EAST GRAND RAPIDS, Mich. — East Grand Rapids City Commissioners approved new poverty-exemption guidelines Nov. 25, doubling the income thresholds and significantly increasing asset limits for residents seeking property tax relief.
The changes raise the income level to twice the federal poverty guidelines. For a single-person household, the threshold increased from $15,060 to $30,120. Four-person households now qualify with incomes up to $62,400, compared to the previous limit of $31,200.
"So our City Commission decided to increase that two times the federal minimum," said Stacey Hayes, East Grand Rapids assessor.
The United States Department of Health and Human Services releases federal minimum income guidelines each year that all jurisdictions are required to minimally meet, though they can set higher thresholds.
The city also raised the asset cap from $6,000 to $40,000 per household, though the new policy excludes primary residences, first vehicles, and jewelry, artwork and antiques from asset calculations.
"The city commission did vote to exclude the primary the value of your primary residence, the first primary vehicle, and then any jewelry, artwork and antiques," Hayes said.
Assets that count toward the $40,000 limit include second homes, recreational vehicles such as campers, motor homes, boats and ATVs, plus bank accounts and money received from property sales including stocks and bonds.
Residents who qualify for the exemption won't pay any property taxes under the 100% exemption policy. The commission decided against using partial exemptions.
"If they meet the income and asset guidelines, that they will be granted the 100% exemption," Hayes said.
East Grand Rapids has never used partial exemptions, though they are allowed under state law.
Stacey says the changes were prompted by two residents who didn't qualify under the previous guidelines.
"The two residents that came in, we knew that they weren't going to make it, you know, they weren't going to fall under our current guidelines. So with the help of our Mayor Katie and trying to push this through," Hayes said.
One applicant was denied by the Board of Review last year for exceeding income guidelines.
One neighbor spoke in favor of the changes at the Nov. 25 commission meeting.
"I believe it will provide meaningful change for non-veterans with disabilities and senior citizens on fixed incomes," said an East Grand Rapids resident.
The city had to remove a clause that allowed it to grant exemptions even if applicants didn't qualify. The state told all jurisdictions to end that practice to ensure uniform standards.
"Previously, the Board of Review was able to maybe give us a special circumstance to a family, and now the state told all jurisdictions you cannot do that anymore," Hayes said.
Hayes noted the city has a state audit scheduled for 2026 and would have failed if the special circumstances provision remained.
The special circumstances exception was rarely used. Hayes said in her tenure since 2012, it was never granted, with only one attempted application in December 2024 that was denied.
Applicants must reapply each year and appear before the Board of Review for their first three years applying. After that, they can submit paperwork without appearing in person, though representatives can appear on behalf of applicants who cannot attend.
The state recently simplified the application process from two forms to one - Form 5737, the application for poverty tax exemption.
WATCH THE VIDEO STORY
This story was initially reported by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
