January 17, 2008, Introduced by Senators STAMAS and ALLEN and referred to the Committee on Commerce and Tourism.
A bill to amend 1974 PA 198, entitled
"An act to provide for the establishment of plant rehabilitation
districts and industrial development districts in local
governmental units; to provide for the exemption from certain
taxes; to levy and collect a specific tax upon the owners of
certain facilities; to impose and provide for the disposition of an
administrative fee; to provide for the disposition of the tax; to
provide for the obtaining and transferring of an exemption
certificate and to prescribe the contents of those certificates; to
prescribe the powers and duties of the state tax commission and
certain officers of local governmental units; and to provide
penalties,"
by amending sections 2, 4, 7, 9, 10, 11, 14, 15, 16, and 16a (MCL
207.552, 207.554, 207.557, 207.559, 207.560, 207.561, 207.564,
207.565, 207.566, and 207.566a), sections 2, 9, and 14 as amended
by 2007 PA 146, section 4 as amended by 2004 PA 437, section 7 as
amended by 2006 PA 483, section 10 as amended by 1996 PA 1, section
11 as amended by 2004 PA 323, section 15 as amended by 1996 PA 513,
section 16 as amended by 1982 PA 417, and section 16a as added by
1996 PA 94.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2. (1) "Commission" means the state tax commission
created by 1927 PA 360, MCL 209.101 to 209.107.
(2)
"Facility" means either a replacement facility, a new
facility, an existing facility, or, if applicable by its usage, a
speculative building.
(3) "Replacement facility" means 1 of the following:
(a) In the case of a replacement or restoration that occurs on
the same or contiguous land as that which is replaced or restored,
industrial property that is or is to be acquired, constructed,
altered, or installed for the purpose of replacement or restoration
of obsolete industrial property together with any part of the old
altered property that remains for use as industrial property after
the replacement, restoration, or alteration.
(b) In the case of construction on vacant noncontiguous land,
property that is or will be used as industrial property that is or
is to be acquired, constructed, transferred, or installed for the
purpose of being substituted for obsolete industrial property if
the obsolete industrial property is situated in a plant
rehabilitation district in the same city, village, or township as
the land on which the facility is or is to be constructed and
includes the obsolete industrial property itself until the time as
the substituted facility is completed.
(4) "New facility" means new industrial property other than a
replacement facility to be built in a plant rehabilitation district
or industrial development district.
(5) "Local governmental unit" means a city, village, or
township located in this state.
(6) "Industrial property" means land improvements, buildings,
structures, and other real property, and machinery, equipment,
furniture, and fixtures or any part or accessory whether completed
or in the process of construction comprising an integrated whole,
the primary purpose and use of which is the engaging in a high-
technology activity, operation of a strategic response center,
operation of a motorsports entertainment complex, operation of a
logistical optimization center, operation of qualified commercial
activity, the manufacture of goods or materials, creation or
synthesis of biodiesel fuel, or the processing of goods and
materials by physical or chemical change; property acquired,
constructed, altered, or installed due to the passage of proposal A
in 1976; the operation of a hydro-electric dam by a private company
other than a public utility; or agricultural processing facilities.
Industrial property includes facilities related to a manufacturing
operation under the same ownership, including, but not limited to,
office, engineering, research and development, warehousing, or
parts distribution facilities. Industrial property also includes
research and development laboratories of companies other than those
companies that manufacture the products developed from their
research activities and research development laboratories of a
manufacturing company that are unrelated to the products of the
company. For applications approved by the legislative body of a
local governmental unit between June 30, 1999 and December 31,
2007, industrial property also includes an electric generating
plant that is not owned by a local unit of government, including,
but not limited to, an electric generating plant fueled by biomass.
Industrial property also includes convention and trade centers over
250,000 square feet in size. Industrial property also includes a
federal reserve bank operating under 12 USC 341, located in a city
with a population of 750,000 or more. Industrial property may be
owned or leased. However, in the case of leased property, the
lessee is liable for payment of ad valorem property taxes and shall
furnish proof of that liability. Industrial property does not
include any of the following:
(a) Land.
(b) Property of a public utility other than an electric
generating plant that is not owned by a local unit of government
and for which an application was approved by the legislative body
of a local governmental unit between June 30, 1999 and December 31,
2007.
(c) Inventory.
(7) "Obsolete industrial property" means industrial property
the condition of which is substantially less than an economically
efficient functional condition.
(8) "Economically efficient functional condition" means a
state or condition of property the desirability and usefulness of
which is not impaired due to changes in design, construction,
technology, or improved production processes, or from external
influencing factors that make the property less desirable and
valuable for continued use.
(9) "Research and development laboratories" means building and
structures, including the machinery, equipment, furniture, and
fixtures located in the building or structure, used or to be used
for research or experimental purposes that would be considered
qualified research as that term is used in section 41 of the
internal revenue code, 26 USC 41, except that qualified research
also includes qualified research funded by grant, contract, or
otherwise by another person or governmental entity.
(10) "Manufacture of goods or materials" or "processing of
goods or materials" means any type of operation that would be
conducted by an entity included in the classifications provided by
sector 31-33 — manufacturing, of the North American industry
classification system, United States, 1997, published by the office
of management and budget, regardless of whether the entity
conducting that operation is included in that manual.
