Michigan Votes Forum

Introduced in the Senate on February 3, 2009

Click here to view bill details.

 Also get the new assessed value to reflect the true value of a home recently sold if it is lower than the artificially high pop-up value. Let the transaction between the seller and buyer determine the value-not the CPI. The price of a gallon of milk or gasoline has no beraing on the selling price of a home. I would hope there is someone in the legislature with enough balls to work on this problem.

Senator Switalski’s statement is as follows:

Beware of the law of unintended consequences. Senate Joint Resolution H is exhibit A in the application of this law. This bill cost $253 million and it is unpaid for. I know my good friend, the Senator from Troy, intends this resolution to provide tax relief to homeowners.

But beware of the law of unintended consequences. This resolution is a Trojan horse. It will result in a tax increase for the majority of homeowners. What? How can this be? Consider the situation of Mr. Hector. He bought his house for $100,000 in 1993, the year of Proposal A. His taxes were capped and he pays on a taxable value of $125,000 today. Today, Mr. Hector sold his house. He thought it was worth $200,000, but he got $150,000. Under current law, the taxes should pop-up to $150,000. But Senate Joint Resolution H says his tax can’t go up because his value went down.

Now, because of the Headlee Amendment, all his neighbors who used to get a reduction equal to Mr. Hector’s pop-up now get nothing. That means this is a tax increase for everyone else in the city. I’m voting “no” on Senate Joint Resolution H.

Senator Cherry’s statement is as follows: During committee, the committee members really got a history lesson about Proposal A from one of the people who testified, Mr. Anderson from the Michigan Townships Association. I think what he said is so important that I would like to talk for a moment about Proposal A and the impact of Senate Joint Resolution H. When Proposal A was in its formative stage, two key issues came to the surface: providing property tax relief and devising a system to equalize funding between school districts within the state. However, during debate on the floor, a third issue surfaced as a floor amendment and included a clause that property assessments would be capped at the rate of inflation or 5 percent, whichever is less. This created the taxable value system of today. By creating this cap, a system based on equity was traded for a system based on predictability. Now the issue of how long a person owned a home becomes more important than the value of the home. The Proposal A cap has saved property owners billions of dollars since 1994 but has created its own set of problems. Now a new issue is being debated before us today, Senate Joint Resolution H. This resolution seeks to amend our Constitution to state that when the SEV on a piece of property declines, the taxable value of that property may not increase. The property tax system has become a taxation system based on inequity. This resolution perpetuates inequity. It offers no assistance to those taxpayers who have borne the greatest burden within our property tax system, those who have recently purchased a home. Any person who moves to our state and purchases a home will find that they are paying proportionately more in property taxes than their neighbors. How’s that for a welcome mat? Senate Joint Resolution H offers tax benefits to property owners who are already seeing reduced taxation compared to their neighbors due to Proposal A. Senate Joint Resolution H seeks to disrupt the natural economic market and create an artificial barrier to change. I thought that we in this state were supportive of the economic market. Senate Joint Resolution H is a flawed proposal, and I urge a “no” vote.

Senator Whitmer’s statement is as follows: You know, we look at legislation like this and you can’t help but ask the question. If you want give property owners a break, let’s pass some foreclosure reform legislation. This is coming from the party that says that we care about law enforcement. Well, we can’t enact sentencing reform because we don’t want to look soft on crime. Do you know what makes up the largest portion of municipalities’ budgets? Police—public safety. You want to keep our people safe and you are going to slash the budget at the same time by $177 million? This goes to law enforcement; it is the biggest portion of those dollars. You also say you care about schools. This cuts $77 million from our public schools. Now you can’t just say we care about law enforcement and we care about kids in schools and then vote for something like this. I’m voting “no.”

Senator Pappageorge’s statement is as follows: There is no question that there are things in Proposal A that are just problems. They are problems for people who keep a house too long, too short, pop-up—we have heard them all before. The arguments that were presented today against Senate Joint Resolution H are simply arguments for other things that have to be fixed in Proposal A. Let’s look again at what Senate Joint Resolution H does. It says that you will not be taxed higher than you were the year before. It says to those who are worried about revenue sharing that revenue sharing—certainly in the budget that is coming out Thursday—my budget—has no cuts in it for revenue sharing. The argument that when we are down $1.2 billion at least in revenue, we ought to increase—bring in more taxes—simply doesn’t hold water as a reason for saying “no” to Senate Joint Resolution H.

 So Sen Whitmer feels that while everyone else is taking pay cuts, losing their property and cutting expenses because inflation is causing their dollar to buy less, the schools and other governmental agencys should not be affected. They can go on spending forever because inflation will cause the CPI to increase, thus our taxes will increase giving them more money to find a use for. Add that to the frequent millage increase requests, we will all lose our homes to the local governments. Where does it stop?  My home sold for 25,000 less than I paid for it 3 years ago, but the taxable value went up! Who/what determines the value? The people who live off the taxes it brings. That sucks and something needs to be done. I think change is needed-6 years is too long for some of you.

Will someone have the balls to tell us the money tax exempt property would bring in if we didn't have so many of them?. Can you give a breakdown by county? Maybe those rules need to be looked at again.

 Senator Gretchen Whitmer [(D) State Senator, District 23 - is telling us what an absolute "social engineer" she is.  Even though the value of your property is being lowered, and many cannot even sell their homes for the amount of their original purchase price -- she wants to tax you above and beyond its worth.  What we need to do is foreclose on this bimbo's election and salary!

Amen,inform4! But those that think they are getting a deal from politicians (LOL) would vote another social engineer in. Remember the last two elections?

