In the quiet corners of Hillsdale County, where family farms and modest homes dot the landscape, a federal lawsuit is quietly unraveling a chapter of financial hardship for some residents. Filed in 2024, Mulkey et al. v. Hillsdale County et al. accuses county officials of stripping away properties through tax foreclosures without returning the excess money from their sales, a practice that echoes statewide controversies over who gets the windfall when a home sells for more than its tax debt.
For Hillsdale locals like Debra and Perry Mulkey, Vicki Alent, and Robert Prochko, the suit represents more than paperwork, it’s a fight to reclaim what they say was taken unjustly. The Estate of Cynthia A. Stramecky, honoring a deceased family member’s legacy, joins them as plaintiffs. Their target? Hillsdale County itself, along with Treasurer Stephenie Kyser and County analyst Julie Beeker, whose roles in tax collection and the data behind property tax assessments put them at the center of the case.
A Familiar Story in Michigan’s Heartland
The case, docketed as No. 1:24-cv-00365 in the U.S. District Court for the Western District of Michigan, stems from Michigan’s aggressive tax foreclosure system under the General Property Tax Act. When property owners fall behind on taxes, often due to job loss, medical bills, or broader economic shocks, the county can seize and auction off homes.
If the sale price exceeds the owed taxes, interest, and fees, that extra money isn’t supposed to be a government bonus. It is the former owner’s equity.
The plaintiffs say that did not happen here. According to their filings, Hillsdale County foreclosed on properties at addresses such as 14727 Diane Drive W. in rural Hillsdale Township, 10500 W. Litchfield Road near the village line, and 70 E. Hallett Street in the city, then sold them for more than the tax debt and quietly routed the surplus into county funds instead of back to the people who lost their homes.
This is not an isolated grievance. It is part of a wave of similar suits across Michigan, sparked by the 2020 state Supreme Court ruling in Rafaeli v. Oakland County, which held that counties cannot keep surplus proceeds from tax foreclosure sales. That decision opened the door to a massive class action settlement in June 2024 covering dozens of Michigan counties, including Hillsdale. Under that deal, eligible former owners could claim up to 80% of surpluses from sales between 2013 and 2020, potentially totaling millions statewide.
For those like the Mulkey plaintiffs, who opted out or pursued individual claims, the fight continues in federal court. Their lawsuit argues that what the law now clearly recognizes as a property right, the surplus equity, was treated by Hillsdale County as a quiet revenue stream.
The County’s Defense, Procedure vs. Property
Hillsdale County removed the case from state court to federal jurisdiction in April 2024, paid the $405 filing fee, and quickly moved to dismiss. In their brief, county attorneys rely on statutes, time limits, and technical arguments, claiming some of the plaintiffs’ claims are too old or not properly brought under state law.
Kyser, the elected treasurer who oversees the tax foreclosure process, and Beeker, who works on GIS mapping and equalization data that underpins tax assessments, are both named as defendants in addition to Hillsdale County itself. Neither has commented publicly on the suit.
In a brief written statement, county officials said Hillsdale County “takes all legal matters seriously and is committed to fair tax administration,” and that it will “vigorously defend the County’s compliance with state law.”
The motion to dismiss, filed April 16, 2024, sparked a procedural back and forth. Plaintiffs sought a status conference to coordinate discovery, but U.S. District Judge Paul L. Maloney instead extended briefing deadlines, plaintiffs’ responses due in late June, defendants’ replies by mid July.
As of this writing, the public docket shows no rulings or settlements entered after May 31, 2024. For residents watching from the outside, it can look like nothing is happening. In reality, cases like this often idle on the surface while lawyers argue over timing, jurisdiction, and potential settlement behind the scenes.
Why It Matters to You, Hillsdale
For the average Hillsdale County resident, whether you are a farmer in Jonesville, a retiree in Hillsdale city, or a young family in Litchfield, this lawsuit shines a light on a system that touches millions of people across Michigan. In recent years, Hillsdale County has foreclosed on dozens of properties annually, many for debts under $5,000, according to state tax foreclosure data.