(11) "High-technology activity" means that term as defined in
section 3 of the Michigan economic growth authority act, 1995 PA
24, MCL 207.803.
(12) "Logistical optimization center" means a sorting and
distribution center that supports a private passenger motor vehicle
assembly center and its manufacturing process for the purpose of
optimizing transportation, just-in-time inventory management, and
material handling, and to which all of the following apply:
(a) The sorting and distribution center is within 2 miles of a
private passenger motor vehicle assembly center that, together with
supporting facilities, contains at least 800,000 square feet.
(b) The sorting and distribution center contains at least
950,000 square feet.
(c) The sorting and distribution center has applied for an
industrial facilities exemption certificate after June 30, 2005 and
before January 1, 2006.
(d) The private passenger motor vehicle assembly center is
located on land conditionally transferred by a township with a
population of more than 25,000 under 1984 PA 425, MCL 124.21 to
124.30, to a city with a population of more than 100,000 that
levies an income tax under the city income tax act, 1964 PA 284,
MCL 141.501 to 141.787.
(13) "Commercial property" means that term as defined in
section 2 of the obsolete property rehabilitation act, 2000 PA 146,
MCL 125.2782.
(14) "Qualified commercial activity" means commercial property
that meets all of the following:
(a) An application for an exemption certificate approved by
the local governmental unit is filed for approval by the state tax
commission not later than April 30, 2006.
(b) At least 90% of the property, excluding the surrounding
green space, is used for warehousing, distribution, and logistics
purposes that provide food for institutional, restaurant, hospital,
or hotel customers.
(c) Is located within a village and is within 15 miles of a
Michigan state border.
(d) Occupies 1 or more buildings or structures that together
are greater than 300,000 square feet in size.
(15) "Motorsports entertainment complex" means a closed-course
motorsports facility, and its ancillary grounds and facilities,
that satisfies all of the following:
(a) Has at least 70,000 fixed seats for race patrons.
(b) Has at least 6 scheduled days of motorsports events each
calendar year, at least 2 of which shall be comparable to nascar
nextel cup events held in 2007 or their successor events.
(c) Serves food and beverages at the facility during
sanctioned events each calendar year through concession outlets, a
majority of which are staffed by individuals who represent or are
members of 1 or more nonprofit civic or charitable organizations
that directly financially benefit from the concession outlets'
sales.
(d) Engages in tourism promotion.
(e) Has permanent exhibitions of motorsports history, events,
or vehicles.
(16) "Existing facility" means industrial property that is not
a replacement facility, a new facility, or a speculative building
and meets 1 or more of the following:
(a) Has been vacant for a period of 4 or more years.
(b) Has become vacant due to the most recent occupant
relocating outside of this state.
Sec. 4. (1) A local governmental unit, by resolution of its
legislative body, may establish plant rehabilitation districts and
industrial development districts that consist of 1 or more parcels
or tracts of land or a portion of a parcel or tract of land.
(2) The legislative body of a local governmental unit may
establish a plant rehabilitation district or an industrial
development district on its own initiative or upon a written
request filed by the owner or owners of 75% of the state equalized
value of the industrial property located within a proposed plant
rehabilitation district or industrial development district. This
request shall be filed with the clerk of the local governmental
unit.
(3) Except as provided in section 9(2)(h), after December 31,
1983, a request for the establishment of a proposed plant
rehabilitation district or industrial development district shall be
filed only in connection with a proposed replacement facility or
new facility, the construction, acquisition, alteration, or
installation of or for which has not commenced at the time of the
filing of the request. The legislative body of a local governmental
unit shall not establish a plant rehabilitation district or an
industrial development district pursuant to subsection (2) if it
finds that the request for the district was filed after the
commencement of construction, alteration, or installation of, or of
an acquisition related to, the proposed replacement facility or new
facility. This subsection shall not apply to a speculative building
or an existing facility.
(4) Before adopting a resolution establishing a plant
rehabilitation district or industrial development district, the
legislative body shall give written notice by certified mail to the
owners of all real property within the proposed plant
rehabilitation district or industrial development district and
shall hold a public hearing on the establishment of the plant
rehabilitation district or industrial development district at which
those owners and other residents or taxpayers of the local
governmental unit shall have a right to appear and be heard.
(5) The legislative body of the local governmental unit, in
its resolution establishing a plant rehabilitation district, shall
set forth a finding and determination that property comprising not
less than 50% of the state equalized valuation of the industrial
property within the district is obsolete.
(6) A plant rehabilitation district or industrial development
district established by a township shall be only within the
unincorporated territory of the township and shall not be within a
village.
(7) Industrial property that is part of an industrial
development district or a plant rehabilitation district may also be
part of a tax increment district established under the tax
increment finance authority act, 1980 PA 450, MCL 125.1801 to
125.1830.
(8) A local governmental unit, by resolution of its
legislative body, may terminate a plant rehabilitation district or
an industrial development district, if there are no industrial
facilities exemption certificates in effect in the plant
rehabilitation district or the industrial development district on
the date of the resolution to terminate.
(9) Before acting on a proposed resolution terminating a plant
rehabilitation district or an industrial development district, the
local governmental unit shall give at least 14 days' written notice
by certified mail to the owners of all real property within the
plant rehabilitation district or industrial development district as
determined by the tax records in the office of the assessor or the
treasurer of the local tax collecting unit in which the property is
located and shall hold a public hearing on the termination of the
plant rehabilitation district or industrial development district at
which those owners and other residents or taxpayers of the local
governmental unit, or others, shall have a right to appear and be
heard.
