The General Property Tax Act

How your property is valued and taxed is due to an amended process that has some procedures over 100 years old.

"All property, real and personal, within the jurisdiction of this state, not expressly exempted shall be subject to taxation." This broad statement of the General Property Tax Act (MCL 211.1) begins to examine assessment administration and its impact in generating local property tax revenues. As, Tufts University professor, Joseph Eckert noted, "Property assessment administration is a complex and technical profession vital to the financial health of local government. Assessors are responsible for administering the Ad Valorem tax system. … An Ad Valorem tax is based upon the principal that the amount of tax paid should depend upon the value of the property owned.” Joan Youngman of the Lincoln Institute of Land Policy further explained, "at the most basic level, (the property tax) provide(s) information on a stable, long-standing and endlessly controversial revenue source that serves as a mainstay of autonomous local government finance in this county." While the state of Michigan collects many types of taxes from income to sales to gasoline, the property tax remains the foundation upon which local units of government are built.

In the state of Michigan, the concept of our present property tax system was put in place on June 12, 1893 with the passage of the General Property Tax Act. While the act has been amended many times in its 125-year history, the basic principals have remained in place.

As all property within the state, unless exempted, is subject to taxation. Each township or city must employ a certified assessor to accomplish this task. This position is most important in each jurisdiction as the General Property Tax Act provides in section 211.10 that "an annual assessment of all property within the state liable to taxation shall be made in all townships, villages and cities by the applicable assessing officer." The act further provides that the annual assessment "shall be made by an assessor who has been certified as qualified” (MCL 211.10d). To accomplish this task of preparing the annual assessment roll, an assessor turns to training, experience and background.

Since the passage of Proposal A, the tasks of the annual assessment roll have become more vast and confusing. From the historic process of determining assessed and true cash values, assessors are now faced with Proposal A calculations of capped, taxable and tentative state equalized values. Each value having its own methods of determination and purpose in the overall process.

Basic assessment administration is now more than ever a complex and highly technical field. It remains as the first step in the property tax system and generation of local governmental revenue. It is in these statutorily defined assessed, taxable and capped values that local units of government begin to determine their local tax liability.

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