Even as home values return to normal, Prop A keeps towns and cities strapped for cash

Aug 25, 2017

It used to be property taxes skyrocketed when home values went up. Sometimes tax bills increased by double digit percentages in a single year.

Voters fixed that with the passage of Proposal A in 1994. The constitutional amendment capped how much property taxes could go up in a year at five percent or the rate of inflation, whichever is less.

However, no one thought home values would drop as much as they did during the Great Recession. Home values are returning to normal now, but the property tax increases are being held down by Proposal A. That means cities are not recovering at the same rate as the economy.

Tony Minghine from the Michigan Municipal League, which represents cities, wants to make some changes to Proposal A. He joined Stateside to explain.

Listen above.

*This story was originally broadcast on May 25, 2017.

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