOINTMENT Appeals Only – No Corrections

Tuesday, July 19, 9:00 AM
Clerical errors and mutual mistakes of fact – No Appeals

Tuesday, December 13, 9:00 AM
Clerical errors and mutual mistakes of fact – No Appeals

Click here to view/print 2016 Board of Review Information

F.A.Q.’S
Can a Board of Review set the SEV or Assessed Value at the sales price of the property? No.  This practice is illegal in Michigan.  An individual sale price IS NOT the same as True Cash Value of the Property due to a variety of reasons, including among those an uninformed buyer, an uninformed seller, insufficient marketing time, buyer and seller are relatives, and other reasons.

Section 27(5) of the General Property Tax Act states the following:  “Beginning December 31, 1994, the purchase price paid in a transfer of property is not the presumptive True Cash Value of the property transferred.  In determining the True Cash Value of transferred property, an assessing officer shall assess that property using the same valuation method used to value all other property of the same classification in the assessing jurisdiction.”

Therefore, a Board of Review does NOT have the authority to change an assessment based on a sale price.

Is this what the State Tax Commission means when it says a Board of Review or Assessor cannot “follow sales”?  Yes.  “Following sales” is defined in the assessor’s manual as the practice of ignoring the assessment of properties, which have not recently been sold, while making significant changes to the assessments of properties which have been sold.  The practice of “following sales” is a serious violation of the law.  The practice of following sales results in assessments that are not uniform.

What is Proposal A? On March 15, 1994 the voters of the State of Michigan approved Proposal A.  Prior to Proposal A, property taxes were based on STATE EQUALIZED VALUE.  Proposal A established TAXABLE VALUE as the basis for calculation of property taxes.

What is Assessed Value and is it still important?  Michigan law requires that all property be uniformly assessed at 50% of the usual selling price, or sometimes called the True Cash Value.  Each year, assessors must still prepare an assessment roll that contains “traditional” Assessed Valuations at 50% of True Cash Value.

What is Taxable Value? Except when there is a transfer of ownership in the prior year, Taxable Value for a parcel of property is the LOWER of STATE EQUALIZED VALUE for the parcel, or the CAPPED VALUE for the parcel.

What is State Equalized Value? State Equalized Value or SEV is the Assessed Value, as adjusted following State and County Equalization.

What is Capped Value? Capped Value is calculated by adjusting the prior year Taxable Value of the property by any additions or losses and multiplying by the inflation rate multiplier (IRM).  The IRM is calculated based on statute and cannot be greater than 1.05 (1 + 5%).

The Capped Value formula is:  (Prior Year Taxable Value – Losses) x (IRM) + Additions.

What is the Inflation Rate Multiplier and how is it calculated?

INFLATION RATE is defined in the Statute as the ratio of the general price level for the state fiscal year ending in the calendar year immediately proceeding the current year divided by the general price level for the state fiscal year ending in the calendar year before the year immediately proceeding the current year.

The Statute also defines GENERAL PRICE as the annual average of the 12 monthly values for the United States consumer price index for all urban consumers as defined and officially reported by the United States Department of Labor, Bureau of Labor Statistics.

Based on this statutory requirement, a sample calculation for 2013 is as follows:
A.  The 12 monthly values for October 2011 through September 2012 are averaged.
B.  The 12 monthly values for October 2012 through September 2013 are averaged.
The ratio of B divided by A is calculated and this becomes the IRM.

The Inflation Rate Multiplier (CPI) for 2014 is 1.6%. This means that the taxable value for your property will increase by 1.6%.  Physical changes in your property may also increase or decrease your Taxable Value.  Changes in the State Equalized Value due to Market Value changes may also affect the Taxable Value, since the Taxable Value cannot be higher than the State Equalized Value.

Does the Board have any authority over Capped Values? STC Bulletin No. 14 of 1994 states:  an assessment roll must contain the Capped Value for each parcel of real property.

If correct figures have been used in the Capped Value formula for the prior year Taxable Value and for the current Inflation Rate Multiplier, the Board of Review cannot make a change that results in a different capped value of the property.

The Board of Review may change the amount of the Losses and Additions used in the Capped Value formula, if they determine they are improper.  Only factual information will be used to amend the Losses or Additions in the Capped Value formula.

