The City of Detroit’s Office of the Chief Financial Officer oversees the assessment division and is responsible for determining the value of property for taxation purposes. The city has more than 350,000 parcels of real property, including land and buildings.
The City of Detroit has faced many of the same changes that other municipalities face (population decline, changes in tax base, budget constraints, legacy costs, deferred maintenance, etc.) albeit on a much larger — some would say seismic — scale. The city’s previous organizational structure and operational procedures were designed to support a city that no longer exists. Its leaders are now focused on creating a “right-sized” organizational structure, efficient procedures, and an effective governance model that are appropriate for the future version of Detroit.
The assessment division was faced with two significant challenges: organizational issues and data validity. Both needed to be addressed simultaneously in order for the department and the assessment records to improve.
Organizational challenges: Perhaps the biggest challenge was the citywide budget cuts continued through the appointed emergency manager and pending bankruptcy. In addition, the city needed help improving:
- Compliance with state of Michigan guidelines
- Performance standards
- Departmental & interagency communication
Data validity challenges: The city needed assistance in combating:
- Low public trust in record accuracy
- Inefficient & error-prone manual methods
- Thousands of backlogged appeals challenging assessment findings
- Auditing shortfalls & inconsistent database records
- Lack of technology upgrades
Our team evaluated several operational scenarios the department could implement for immediate improvement. The primary goal was to take the assessment division from a paper-based manual operation to a technology-driven operation based on data integrity. To address organizational challenges, we recommended a plan to:
- Re-inspect all city properties to ensure correct data
- Invest in technology to contain departmental costs
- Reorganize department staff to support core processes
- Embed quality throughout organizational culture
We also provided recommendations to address outdated property values and adjustments. A key element was adopting an alternative service delivery model for all residential appraisals composed of the following steps:
- Digital imaging — Scan every paper record into a digital file.
- Improve data — Implement remote data-gathering techniques including aerial photos and street-view imagery to allow all parcels to be viewed from an employee’s desktop.
- Data verification — Hire an outside vendor to verify and review all parcels using new digital data sources.
- Revaluing — Revise values for all properties based on updated information. (This is expected to be completed in 2016 for residential properties.)
“Plante Moran was able to bring an outsider’s view of the process, and I think we’re moving in the right direction. Plante Moran is on our steering committee for the reappraisal project and continues to be involved in the department restructuring plan. The team we’ve worked with has been first class all the way.” - Alvin Horhn, Deputy CFO
By improving organizational structure and data integrity simultaneously, the assessment division is able to improve competency and accountability while saving time and money. Some key benefits include:
- By using remote data techniques and relying on outside vendors, the city is able to save $18–$43M in the revaluation effort, when compared to a traditional on-site approach.
- By the end of 2016, the assessment division will have new values documented for every residential property within the city. A traditional approach would take years longer to complete.
- With improved valuations, the city can expect fewer appeals.
- The assessment division’s reorganization outlines new job descriptions and responsibilities based on qualifications. This allows exemplary employees a clearly defined career path based on merit and contributions to the department.
- With current and accurate property data, opportunities now exist for data sharing and integration with internal city operations as well as external partners.
- The citizens of Detroit receive better customer service.