Sunday, February 24, 2013

Taxpayer morale--a case study in Detroit

Someone could write a PhD dissertation on the fiscal devolution of Detroit and the role of taxpayer morale. Between the below story and the continuing sage of the attempt to make a tax haven out of Belle Island, it would be a fascinating study.

Half of Detroit property owners don't pay taxes:

47 percent of the city's taxable parcels are delinquent on their 2011 bills. Some $246.5 million in taxes and fees went uncollected, about half of which was due Detroit and the rest to other entities, including Wayne County, Detroit Public Schools and the library.
Delinquency is so pervasive that 77 blocks had only one owner who paid taxes last year, The News found. Many of those who don't pay question why they should in a city that struggles to light its streets or keep police on them.
"Why pay taxes?" asked Fred Phillips, who owes more than $2,600 on his home on an east-side block where five owners paid 2011 taxes. "Why should I send them taxes when they aren't supplying services? It is sickening. … Every time I see the tax bill come, I think about the times we called and nobody came."
...Detroit's delinquencies are so pervasive that some owners have been allowed to keep their property even if they don't pay taxes. Wayne County treasury officials are so overwhelmed by foreclosures that they ignored about 40,000 delinquent Detroit properties that should have been seized last year and said they will look the other way on about 36,000 this year.
...Leola Wesley questions what services she gets for her taxes. ...She was the only resident on her 32-parcel block who paid.
"It makes me not want to pay," said Wesley, 85, who would move from her home of more than 20 years if she could afford it. "If nobody else is paying, why should I?"
...In the past five years, the city has lost out on $317 million in taxes, county records show.
"It makes me wonder why I pay my taxes and keep my property up," said Kisner, a North Rosedale Park resident and former top finance official for the city and Detroit Public Schools. "I keep asking myself, 'Am I the stupid one?'"
The billionaires looking to liberate Belle Island don't want any part of this problem, and if they are successful they most certainly won't be any part of its solution.

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