SB-0787, As Passed Senate, March 26, 2014

SUBSTITUTE FOR

SENATE BILL NO. 787

     A bill to provide for the exemption of certain property from

certain taxes; to levy and collect a specific tax upon the owners

of certain property; to provide for the disposition of the tax; to

prescribe the powers and duties of certain local government

officials; and to provide penalties.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 1. This act shall be known and may be cited as the

"hydroponics and aquaculture production facilities specific tax

act".

     Sec. 2. As used in this act:

     (a) "Aquaculture" means the commercial husbandry of

aquaculture species, including, but not limited to, culturing,

producing, growing, propagating, and harvesting aquaculture

products under any applicable permits or registration.

     (b) "Aquaculture production facility" means an indoor

aquaculture production operation using aquaculture techniques or

practices for growing aquaculture species. An aquaculture

production facility includes the pumps, tanks, controls,

application systems, indoor recirculating systems, and related

infrastructure required to grow aquaculture species using

aquaculture techniques or practices. An aquaculture production

facility includes any warehouse or shipping area integrated into

the aquaculture production operation. An aquaculture production

facility includes offices integrated into the aquaculture

production operation if the taxable value of the offices is less

than 50% of the combined taxable value of the aquaculture

production facility and the offices.

     (c) "Commission" means the state tax commission created by

1927 PA 360, MCL 209.101 to 209.107.

     (d) "Hydroponics" means a system in which water-soluble

nutrients are placed in intimate contact with a plant's root

system, being grown in an inert supportive medium, which inert

supportive medium itself does all of the following:

     (i) Supplies physical support for the roots.

     (ii) Does not add or subtract plant nutrients.

     (e) "Hydroponics production facility" means an indoor

agriculture production operation using hydroponics techniques or

practices for growing plants produced by agriculture that are

useful to human beings, including, but not limited to, forages,

field crops, sod, berries, herbs, fruits, vegetables, flowers,

seeds, and nursery stock. Hydroponics production facility does not

include an indoor agriculture production operation for growing

plants that are illegal under federal law. A hydroponics production

facility includes, but is not limited to, the pumps, tanks,

controls, application systems, and related infrastructure required

to grow agricultural crops using hydroponics techniques or

practices. A hydroponics production facility includes any warehouse

or shipping area integrated into the hydroponics production

facility operation. A hydroponics production facility includes

offices integrated into the indoor agriculture production operation

if the taxable value of the offices is less than 50% of the

combined taxable value of the hydroponics production facility and

the offices.

     (f) "Taxable value" means the taxable value as determined

under section 27a of the general property tax act, 1893 PA 206, MCL

211.27a.

     Sec. 3. For taxes levied after December 31, 2013, a

hydroponics production facility or an aquaculture production

facility is exempt from ad valorem property taxes collected under

the general property tax act, 1893 PA 206, MCL 211.1 to 211.155, as

provided under section 7uu of the general property tax act, 1893 PA

206, MCL 211.7uu.

     Sec. 4. The assessor of each local tax collecting unit in

which there is a hydroponics production facility or an aquaculture

production facility shall determine annually as of December 31 the

value and taxable value of each hydroponics production facility or

aquaculture production facility located in that local tax

collecting unit.

     Sec. 5. (1) There is levied upon the owner of every

hydroponics production facility or aquaculture production facility

a specific tax to be known as the hydroponics and aquaculture

production facilities specific tax.

     (2) The amount of the hydroponics and aquaculture production

facilities specific tax in each year shall be determined as

follows:

     (a) Multiply the number of mills that would be assessed in the

local tax collecting unit if the property were subject to the

collection of taxes under the general property tax act, 1893 PA

206, MCL 211.1 to 211.155, and if the property was exempt as

provided under section 7cc of the general property tax act, 1893 PA

206, MCL 211.7cc, by the hydroponics production facility's or

aquaculture production facility's taxable value.

     (b) Multiply the result of the calculation in subdivision (a)

by .25.

     (c) If a new millage is approved in the local tax collecting

unit in which a hydroponics production facility or aquaculture

production facility is located after the effective date of this

act, multiply the number of mills that were approved that would be

assessed if the hydroponics production facility or aquaculture

production facility were subject to the collection of taxes under

the general property tax act, 1893 PA 206, MCL 211.1 to 211.155, by

the hydroponics production facility's or aquaculture production

facility's taxable value. Repeat this calculation for each

individual millage approved in the local tax collecting unit after

the effective date of this act.

     (d) Add the result of the calculation under subdivision (b)

and the result of all calculations under subdivision (c).

     (3) The hydroponics and aquaculture production facilities

property specific tax is an annual tax, payable at the same times,

in the same installments, and to the same collecting officer or

officers as taxes collected under the general property tax act,

1893 PA 206, MCL 211.1 to 211.155.

     (4) The collecting officer or officers shall disburse the

hydroponics and aquaculture production facilities property specific

tax to and among this state and cities, townships, villages, school

districts, counties, or other taxing units, 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 211.155.

     (5) The collecting officer or officers shall send a copy of

the amount of disbursement made to each taxing unit under this

section to the commission on a form provided by the commission.

     Sec. 6. Unpaid hydroponics and aquaculture production

facilities specific taxes are subject to forfeiture, foreclosure,

and sale in the same manner and at the same time as taxes returned

as delinquent under the general property tax act, 1893 PA 206, MCL

211.1 to 211.155.

     Enacting section 1. This act does not take effect unless

Senate Bill No. 786 of the 97th Legislature is enacted into law.