Sec. 7. (1) Within 60 days after receipt of an approved
application or an appeal of a disapproved application that was
submitted to the commission before October 31 of that year, the
commission shall determine whether the facility is a speculative
building, an existing facility, or designed and acquired primarily
for the purpose of restoration or replacement of obsolete
industrial property or the construction of new industrial property,
and whether the facility otherwise complies with section 9 and with
the other provisions of this act. If the commission so finds, it
shall issue an industrial facilities exemption certificate. Before
issuing a certificate the commission shall notify the state
treasurer of the application and shall obtain the written
concurrence of the department of labor and economic growth that the
application complies with the requirements in section 9. Except as
otherwise provided in section 7a, the effective date of the
certificate for a replacement facility, an existing facility, or a
new facility is the immediately succeeding December 31 following
the date the certificate is issued. For a speculative building or a
portion of a speculative building, except as otherwise provided in
section 7a, the effective date of the certificate is the
immediately succeeding December 31 following the date the
speculative building, or the portion of a speculative building, is
used as a manufacturing facility.
(2) The commission shall send an industrial facilities
exemption certificate, when issued, by certified mail to the
applicant, and a certified copy by certified mail to the assessor
of the assessing unit in which the facility is located or to be
located, and that copy shall be filed in his or her office. Notice
of the commission's refusal to issue a certificate shall be sent by
certified mail to the same persons.
(3) Notwithstanding any other provision of this act, if on
December 29, 1986 a local governmental unit passed a resolution
approving an exemption certificate for 10 years for real and
personal property but the commission did not receive the
application until 1992 and the application was not made complete
until 1995, then the commission shall issue, for that property, an
industrial facilities exemption certificate that begins December
30, 1987 and ends December 30, 1997.
(4) Notwithstanding any other provision of this act, if
pursuant to section 16a a local governmental unit passed a
resolution approving an industrial facilities exemption certificate
for a new facility on October 14, 2003 for a certificate that
expired in December 2002, the commission shall issue for that
property an industrial facilities exemption certificate that begins
on December 30, 2002 and ends December 30, 2009.
(5) Notwithstanding any other provision of this act, if on or
before February 10, 2007 a local governmental unit passed a
resolution approving an amendment of an industrial facilities
exemption certificate for a replacement facility and that
certificate was revoked by the commission effective December 30,
2005 with the order of revocation issued by the commission on April
10, 2006, notwithstanding the revocation, the commission shall
retroactively amend the certificate and give full effect to the
amended certificate, which shall include the additional personal
property expenditures described in the resolution amending the
certificate, for the period of time beginning when the certificate
was originally approved until the certificate was revoked.
Sec. 9. (1) The legislative body of the local governmental
unit, in its resolution approving an application, shall set forth a
finding and determination that the granting of the industrial
facilities exemption certificate, considered together with the
aggregate amount of industrial facilities exemption certificates
previously granted and currently in force, shall not have the
effect of substantially impeding the operation of the local
governmental unit or impairing the financial soundness of a taxing
unit that levies an ad valorem property tax in the local
governmental unit in which the facility is located or to be
located. If the state equalized valuation of property proposed to
be exempt pursuant to an application under consideration,
considered together with the aggregate state equalized valuation of
property exempt under certificates previously granted and currently
in force, exceeds 5% of the state equalized valuation of the local
governmental unit, the commission, with the approval of the state
treasurer, shall make a separate finding and shall include a
statement in the order approving the industrial facilities
exemption certificate that exceeding that amount shall not have the
effect of substantially impeding the operation of the local
governmental unit or impairing the financial soundness of an
affected taxing unit.
(2) Except for an application for a speculative building,
which is governed by subsection (4), or for an application for an
existing facility, the legislative body of the local governmental
unit shall not approve an application and the commission shall not
grant an industrial facilities exemption certificate unless the
applicant complies with all of the following requirements:
(a) The commencement of the restoration, replacement, or
construction of the facility occurred not earlier than 12 months
before the filing of the application for the industrial facilities
exemption certificate. If the application is not filed within the
12-month period, the application may be filed within the succeeding
12-month period and the industrial facilities exemption certificate
shall in this case expire 1 year earlier than it would have expired
if the application had been timely filed. This subdivision does not
apply for applications filed with the local governmental unit after
December 31, 1983.
(b) For applications made after December 31, 1983, the
proposed facility shall be located within a plant rehabilitation
district or industrial development district that was duly
established in a local governmental unit eligible under this act to
establish a district and that was established upon a request filed
or by the local governmental unit's own initiative taken before the
commencement of the restoration, replacement, or construction of
the facility.
(c) For applications made after December 31, 1983, the
commencement of the restoration, replacement, or construction of
the facility occurred not earlier than 6 months before the filing
of the application for the industrial facilities exemption
certificate.
(d) The application relates to a construction, restoration, or
replacement program that when completed constitutes a new or
replacement facility within the meaning of this act and that shall
be situated within a plant rehabilitation district or industrial
development district duly established in a local governmental unit
eligible under this act to establish the district.