Senator Switalski’s statement, in which Senators Cherry, Brater and Whitmer concurred, is as follows:

Yesterday I talked about how Senate Joint Resolution H is a tax increase. Today I want to talk about fairness. What is fair? The Michigan Constitution says it is fair that everybody pays the same. The Constitution says that we should pay 50 percent of the value of our house. Now is it fair that one person pays 50 percent and another pay 30 percent? No, that is two-thingsism. Under Proposal A, we said we would tolerate a limited amount of two-thingsism. Proposal A capped growth and taxable value below the rate of market value with the understanding that the discounted property would eventually catch up.

Now we are told there is a great injustice upon the land. How can taxable value go up when market value goes down? That is like saying how can rain come down when the temperature goes up? The Constitution says fairness is that everybody pays 50 percent. Which is more fair, one homeowner paying 50 percent while the other pays 30 percent or the other homeowner paying 35 percent? Wouldn’t 35 percent be fair, especially to the majority of people who are paying 50 percent? I checked with the equalization directors in Oakland and Macomb Counties, 60 percent of the households have no gap anymore between taxable and market value, and they are paying 50 percent. That number is growing.

Why is it fair to keep the minority with their full discount of 50 percent? Mr. President, say we live next door to each other and we have exactly the same house. You are paying taxes on $125,000 and I am paying on $150,000. Now suppose that if this Senate Joint Resolution H passes, a buyer walks up. He can buy either one of our houses for $150,000, but if he buys yours, he will save $25,000 in the tax. I am being cheated. Not only do I have to pay more tax, but now you get to sell your house ahead of me because of your tax discount. That is completely unfair. It is two-thingsism.

Senate Joint Resolution H will put this unfairness into the Constitution. Defeat Senate Joint Resolution H.

 

Senator Clarke’s statement is as follows:

I believe that we can address the apparent unfairness of someone whose property value is dropping, yet his or her tax burden may be increasing. We can address that issue as well as the local units of government budgetary concerns of providing essential services to the taxpayers. By doing one thing, we can by legislation, not by changing the constitution, give the local taxing units the authority to freeze the property tax base in their community. This would provide that homeowner with the tax relief that we all need, but also it would allow that local unit of government to make the decision whether they want to freeze the tax base to attract more residents to their community and weigh that against the loss of increased revenue that they would otherwise receive.

Local units of government have lost a lot of money because this Legislature has not addressed the foreclosure process. I believe that we should address the foreclosure problem by keeping families in their homes who have the ability to maintain their property. That would also help maintain their tax base. We don’t need to change the Constitution. All we need to do is give local units of government the authority to freeze property tax bases. That is a responsible way to do it.

 

Senator Jacobs’ first statement is as follows:

I just have to respond to my good friend, the Senator from Troy. The very reason that you spoke against this amendment is the reason that I am telling you that we need to vote for this amendment. It is the problem that I have with this entire Senate joint resolution.

Yes, indeed, we are losing $100 million a month. We cannot afford to keep our doors open keeping things the way that they are here. Now we are going to take another $250 million hit—$77 million to our school budget. I feel like I am living in a 3-D movie. This doesn’t make sense. We must at least try to make whole the services that we need to basically keep our doors open in Michigan. In this bad economy, the demand for government services is even greater. We know homes go into foreclosure. We need to know that there is an increase for public safety. I heard the city of Pontiac only has 66 police officers right now for that city. Can they take the hit that they will take if we don’t pass this amendment? If this amendment doesn’t pass, to take the hit that they will get? The same kind of hit that Muskegon will get and Flint will get. You know, some of these urban areas that are being decimated right now.

So I think we need to at least support the Whitmer amendment if we are going to do anything that is fiscally responsible out of this chamber today.

 

Senator Jacobs’ second statement is as follows:

You know, when Proposal A was passed, I voted against it even though I knew that I was going to be a great beneficiary of it. I was paying a lot in taxes. My property taxes were cut in half, and I am still, fifteen years later, enjoying the benefits of Proposal A. Not everybody in Michigan has been in their home like I have for 30 years. Now again, today, we are going to pass something that will totally benefit me again, but it is not going to benefit the other 50 percent of people in Michigan who really do need their property tax relief. I think that Senator Switalski did a really good job explaining that.

You know, under our watch, since 2001 revenue sharing is down—are we ready—$3 billion. That’s $3 billion under our watch since 2001. So what we are going to do again today is put another nail in the coffin for local services that are barely able to meet the needs of our constituents. So I think we should be very careful and very thoughtful before we push this button in a minute or so. This is really not good public policy, although it is great populist policy.

When I was a younger person, I really thought about going to medical school. The reason I decided not to, was I was nervous about making life and death decisions. I just didn’t want that responsibility. I fast forward and here I am in the legislature and I feel like every day I do make those life-and-death decisions.

I think this is one of those very, very tough votes that we have to take as legislators. I understand where everybody is coming from on both sides of the aisle, as well as various philosophies, but I certainly don’t want our communities to die and wither under my watch. That is why I urge my colleagues not to adopt Senate Joint Resolution H.

Senator Whitmer’s statement is as follows:

I rise today to offer an amendment to this joint resolution before us. Yesterday I spoke against the resolution because there is a huge price tag that is associated with the passage of this. I was opposed yesterday because of the hit to the locals—the police protection, fire protection, and to our schools; to put it more simply, cops and kids.

This amendment will ensure that they are protected from those devastating cuts; protecting those who protect us—the cops; and protecting those who need us the most—kids. Repeatedly, the sponsor insisted that this was not a cut.

So I would hope for his support on this amendment. Let’s ensure that there is no cut to cops or to kids. I ask for your support.

I don't think we should be opening up Proposal "A" because there is too much of a chance for our legislatures to create a lot of mischief to the detriment of homesteaders.  The only thing I would recommend is to lower the cap on the State Equalization Value from 50% to 30%.