Assessing Department

The Office of the Assessor is responsible for assessing of real and personal property in the township. This office is also responsible for Property Transfer Affidavits as well as Principle Residence Exemption Affidavits.

The assessing task requires the maintenance of records on each property in the township. The types of data maintained on assessment cards are building sketches & pictures, legal descriptions, square footage and year built.

By contacting the Mr. Kim Schmidt, the assessor, you can Request a copy of your Property Record Card.

You can find other forms at the following links:
Request to Rescind Homeowner's Principle Residence Exemption
Homeowner's Principle Residence Exemption Affidavit
Property Transfer Affidavit
Summer Tax Deferment

How are taxes calculated?
The taxable value of a property is the amount used to calculate the property tax bill. Taxable value is the lesser of state equalized value or the prior years taxable value minus losses, multiplied by the lesser of 105% or the Consumer Price Index plus additions. The taxable value multiplied by the township's millage rate equals the tax bill. For instance: $50,000 taxable value x 40 mills = $2,000 property tax bill.

General property taxes are charges to taxpayers who are not otherwise exempt from the tax for the costs of government activities that benefit the general public or for payments of indebtedness that finance public capital improvements, such as a new jail or an addition to a school.

How is Taxable Value Calculated?
Taxable value, the value upon which your tax bill is calculated, is determined each year by comparing SEV/ASSESSED and CAPPED values and choosing the lower of the two. ASSESSED value is the assessor's estimate of 50% of the market value of the property. CAPPED value is determined via the following formula: (Prior year taxable value – losses) x [CPI or 5% (which ever is lower)] + additions. LOSSES, in most cases, are equal to the taxable value of any buildings, or portions there of, that were removed or destroyed in the previous year. ADDITIONS, in most cases, are equal to the assessed value of any new buildings, or portions there of, that were built in the previous year. CPI is equal to the Consumer Price Index (i.e., the inflation rate) that was experienced in the State of Michigan in the prior year. This figure is determined by the Michigan Department of Treasury.

Restated 2004 Taxable Value for a parcel of property is the LOWER of:
1) 2004 SEV for the parcel or
2) 2004 CAPPED VALUE for the parcel which is calculated as follows:
(2003 Taxable Value - Losses) X (The lower of 1.05 or the Inflation Rate Multiplier of 1.023) + Additions.

The following example shows the calculation of Taxable Value for a property, which had no physical changes during 2003 (meaning that the property's land size was still the same and the buildings on the property were neither destroyed in whole or in part, nor improved, etc.). EXAMPLE: for a property whose market value increased by 2% for 2004 and there was not a "transfer of ownership" in 2003.

Given: 2003 SEV = 50,000

2003 Taxable Value = 49,000 2004 SEV = 50,000 + 2% = 51,000 2004 Taxable Value is the LOWER of:
1) The 2004 SEV of 51,000 OR
2) The 2004 Capped Value which is calculated as follows:
(2003 Taxable Value - Losses) X (The lowest of 1.05 or the inflation rate multiplier of 1.023) + Additions Since there are no additions or losses for this example, the formula for Capped Value is: (49,000 - 0) X 1.023 + 0 for Additions It can be further simplified as: 49,000 X 1.023 2004 Capped Value = $50,127

The 2004 Taxable Value is $50,127 (since this is lower than the 2004 SEV of $51,000.)

How to Calculate Your Property Tax
Property tax calculation is a straightforward multiplication problem. The formula is:
TAXABLE VALUE x MILLAGE RATE = TAX 1000

The taxable value of your property is determined via a formula. This formula is calculated by the assessor and is reported to you on your Notice of Assessment, Taxable Valuation, and Property Classification document mailed annually in February. The millage rate is the total number of mills being levied. Millage rates are calculated in the spring for the summer collection and in the fall for the winter collection. Millage rates vary from year to year. Here is an example for a homeowner's principal residence in the Elk Rapids School District for the year 2004: If your 2004 taxable value is $60,000 and the 2004 millage rate is 11.5429 mills, your 2004 total property tax can be estimated as follows:
$60,000 X (11.5429/1000) = $692.57

Keep in mind that the method shown here will result in an estimate of your total tax for the entire year. The same method can be used to estimate your summer and winter bill separately. Just insert the summer millage rate to estimate your summer tax and insert the winter millage rate to estimate your winter tax. This figure is then multiplied by 1.01 (1 percent) for the property tax administration fee, which can only be used for assessing and property tax collection purposes.

Michigan law gives townships the authority to assess property.
Townships and cities are the only two local governmental agencies that assess property. Villages are required to have assessment rolls, but the assessments must be identical to those set by the township assessor.

The Michigan Constitution and property tax law requires that all property be uniformly assessed at no more than 50% of true cash value, which is the cash price a property could bring in a competitive and open market. Proposal A, the March 15, 1994 amendment to the Michigan Constitution did not eliminate the requirement that property be uniformly assessed. The assessing officer is responsible for determining this assessed value.

There are two types of property subject to assessment:
Real Property - land, land improvements and structures, farms, businesses, industry, residences, timber cut-over land and development property.

Personal Property - furniture and fixtures, machines and equipment belonging to a business, certain public utilities, oil wells, structures on leased properties, and other similar tangible property.