(e) Completion of the facility is calculated to, and will at
the time of issuance of the certificate have the reasonable
likelihood to create employment, retain employment, prevent a loss
of employment, or produce energy in the community in which the
facility is situated.
(f) Completion of the facility does not constitute merely the
addition of machinery and equipment for the purpose of increasing
productive capacity but rather is primarily for the purpose and
will primarily have the effect of restoration, replacement, or
updating the technology of obsolete industrial property. An
increase in productive capacity, even though significant, is not an
impediment to the issuance of an industrial facilities exemption
certificate if other criteria in this section and act are met. This
subdivision does not apply to a new facility.
(g) The provisions of subdivision (c) do not apply to a new
facility located in an existing industrial development district
owned by a person who filed an application for an industrial
facilities exemption certificate in April of 1992 if the
application was approved by the local governing body and was denied
by the state tax commission in April of 1993.
(h) The provisions of subdivisions (b) and (c) and section
4(3) do not apply to 1 or more of the following:
(i) A facility located in an industrial development district
owned by a person who filed an application for an industrial
facilities exemption certificate in October 1995 for construction
that was commenced in July 1992 in a district that was established
by the legislative body of the local governmental unit in July
1994. An industrial facilities exemption certificate described in
this subparagraph shall expire as provided in section 16(3).
(ii) A facility located in an industrial development district
that was established in January 1994 and was owned by a person who
filed an application for an industrial facilities exemption
certificate in February 1994 if the personal property and real
property portions of the application were approved by the
legislative body of the local governmental unit and the personal
property portion of the application was approved by the state tax
commission in December 1994 and the real property portion of the
application was denied by the state tax commission in December
1994. An industrial facilities exemption certificate described in
this subparagraph shall expire as provided in section 16(3).
(iii) A facility located in an industrial development district
that was established in December 1995 and was owned by a person who
filed an application for an industrial facilities exemptions
certificate in November or December 1995 for construction that was
commenced in September 1995.
(iv) A facility located in an industrial development district
owned by a person who filed an application for an industrial
facilities exemption certificate in July 2001 for construction that
was commenced in February 2001 in a district that was established
by the legislative body of the local governmental unit in September
2001. An industrial facilities exemption certificate described in
this subparagraph shall expire as provided in section 16. The
facility described in this subparagraph shall be taxed under this
act as if it was granted an industrial facilities exemption
certificate in October 2001, and a corrected tax bill shall be
issued by the local tax collecting unit if the local tax collecting
unit has possession of the tax roll or by the county treasurer if
the county has possession of the tax roll. If granting the
industrial facilities exemption certificate under this subparagraph
results in an overpayment of the tax, a rebate, including any
interest and penalties paid, shall be made to the taxpayer by the
local tax collecting unit if the local tax collecting unit has
possession of the tax roll or by the county treasurer if the county
has possession of the tax roll within 30 days of the date the
exemption is granted. The rebate shall be without interest.
(v) A facility located in an industrial development district
owned by a person who filed an application for an industrial
facilities exemption certificate in December 2005 for construction
that was commenced in September 2005 in a district that was
established by the legislative body of the local governmental unit
in December 2005. An industrial facilities exemption certificate
described in this subparagraph shall expire as provided in section
16.
(vi) A facility located in an existing industrial development
district owned by a person who filed or amended an application for
an industrial facilities exemption certificate for real property in
July 2006 if the application was approved by the legislative body
of the local governmental unit in September 2006 but not submitted
to the state tax commission until September 2006.
(vii) A new facility located in an existing industrial
development district owned by a person who filed or amended an
application for an industrial facilities exemption certificate for
personal property in June 2006 if the application was approved by
the legislative body of the local governmental unit in August 2006
but not submitted to the state tax commission until 2007. The
effective date of the certificate shall be December 31, 2006.
(viii) A new facility located in an industrial development
district that was established by the legislative body of the local
governmental unit in September of 2007 for construction that was
commenced in March 2007 and for which an application for an
industrial facilities exemption certificate was filed in September
of 2007.
(ix) A facility located in an industrial development district
that was established by the legislative body of the local
governmental unit in August 2007 and was owned by a person who
filed an application for an industrial facilities exemption
certificate in June 2007 for equipment that was purchased in
January 2007.
(x) A facility located in an industrial development district
that was established by the legislative body of the local
governmental unit in October 2006 for construction that was
commenced in August 2006 and was owned by a person who filed an
application for an industrial facilities exemption certificate in
January 2007.
(i) The provisions of subdivision (c) do not apply to any of
the following:
(i) A new facility located in an existing industrial
development district owned by a person who filed an application for
an industrial facilities exemption certificate in October 1993 if
the application was approved by the legislative body of the local
governmental unit and the real property portion of the application
was denied by the state tax commission in December 1993.
(ii) A new facility located in an existing industrial
development district owned by a person who filed an application for
an industrial facilities exemption certificate in September 1993 if
the personal property portion of the application was approved by
the legislative body of the local governmental unit and the real
property portion of the application was denied by the legislative
body of the local governmental unit in October 1993 and
subsequently approved by the legislative body of the local
governmental unit in September 1994.
(iii) A facility located in an existing industrial development
district owned by a person who filed an application for an
industrial facilities exemption certificate in August 1993 if the
application was approved by the local governmental unit in
September 1993 and the application was denied by the state tax
commission in December 1993.
