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Should counties keep windfalls in tax foreclosures?

Posted at 7:31 AM, Dec 12, 2017
and last updated 2017-12-12 07:31:53-05

The Michigan Supreme Court is being asked to look at the windfalls enjoyed by counties when they sell a property because of unpaid taxes.

Local governments are keeping the cash — even if a sale exceeds the taxes and penalties owed.

Because of a mistake, Uri Rafaeli owed $8.41 on a rental property in Southfield. The bill grew to $285 with penalties and interest. Rafaeli says Oakland County sold the house for $24,500 and kept the balance.

The Pacific Legal Foundation calls it an unconstitutional taking, even if Michigan law allows it. The foundation is asking the Supreme Court to hear an appeal, although the court could say no. The group says thousands of people have been affected.

Oakland County says Rafaeli forfeited the house by not paying his bill.