Winning the Tuscarora Township Property Tax Lottery

Our great country was born of a revolution against the King of England and unfair taxation. We lost the King but taxation remains a necessary part of our democracy. We deserve and usually enjoy some fairness in our taxes. When we pay gas tax at the pump, income taxes, or sales taxes on goods or a vehicle we know what tax rate we are going to pay and others are also paying a similar share.

I did not include property taxes among those mentioned because so many question the fairness of property taxes. All of us who own property pay taxes expressed as a millage based on each $1,000 of taxable value. Your assessment card and tax bill also shows a figure identified as State Equalized Value (SEV). That figure should represent about 50% of your property’s market or current sales value. Taxable value may increase by the amount of inflation while the SEV may go up or down supposedly tracking real market sales. That is the theory. The real world practice varies wildly and the assessor like a King determines fairness. The issues created by the need for the state to maximize all property taxes to fund our government weighed against some attempt to maintain fairness has created a complex system ripe for error and abuse.

In retail, there is an expression called shrinkage. It is the reduction in the profit of a business due to wastage or theft. That shrinkage means higher prices for all of us. We pay for each theft or loss that occurs. If you are not yelling, “Stop thief” as someone runs out of the store with a big screen TV, you are aiding the thief while costing yourself money.

Property taxes also have a shrinkage factor created by errors in fact and sometimes from biases, favoritism, or even fraud resulting from the archaic practice of employing elected officials as assessors. If your neighbor is receiving a special deal on property taxes, we are all subsidizing that gift from the assessor. 

Is someone as guilty as the thief running from the store? Are the property owner and assessor equally guilty? I ask these questions because some jurisdictions, Tuscarora Township being one in particular, has had years of allegations of special property tax deals cut for the good old boys by Supervisor/Assessor Mike Ridley.

Is there any truth to the whispered rumors? A couple bought a lot in a golf course development north of Indian River. The SEV of the vacant lot had been $35,000 and the taxable value was $162.  The Tuscarora Assessor then lowered the SEV to $22,500 and raised the taxable value to $22,500. Did I mention the purchaser had a custom home built on the lot with an occupancy permit issued in September 2009? The Cheboygan County Building Safety department provided the public record of the “Assessor’s Copy of Building Permit”. The total Building Permit Valuation was $328,000. Did the SEV, supposedly 50% of the market value, increase for 2010?  Not in this fairy tale. The SEV and taxable value then remained at $22,500 for 2010, 2011, and 2012. In 2013, those numbers started to depreciate and the SEV and taxable value for 2016 is now only $15,600.  

When these taxpayers, and I use the term reluctantly, received their annual assessment card for 2016 did they run out and buy a lottery ticket? They are paying 2016 property taxes on a taxable value of $15,600. Can they honestly think their custom built home is only worth double that $15,600 SEV, about $31,000? 

Did both they and Tuscarora Township Supervisor/Assessor Mike Ridley knowingly ignore the small print that says:”State Equalized Value must approximate 50% of the market value”? 

That couple has been winning the property tax lottery every year since 2010. Every other Tuscarora Township property owner for the past 6 years is paying for that fraud or error. We deserve justice. Will the State Tax Commission correct this fraud or error?