(iv) A facility located in an existing industrial development
district occupied by a person who filed an application for an
industrial facilities exemption certificate in June of 1995 if the
application was approved by the legislative body of the local
governmental unit in October of 1995 for construction that was
commenced in November or December of 1994.
(v) A facility located in an existing industrial development
district owned by a person who filed an application for an
industrial facilities exemption certificate in June of 1995 if the
application was approved by the legislative body of the local
governmental unit in July of 1995 and the personal property portion
of the application was approved by the state tax commission in
November of 1995.
(j) If the facility is locating in a plant rehabilitation
district or an industrial development district from another
location in this state, the owner of the facility is not delinquent
in any of the taxes described in section 10(1)(a) of the Michigan
renaissance zone act, 1996 PA 376, MCL 125.2690, or substantially
delinquent in any of the taxes described in and as provided under
section 10(1)(b) of the Michigan renaissance zone act, 1996 PA 376,
MCL 125.2690.
(3) If the replacement facility when completed will not be
located on the same premises or contiguous premises as the obsolete
industrial property, then the applicant shall make provision for
the obsolete industrial property by demolition, sale, or transfer
to another person with the effect that the obsolete industrial
property shall within a reasonable time again be subject to
assessment and taxation under the general property tax act, 1893 PA
206,
MCL 211.1 to 211.157 211.155, or be used in a manner
consistent with the general purposes of this act, subject to
approval of the commission.
(4) The legislative body of the local governmental unit shall
not approve an application and the commission shall not grant an
industrial facilities exemption certificate that applies to a
speculative building unless the speculative building is or is to be
located in a plant rehabilitation district or industrial
development district duly established by a local governmental unit
eligible under this act to establish a district; the speculative
building was constructed less than 9 years before the filing of the
application for the industrial facilities exemption certificate;
the speculative building has not been occupied since completion of
construction; and the speculative building otherwise qualifies
under subsection (2)(e) for an industrial facilities exemption
certificate. An industrial facilities exemption certificate granted
under this subsection shall expire as provided in section 16(3).
(5) Not later than September 1, 1989, the commission shall
provide to all local assessing units the name, address, and
telephone number of the person on the commission staff responsible
for providing procedural information concerning this act. After
October 1, 1989, a local unit of government shall notify each
prospective applicant of this information in writing.
(6) Notwithstanding any other provision of this act, if on
December 29, 1986 a local governmental unit passed a resolution
approving an exemption certificate for 10 years for real and
personal property but the commission did not receive the
application until 1992 and the application was not made complete
until 1995, then the commission shall issue, for that property, an
industrial facilities exemption certificate that begins December
30, 1987 and ends December 30, 1997. The facility described in this
subsection shall be taxed under this act as if it was granted an
industrial facilities exemption certificate on December 30, 1987.
(7) Notwithstanding any other provision of this act, if a
local governmental unit passed a resolution approving an industrial
facilities exemption certificate for a new facility on July 8, 1991
but rescinded that resolution and passed a resolution approving an
industrial facilities exemption certificate for that same facility
as a replacement facility on October 21, 1996, the commission shall
issue for that property an industrial facilities exemption
certificate that begins December 30, 1991 and ends December 2003.
The replacement facility described in this subsection shall be
taxed under this act as if it was granted an industrial facilities
exemption certificate on December 30, 1991.
(8) Property owned or operated by a casino is not industrial
property or otherwise eligible for an abatement or reduction of ad
valorem property taxes under this act. As used in this subsection,
"casino" means a casino or a parking lot, hotel, motel, convention
and trade center, or retail store owned or operated by a casino, an
affiliate, or an affiliated company, regulated by this state
pursuant to the Michigan gaming control and revenue act, 1996 IL 1,
MCL 432.201 to 432.226.
(9) Notwithstanding section 16a and any other provision of
this act, if a local governmental unit passed a resolution
approving an industrial facilities exemption certificate for a new
facility on October 28, 1996 for a certificate that expired in
December 2003 and the local governmental unit passes a resolution
approving the extension of the certificate after December 2003 and
before March 1, 2006, the commission shall issue for that property
an industrial facilities exemption certificate that begins on
December 30, 2005 and ends December 30, 2010 as long as the
property continues to qualify under this act.
(10) Notwithstanding any other provision of this act, if the
commission issued an industrial facilities exemption certificate
for a new facility on December 8, 1998 but revoked that industrial
facilities exemption certificate for that same facility effective
December 30, 2006 and that new facility is purchased by a buyer on
or before November 1, 2007, the commission shall issue for that
property an industrial facilities exemption certificate that begins
December 31, 1998 and ends December 30, 2010 and shall transfer
that industrial facilities exemption certificate to the buyer. The
new facility described in this subsection shall be taxed under this
act as if it was granted an industrial facilities exemption
certificate effective on December 31, 1998.
Sec. 10. (1) The assessor of each city or township in which
there is a speculative building, new facility, existing facility,
or replacement facility with respect to which 1 or more industrial
facilities exemption certificates have been issued and are in force
shall determine annually as of December 31 the value and taxable
value of each facility separately, both for real and personal
property, having the benefit of a certificate.
(2) The assessor, upon receipt of notice of the filing of an
application for the issuance of a certificate, shall determine and
furnish to the local legislative body and the commission the value
of the property to which the application pertains and other
information as may be necessary to permit the local legislative
body and the commission to make the determinations required by
section 9(1).