STC Bulletins 3 of 1995, 18 of 1995, and 3 of 1997, address the procedures required by law for determining the amount of Losses and Additions for calculation of the cap on Taxable Value. (Note:  an increase in value due to an increase in a property’s occupancy rate is not a legal addition in the Capped Value formula.)

What is Uncapping? When a property transfers ownership as defined by law, the property’s Taxable Value uncaps the following year.  A property on which “Transfer of Ownership” occurred shall have its Taxable Value uncapped the following year.  For example, a property that transferred in 2013 will have the 2014 Taxable Value equal to its 2014 SEV.  A Question and Answer document regarding many common Transfer of Ownership questions is available at www.michigan.gov/treasury.

Does the Property then “recap”?  The growth in Taxable Value of transferred properties will then be capped again in the second year following the “Transfer of Ownership”

What are the authorities of the Board of Review over transfers of ownership and uncapping? The assessor of each Township and City is required by law to review all of the transfers and conveyances, which occurred in the prior year and determine which of these transfers and conveyances, are “Transfers of Ownership”.

The determination by the assessor that a particular transfer or conveyance is a “Transfer of Ownership” and that the property’s Taxable Value should be uncapped is subject to review by the March Board of Review either on the Board’s own initiative or at the request of a property owner.

Public Act (PA) 23 of 2005 granted the July or December Board of Review the authority to correct the Taxable Value of property which was previously uncapped (due to a perceived transfer of ownership) if the assessor later determines there had NOT been a transfer of ownership of that property after all.  This authority applies to the current year and the 3 immediately preceding years.  Bulletin 9 of 2005 provides more detailed information.

State Tax Commission Bulletin No. 19 of 1997
DATE: December 12, 1997
TO: Assessing Officers, Equalization Directors
FROM: State Tax Commission (STC)

RE: THE ILLEGAL PRACTICES OF: A) “FOLLOWING SALES”

The State Tax Commission is very concerned about reports that some assessors have engaged in the illegal practices of “following sales” and assessing over 50% of true cash value.

The purpose of this bulletin is to provide instruction to assessors regarding these illegal practices.

  1. A.   “Following Sales”

“Following sales” is described in the State Tax Commission Assessor’s Manual as the practice of ignoring the assessments of properties which HAVE NOT RECENTLY SOLD while making significant changes to the assessments of properties which HAVE RECENTLY SOLD.

“Following sales” can also be described as the practice of assessing properties which HAVE RECENTLY SOLD significantly differently from properties which HAVE NOT RECENTLY SOLD.

Article IX, Section 3 of the State Constitution states that “The legislature shall provide for the UNIFORM general ad valorem taxation of real and tangible personal property …” This requirement has NOT changed as a result of Proposal A.

Section 27(5) of the General Property Tax Act states the following:

“In determining the true cash value of transferred property, an assessing officer shall assess that property using the same valuation method used to value all other property of that same classification in the assessing jurisdiction.”

The following example illustrates the illegal practice of “following sales”.

EXAMPLE: An assessor has been notified by the equalization department that the starting base for the residential class in his/her unit is 45.45%. This means that it is necessary for the assessor to increase the residential class overall by about 10% in order to avoid a factor. It is the assessor’s responsibility to determine where this increase should be spread in order that all properties are assessed at 50%.

It would be illegal for the assessor to generally increase properties which have recently sold by say 25% while increasing all other properties in a neighborhood by say 5%. This would be an example of the illegal practice of “following sales”.

“Following sales” is both UNCONSTITUTIONAL AND ILLEGAL. An exception would occur where an assessor inspects a property after a transfer of ownership and discovers that there is omitted property such as a garage which was built in the past but was not included in the assessment and was not noted on the assessment card. In this case the assessor must include the omitted property in the assessed value for the year following the transfer of ownership.

If the assessor is doing a proper job of assessing all properties uniformly at 50% of true cash value each year, there is no reason to assess properties which have sold any differently from properties which have not sold.

In a related matter, some assessors believe that Proposal A requires that, in the year following a transfer of ownership, the assessed value of a property which has transferred must automatically be set at 1/2 of the sale price. Proposal A does NOT authorize the assessor to AUTOMATICALLY set the assessed value of a property which has sold at 1/2 of the sale price. An individual sale price may NOT be a good indicator of the true cash value of the property due to a variety of reasons (such as an uninformed buyer, an uninformed seller, insufficient marketing time, buyer and seller are relatives, and other possible reasons).