SB-0371, As Passed House, March 14, 2006

HOUSE SUBSTITUTE FOR

SENATE BILL NO. 371

     A bill to amend 1996 PA 376, entitled

"Michigan renaissance zone act,"

by amending section 8d (MCL 125.2688d), as amended by 2005 PA 276.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 8d. (1) The board of the Michigan strategic fund

described in section 4 of the Michigan strategic fund act, 1984 PA

270, MCL 125.2004, may designate not more than 25 tool and die

renaissance recovery zones within this state in 1 or more cities,

villages, or townships if that city, village, or township or

combination of cities, villages, or townships consents to the

creation of a recovery zone within their boundaries. A recovery

zone shall have a duration of renaissance zone status for a period

of not less than 5 years and not more than 15 years as determined

by the board of the Michigan strategic fund. If the Michigan

strategic fund determines that the duration of renaissance zone

status for a recovery zone is less than 15 years, then the Michigan

strategic fund, with the consent of the city, village, or township

or combination of cities, villages, or townships in which the

qualified tool and die business is located, may extend the duration

of renaissance zone status for the recovery zone for 1 or more

periods that when combined do not exceed 15 years. Not less than 1

of the recovery zones shall consist of 1 or more qualified tool and

die businesses that have a North American industrial classification

system (NAICS) of 332997.

     (2) The board of the Michigan strategic fund may designate a

recovery zone within this state if the recovery zone consists of

not less than 4 and not more than 20 qualified tool and die

businesses at the time of designation. If the board of the Michigan

strategic fund designated 1 or more recovery zones that contain

less than 20 qualified tool and die businesses before  the

effective date of the amendatory act that added this sentence

December 19, 2005, the board of the Michigan strategic fund may add

additional qualified tool and die businesses to that recovery zone

subject to the limitations contained in this subsection. A recovery

zone shall consist of only qualified tool and die business

property. The board of the Michigan strategic fund may combine

existing recovery zones that are comprised solely of tool and die

businesses that are parties to the same qualified collaborative

agreement. Where 2 or more recovery zones have been combined, the

board of the Michigan strategic fund may continue to designate

additional recovery zones, provided that no more than 25 tool and

die recovery zones exist at 1 time.

     (3) The board of the Michigan strategic fund may revoke the

designation of all or a portion of a recovery zone with respect to

1 or more qualified tool and die businesses if those qualified tool

and die businesses fail or cease to participate in or comply with a

qualified collaborative agreement. A qualified tool and die

business may enter into another qualified collaborative agreement

once it is designated part of a recovery zone.

     (4) One or more qualified tool and die businesses subject to a

qualified collaborative agreement may merge into another group of

qualified tool and die businesses subject to a different qualified

collaborative agreement upon application to and approval by the

Michigan strategic fund.

     (5) A qualified tool and die business in a recovery zone may

have a different period of renaissance zone status than other

qualified tool and die businesses in the same recovery zone.

     (6) The board of the Michigan strategic fund may modify an

existing recovery zone to add 1 or more qualified tool and die

businesses with the consent of all other qualified tool and die

businesses that are participating in the recovery zone.

     (7) As used in this section:

     (a) "Qualified collaborative agreement" means an agreement

that demonstrates synergistic opportunities, including, but not

limited to, all of the following:

     (i) Sales and marketing efforts.

     (ii) Development of standardized processes.

     (iii) Development of tooling standards.

     (iv) Standardized project management methods.

     (v) Improved ability for specialized or small niche shops to

develop expertise and compete successfully on larger programs.

     (b) "Qualified tool and die business" means a business entity

that meets all of the following:

     (i) Has a North American industrial classification system

(NAICS) of 332997, 333511, 333512, 333513, 333514, or 333515; or

has a North American industrial classification system (NAICS) of

337215 and operates a facility within an existing renaissance zone,

which facility is adjacent to real property not located in a

renaissance zone and is located within 1/4 mile of a Michigan

technical education center.

     (ii) Has entered into a qualified collaboration agreement as

approved by the Michigan strategic fund consisting of not fewer

than 4 or more than 20 other business entities at the time of

designation that have a North American industrial classification

system (NAICS) of 332997, 333511, 333512, 333513, 333514, or

333515.

     (iii) Has fewer than 75 full-time employees.

     (c) "Qualified tool and die business property" means 1 or more

of the following:

     (i) Property owned by 1 or more qualified tool and die

businesses and used by those qualified tool and die businesses

primarily for tool and die business operations. Qualified tool and

die business property is used primarily for tool and die business

operations if the qualified tool and die businesses that own the

qualified tool and die business property generate 75% or more of

the qualified tool and die businesses' gross revenue from tool and

die operations that take place on the qualified tool and die

business property at the time of designation.

     (ii) Property leased by 1 or more qualified tool and die

business for which the qualified tool and die business is liable

for ad valorem property taxes and which is used by those qualified

tool and die businesses primarily for tool and die business

operations. Qualified tool and die business property is used

primarily for tool and die business operations if the qualified

tool and die businesses that lease the qualified tool and die

business property generate 75% or more of the qualified tool and

die businesses' gross revenue from tool and die operations that

take place on the qualified tool and die business property at the

time of designation. The qualified tool and die business shall

furnish proof of its ad valorem property tax liability to the

department of treasury.