Critics, including the plaintiffs’ legal team and local activists, say these seizures disproportionately hit vulnerable residents, people who miss a tax bill during a medical crisis, a job loss, or a messy divorce, and turn minor delinquencies into permanent losses of equity built over decades. Court filings in Mulkey describe a process where the County forecloses, auctions the property, and then absorbs the surplus into county funds, treating a family’s life savings as just another line item in the budget.
For the plaintiffs, the legal words may sound abstract, words like “takings,” “equity,” and “surplus proceeds,” but the stakes are painfully concrete. If a bank or private creditor seized your truck to cover a small debt, sold it for more than you owed, and refused to return the difference, most people would not call that sound fiscal management. They would call it a ripoff. The plaintiffs argue the County has been doing the same thing with homes.
Follow the Money, and the Movers
The lawsuit lands in a community already suspicious of how public power and public money are used. Over the past few years, Hillsdale residents have watched a string of local officials head for the exits while insisting that the real problem is not policy, but “negativity.”
As the Hillsdale County Review recently noted, former city code enforcement official Alan Beeker, the husband of Julie Beeker, resigned after publicly blaming “negativity,” a term many residents translate as “council members asking hard questions.” Beeker, who had reportedly talked about retiring for months, did not retire to a small cabin in the woods. He moved to Ludington, a popular lakeshore town. He was not alone. Another official, Jeff Gier, resigned for similar reasons and likewise ended up in Ludington.
Meanwhile, Hillsdale City Manager David Mackie, a familiar figure in local controversies, owns multiple properties in that same lakeshore community. Local commentary has pointed out that Mackie and Beeker will effectively be neighbors on or near the pier.
“Mr. Alan Beeker, who resigned on account of ‘Negativity,’ i.e., Council asking questions, (and despite his many months of reportedly talking openly about retirement) has moved to lovely Ludington, along with Mr. Jeff Gier, who resigned for the same alleged reasons! City Manager David Mackie owns numerous properties in Ludington. It looks like he’ll be neighbors with Mr. Beeker, right on the pier. Well done, gentlemen, you lovers of Hillsdale, you,” the Review quipped, with a mix of sarcasm and frustration.
To many residents, it all feels a little too obvious, officials invoke “negativity” at home, then quietly cash out and head for nicer zip codes, often with public salaries and pensions built on the backs of the same taxpayers now fighting to get their equity back.
One Hillsdale resident, responding to an online commenter who shrugged off these concerns, put it bluntly,
“People become pretty well-off when they work in the government in positions of authority. They enjoy enriching themselves, courtesy of the taxpayer. I guess if you don’t understand now, you will never understand.”
That is not a legal brief. It is a gut reaction, but it captures the mood. When you lay the Mulkey lawsuit alongside the revolving door of local officials, the pattern that ordinary people see is not just about a technical misreading of the General Property Tax Act. It is about a culture where government insiders seem to land softly, while ordinary families lose homes, land, and the savings tied up in both.
A Bigger Fight Than One Lawsuit
Ultimately, Mulkey is about more than four sets of plaintiffs and a few parcels of land. It is a test of whether the promises made in Rafaeli and the 2024 class action settlement actually mean anything in places like Hillsdale, or whether counties can keep treating surplus equity as discretionary cash, shielded by technical defenses and shifting explanations about who, exactly, can be sued.
If the plaintiffs prevail, Hillsdale County could be ordered to return tens or hundreds of thousands of dollars in surplus proceeds and change how it handles future tax foreclosures. If the County wins on technical grounds, many residents will read it as confirmation of what they already suspect, that in Hillsdale, the rules are strict for those who fall behind and flexible for those who run the system.
Either way, the case forces a hard question back onto the local agenda,
Who really prospers when Hillsdale takes a home for taxes, the community, or the people in charge of the paperwork?
Written in Collaboration with Joseph Hendee, fellow conservative and local watchdog.
in liberty,
the Hillsdale Conservatives.
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