Assessing FAQs
1. What is a State Equalized Value?
State Equalized Value (SEV): 50% of Market Value or True Cash
Value.
2. What is the formula for Capped Value?
Capped Value (CV): The formula is: Previous year’s Taxable
Value minus Losses (physical changes to the property) times the
Consumer Price Index (CPI) or 5% whichever is less plus Additions
(physical changes to the property), (TV-Losses x CPI (5%) +
Additions = CV)
3. What is Taxable Value?
Taxable Value (TV): Lesser of State Equalized Value and Capped
Value or the year following a transfer of ownership (sale, gift,
inheritance, etc) is equal to the State Equalized Value. Taxes are
based on Taxable Value, not State Equalized Value.
4. How can my assessment go down and my taxes go up?
If your assessment (SEV) is larger than the taxable value the
assessment could be reduced and still not be less than the
calculated capped value. Example: SEV = $150,000 – Market
reduction 5% = $142,500.
2008 TV = $120,000
2009 CPI = 4.4%
2009 CV = $120,000 x 1.044 = $125,280
Therefore, the assessment would have decreased by $7,500 but the
capped value is still less so the taxable value would be equal to
the capped value resulting in an increase in tax dollars.
5. Why isn’t my new assessment 50% of my purchase price?
The simple answer is that it is against the law. MCL 211.27
states that the purchase price is no longer the presumptive True
Cash Value of a property. The assessment may be close to 50% of the
purchase price but it is determined by investigating the other sales
in the area of the property and all of the SEV are set using that
sales study.
6. Sale prices are going down in my neighborhood, why hasn’t my
assessment gone down?
Sale prices going down in the neighborhood will not be reflected
immediately in your assessment. The State allows for a two year
sales study and an optional one year sales study. In inflationary
times, a two year study helps the taxpayer because sales used are
older and therefore lower in value. In deflationary times such as
now, a one year sales study helps the taxpayer because it reflects
the more recent sales. The City of Novi has used one year sales
studies for 2008 and 2009.
7. What is the time period considered in the 2009 Novi sales
study?
The State Tax Commission recommends using a period from October
1, 2007 to September 30, 2008. This is considered to be a 12 month
study. Because of the declining market, Novi also considers sales
occurring between October 1, 2008 and December 31, 2008, thus
rendering it a 15 month study. This allows Novi to gauge additional
changes in the market occurring before Tax Day.
8. Every time I read the paper or turn on the television,
there’s a story about foreclosures. Are foreclosures included in
the Novi sales studies?
Yes. Foreclosures and the subsequent sales from foreclosure are
reviewed. If the foreclosure sale price is influenced by a previous
owner’s damage, that sale may be eliminated from the study. Also,
some foreclosure sales may be so unreasonable as to give undue
weight to the study. Those sales may be eliminated from the study.
9. How have foreclosures affected the Novi real estate market?
Although Novi is not immune from the effects of foreclosures,
their impact has not been as severe as many other communities in the
metro area. Less than 200 Novi properties have been involved in
foreclosure process in the last 15 months. That’s about half of the
number in Farmington Hills and less than a quarter of those in
Southfield. Oakland County reports over 15,000 foreclosure related
transactions in the past year. Even with the inclusion of the Novi
foreclosures, the sale ratio is still below 50% for the 2009
assessment projections.
10. When can I appeal my assessment?
By law, the only time you may appeal your assessment is at the
March Board of Review, which is held the second Monday, Tuesday, and
Wednesday in March. After you receive the Change of Assessment
notice you may file a petition to make an appointment. Read the
Board of Review notice for dates and times.
11. What happens if I’m not happy with the decision of the
March Board of Review?
State law provides the next level of appeal at the Michigan Tax
Tribunal. A letter of appeal on residential property must be sent
to the Tribunal (P. O. Box 30232, Lansing, MI 48909) by July 31st
following an appearance at the March Board of Review.
12. Why can’t I protest my taxes when I get my tax bill in
July?
The State law provides for one time per year to protest the value
of your property. That protest may be made at the March Board of
Review only.
13. Is there any other tax relief for seniors besides deferment
or Poverty?
Besides deferment and poverty exemption, the only other tax
relief available is the Homestead Credit that is filed with your
income tax. You may receive up to $1,200 back from the State of
Michigan depending on your income and property tax amounts.
14. Do you have all of your information online?
Almost all of the information in the Assessor’s Office is public
record. The amount paid in taxes
is also public record and it is all available online by clicking
here. Access the Assessor’s area and you may look up
information by name, address or parcel number. Square footage &
2008 values are available and we expect to have the drawings of the
ground floor areas online in the near future. 2009 values will not
be posted online until the roll has been reviewed and confirmed
following the March Board of Review. That information is available
at the Assessing Department counter.
15. Where do I change my address?
You need to send a written request to the Assessing Department to
change the mailing address and that will change the address for both
assessments and taxes. It will not, however, change the water
billing address. You must contact the water department separately.
16. How do I qualify for the homestead exemption?
The homestead exemption is more correctly known as the Principal
Residence Exemption (PRE). The qualifications are simple; you must
own and occupy the home as your principal residence on or before May
1. A person or a married couple is allowed only one PRE in the
State. You may not claim an exemption in any other state. The
exemption continues until the use of the home as your principal
residence changes. When the change occurs, you must notify the
assessor’s office in writing. Proposal A and the enabling
legislature does NOT allow for any partial credit. Even if you move
into a non-homestead property on May 5, the exemption does not begin
until the following year. Recent legislation has allowed the
granting of a second homestead in certain conditions. The
Conditional Rescission is available when the previous homestead is
not occupied or rented, and is listed for sale. Please contact the
Assessing Department if you think you qualify for the additional
exemption.
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