Detroit — Wayne County Treasurer Raymond Wojtowicz announced Tuesday afternoon he’s extending the deadline to May 12 for homeowners to pay their delinquent taxes and avoid foreclosure.
The move comes the same day the Detroit City Council passed a resolution urging his office to enact a moratorium members said would create more time for legislative steps aimed at tax relief.
Hundreds of property owners packed the treasurer’s offices Tuesday, which officials had said was the deadline to pay and avoid losing their homes. Those living in homes they own now have until May 12 to pay. Foreclosed properties are auctioned in the fall.
“We continue to do all we can to help taxpayers avoid foreclosure,” Chief Deputy Treasurer David Szymanski wrote in an email Tuesday afternoon. “This is one step to make sure people can access the new programs granted by the legislature to reduce interest and save their homes.”
Recent legislation signed by Gov. Rick Snyder allows the treasurer to lower interest on debt from 18 percent to 6 percent for many homeowners. In many instances, homeowners can have taxes capped at a quarter of the market value of the home.
Wojtowicz is pursuing a record number of foreclosures this year, but his staff has said halting the process would only allow people to get further behind.
In June, the office started the foreclosure process on nearly 75,000 properties, the vast majority in Detroit. But as of mid-March, half of those property owners had paid or were in payment plans or other programs.
Of the remaining 38,000 facing foreclosure, about 16,000 are estimated to be occupied, Szymanski said. He expected that number to dwindle further after Tuesday.
Detroit Mayor Mike Duggan also announced Tuesday afternoon a new effort to give homeowners some relief on 2015 taxes.
The city will waive interest and penalties on 2015 taxes for homeowners in a county payment plan that reduced their interest rate, as long as they pay 2015 taxes by February 2016.
“It is my desire to encourage responsible home ownership in Detroit and to support taxpayers in remaining compliant with Treasurer Wojtowicz’s payment plans,” Duggan said in a release.
Nonprofits, the treasurer and other groups held numerous workshops over the past few months to get homeowners into payment plans to avoid foreclosure.
Around noon Tuesday outside the treasurer’s Greektown offices, a couple of dozen protesters held signs and chanted. Activists also picketed Wojtowicz’s home Monday night.
Surquetta Morgan, 38, showed up Tuesday in hopes of preventing her foreclosure. She said her husband recently died and she is worried about losing the home they shared for 17 years over her estimated $4,000 tax debt. She said if she’s homeless, she’s scared protective services will come for her two small children.
“I am worried my house is going to get taken. My kids are going to get taken,” Morgan said. “I am just praying.”
Housing advocates argued there wasn’t enough time to help everyone and pressed for a temporary halt on the foreclosures.
“This is a state of emergency,” Abayomi Azikiwe, of the Moratorium Now coalition of groups working to stop foreclosures, told the Wayne County Commission in March. “Ten thousand people could be removed from their homes if something isn’t done.”
Szymanski called that a “tremendous exaggeration.” The county doesn’t evict homeowners, he said, adding he’s “cautiously optimistic” most owner-occupants will be able to remain in their homes.
“We want people to stay in their homes,” he said. “If they can’t afford payments, go ahead and don’t pay taxes until the auction. You are living there rent-free. Hopefully, the new owner can say ‘Hey, do you want to rent from me’ and there will be an orderly transition.”
The foreclosures are a record. Last year, the county had 23,303, up from 18,771 in 2013 and 20,062 in 2012. Szymanski said most foreclosed properties are abandoned and there is no good argument to allow people who don’t pay taxes to avoid foreclosure.
“The property receives government services — streetlights, police and fire protection, local schools and trash,” he said. “If you don’t pay your taxes, your neighbor is subsidizing you.”
Advocates argue that foreclosure leads to blight, which costs residents millions to clean up. They also are concerned that poor, old people will lose their homes.
“You are never going to stop the blight until you stop the foreclosures,” said Dawn DeRose, a social worker who volunteers with Detroit Eviction Defense. “What kind of government are we having here in Detroit if you turn 80-year-olds out of their home?’
The council wanted time to advocate for changes in Lansing that would allow the city more time to grant poverty exemptions and review property tax appeals.
“The city’s prosperity in its post-bankruptcy world, and in fact, its survival, depends on population and community economic growth — the very opposite of the demise of existing neighborhoods,” the resolution passed Tuesday read.