HB-5421, As Passed Senate, December 17, 2014

SENATE SUBSTITUTE FOR

HOUSE BILL NO. 5421

     A bill to amend 1893 PA 206, entitled

"The general property tax act,"

by amending section 78g (MCL 211.78g), as amended by 2003 PA 263.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 78g. (1) Except as otherwise provided in this subsection,

on March 1 in each tax year, certified abandoned property and

property that is delinquent for taxes, interest, penalties, and

fees for the immediately preceding 12 months or more is forfeited

to the county treasurer for the total amount of those unpaid

delinquent taxes, interest, penalties, and fees. If property is

forfeited to a county treasurer under this subsection, the

foreclosing governmental unit does not have a right to possession

of the property until the April 1 immediately succeeding the entry

of a judgment foreclosing the property under section 78k or in a

contested case until 22 days after the entry of a judgment

foreclosing the property under section 78k. If property is

forfeited to a county treasurer under this subsection, the county

treasurer shall add a $175.00 fee to each parcel of property for

which those delinquent taxes, interest, penalties, and fees remain

unpaid. A county treasurer shall withhold a parcel of property from

forfeiture for any reason determined by the state tax commission.

The procedure for withholding a parcel of property from forfeiture

under this subsection shall be determined by the state tax

commission.

     (2) Not more than 45 days after property is forfeited under

subsection (1), the county treasurer shall record with the county

register of deeds a certificate in a form determined by the

department of treasury for each parcel of property forfeited to the

county treasurer, specifying that the property has been forfeited

to the county treasurer and not redeemed and that absolute title to

the property shall vest in the county treasurer on the March 31

immediately succeeding the entry of a judgment foreclosing the

property under section 78k or in a contested case 21 days after the

entry of a judgment foreclosing the property under section 78k. If

a certificate of forfeiture is recorded in error, the county

treasurer shall record with the county register of deeds a

certificate of error in a form prescribed by the department of

treasury. A certificate submitted to the county register of deeds

for recording under this subsection need not be notarized and may

be authenticated by a digital signature of the county treasurer or

by other electronic means. If the county has elected under section

78 to have this state foreclose property under this act forfeited

to the county treasurer under this section, the county treasurer

shall immediately transmit to the department of treasury a copy of

each certificate recorded under this subsection. The county

treasurer shall upon collection transmit to the department of

treasury within 30 days the fee added to each parcel under

subsection (1), which may be paid from the county's delinquent tax

revolving fund and shall be deposited in the land reutilization

fund created under section 78n.

     (3) Property forfeited to the county treasurer under

subsection (1) may be redeemed at any time on or before the March

31 immediately succeeding the entry of a judgment foreclosing the

property under section 78k or in a contested case within 21 days of

the entry of a judgment foreclosing the property under section 78k

upon payment to the county treasurer of all of the following:

     (a) The total amount of unpaid delinquent taxes, interest,

penalties, and fees for which the property was forfeited or the

reduced amount of unpaid delinquent taxes, interest, penalties, and

fees payable under subsection (8), if applicable.

     (b) In Except as otherwise provided in this subdivision and

subdivision (c), in addition to the interest calculated under

sections 60a(1) or (2) and 78a(3), additional interest computed at

a noncompounded rate of 1/2% per month or fraction of a month on

the taxes that were originally returned as delinquent, computed

from the March 1 preceding the forfeiture. The county treasurer may

waive the additional interest under this subdivision if the

property is withheld from the petition for foreclosure under

section 78h(3)(c).

     (c) If the property is classified as residential real property

under section 34c, the property is a principal residence exempt

from the tax levied by a local school district for school operating

purposes under section 7cc, and a tax foreclosure avoidance

agreement is in effect for the property under section 78q(5), while

the tax foreclosure avoidance agreement is effective, all of the

following shall apply:

     (i) The property shall be withheld from the petition for

foreclosure under section 78h.

     (ii) The additional interest under subdivision (b) shall not

apply and interest computed at a noncompounded rate of 1/2% per

month or fraction of a month on the taxes that were originally

returned as delinquent, computed from the date that the taxes

originally were returned as delinquent, shall apply to the

property.

(d) (c) All recording fees and all fees for service of process

or notice.

     (4) If property is redeemed by a person with a legal interest

as provided under subsection (3), any unpaid taxes not returned as

delinquent to the county treasurer under section 78a are not

extinguished.

     (5) If property is redeemed by a person with a legal interest

as provided under subsection (3), the person redeeming does not

acquire a title or interest in the property greater than that

person would have had if the property had not been forfeited to the

county treasurer, but the person redeeming, other than the owner,

is entitled to a lien for the amount paid to redeem the property in

addition to any other lien or interest the person may have, which

shall be recorded within 30 days with the register of deeds by the

person entitled to the lien. The lien acquired shall have the same

priority as the existing lien, title, or interest.

     (6) If property is redeemed as provided under subsection (3),

the county treasurer shall issue a redemption certificate in

quadruplicate in a form prescribed by the department of treasury.

One of the quadruplicate certificates shall be delivered to the

person making the redemption payment, 1 shall be filed in the

office of the county treasurer, 1 shall be recorded in the office

of the county register of deeds, and 1 shall be immediately

transmitted to the department of treasury if this state is the

foreclosing governmental unit. The county treasurer shall also make

a note of the redemption certificate in the tax record kept in his

or her office, with the name of the person making the final

redemption payment, the date of the payment, and the amount paid.

If the county treasurer accepts partial redemption payments, the

county treasurer shall include in the tax record kept in his or her

office the name of the person or persons making each partial

redemption payment, the date of each partial redemption payment,

the amount of each partial redemption payment, and the total amount

of all redemption payments. A certificate and the entry of the

certificate in the tax record by the county treasurer is prima

facie evidence of a redemption payment in the courts of this state.

A certificate submitted to the county register of deeds for

recording under this subsection need not be notarized and may be

authenticated by a digital signature of the county treasurer or by

other electronic means. If a redemption certificate is recorded in

error, the county treasurer shall record with the county register

of deeds a certificate of error in a form prescribed by the

department of treasury. A copy of a certificate of error recorded

under this section shall be immediately transmitted to the

department of treasury if this state is the foreclosing

governmental unit.

     (7) If a foreclosing governmental unit has reason to believe

that a property forfeited under this section may be the site of

environmental contamination, the foreclosing governmental unit

shall provide the department of environmental quality with any

information in the possession of the foreclosing governmental unit

that suggests the property may be the site of environmental

contamination.

     (8) Before July 1, 2016, if the amount of unpaid delinquent

taxes, interest, penalties, and fees for which a property was

forfeited is greater than 50% of the state equalized valuation of

the property and the property is subject to and in compliance with

a delinquent property tax installment payment plan under section

78q(1) or a tax foreclosure avoidance agreement under section

78q(5), or both, the foreclosing governmental unit may reduce the

amount of taxes, interest, penalties, and fees required to be paid

to redeem the property under subdivision (3)(a) to an amount equal

to 50% of the state equalized valuation of the property. If a

property is redeemed by payment of the reduced amount under this

subsection, any remaining unpaid taxes, interest, penalties, and

fees for which the property was forfeited and otherwise payable

shall be canceled by the county treasurer. A foreclosing

governmental unit may not approve a reduction in the amount

necessary to redeem property under this subsection if the reduction

would cause noncompliance with section 87c(7) or otherwise

impermissibly impair an outstanding debt of the county.

     Enacting section 1. This amendatory act does not take effect

unless House Bill No. 4882 of the 97th Legislature is enacted into

law.