Proposed Land Value Tax Plan in Detroit

Detroit Mayor Mike Duggan proposes hiking property taxes for vacant land and buildings while lowering the rate for occupied homes and businesses in a split tax plan he contends will resolve many of Detroit's blight and high property tax woes.

2 minute read

June 2, 2023, 6:00 AM PDT

By DA Hedges


On Wednesday, Detroit Mayor Mike Duggan proposed hiking the city's property taxes for vacant land and buildings while lowering the rate for occupied homes and businesses in a split tax plan he contends will resolve many of Detroit's blight and high property tax woes.

The proposal, dubbed the Land Value Tax Plan, would increase taxes on land while reducing taxes on homes and structures by an expected 30 percent, or roughly $38 million total. This would apply to every neighborhood in Michigan's largest city, require, no application, and never expire.

If approved by the Michigan Legislature and later by Detroit voters, Duggan said, the plan would provide relief to homeowners who have been struggling under the burden of high taxes, encourage further neighborhood growth and hold land speculators accountable. Duggan laid out his plan Wednesday during an annual address at the Detroit Regional Chamber's Mackinac Policy Conference.

Currently, private owners own roughly 30,000 neglected lots that Duggan on Wednesday described as “cheap lottery tickets” that bet on an increase in land value with no actual investment in the property. The city is forced to cut grass in the lots and remove garbage to spare surrounding neighbors while the property owners pay about $25-30 a year in taxes.

“This is what is driving me nuts,” Duggan said. “In Detroit, blight is rewarded and building is punished.”

Under Duggan's plan, the average homeowner will see a $250 annual tax reduction, according to the mayor's office.

Owners of active businesses and land that is in productive use will also see their tax bills go down, depending on the taxable value of their assets. Currently, vacant residential lots in the city are taxed at an average of $25 annually, according to the mayor's office.

The program, which would be phased in over three years starting in 2025, would on average increase the millage rate on vacant land from 86 to 124 mills and lower the millage rate on a home from 86 to 60 mills, Duggan told The Detroit News.

Wednesday, May 31, 2023 in The Detroit News

Chicago Intercity Rail

Amtrak Ramping Up Infrastructure Projects

Thanks to federal funding from the 2021 infrastructure act, the agency plans to triple its investment in infrastructure improvements and new routes in the next two years.

September 25, 2023 - Smart Cities Dive

Google maps street view of San Francisco alleyway.

Ending Downtown San Francisco’s ‘Doom Loop’

A new public space project offers an ambitious vision—so why is the city implementing it at such a small scale?

September 26, 2023 - Fast Company

Google street view of yellow "End Freeway 1/4 mile" sign on 90 freeway in Los Angeles, California.

Proposal Would Transform L.A.’s ‘Freeway to Nowhere’ Into Park, Housing

A never-completed freeway segment could see new life as a mixed-use development with housing, commercial space, and one of the county’s largest parks.

September 26, 2023 - Los Angeles Times

Aerial view of coastal town of Santa Cruz, California.

Santa Cruz Transit Looks to Expand

A small transit agency in Northern California is making ambitious expansion plans.

3 hours ago - Human Transit

View of dirt trail between shrubs with downtown Los Angeles skyline in background.

Advancing Park Equity Through Needs Assessments

City Parks Alliance, in partnership with Prevention Institute, recently hosted a webinar about park equity and collaboration, focusing on the Los Angeles Countywide Parks Needs Assessment.

4 hours ago - City Parks Alliance

Wood-frame houses under construction.

California Impact Fees Reach Supreme Court

An upcoming ruling could have a major impact on building and development in California and around the country.

5 hours ago - San Francisco Chronicle

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.