SB-0500, As Passed Senate, July 1, 2010
HOUSE SUBSTITUTE FOR
SENATE BILL NO. 500
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 3 and 15 (MCL 207.553 and 207.565), section 3
as amended by 2007 PA 13 and section 15 as amended by 2008 PA 170.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3. (1) "Plant rehabilitation district" means an area of a
local governmental unit established as provided in section 4.
(2) "Industrial development district" means an area
established by a local governmental unit as provided in section 4.
(3) "Industrial facility tax" means the specific tax levied
under this act.
(4) "Industrial facilities exemption certificate" means a
certificate issued pursuant to sections 5, 6, and 7.
(5) "Replacement" means the complete or partial demolition of
obsolete industrial property and the complete or partial
reconstruction or installation of new property of similar utility.
(6) "Restoration" means changes to obsolete industrial
property other than replacement as may be required to restore the
property, together with all appurtenances to the property, to an
economically efficient functional condition. Restoration does not
include delayed maintenance or the substitution or addition of
tangible personal property without major renovation of the
industrial property. A program involving expenditures for changes
to the industrial property improvements aggregating less than 10%
of the true cash value at commencement of the restoration of the
industrial property improvements is delayed maintenance.
Restoration includes major renovation including but not necessarily
limited to the improvement of floor loads, correction of deficient
or excessive height, new or improved building equipment, including
heating, ventilation, and lighting, reducing multistory facilities
to 1 or 2 stories, improved structural support including
foundations, improved roof structure and cover, floor replacement,
improved wall placement, improved exterior and interior appearance
of buildings, improvements or modifications of machinery and
equipment to improve efficiency, decrease operating costs, or to
increase productive capacity, and other physical changes as may be
required to restore the industrial property to an economically
efficient functional condition, and shall include land and building
improvements and other tangible personal property incident to the
improvements.
(7) "State equalized valuation" means the valuation determined
under 1911 PA 44, MCL 209.1 to 209.8.
(8)
"Speculative building" means a new building that meets all
1 of the following criteria and the machinery, equipment,
furniture,
and fixtures located in the new building:
(a) A new building that meets all of the following:
(i) (a)
The building is owned by, or
approved as a speculative
building by resolution of, a local governmental unit in which the
building is located or the building is owned by a development
organization and located in the district of the development
organization.
(ii) (b)
The building is constructed for the
purpose of
providing a manufacturing facility before the identification of a
specific user of that building.
(iii) (c)
The building does not qualify as a
replacement
facility.
(b) The building is an existing building on an improved parcel
of industrial property used for the manufacturing of goods or
materials or processing of goods or materials. Not more than 1
building shall be awarded an industrial facilities exemption
certificate under this subdivision. A building that complies with
this subdivision shall be presumed to have been constructed within
9 years of the filing of the application for an industrial
facilities exemption certificate and shall comply with the
following:
(i) Has been unoccupied for at least 4 years immediately
preceding the date the certificate is issued.
(ii) Is in an industrial development district created before
January 1, 2011.
(iii) Is located in a county with a population of more than
22,000 and less than 24,500 containing a city with a population of
more than 3,600 according to the last decennial census.
(9) "Development organization" means any economic development
corporation, downtown development authority, tax increment
financing authority, or an organization under the supervision of
and created for economic development purposes by a local
governmental unit.
(10) "Manufacturing facility" means buildings and structures,
including the machinery, equipment, furniture, and fixtures located
therein, the primary purpose of which is 1 or more of the
following:
(a) The manufacture of goods or materials or the processing of
goods and materials by physical or chemical change.
(b) The provision of research and development laboratories of
companies whether or not the company manufactures the products
developed from their research activities.
(11) "Taxable value" means that value determined under section
27a of the general property tax act, 1893 PA 206, MCL 211.27a.
(12) "Strategic response center" means a facility that
provides catastrophe response solutions through the development and
staffing of a national response center for which a plant
rehabilitation district or an industrial development district was
created before December 31, 2007.
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 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.
(6) Notwithstanding any other provision of this act, upon the
written request of the holder of a revoked industrial facilities
exemption certificate to the local unit of government and the
commission or upon the application of a subsequent owner to the
local governing body to transfer the revoked industrial facilities
exemption certificate to a subsequent owner, and the submission to
the commission of a resolution of concurrence by the legislative
body of the local unit of government in which the facility is
located, and if the facility continues to qualify under this act,
the commission may reinstate a revoked industrial facilities
exemption certificate for the holder or a subsequent owner that has
applied for the transfer.