In the past year Metro area property tax values fall 10%

now we are enjoy this Metro area property tax values fall 10%
Trend means shrinking revenues for cities, cuts in staff and services
Ron French / The Detroit News
Metro Detroit lost nearly 10 percent of its taxable value -- $16 billion -- in the past year because of a real-estate crash that keeps claiming victims, according to a Monday report.
The crisis that robbed many southeast Michigan residents of their nest eggs and led to record foreclosures, and later led to devastating drops in the value of commercial property, is now decimating public services in communities across the region, a report from the Southeast Michigan Council of Governments (SEMCOG) stated.
The fall in taxable values was almost triple the record set last year. That means grim cuts in services -- from closed libraries to the end of snow plowing -- could become the latest dominoes to fall in a crisis that already has cost residents jobs and homes.
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"I've been doing this for 35 years, and this is the worst time ever," said Troy assistant city manager John Lamerato. "It's not a pretty picture."
The data offered a sobering reminder of the economic strings that run from kitchen tables to city council chambers.
Property tax value is not the actual value of homes or commercial properties, but is a reflection of the crisis that has sucker-punched homeowners. As home and commercial values declined, the property tax that owners pay declined to reflect that loss. Lower property tax values mean less money is collected by governments to provide services.
Even though median home prices are beginning to inch up, the taxable value -- the amount on which government units can tax property -- usually lags trends in actual home values by a few years.
Eastpointe lost 20 percent of its taxable value last year; Lathrup Village lost nearly 20 percent; and Harper Woods lost more than 16 percent, according to the report.
"Property taxes are the largest revenue source for communities," said Brian Parthum, senior planning analyst at SEMCOG. "With that taking such a big hit, they're going to have to make some tough decisions, such as cutting services or, in some cases, trying to perhaps increase tax rates."
Libraries will close. Streets will go unplowed. More city workers will get pink slips.
Troy, Southfield, West Bloomfield and Farmington Hills each lost more than a half billion dollars in taxable income.
Troy will lose more than $3 million because of lowered tax values. The city let go 55 workers in July and plans to lay off more than 50 again next year.
"Our city work force will be cut by a third in a five-year period," Lamerato said.
Troy's library, nature center and museum, all operating under reduced hours this year, are likely to close in 2011. The community center will remain open "as long as it can remain self-sufficient," Lamerato said.
In Southfield, city officials are weighing what cuts can be made that damage the quality of life of its residents the least. The city is already down 160 employees from 2005, and Fourth of July fireworks displays are gone.
"We cannot reconstruct streets, we're patching and trying to hold them together," said Southfield Mayor Brenda Lawrence. "Now we're looking at how we can consolidate services.
"It's a balancing act," Lawrence said. "We have to provide public safety. You have to put out the fires. But do you close down the library in a region struggling for jobs, when a library is one of the few free places adults can visit for resources? What's the effect of doing that? It's easy to say you're not going to plow the streets. But in Michigan? How do people get to work?"
Southfield may have to stop trimming trees every year and planting flowers in public areas, "things we do that everyone loves about our community."
Oakland County lost 12 percent of taxable income this year, after losing 3.8 percent last year. Washtenaw County lost the least, dropping about 4 percent.
Waterford Township lost 15 percent of its taxable value, which will cost the township $4.1 million in next year's budget.
"There's nothing left to cut but people," said Carl Solden, the Waterford Township supervisor. "We're offering retirements to employees and negotiating concessions with the unions. It'll affect every department, including police and fire."
Waterford already has 23 fewer police officers than in 2006, and next year's cuts "will be a lot more severe," Solden said.
Township supervisors had a meeting with Oakland County officials Monday, at which they were told the county Sheriff's Department would be making cuts next year, too.
The long-term outlook isn't much better. SEMCOG will release projections for next year in September, but Troy already projects another 10 percent cut in taxable value, followed by an additional 6 percent decrease the following year.
"Five years out, we expect to have City Hall open four days a week," Lamerato said, effectively cutting city workers' hours and pay 20 percent. "We don't expect to return to the taxable value of 2007 until 2024."
Lawrence, the Southfield mayor, believes there may be a silver lining to the financial crisis. "In this region, everyone has their own little square foot of land," she said. "There are all these barriers to working collaboratively. This is forcing us to look across the street and think, 'maybe we can work together.' "
Lawrence believes communities will be forced to share services to survive.
"When this crisis is over, that will make us stronger," she said.


From The Detroit News: http://www.detnews.com/article/20100817/METRO/8170336/Metro-area-property-tax-values-fall-10-#ixzz0wq2xYnLx
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