News Story

Two state grants pump $3 million into Detroit gym

One grant flows through a regional education agency more than 100 miles away

The Downtown Boxing Gym in Wayne County will receive two grants from the 2025 state budget, totaling $3 million. One grant passes through a regional educational service agency four counties away.

A $2 million grant for the gym is listed among the Labor and Economic Opportunity grants in the budget. The other grant flows through the Clinton County Regional Educational Service Agency, which will pass the funds to the gym.

The state’s 2025 education budget allocates $75 million to Clinton County RESA, which provides special education and other services to six school districts in the greater Lansing area. Of that amount, the regional district must distribute $18 million to specific organizations, including the Downtown Boxing Gym, which is 108.7 miles from the RESA building.

The nonpartisan House Fiscal Agency confirmed to Michigan Capitol Confidential that the gym will receive two separate grants, totaling $3 million.

The $2 million grant is “to support services that provide free out-of-school time programming and supports program alumni, students, and families,” agency analyst Noel Benson told CapCon in an email.

The $1 million grant flows through Clinton County RESA for programming, construction and other remodeling, Benson wrote. The Michigan Constitution allows the pass-through of grants outside an organization’s service area.

”Under Article IX Sec. 11 of the Michigan Constitution, School Aid Fund dollars may be used only for aid to school districts, higher education, and school employees’ retirement systems,” Benson wrote.

CapCon sent an email to members of the RESA board asking for comment. None have responded.

The fee-free youth mentorship program subsidized by the budget helps Michiganders, the Downtown Boxing Gym told CapCon in an email.

“For every student we serve, there are thousands more on a waiting list who greatly need the individualized academic support, transformative mentorship, and measured impact we provide,” an official wrote. “Meeting that need requires significant funds and we work tirelessly to raise those funds to ensure every child can receive the equitable access to education and opportunities they need and deserve.”

The gym has served the community for 17 years. The funding will help expand its campus, build a new STEAM building and double the number of students, a representative said in an email.

“We applaud our lawmakers for investing in the education of our young people and the enhancement of our community. Investments like these will result in a better state and a better world for all of us,” the orgnization said.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

News Story

Michigan mom seeks just compensation in home foreclosure

Manistee County seized and sold home, then kept $102,636 more than owed

Four years after the Michigan Supreme Court unanimously ruled that counties can’t keep excess profits from tax foreclosures, one Michigan mom is fighting for $102,636 in home equity seized by Manistee County.

Chelsea Koetter, a single mother of two boys, fell behind on her property taxes in 2018 and underpaid what she owed in 2021. The tax bill grew to $3,863 with interest, penalties, and fees. Koetter later attempted to pay the overdue bill but missed the deadline by eight days. Manistee County foreclosed on the home. The county auctioned Koetter’s home for $106,500 in August 2021, keeping all the profit — $102,636 more than Koetter owed in taxes, penalties, interest and fees. 

Koetter argues that this violates a 2020 Michigan Supreme Court decision that it is unconstitutional for counties to keep excess equity after foreclosing on a tax-delinquent home.

That ruling followed Oakland County’s seizure of Uri Rafaeli’s property in 2014 over an initial tax debt of $8.41, which rose to $285.81 after interest, penalties and fees. In another decision from late July, the state Supreme Court ruled that counties must return excess profits seized from foreclosed homeowners, going back to 2020.

Nevertheless, a circuit court judge rejected Koetter’s motion to recover the surplus proceeds. The Michigan Court of Appeals also ruled against her. 

“The government can sell property to collect unpaid taxes, but it has a duty to pay just compensation when it takes more than what is owed,” Christina Martin, senior attorney at Pacific Legal Foundation, said in a statement. “But Michigan uses an unusual and complicated process that is designed to fail. It is a calculated attempt by the government to avoid Supreme Court precedent so that it can unconstitutionally take property without compensation.”

Rachel Nelson, the Manistee County treasurer, did not respond to a request for comment.

“It seems like the counties really just don’t want to pay,” Martin told CapCon in a phone interview. “But the Michigan Supreme Court has now twice unanimously said they have to. On top of that, the U.S. Supreme Court has unanimously said this is unconstitutional. So the counties need to stop fighting people and just start paying what they are owed.”

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.