Monday, June 11, 2018

Jerry Paffendorf Presents Information On Wayne County Property Tax Foreclosure Debt Collection

75-second video describing the information I received from the Wayne County Treasurer's Office about how much delinquent property tax money they forward countywide and how much money they make as the debt collector (more than $300,000,000 since 2009, and currently between $30 and $40 million a year).

What if even 10% of this money could be used to solve the problem? More thorough description below. Graph and sources at

Thank you to Wayne County staff for being helpful in sorting through this.

I hope you think it's constructive. After a long back and forth of FOIAs and confusing answers, and follow-up FOIAs, and denials, and appeals, we received some really interesting information from the Wayne County Treasurer's Office on the size and shape of the delinquent tax fund and surplus going back to 2009. In this graph, the Countywide Delinquent Tax Net Receivables measures all of the money that Wayne County forwarded to all of its communities, including and especially Detroit, to cover the property taxes they didn't collect in a given year.

 The Total Collections of Taxes, Fees, and Interest measures all of the money that came back to them in a given year through collections, fees, interest, and chargebacks from any properties where taxes weren't ultimately collected. You can see that even as the number of foreclosures at auction has reduced in the last couple of years, the surplus remains high -- nearly $37,000,000 in 2014, which is the 2017 foreclosure class, nearly $30,000,000 for 2015, and a projected $35,000,000 for 2016.

 The shape of this system was known, but this may be the first time someone has sat down with county staff to confirm the annual tallies. It should be noted that there are still unknowns including the cost of collecting this money, so conversationally we're rounding $339,463,038 to "more than $300,000,000."

 The graph was pieced together by taking the Net Receivables column from this document for the years 2014-2017 and the cumulative collections from this document and subtracting the Collections on Tax or Delinquency number (from the second document). Wayne County staff was very helpful in walking through this process when we did have a chance to sit down.

Thank you to the staff of the Treasurer's Office. Respectfully, while there are no easy answers to complex problems, it seems that since this money is generated by a huge problem that adversely impacts the lives of Detroit and Wayne County residents, and would not exist without hardship and suffering, that a significant portion of it should be dedicated to solving the underlying problem that causes the hardship and suffering.

 As is said in the video, a mere 10% of $35,000,000 is $3.5 million dollars that could be put towards earlier and more persistent door-to-door outreach, making sure no occupied homes are sold at auction, and improving property tax payment systems so that more people pay on time at the local level and never get caught up in the penalties, fees, and interest trap.

 Maybe we can have that conversation moving forward. (Note that the delinquent tax fund extends back earlier than 2009, but that was the first year we received data for.

We do know from other documents that the countywide delinquent tax net receivables in 2007 was $314,672,406, and in 2008 it was $357,764,507.)

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