HB-6025, As Passed House, June 24, 2004

SUBSTITUTE FOR

HOUSE BILL NO. 6025

                                                                             A bill to amend 1893 PA 206, entitled                                             

"The general property tax act,"                                             

(MCL 211.1 to 211.157) by adding section 7hh.                               

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1   Sec. 7hh.  (1) Notwithstanding the tax day provided in                      

2   section 2 and except as limited in subsection (5) and otherwise             

3   provided in subsection (7), for taxes levied after December 31,             

4   2004, real and personal property of a qualified start-up business           

5   is exempt from taxes levied under this act for each tax year in             

6   which all of the following occur:                                           

7       (a) The qualified start-up business applies for the exemption               

8   as provided in subsection (2) or (3).                                       

9   (b) The governing body of the local tax collecting unit or,                 

10  for taxes levied by the county in which the qualified start-up              

11  business is located, the county board of commissioners adopts a             

1   resolution approving the exemption as provided in subsection                

2   (4).                                                                        

3       (2) Except as otherwise provided in subsection (3), a                       

4   qualified start-up business may claim the exemption under this              

5   section by filing an affidavit on or before May 1 in each tax               

6   year with the assessor of the local tax collecting unit.  The               

7   affidavit shall be in a form prescribed by the state tax                    

8   commission.  The affidavit shall state that the qualified                   

9   start-up business was eligible for and claimed the qualified                

10  start-up business credit under section 31a of the single business           

11  tax act, 1975 PA 228, MCL 208.31a, for the applicant's last tax             

12  year ending before May 1.  The affidavit shall include all of the           

13  following:                                                                  

14      (a) A copy of the qualified start-up business's annual return               

15  filed under the single business tax act, 1975 PA 228, MCL 208.1             

16  to 208.145, in which the qualified start-up business claimed the            

17  qualified start-up business credit under section 31a of the                 

18  single business tax act, 1975 PA 228, MCL 208.31a.                          

19      (b) A statement authorizing the department of treasury to                   

20  release information contained in the qualified start-up                     

21  business's annual return filed under the single business tax act,           

22  1975 PA 228, MCL 208.1 to 208.145, that pertains to the qualified           

23  start-up business credit claimed under section 31a of the single            

24  business tax act, 1975 PA 228, MCL 208.31a.                                 

25      (3) If a qualified start-up business applies for an extension               

26  for filing its annual single business tax return under section 73           

27  of the single business tax act, 1975 PA 228, MCL 208.73, the                

1   qualified start-up business may claim the exemption under this              

2   section after May 1 if all of the following conditions are met:             

3       (a) The governing body of the local tax collecting unit or,                 

4   for taxes levied by the county in which the qualified start-up              

5   business is located, the county board of commissioners adopts a             

6   resolution under subsection (4)(b) approving the exemption for              

7   all qualified start-up businesses that apply for an extension for           

8   filing the annual single business tax return under section 73 of            

9   the single business tax act, 1975 PA 228, MCL 208.73.                       

10      (b) The qualified start-up business submits a copy of its                   

11  application for an extension for filing its annual single                   

12  business tax return under section 73 of the single business tax             

13  act, 1975 PA 228, MCL 208.73, and the affidavit described in                

14  subsection (2) to the December board of review provided in                  

15  section 53b.  For purposes of section 53b, an exemption granted             

16  under this subsection shall be considered the correction of a               

17  clerical error.                                                             

18      (4) On or before its last meeting in May in each tax year,                  

19  the governing body of a local tax collecting unit may adopt a               

20  resolution approving the exemption provided in this section.  The           

21  clerk of the local tax collecting unit shall notify in writing              

22  the assessor of the local tax collecting unit and the legislative           

23  body of each taxing unit that levies ad valorem property taxes in           

24  the local tax collecting unit.  Before acting on the resolution,            

25  the governing body of the local tax collecting unit shall afford            

26  the assessor and a representative of the affected taxing units an           

27  opportunity for a hearing.  If the governing body of a local tax            

1   collecting unit does not adopt a resolution approving the                   

2   exemption provided in this section, the county in which the                 

3   qualified start-up business is located may adopt a resolution               

4   approving the exemption provided in this section for taxes levied           

5   by the county in which the qualified start-up business is                   

6   located.  A resolution approving the exemption provided in this             

7   section may be for 1 or both of the following:                              

8       (a) One or more of the individual qualified start-up                        

9   businesses that claim the exemption under this section by filing            

10  an affidavit on or before May 1 as provided in subsection (2).              

11      (b) All qualified start-up businesses that claim the                        

12  exemption under this section after May 1 as provided in                     

13  subsection (3).                                                             

14      (5) If the governing body of a local tax collecting unit                    

15  adopts a resolution approving the exemption provided in this                

16  section, each affected taxing unit may, by resolution adopted               

17  within 45 days of the adoption of the resolution under subsection           

18  (4), deny the exemption under this section for taxes levied by              

19  that taxing unit.                                                           

20      (6) A qualified start-up business shall not receive the                     

21  exemption under this section for more than a total of 5 tax                 

22  years.  A qualified start-up business may receive the exemption             

23  under this section in nonconsecutive tax years.                             

24      (7) If an exemption under this section is erroneously                       

25  granted, the tax rolls shall be corrected for the current tax               

26  year and the 3 immediately preceding tax years.  The property               

27  that had been subject to that exemption shall be immediately                

1   placed on the tax roll by the local tax collecting unit if the              

2   local tax collecting unit has possession of the tax roll or by              

3   the county treasurer if the county has possession of the tax roll           

4   as though the exemption had not been granted.  A corrected tax              

5   bill shall be issued for the tax year being adjusted by the local           

6   tax collecting unit if the local tax collecting unit has                    

7   possession of the tax roll or by the county treasurer if the                

8   county has possession of the tax roll.  If an owner pays the                

9   corrected tax bill issued under this subsection within 60 days              

10  after the corrected tax bill is issued, that owner is not liable            

11  for any penalty or interest on the additional tax.  If an owner             

12  pays a corrected tax bill issued under this subsection more than            

13  60 days after the corrected tax bill is issued, the owner is                

14  liable for the penalties and interest that would have accrued if            

15  the exemption had not been granted from the date the taxes were             

16  originally levied.                                                          

17      (8) Real and personal property of a qualified start-up                      

18  business is not exempt from collection of the following:                    

19      (a) A special assessment levied by the local tax collecting                 

20  unit in which the property is located.                                      

21      (b) Ad valorem property taxes specifically levied for the                   

22  payment of principal and interest of obligations approved by the            

23  electors or obligations pledging the unlimited taxing power of              

24  the local governmental unit.                                                

25      (c) A tax levied under section 705 or 1212 of the revised                   

26  school code, 1976 PA 451, MCL 380.705 and 380.1212.                         

27      (9) As used in this section, "qualified start-up business"                  

1   means that term as defined in section 31a of the single business            

2   tax act, 1975 PA 228, MCL 208.31a.