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DOCUMENT RESUME
03505 - [.A2723943]
Department cf Housing and Urban Development Unresponsive to
Multifamily Hcusinj Real Estate Tax Problems. CED-77-125;
E-114860. Septembh. 27, 1977. 23 pp. + 2 appendices (6 pp.).
Repozt to the Congress; by Elmer B. Staats, Comptroller General.
Issue Area: romestic Housing and Community Development:
Minimizing Costs in Maintaining Integrity and Livability of
Subsidized Housing (2107).
Contact: Community and Economic Develc-pent Div.
Budget Function: Commerce and Transportation: Mortgage Credit
and Thrift Insurance (401).
Organizaticn toncerned: Department of Housing and Urban
Development.
Congressional Relevance: House Committee on Banking, Currency
and Housing; Senate Committee on Banking, Hoilsing and Urban
Affairs; Congress.
Authority: National Housing Act, as amended (12 U.S.C. 1701 et
seq.). State of Michigan Public Act of 1966, no. 346.
Although the Department of Housing and Urban
Development (HUD) has beeA able to reduce real estate taxes
sporadically through local appeal actions, it has been
unresponsive generally to real estate Ldx problems of
multifamily housing projects. The lack of a program to verify
that taxes assessed on HUD-insured projects are fair and
equitable has resulted in payment of excessive taxes and
approval cf unnecessary rent increases. Findings/Conclusions: A
review of the Chicago, Detroit, and Dallas area office
operations indicated that HUD has not effectively reviewed and
appealed tax assessments on projects it owns, insured proper and
timely payment of taxes on these projects, or concerned itself
with real estate taxes in its review of financial operations of
insured projects. These problems were caused, in part, by a lack
of needed tax information at the local offices and the absence
cf a headquarters policy on servicing insured-project tay
proble-s. In Detroit, HUD was everassessed in several cases,
paid taxes on projects it did not own, and paid $35,000 worth of
late charges. In cther cases, HUD paid unnecessary taxes by not
taking advantage of State relief laws, and did not appeal a
known overassessment. Although area offices are required to
evaluate the fairness of tax assessments, they do not have the
data available to them. HUD believes that tax assessment review
for insured projects is the cwners' responsibility.
Reccmmendaticns: Real estate taxes should be included as one of
the items to be dealt with in monitoring problems of insured
projects. Procedures should be established to assure that real
estate taxes assessed on both HUD-owned and -insured multifamily
projects are fair and equitable. A multifamily tax payment
system should be developed which insures proper and timely
payment of rfal estate taxes. States and other taxing](ViewImageLocal?handle=hein.gao/gaobaavzg0001&div=1&collection=&method=preview&ext=.png&size=3)