By: Teresa Mull
An octogenarian from Michigan had his home seized by the county because he failed to pay a measly $8.41 in taxes.
Uri Rafaeli, an 83-year-old retired engineer, made a mistake on his taxes (he miscalculated the interest owed) that led him to underpay the county by $8.41. Rafaeli’s tiny and honest mistake led to a penalty, the ultimate seizure of his property, and a huge financial loss.
“Uri Rafaeli, who lost his property and all the equity associated with it, is just one of thousands of people to be victimized by Michigan's uniquely aggressive property tax statute. The law, passed in 1999 in an attempt to accelerate the rehabilitation of abandoned properties, empowers county treasurers to act as debt collectors. In the process, it creates a perverse incentive by allowing treasurers' offices to retain excess revenue raised by seizing and selling properties with delinquent taxes—even when the amount owed is miniscule, and even when the homes aren't abandoned or blighted at all.
“Organizations representing property owners like Rafaeli say the practice is unconstitutional, inequitable, and unreasonably harsh. They call it "home equity theft"—a process that's a close relative to the civil asset forfeiture laws that have been used by police departments to similarly deprive innocent Americans of their property without due process. They are now asking the state Supreme Court to restrict the practice.”
Why It Matters:
"Counties have been authorized to take not just what they are owed, but to take people's life savings."
Teresa Mull is editor of GunpowderMagazine.com. Contact her at firstname.lastname@example.org.