SB-1305, As Passed Senate, June 24, 2004                                    

    SUBSTITUTE FOR

    SENATE BILL NO. 1305

(As amended, June 24, 2004)                                                 

                                                                             A bill to amend 1953 PA 189, entitled                                             

"An act to provide for the taxation of lessees and users of                 

tax-exempt property,"                                                       

(MCL 211.181 to 211.182) by adding section 1a.                              

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1   Sec. <<1a>>.  (1) Notwithstanding the tax day provided in                   

2   section 2 of the general property tax act, 1893 PA 206, MCL                 

3   211.2, and except as limited in subsection (5) and otherwise                

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

5   2004, real and personal property of a qualified start-up business           

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

7   which all of the following occur:                                           

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

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

10  (b) The governing body of the local tax collecting unit                     

11  adopts a resolution approving the exemption as provided in                  

1   subsection (4).                                                             

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

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

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

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

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

7   commission.  The affidavit shall state that the qualified                   

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

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

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

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

12  following:                                                                  

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

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

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

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

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

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

19  release information contained in the qualified start-up                     

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

21  1975 PA 228, MCL 208.1 to 208.145, that pertains to the qualified           

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

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

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

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

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

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

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

2       (a) The governing body of the local tax collecting unit                     

3   adopts a resolution under subsection (4)(b) approving the                   

4   exemption for all qualified start-up businesses that apply for an           

5   extension for filing the annual single business tax return under            

6   section 73 of the single business tax act, 1975 PA 228, MCL                 

7   208.73.                                                                     

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

9   application for an extension for filing its annual single                   

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

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

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

13  section 53b of the general property tax act, 1893 PA 206, MCL               

14  211.53b.  For purposes of section 53b of the general property tax           

15  act, 1893 PA 206, MCL 211.53b, an exemption granted under this              

16  subsection shall be considered the correction of a clerical                 

17  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.  A resolution approving the exemption            

1   provided in this section may be for 1 or both of the following:             

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

3   businesses that claim the exemption under this section by filing            

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

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

6   exemption under this section after May 1 as provided in                     

7   subsection (3).                                                             

8       (5) A qualified start-up business shall not receive the                     

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

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

11  under this section in nonconsecutive tax years.                             

12      (6) If an exemption under this section is erroneously                       

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

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

15  that had been subject to that exemption shall be immediately                

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

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

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

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

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

21  tax collecting unit if the local tax collecting unit has                    

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

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

24  corrected tax bill issued under this subsection within 60 days              

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

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

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

1   60 days after the corrected tax bill is issued, the owner is                

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

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

4   originally levied.                                                          

5       (7) Real and personal property of a qualified start-up                      

6   business is not exempt from collection of the following:                    

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

8   unit in which the property is located.                                      

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

10  payment of principal and interest of obligations approved by the            

11  electors or obligations pledging the unlimited taxing power of              

12  the local governmental unit.                                                

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

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

15      (8) As used in this section, "qualified start-up business"                  

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

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