Sec. 11. (1) Except as provided in subsections (6) and (7),
there is levied upon every owner of a speculative building, a new
facility, an existing facility, or a replacement facility to which
an industrial facilities exemption certificate is issued a specific
tax to be known as the industrial facility tax and an
administrative fee calculated in the same manner and at the same
rate that the local tax collecting unit imposes on ad valorem taxes
collected under the general property tax act, 1893 PA 206, MCL
211.1
to 211.157 211.155.
(2) The industrial facility tax and administrative fee are to
be paid annually, at the same times, in the same installments, and
to the same officer or officers as taxes and administrative fees,
if any, imposed under the general property tax act, 1893 PA 206,
MCL
211.1 to 211.157 211.155, are payable. Except as otherwise
provided in this section, the officer or officers shall disburse
the industrial facility tax payments received each year to and
among the state, cities, townships, villages, school districts,
counties, and authorities, at the same times and in the same
proportions as required by law for the disbursement of taxes
collected under the general property tax act, 1893 PA 206, MCL
211.1
to 211.157 211.155. To determine the proportion for the
disbursement of taxes under this subsection and for attribution of
taxes under subsection (5) for taxes collected under industrial
facilities exemption certificates issued before January 1, 1994,
the number of mills levied for local school district operating
purposes to be used in the calculation shall equal the number of
mills for local school district operating purposes levied in 1993
minus the number of mills levied under the state education tax act,
1993 PA 331, MCL 211.901 to 211.906, for the year for which the
disbursement is calculated.
(3) Except as provided by subsections (4) and (5), for an
intermediate school district receiving state aid under section 56,
62, or 81 of the state school aid act of 1979, 1979 PA 94, MCL
388.1656, 388.1662, and 388.1681, of the amount that would
otherwise be disbursed to or retained by the intermediate school
district, all or a portion, to be determined on the basis of the
tax rates being utilized to compute the amount of the state school
aid, shall be paid instead to the state treasury to the credit of
the state school aid fund established by section 11 of article IX
of the state constitution of 1963. If the sum of any commercial
facilities taxes prescribed by the commercial redevelopment act,
1978 PA 255, MCL 207.651 to 207.668, and the industrial facility
taxes paid to the state treasury to the credit of the state school
aid fund that would otherwise be disbursed to the local or
intermediate school district, under section 12 of the commercial
redevelopment act, 1978 PA 255, MCL 207.662, and this section,
exceeds the amount received by the local or intermediate school
district under sections 56, 62, and 81 of the state school aid act
of 1979, 1979 PA 94, MCL 388.1656, 388.1662, and 388.1681, the
department of treasury shall allocate to each eligible local or
intermediate school district an amount equal to the difference
between the sum of the commercial facilities taxes and the
industrial facility taxes paid to the state treasury to the credit
of the state school aid fund and the amount the local or
intermediate school district received under sections 56, 62, and 81
of the state school aid act of 1979, 1979 PA 94, MCL 388.1656,
388.1662, and 388.1681. This subsection does not apply to taxes
levied for either of the following:
(a) Mills allocated to an intermediate school district for
operating purposes as provided for under the property tax
limitation act, 1933 PA 62, MCL 211.201 to 211.217a.
(b) An intermediate school district that is not receiving
state aid under section 56 or 62 of the state school aid act of
1979, 1979 PA 94, MCL 388.1656 and 388.1662.
(4) For industrial facilities taxes levied before 1994, a
local or intermediate school district shall receive or retain its
industrial facility tax payment that is levied in any year and
becomes a lien before December 1 of the year if the district files
a statement with the state treasurer not later than June 30 of the
year certifying that the district does not expect to receive state
school aid payments under section 56, 62, or 81 of the state school
aid act of 1979, 1979 PA 94, MCL 388.1656, 388.1662, and 388.1681,
in the state fiscal year commencing in the year this statement is
filed and if the district did not receive state school aid payments
under section 56, 62, or 81 of the state school aid act of 1979,
1979 PA 94, MCL 388.1656, 388.1662, and 388.1681, for the state
fiscal year concluding in the year the statement required by this
subsection is filed. However, if a local or intermediate school
district receives or retains its summer industrial facility tax
payment under this subsection and becomes entitled to receive state
school aid payments under section 56, 62, or 81 of the state school
aid act of 1979, 1979 PA 94, MCL 388.1656, 388.1662, and 388.1681,
in the state fiscal year commencing in the year in which it filed
the statement required by this subsection, the district immediately
shall pay to the state treasury to the credit of the state school
aid fund an amount of the summer industrial facility tax payments
that would have been paid to the state treasury to the credit of
the state school aid fund under subsection (3) had not this
subsection allowed the district to receive or retain the summer
industrial facility tax payment.
(5) For industrial facilities taxes levied after 1993, the
amount to be disbursed to a local school district, except for that
amount of tax attributable to mills levied under section 1211(2) or
1211c of the revised school code, 1976 PA 451, MCL 380.1211 and
380.1211c, and mills that are not included as mills levied for
school operating purposes under section 1211 of the revised school
code, 1976 PA 451, MCL 380.1211, shall be paid to the state
treasury and credited to the state school aid fund established by
section 11 of article IX of the state constitution of 1963.
