Oxford and Addison townships recently sent out their annual assessment notices and some folks are probably wondering why their property value went down, yet their taxes are still going up.
‘Proposal A caps the limit on the tax increase. It doesn’t do anything to provide tax relief when market value falls,? explained Dave Hieber, manager of Oakland County’s Equalization Division. ‘There’s no provision to have the taxable value go down simply because the market value’s going down on a property.?
To help people understand what’s going on with property values, taxes and Proposal A, the county has a pamphlet available on its website at www.oakgov.com/equal/info/pub_index.html.
Approved by state voters in March 1994, Proposal A caps a property’s taxable value (unless there’s a transfer in ownership or new construction) and limits increases to the rate of inflation or 5 percent, whichever is less.
For years, property owners reaped the benefits of Proposal A as market and assessed values climbed steadily, yet taxable value increases remained limited to inflation.
‘Back in the mid-to-late 1990s, things we’re going up substantially in value,? Hieber said. ‘The last four, five, six years property values in the county were still going up, but not at those double-digit rates we saw in the 1990s.?
But that’s all changed now that the real estate market is at a record low. Residential property values fell by an overall average of 6.8 percent in Oxford and 2.82 percent in Addison.
This drop affected assessed values which are 50 percent of the market value.
For people who have owned their properties for many years, the decrease in assessed values didn’t affect their taxable values, which still increased.
That’s because there’s such a great disparity between their State Equalized Value (which in Oakland County is equal to the assessed value) and taxable value due to the capping effect of Proposal A.
A drop in the higher SEV won’t affect the much lower taxable value at all unless it drops below the capped value, which is prior year’s taxable value adjusted for inflation. Taxable value is the lesser of SEV or capped value.
As a result, taxable value keeps increasing on these properties with the rate of inflation, which is 2.3 percent.
Property owners can appeal their assessment by going before their local board of review, which meets in early March (see shaded box for times and dates in Oxford and Addison).
However, unless a property owner can demonstrate that their SEV should be lowered to an amount below their capped value, an appeal will not lower their taxable value or property tax bill.
Property owners who’s State Equalized Value and taxable value are either the same or very close will notice a decrease in their taxable value, according to Hieber.
SEV and taxable value start out as equal whenever ownership of a new or existing home is transferred. Taxable value is then capped the following year after being multiplied by the inflation rate.
‘Communities that have had a lot of new growth over the last five to six years have a lot larger percentage of properties where SEV and taxable value are the same or very close,? Hieber explained. ‘It’s case by case. It depends on what the assessor did with it at the time.?
During this time, property values went up, but they didn’t increase much more than the 2-3 percent by which inflation and taxable values were rising.
‘So, the numbers tracked together,? Hieber said.
Since taxable value is determined by whichever is less, SEV or capped value, if SEV decreases and drops below below the capped value, it becomes the new taxable value.
‘There’s a substantial number of properties that are actually seeing taxable value reductions,? Hieber said. ‘It varies from community to community.?

Where and when to appeal
Oxford Township’s Board of Review will convene on the second floor of the Oxford Veterans Memorial Civic Center (28 N. Washington St.).
The board will meet Monday, March 10 from 9 a.m.-Noon and 1:30 until 6 p.m.; Tuesday, March 11 from 1-4:30 p.m. and 6-9 p.m.; Thursday, March 13 from 1-4:30 p.m. and 6-9 p.m.; and Friday, March 14 from 9:30 a.m. until 12:30 p.m.
To schedule an appointment contact the Oakland County Equalization Division at 1-888-350-0900. Those without appointments will be served on a first come, first served basis.
Addison Township’s Board of Review will convene at the township offices (1440 Rochester Rd. in Lakeville) in the public meeting room.
The board will meet Monday, March 10 from 9 a.m.-Noon and 2-5 p.m.; Wednesday, March 12 from 1-4 p.m. and 6-9 p.m.; and Thursday, March 13 from 6-9 p.m.
No appointments will be taken for Addison’s Board of Review.
Everything will be done on a first come, first served basis.
Please be courteous to Board of Review members who are fellow residents and taxpayers doing a difficult job.
To learn more about property values, taxes and Proposal A visit Oakland County’s website www.oakgov.com/equal/info/pub_index.html.