The General Property Tax Act [MCL211.1, etseq] requires real and personal property to be assessed annually in each township and city by a certified officer. The assessment roll must include the name and address of every person subject to taxation in the municipality. The roll must also contain a full description of real property, including the number of acres contained in it.

Who is responsible for assessing property at the township level?
The township supervisor is the chief assessing officer of the township. If the supervisor is not certified at the proper level by the State Assessors Board, MCL 41.61 requires the township board to appoint a properly certified assessor. According to MTA’s records, approximately 38% of all Michigan township supervisors also perform the assessing function. This number has declined over the past 20 years. Township assessors can work as employees of the township or as independent contractors, providing assessing services on a contractual basis. The township board determines the appropriate compensation for the assessor based on the amount of time needed to get the job done and the wages received by other assessors at the same certification level.

The law states that the assessor is subordinate to the supervisor, even if the supervisor is not a certified assessor. As chief assessing officer, the non-certified supervisor is still responsible for the assessment process.

How should an assessor appraise property?
The assessor has three traditional appraisal techniques to use when estimating the value of property:
Cost approach-Provides an estimate of value based on a determination of land value added to the depreciated cost of buildings and other improvements. The cost approach must be tested against local real estate market activity. Cost manuals for agricultural, commercial, industrial and residential buildings are approved by the State Tax Commission for use by assessors.

Market approach-This is used for the valuation of vacant land and to defend assessments in any appeal proceeding. Sometimes called the direct comparison method, this approach compares a property with similar properties that have sold recently to estimate the value of the property. The selling prices of the comparable properties are adjusted by judging their advantages and disadvantages measured against features of the subject property. Adjustments are usually made for comparisons in physical features such as size, quality of construction and condition, location, and time of sale. The value of land is most frequently estimated by the market approach. Soil type, zoning, public improvements, shape, size of parcel, topography and cover are factors considered when valuing land. The advantages of market approach are that it reflects the actions of buyers and sellers of property, and it is the method most easily understood by people who are not property valuation experts and by the courts and other review bodies. It is more useful as a defense of assessments than as a technique in the mass appraisal of property.

Income approach- The income approach can be used to appraise commercial property, but is primarily used in Michigan Tax Tribunal cases. Often referred to as the capitalization of income approach, it provides an estimate of value by analyzing the income producing capacity of investment property. It is based on the premise that the value of investment property is directly related to the income it is expected to produce over its economic life. Investment property is worth the present value of income that is to be received in the future. While the income approach is used primarily to defend assessments, it is also used in some assessing units to establish assessed values for income-producing properties. This approach is more difficult to use than the other approaches because the appraiser needs extensive training regarding real estate investments, income and expense analysis, and various income appraisal techniques. It is important that assessors have an understanding of the basic concepts of the income approach because they will encounter such appraisals prepared for owners of investment property during the appeals process.

Equalization of assessments is a three-step process:
Step 1: If there is a lack of uniformity among individual assessments on an assessment roll, the assessor and board of review examine and adjust the value as necessary. The Michigan Tax Tribunal can provide relief for lack of uniformity only to those taxpayers who appeal their assessment.

Step 2: After the assessor and the board of review finish their work, the tax rolls are given to the county. The county board of commissioners, with the assistance of the equalization department, reviews the assessment rolls and approves the totals, or adds to or deducts from those totals not representative of the required level of true cash value.

Reports of assessment roll changes made by the assessors, board of review and county equalization department are submitted to the State Tax Commission for review. Townships can appeal county equalization to the Michigan Tax Tribunal within 30 days of its adoption. Individual taxpayers may not appeal county or state equalization.

Step 3: On the second Monday in May, the State Tax Commission issues a preliminary report of its determinations of the totals for each class of real property and total personal property for each county. The tax commission adds to or deducts from the total county values that are not representative of the required levels of value.

If the total assessments fail to meet the required level after the county adjustment, the State Tax Commission applies an adjustment factor to the assessment in each class of property in an entire county. This is the state equalized value.

Hardship Exemption:
The General Property Tax Act provides a hardship (poverty) exemption irom property taxes:
(1) The principal residence of persons who, in the judgment of the supervisor and board of review, by reason of poverty, are unable to contribute toward the public charges is eligible for exemption in whole or in part from taxation under this act." [Excerpted] (MCL2Ll.7u)

To be eligible for an exemption, a person must own and occupy as a principal residence the property for which the exemption is requested, and must meet the federal poverty income standards. The exemption must be applied for each year by filing a claim with the supervisor or board of review on a form provided by the township. The application must be filed between January 1 and the last day of the board of review. (See the statute for more complete eligibility requirements.)

Every township board must establish hardship exemption guidelines, including specilic income and asset levels for the applicant, and total household income and assets. Based on the recommendation of the supervisor, the board of review may grant an exemption up to 100 percent of the property taxes on the principal residence property.

To obtain MTA's Sample Hardship Exemption Application, contact the Member Information Services Department at (517) 321-6467, or visit www.michigantown ships.org and type "hardship" in the site search window.

Size of Family Unit	Poverty Guideline
1	$ 9,570
2	$12,830
3	$16,090
4	$19,350
5	$22,610
6	$25,870
7	$29,130
8	$32,390
For each additional person, add 3,260.

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