(6) A speculative building, a new facility, an existing
facility, or a replacement facility located in a renaissance zone
under the Michigan renaissance zone act, 1996 PA 376, MCL 125.2681
to 125.2696, is exempt from the industrial facility tax levied
under this act to the extent and for the duration provided pursuant
to the Michigan renaissance zone act, 1996 PA 376, MCL 125.2681 to
125.2696, except for that portion of the industrial facility tax
attributable to a special assessment or a tax described in section
7ff(2) of the general property tax act, 1893 PA 206, MCL 211.7ff.
The industrial facility tax calculated under this subsection shall
be disbursed proportionately to the local taxing unit or units that
levied the special assessment or the tax described in section
7ff(2) of the general property tax act, 1893 PA 206, MCL 211.7ff.
(7) Upon application for an exemption under this subsection by
a qualified start-up business, the governing body of a local tax
collecting unit may adopt a resolution to exempt a speculative
building, a new facility, or a replacement facility of a qualified
start-up business from the collection of the industrial facility
tax levied under this act in the same manner and under the same
terms and conditions as provided for the exemption in section 7hh
of the general property tax act, 1893 PA 206, MCL 211.7hh. The
clerk of the local tax collecting unit shall notify in writing the
assessor of the local tax collecting unit and the legislative body
of each taxing unit that levies ad valorem property taxes in the
local tax collecting unit. Before acting on the resolution, the
governing body of the local tax collecting unit shall afford the
assessor and a representative of the affected taxing units an
opportunity for a hearing. If a resolution authorizing the
exemption is adopted in the same manner as provided in section 7hh
of the general property tax act, 1893 PA 206, MCL 211.7hh, a
speculative building, a new facility, or a replacement facility
owned or operated by a qualified start-up business is exempt from
the industrial facility tax levied under this act, except for that
portion of the industrial facility tax attributable to a special
assessment or a tax described in section 7ff(2) of the general
property tax act, 1893 PA 206, MCL 211.7ff, for the year in which
the resolution is adopted. A qualified start-up business is not
eligible for an exemption under this subsection for more than 5
years. A qualified start-up business may receive the exemption
under this subsection in nonconsecutive years. The industrial
facility tax calculated under this subsection shall be disbursed
proportionately to the taxing unit or units that levied the special
assessment or the tax described in section 7ff(2) of the general
property tax act, 1893 PA 206, MCL 211.7ff. As used in this
subsection, "qualified start-up business" means that term as
defined in section 31a of the single business tax act, 1975 PA 228,
MCL 208.31a.
Sec. 14. (1) The amount of the industrial facility tax, in
each year for a replacement facility, shall be determined by
multiplying the total mills levied as ad valorem taxes for that
year by all taxing units within which the facility is situated by
the taxable value of the real and personal property of the obsolete
industrial property for the tax year immediately preceding the
effective date of the industrial facilities exemption certificate
after deducting the taxable value of the land and of the inventory
as specified in section 19.
(2) The amount of the industrial facility tax, in each year
for a new facility or a speculative building for which an
industrial facilities exemption certificate became effective before
January 1, 1994, shall be determined by multiplying the taxable
value of the facility excluding the land and the inventory personal
property by the sum of 1/2 of the total mills levied as ad valorem
taxes for that year by all taxing units within which the facility
is located other than mills levied for school operating purposes by
a local school district within which the facility is located or
mills levied under the state education tax act, 1993 PA 331, MCL
211.901 to 211.906, plus 1/2 of the number of mills levied for
local school district operating purposes in 1993.
(3) Except as provided in subsection (4), the amount of the
industrial facility tax in each year for a new facility, an
existing facility, or a speculative building for which an
industrial facilities exemption certificate becomes effective after
December 31, 1993, shall be determined by multiplying the taxable
value of the facility excluding the land and the inventory personal
property by the sum of 1/2 of the total mills levied as ad valorem
taxes for that year by all taxing units within which the facility
is located other than mills levied under the state education tax
act, 1993 PA 331, MCL 211.901 to 211.906, plus, subject to section
14a, the number of mills levied under the state education tax act,
1993 PA 331, MCL 211.901 to 211.906.
(4) For taxes levied after December 31, 2007, for the personal
property tax component of an industrial facilities exemption
certificate for a new facility or a speculative building that is
sited on real property classified as industrial real property under
section 34c of the general property tax act, 1893 PA 206, MCL
211.34c, the amount of the industrial facility tax in each year for
a new facility or a speculative building shall be determined by
multiplying the taxable value of the facility excluding the land
and the inventory personal property by the sum of 1/2 of the total
mills levied as ad valorem taxes for that year by all taxing units
within which the facility is located other than mills levied under
the state education tax act, 1993 PA 331, MCL 211.901 to 211.906,
and the number of mills from which the property is exempt under
section 1211(1) of the revised school code, 1976 PA 451, MCL
380.1211.
(5) For a termination or revocation of only the real property
component, or only the personal property component, of an
industrial facilities exemption certificate as provided in this
act, the valuation and the tax determined using that valuation
shall be reduced proportionately to reflect the exclusion of the
component with respect to which the termination or revocation has
occurred.
Sec. 15. (1) Upon receipt of a request by certified mail to
the commission by the holder of an industrial facilities exemption
certificate requesting revocation of the certificate, the
commission shall by order revoke the certificate in whole or revoke
the certificate with respect to its real property component, or its
personal property component, whichever is requested.
