Law lecture examines impact of over-taxing housing property on Black families

Racial disparities in house value appreciation, mortgage lending and realtor steering are well-known concerns of housing advocates. Less known, but still as problematic, are disparities in property tax assessments. A July 2020 Washington Post analysis highlighted the fact that unfair property assessments led to over-taxation of Black property owners. As with most racial disparities, these findings are rooted in racist housing policies of the past. What can be done and how can this conversation reach the national conscious?

Bernadette Atuahene, professor of law at IIT, Chicago-Kent College of Law and a research professor at the American Bar Foundation, will explore these issues during her lecture “Detroit's Property Tax Foreclosure Crisis: A Tale of Structural Racism”. This event, the 2021 Robert S. Marx Lecture, will be held at 12:15 p.m., Thursday, Feb. 11, via WebEx. CLE: Approved for 1.0 of General CLE in OH and KY.

Between 2009-2015, the City of Detroit assessed the property value of 53 to 84 percent of homes in violation of the Michigan Constitution, which prohibits localities from assessing any property at more than 50 percent of its market value. Despite the City of Detroit’s 2017 attempt to correct this pervasive illegality, the inflated property taxes continue even today, especially for the lowest valued homes.

When Detroit homeowners cannot afford to pay their illegally inflated property taxes, the County takes their homes. In fact, since 2009, one in three Detroit properties have completed the tax foreclosure process. Significantly, only the majority Black cities in the County—Detroit, Inkster, and Highland Park—have experienced illegally inflated tax assessments and tax foreclosure at historic rates.

Detroit is not the only city with racially discriminatory property taxes. In Chicago’s Black and Hispanic neighborhoods, officials estimated home values far above their true market value, causing improperly inflated property tax bills.

In contrast, Chicago officials systematically underestimated home values in wealthier, white neighborhoods. A recent study finds that across the country, Black and Hispanic homeowners pay, on average, a 10 to 13 percent higher tax rate.

For the median Black or Hispanic homeowner, this translates into an extra $300 to $400 annually in property taxes. For neighborhoods with a high density of Blacks and Hispanics, this extra tax burden can be several times higher, fueling the racial wealth divide.

Though not as widely recognized as redlining and predatory mortgage lending, racialized property tax administration is a longstanding driver of the racial wealth gap.Historians show that it has been a common tool of displacement and extraction since Reconstruction. In the routine administration of white supremacy, local governments charged African Americans higher property tax rates while delivering them less in taxpayer supported services and foreclosing on their properties more frequently when they could not afford to pay the inflated property taxes.

Despite its pervasiveness through time, this racial injustice has not yet penetrated our national discourse, which renders the Black taxpayer invisible while making the Black tax recipient hyper visible. 

Bernadette Atuahene is a law professor at IIT, Chicago-Kent College of Law and a Research Professor at the American Bar Foundation. She received her BA from the University of California, Los Angeles, JD from Yale Law School, and  MPA from the Harvard Kennedy School of Government.  After her graduate work, she served as a judicial clerk at the Constitutional Court of South Africa, practiced as an associate at Cleary Gottlieb in New York, and served as a consultant for the World Bank and the South African Land Restitution Commission. 

Atuahene’s research focuses on land dispossession affecting people of the African diaspora. She has written several articles and a book manuscript entitled "We Want What’s Ours: Learning from South Africa’s Land Restitution Program" (Oxford University Press, 2014).

Atuahene also directed and produced an award-winning short documentary film about one South African family’s struggle to regain their land. She has been honored with the Fulbright Fellowship, Council on Foreign Relation’s International Affairs Fellowship, Princeton’s Law and Public Affairs Fellowship, and the Soros Equality Fellowship. She is currently working on a National Science Foundation funded research project, exploring land dispossession in Detroit.

Featured image at top: Courtesy of istockphoto.com