Grant Township, Cheboygan County, Michigan
www.granttwp.com
Why are your taxes going up
while your home value is going down?
Leonard Page, Cheboygan County Commissioner
Explains the Headlee Amendment
Many homeowners are understandably upset when they get their property tax bills. They know
that their property values are going down and can't understand why their property taxes are
going up.

It goes back to the Headlee Amendment to the Michigan Constitution adopted by the voters in
1978. Proposition A (as it is also called) capped tax increases in a given year to the lesser of
the rate of inflation or 5%. When you buy or build your house your taxable value (TV) and your
State Equalized Value  (SEV - which is supposed to be 50% of market value) should be the
same. However, as time goes by in a robust economy, the SEV tends to become larger than the
TV as property values rise while the TV increases are capped. But what happens when property
values go down while inflation steadily rises - like now? Even though your property value (SEV)
has fallen, after years of disproportionately rising above the TV, it is more than likely still higher
than your TV. As long as  your TV is less than your SEV, the Headlee Amendment demands
that your TV - your taxes - go up by the rate of inflation or 5%, whichever less. (This year's rate  
eventually matches your SEV again, you will not be taxed more than  your house is worth (your
still going up and may save you the time of demanding an explanation at a local Board of
The Cheboygan County website also has a video explanation of the problem. Click on this link  and when you get to the County website,
on the left, immediately under  "Special Interests", is the link to the video.