(2) The legislative body of a local governmental unit may by
resolution request the commission to revoke the industrial
facilities exemption certificate of a facility upon the grounds
that, except as provided in section 7a, completion of the
replacement facility or new facility has not occurred within 2
years after the effective date of the certificate, unless a greater
time has been authorized by the commission for good cause; that the
replacement, restoration, or construction of the facility has not
occurred within 6 years after the date the initial industrial
facilities exemption certificate was issued as provided in section
7a, unless a greater time has been authorized by the commission for
good cause; that completion of the speculative building has not
occurred within 2 years after the date the certificate was issued
except as provided in section 7a, unless a greater time has been
authorized by the commission for good cause; that a speculative
building for which a certificate has been issued but is not yet
effective has been used as other than a manufacturing facility;
that the certificate issued for a speculative building has not
become effective within 2 years after the December 31 following the
date the certificate was issued; or that the purposes for which the
certificate was issued are not being fulfilled as a result of a
failure of the holder to proceed in good faith with the
replacement, restoration, or construction and operation of the
replacement facility or new facility, or with the operation of an
existing facility, or with the use of the speculative building as a
manufacturing facility in a manner consistent with the purposes of
this act and in the absence of circumstances that are beyond the
control of the holder.
(3) Upon receipt of the resolution, the commission shall give
notice in writing by certified mail to the holder of the
certificate, to the local legislative body, to the assessor of the
assessing unit, and to the legislative body of each local taxing
unit which levies taxes upon property in the local governmental
unit in which the facility is located. The commission shall afford
to the holder of the certificate, the local legislative body, the
assessor, and a representative of the legislative body of each
taxing unit an opportunity for a hearing. The commission shall by
order revoke the certificate if the commission finds that
completion except as provided in section 7a of the replacement
facility or new facility has not occurred within 2 years after the
effective date of the certificate or a greater time as authorized
by the commission for good cause; that completion of the
speculative building has not occurred within 2 years after the date
the certificate was issued except as provided in section 7a, unless
a greater time has been authorized by the commission for good
cause; that a speculative building for which a certificate has been
issued but is not yet effective has been used as other than a
manufacturing facility; that the certificate issued for a
speculative building has not become effective within 2 years after
the December 31 following the date the certificate was issued; or
that the holder of the certificate has not proceeded in good faith
with the replacement, restoration, or construction and operation of
the facility or with the use of the speculative building as a
manufacturing facility in good faith in a manner consistent with
the purposes of this act and in the absence of circumstances that
are beyond the control of the holder.
(4) The order of the commission revoking the certificate shall
be effective on the December 31 next following the date of the
order and the commission shall send by certified mail copies of its
order of revocation to the holder of the certificate, to the local
legislative body, to the assessor of the assessing unit in which
the facility is located, and to the legislative body of each taxing
unit which levies taxes upon property in the local governmental
unit in which the facility is located.
(5) A revocation of a certificate issued for a speculative
building shall specify and apply only to that portion of the
speculative building for which the grounds for revocation relate.
Sec. 16. (1) Unless earlier revoked as provided in section 15,
an industrial facilities exemption certificate shall remain in
force and effect for a period to be determined by the legislative
body of the local governmental unit and commencing with its
effective date and ending on the December 31 next following not
more than 12 years after the completion of the facility with
respect to both the real property component and the personal
property component of the facility or, for an existing facility,
not more than 12 years after the issuance of the certificate for
the existing facility. The date of issuance of a certificate of
occupancy, if one is required, by appropriate municipal authority
shall be the date of completion of the facility.
(2) In the case of an application which was not filed within
12 months after the commencement of the restoration, replacement,
or construction of the facility but was filed within the succeeding
12-month period as provided in section 9(2)(a), the industrial
facilities exemption certificate, unless earlier revoked as
provided in section 15, shall remain in force and effect for a
period commencing with its effective date and ending on the
December 31 next following not more than 11 years after completion
of the facility with respect to both the real property component
and the personal property component of the facility. The date of
issuance of a certificate of occupancy, if one is required, by
appropriate municipal authority shall be the date of completion of
the facility. This subsection shall not apply for certificates
issued after December 31, 1983.
(3) In the case of an application filed pursuant to section
9(4), an industrial facilities exemption certificate, unless
earlier revoked as provided in section 15, shall remain in force
and effect for a period to be determined by the legislative body of
the local governmental unit and commencing on the effective date of
the certificate and ending on the December 31 next following not
more than 11 years after the effective date of the certificate.
Sec. 16a. If an industrial facilities exemption certificate
for a replacement facility, a new facility, an existing facility,
or a speculative building becomes effective after December 31,
1995, for a period shorter than the maximum period permitted under
section 16, then both of the following apply:
(a) The owner or lessee of the replacement facility, new
facility, existing facility, or speculative building may, within
the final year in which the certificate is effective, apply for
another certificate under this act. If the legislative body of a
local governmental unit disapproves an application submitted under
this subdivision, then the applicant has no right of appeal of that
decision as described in section 6.
(b) The legislative body of a local governmental unit shall
not approve applications for certificates the sum of whose periods
exceeds the maximum permitted under section 16 for the user or
lessee of a replacement facility, new facility, existing facility,
or speculative building.