The Michigan Court of Appeals recently ruled that it is the municipality’s legislative body, and not the County Treasurer, who has the final say as to whether a proposed purchase of tax foreclosed property is for a “public purpose,” as required under Michigan’s General Property Tax Act.
In Bay City v. Bay County Treasurer, a unanimous panel of the Michigan Court of Appeals ruled that the Bay County Treasurer had no role in determining whether the City of Bay City’s proposed use of a home it desired to purchase after the home was foreclosed for failure to pay property taxes was indeed a “public purpose.” The City intended to purchase a vacant lot, and was considering conveying the lot to Habitat for Humanity for the construction of a new home. The County Treasurer refused to sell the parcel to the City, claiming the City would “not be able to achieve its public purpose . . .efficiently and expeditiously.” Although the trial court ruled for the Treasurer, the Court of Appeals reversed, determining that: (a) there was no requirement that the public purpose be efficiently and expeditiously achieved; and (b) the Treasurer had no authority under the General Property Tax Act to make an independent assessment of the City’s purported public purpose.
One should not read this opinion too broadly, as the “efficiently and expeditiously” element discussed by the Court is likely a required element to “public purpose” if the property were being taken under the power of eminent domain, rather than being purchased at tax sale.
If you have questions regarding property tax forfeitures, foreclosures, appeals, or payment plans, please contact at Demorest Law Firm.
