Property Taxes

The largest share of the General Fund revenues comes from the property taxes. Property taxes are a critical source of revenue for the City of Ann Arbor, as well as neighboring communities. Many Ann Arbor taxpayers are surprised to learn that approximately $0.28 of every dollar paid in property taxes goes to the City of Ann Arbor to fund vital services. Most of the receipts of property taxes are various education agencies including the Ann Arbor Public Schools, Washtenaw Intermediate Schools, the State of Michigan and Washtenaw Community College – comprises approximately $0.52 of every dollar paid in property taxes.  The following chart depicts where the city’s property tax dollars are distributed:

During the last 32 years, there have been two State of Michigan constitutional amendments – the Headlee Amendment of 1978 and Public Act 415 of 1994 (commonly known as Proposal A) – and other related statutory changes that have impacted property tax revenue for local governments. During fiscal year 2008, the Headlee rollback started reducing the levy. The following charts and tables give a historical view of the General Levy, as well as cty millage trends.

In addition to the General Operating millage, the city’s General Fund collects money from the Employee Benefits and Ann Arbor Transportation Authority (AATA) millage. The remaining millages are assessed for dedicated purposes and are used to finance the activities of those dedicated funds. The chart below shows the millage trends during the past six years: