Michigan’s Headlee Amendment rollbacks and overrides work as a two-part system: when existing property values in a jurisdiction grow faster than inflation, the local millage rate is automatically reduced, and the only way to lift the rate back above that reduced ceiling is a voter-approved Headlee override. The amendment, added to the Michigan Constitution in 1978 as Article IX, Sections 25 through 34, prevents local governments from collecting windfall revenue when real estate values surge.1Michigan Legislature. Constitution of Michigan of 1963 – Article IX For the 2026 tax year, the state inflation rate multiplier is 1.027, so any jurisdiction where existing property values grew by more than 2.7% faces a mandatory rate reduction.2Michigan Department of Treasury. Bulletin 14 of 2025 – Inflation Rate Multiplier for 2026
What Triggers a Rollback
Article IX, Section 31 requires that when the total assessed value of existing property in a jurisdiction grows faster than the “general price level,” the maximum authorized millage rate is reduced so the local government collects roughly the same revenue it would have collected at the old rate, adjusted for inflation.3Michigan Legislature. Constitution of Michigan of 1963 – Article IX, Section 31 The constitution defines “general price level” as the annual average of the U.S. Consumer Price Index for All Urban Consumers, and the Michigan State Tax Commission converts that index into a single inflation rate multiplier each year.
The rollback only looks at property already on the tax rolls the previous year. New construction and other additions don’t count toward the growth that triggers a reduction. If the collective taxable value of existing parcels climbs faster than the multiplier allows, the millage rate is trimmed so the extra value doesn’t produce extra revenue. The reduction applies to the average increase in taxable value across the entire jurisdiction, not parcel by parcel.4Michigan House Fiscal Agency. Legislative Snapshot – Headlee Rollbacks and Millage Reduction Fraction
How the Millage Reduction Fraction Is Calculated
The Millage Reduction Fraction (MRF) is the number that determines whether a rollback happens and how deep it goes. The calculation is governed by MCL 211.34d:
MRF = (Prior Year’s Taxable Value − Losses) × Inflation Rate Multiplier ÷ (Current Year’s Taxable Value − Additions)4Michigan House Fiscal Agency. Legislative Snapshot – Headlee Rollbacks and Millage Reduction Fraction
In plain terms: take last year’s total taxable value and subtract losses such as demolished buildings or property reclassified as exempt. Multiply that adjusted number by the inflation rate multiplier (1.027 for 2026). Divide by this year’s total taxable value minus additions, meaning newly constructed or improved property not previously on the rolls. If the result falls below 1.0, the jurisdiction must multiply its maximum authorized millage by the MRF, which lowers the rate. If the result is 1.0 or higher, no rollback is required. The MRF can never exceed 1.0, so this calculation cannot raise a rate.2Michigan Department of Treasury. Bulletin 14 of 2025 – Inflation Rate Multiplier for 2026
The county equalization director compiles the data and completes Form L-4028 for every taxing jurisdiction in the county, sending copies to the State Tax Commission and to each local unit that levies a property tax.5Michigan Department of Treasury. Form 612 – 2026 Millage Reduction Fraction Computation Misclassifying a property transfer as an “addition” or overlooking a demolished structure in the “losses” column throws off the entire fraction and generates incorrect tax bills across the jurisdiction.
Why Rollbacks Are Permanent
A Headlee rollback stays in place once it happens. Before 1994, local governments could “roll up” their millage rate in years when property values grew more slowly than inflation, gradually recovering what earlier rollbacks had taken away. Proposal A eliminated that self-correcting mechanism in 1994. Now, once a rate is rolled back, it stays rolled back unless voters approve a Headlee override.
Proposal A also added a second layer of tax protection that interacts with Headlee in ways local officials find frustrating. It caps the annual increase in each parcel’s taxable value at the lesser of inflation or 5%, regardless of what the market did. That cap holds until the property changes hands, at which point the taxable value “uncaps” and resets to the current state equalized value.6Michigan Legislature. Constitution of Michigan of 1963 – Article IX, Section 3
When a property sells and its taxable value jumps, that increase counts as growth on existing property for Headlee purposes. It is not treated as an addition the way new construction would be. So a community with an active real estate market can see its total taxable value surge from turnover alone, triggering a rollback even though no new buildings went up. The reduced millage rate then applies to everyone in the jurisdiction, including parcels whose values didn’t uncap. Total property tax revenue can end up growing less than inflation despite rising values. This dynamic is why Headlee overrides have become common on Michigan ballots since the mid-1990s.
When a Public Hearing Is Enough Instead of a Vote
Not every rate increase requires an election. Under MCL 211.24e, a local governing body can levy above the “base tax rate” (the rate that would produce no more revenue from existing property than it collected last year) without going to voters, provided it holds a Truth in Taxation hearing first.7Michigan Legislature. MCL Section 211.24e The rate levied through this process still cannot exceed the Headlee-reduced maximum authorized rate. Going above that ceiling requires a voter-approved override.
The process starts with a resolution setting the proposed additional rate, followed by a published newspaper notice at least six days before the hearing. The notice must state the proposed rate, the percentage revenue increase it would produce over the base rate, and the percentage revenue increase the jurisdiction would receive without the additional rate. After the hearing, the governing body has ten days to vote, and it cannot approve a rate higher than what appeared in the notice.7Michigan Legislature. MCL Section 211.24e
Putting a Headlee Override on the Ballot
To restore a millage rate above the Headlee-reduced maximum, voter approval is the only path. Section 31 classifies any rate increase beyond the rolled-back maximum as a new tax levy requiring “approval of a majority of the qualified electors of that unit of Local Government voting thereon.”3Michigan Legislature. Constitution of Michigan of 1963 – Article IX, Section 31
Ballot language must describe the restored amount as an increase in taxes. The jurisdiction is technically returning to a rate voters previously authorized, but the rollback made that higher rate unavailable, so restoring it is treated the same as a new tax. The proposal must identify the original maximum millage rate, the current rolled-back rate, and the specific increase being requested.
How the question is framed matters, and getting it wrong creates real legal exposure. Three common structures cover most situations:
- Renewal only. If the jurisdiction is simply renewing the current rolled-back rate for another term, the ballot describes it as a “renewal of a previously authorized millage.” No override language is needed because the rate isn’t going up.
- Override only. If the jurisdiction wants to restore the full amount lost to rollbacks, the ballot must describe the increase as “new additional millage in excess of the limitation imposed by operation of the Headlee amendment.”
- Renewal plus override. If an expiring authorization is being renewed and the rolled-back portion is being restored at the same time, the ballot combines both: a renewal of the rolled-back rate plus new additional millage equal to the amount lost to Headlee.
The proposal must also specify the duration. Some jurisdictions request a single year; others ask for a longer term. Before the question reaches the ballot, the governing body adopts a formal resolution and files it with the local clerk within the applicable election filing deadlines. Public hearings typically accompany the process.
The Election and What Happens After
Michigan holds regular elections in February, May, August, and November. Override proposals most often appear on November general election ballots, though May and August are used as well. A simple majority of voters casting ballots on the question is enough to pass it.3Michigan Legislature. Constitution of Michigan of 1963 – Article IX, Section 31
If voters approve the override, the restored rate takes effect for the next tax billing cycle rather than retroactively. The local clerk certifies the results, the treasurer updates the tax rolls, and the higher rate shows up on the next round of summer or winter tax statements.
If the override fails, the rolled-back rate stays in place and the jurisdiction operates within the tighter revenue constraints. There is no limit on how many times a local government can bring an override back to voters, but each attempt requires a new resolution, new ballot language, and a new election.
Taxpayer Remedies If the Rules Aren’t Followed
The Headlee Amendment carries an unusual enforcement mechanism: any Michigan taxpayer has standing to sue. Article IX, Section 32 allows any taxpayer to bring an original action in the Michigan Court of Appeals to enforce Sections 25 through 31, and a prevailing taxpayer is entitled to litigation costs from the local government.8Michigan Legislature. Constitution of Michigan of 1963 – Article IX, Section 32
The Court of Appeals can refer a case to a circuit court or the Michigan Tax Tribunal for fact-finding when the dispute involves detailed calculations or valuation questions.9Michigan Legislature. The Headlee Amendment – A Study Report by the Michigan Law Revision Commission The Local Government Claims Review Board has no authority over these challenges. If your jurisdiction miscalculated the MRF, failed to apply a rollback, or levied above its authorized maximum without proper voter approval, the Court of Appeals is the venue.
Taxpayers seeking to compel compliance with specific reporting or calculation requirements can pursue a writ of mandamus, which requires showing a clear legal right, a clear ministerial duty, and no other adequate remedy.10Justia. Taxpayers for Michigan Constitutional Govt v Michigan The cost-recovery provision in Section 32 lowers the financial risk of these cases for individual taxpayers, which is what the amendment’s drafters intended.