This story was created in partnership with the Rocket Community Fund to highlight a tax relief opportunity through the Detroit Homeowners Property Exemption (HOPE) Program.
After Brenda Butler received a reduction in her property tax rate, on the home she’s owned in the Chandler Park neighborhood since the 1980s, she started to spread the word. She alerts others who need help from the city to afford to stay in their homes that there is a program to assist.
The 77-year-old Detroiter said she was approved for a property tax exemption, based on her income, and she has now been able to use those saved funds to upgrade her home’s electrical work, plumbing and landscaping.
Butler carries flyers with her when she’s out to lunch and on evenings out, to share information with others who may not know about HOPE: the Homeowners Property Exemption program. Homeowners must apply for the program by 4:30 p.m. on Friday, Nov. 1, to learn if they qualify for a chance to reduce or eliminate their current year taxes.
“This has helped me tremendously,” said Butler.
The annual HOPE application is the key to unlocking property tax relief for Detroiters, and qualifying to reduce or eliminate the current year’s tax can prevent homeowners from entering tax delinquency in the first place.
Homeowners with property tax debt from prior years pay those back taxes to the Wayne County Treasurer’s Office. If approved for HOPE, they are also eligible for the county’s Pay As You Stay, or PAYS program, with assistance from the Gilbert Family Foundation’s Detroit Property Tax Relief Fund, to wipe out those back taxes.
By the end of 2023, the Detroit Property Tax Relief Fund had completely eliminated the tax debt of more than 10,000 Detroit families, according to Laura Grannemann, executive director of the Rocket Community Fund. and executive director of the Gilbert Family Foundation.
‘Don’t count yourself out’
The HOPE program is for residents who are unable to pay their property taxes and who are the owner and occupier of the home, living in it as their primary residence. The applications are reviewed and a determination is made by the city’s Property Assessment Board of Review. Homeowners can receive total exemptions from current year property taxes, or partial exemptions of 75 percent, 50 percent, 25 percent or 10 percent, depending on their income. The complete income guidelines can be found at this link and are based on the federal poverty guidelines.
It’s critical for homeowners experiencing hardship to apply for the HOPE program and not make an assumption about whether they qualify, said Willie Donwell, director of the board of review.
“Don’t count yourself out,” Donwell said, explaining that the board has requirements it must follow for how it determines whether the applicant’s income disqualifies them.
For example, the board cannot count non-cash payments. “If a person is receiving Medicaid or Medicare as part of a benefit, we can’t count that as a part of their income.”
Donwell encourages homeowners to submit their applications early so there’s time for the board of review to process it and reach back out to the applicant if needed.
Homeowners can download the application here; pick up the form from the Detroit Tax Service Center in Suite 130 at the Coleman A. Young Municipal Center; call 313-224-3035 and request a form to be mailed to their home; or email BoardofReview@DetroitMI.gov.
The following items are required for a HOPE application:
- Michigan Department of Treasury Form 5737 for a poverty exemption, and Form 5739 an affirmation of ownership and occupancy.
- Registered proof of ownership, such as a deed, land contract, probate court order or divorce judgment.
- A government ID with the address and picture of the owner;government IDs with the address and picture for all residents over 18; and proof of residency for all minors in the household.
- Proof of income for all household members, including minor children, with examples being: W2 Forms, pay stubs, Social Security income or disability statements, pensions, verification of income received as child support, self-employment, or a signed and notarized letter from an individual who is helping the applicant financially.
- 2022 federal and state tax returns for all household adults, if filed, and proof of income for 2023. If the adult is not required to file a tax return, they must complete Michigan Treasury Form 4988, a poverty exemption affidavit, and IRS Form 4506-T and provide W2s, Social Security statements or any document proving the last year’s income.
The board of review has the right to make additional document requests of applicants.
Don’t worry about submitting documents other than those required, Donwell said.
“Oftentimes we get things like Social Security cards, Bridge Cards, passports — these are things we can’t do anything with,” he said. “We can’t do anything with your utility bills.”
Resource Fair planned before HOPE application deadline
Healthy Home resource fairs are being held in Detroit ahead of the Nov. 1 HOPE application deadline. At the fairs, Detroit homeowners will find a team that can help with their HOPE application, along with information on more resources, like water affordability, energy savings and zero-interest loans.
“The HOPE exemption is the beginning but it is not the end,” Donwell told Outlier. “It is the start of a process to build a better quality of life for homeowners.”
A resource fair is being held on the city’s east side on Saturday, Oct. 26 from 10 a.m. to 3 p.m. at Perfecting Church, 7616 Nevada Ave. This fair is designed especially for seniors and people with a disability, Donwell said. Residents can call 313-244-0274 to schedule a Lyft ride to their HOPE resource information appointment.
Property taxes as a quality of life issue
Donwell said he stays in touch with more than 2,000 seniors and Detroiters with a disability, regarding their tax issues. The average senior homeowner the board of review sees has an income of $750 to $800 per month, he said. For someone with property taxes of $2,000 per year, that means it takes them two months of income to pay their property taxes.
“Now that means something else is going to suffer in order for them to meet their property tax obligations. Lights, gas, water, food — something is going to go by the wayside and now they’re playing catch-up on their utilities or medication,” he said. “We’re really talking about quality of life.”
Donwell said the Gilbert Family Foundation and Rocket Community Fund are involved in property tax relief because Rocket “understands the need and what we have to do in the community to stabilize it. “Their focus and position isn’t just to look at helping somebody with property taxes. It’s, ‘How do we get them through or how do we better their quality of life?’”
Donwell joined the board of review in 2007, as the wave of foreclosures from the Great Recession began to crash ashore. He said he remembers being in what was then Cobo Hall with more than 2,000 Detroiters who were at risk of tax foreclosure, for their show cause hearings before the Wayne County treasurer.
Between 2007 and 2016, Detroit was “somewhat devastated” by foreclosed homes that became vacant, he said. “What is the real cost of the loss to the city when you start talking about tax foreclosure? Is it just the amount of taxes? Or is it the cost of all the after-effects that happen after a property is lost?”
This year marked Detroit’s lowest number of property tax foreclosures since 2003, Donwell told Outlier. Since the inception of the PAYS program in 2020, more than 12,000 or 13,000 homes have been taken out of the foreclosure process, he said.
“What we do in terms of forgiving a person, their tax debt through this process, it actually saves, I believe, the community a lot more money than if they were evicted or ended up having to leave the home.”
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