SB-0624, As Passed Senate, March 16, 2016

SUBSTITUTE FOR

SENATE BILL NO. 624

A bill to amend 2004 PA 530, entitled

"Historical neighborhood tax increment finance authority act,"

by amending sections 3 and 17 (MCL 125.2843 and 125.2857), section

3 as amended by 2010 PA 237.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 3. As used in this act:

(a) "Operations" means office maintenance, including salaries

and expenses of employees, office supplies, consultation fees,

design costs, and other expenses incurred in the daily management

of the authority and planning of its activities.

(b) "Parcel" means an identifiable unit of land that is

treated as separate for valuation or zoning purposes.

pedestrian mall, and any improvements to a street, plaza, or

pedestrian mall including street furniture and beautification,

park, parking facility, recreational facility, right-of-way,

structure, waterway, bridge, lake, pond, canal, utility line or

pipe, transit-oriented development, transit-oriented facility, or

building, including access routes designed and dedicated to use by

the public generally, or used by a public agency. Public facility

includes an improvement to a facility used by the public or a

public facility as those terms are defined in section 1 of 1966 PA

1, MCL 125.1351, if the improvement complies with the barrier free

design requirements of the state construction code promulgated

under the Stille-DeRossett-Hale single state construction code act,

1972 PA 230, MCL 125.1501 to 125.1531.

(d) "Specific local tax" means a tax levied under 1974 PA 198,

MCL 207.551 to 207.572, the commercial redevelopment act, 1978 PA

255, MCL 207.651 to 207.668, the technology park development act,

1984 PA 385, MCL 207.701 to 207.718, or 1953 PA 189, MCL 211.181 to

211.182. The initial assessed value or current assessed value of

property subject to a specific local tax shall be the quotient of

the specific local tax paid divided by the ad valorem millage rate.

The state tax commission shall prescribe the method for calculating

the initial assessed value and current assessed value of property

for which a specific local tax was paid in lieu of a property tax.

(e) "State fiscal year" means the annual period commencing

October 1 of each year.

(f) "Tax increment revenues" means the amount of ad valorem

property taxes and specific local taxes attributable to the

application of the levy of all taxing jurisdictions upon the

captured assessed value of real and personal property in the

development area. Tax increment revenues do not include any of the

following:

(i) Taxes under the state education tax act, 1993 PA 331, MCL

211.901 to 211.906.

(ii) Taxes levied by local or intermediate school districts.

(iii) Ad valorem property taxes attributable either to a

portion of the captured assessed value shared with taxing

jurisdictions within the jurisdictional area of the authority or to

a portion of value of property that may be excluded from captured

assessed value or specific local taxes attributable to the ad

valorem property taxes.

(iv) Ad valorem property taxes excluded by the tax increment

financing plan of the authority from the determination of the

amount of tax increment revenues to be transmitted to the authority

or specific local taxes attributable to the ad valorem property

taxes.

(v) Ad valorem property taxes exempted from capture under

section 17(5) or specific local taxes attributable to the ad

valorem property taxes.

(vi) Ad valorem property taxes specifically levied for the

payment of principal and interest of obligations approved by the

electors or obligations pledging the unlimited taxing power of the

local governmental unit or specific taxes attributable to those ad

valorem property taxes.

(vii) Ad valorem property taxes levied under 1 or more of the

following or specific local taxes attributable to those ad valorem

property taxes:

(A) The zoological authorities act, 2008 PA 49, MCL 123.1161

to 123.1183.

(B) The art institute authorities act, 2010 PA 296, MCL

123.1201 to 123.1229.

property taxes or specific local taxes attributable to those ad

valorem property taxes levied for a separate millage for public

library purposes approved by the electors after December 31, 2015.

(g) "Transit-oriented development" means infrastructure

improvements that are located within 1/2 mile of a transit station

or transit-oriented facility that promotes transit ridership or

passenger rail use, as determined by the board and approved by the

municipality in which it is located.

(h) "Transit-oriented facility" means a facility that houses a

transit station in a manner that promotes transit ridership or

passenger rail use.

Sec. 17. (1) If the authority determines that it is necessary

for the achievement of the purposes of this act, the authority

shall prepare and submit a tax increment financing plan to the

governing body of the municipality. The plan shall include a

development plan as provided in section 19, a detailed explanation

of the tax increment procedure, the maximum amount of bonded

indebtedness to be incurred, and the duration of the program, and

shall be in compliance with section 18. The plan shall contain a

statement of the estimated impact of tax increment financing on the

assessed values of all taxing jurisdictions in which the

development area is located. The plan may provide for the use of

part or all of the captured assessed value, but the portion

intended to be used by the authority shall be clearly stated in the

tax increment financing plan. The authority or municipality may

exclude from captured assessed value growth in property value

resulting solely from inflation. The plan shall set forth the

method for excluding growth in property value resulting solely from

inflation.

(2) Approval of the tax increment financing plan shall comply

with the notice, hearing, and disclosure provisions of section 21.

If the development plan is part of the tax increment financing

plan, only 1 hearing and approval procedure is required for the 2

plans together.

(3) Before the public hearing on the tax increment financing

plan, the governing body shall provide a reasonable opportunity to

the taxing jurisdictions levying taxes subject to capture to meet

with the governing body. The authority shall fully inform the

taxing jurisdictions of the fiscal and economic implications of the

proposed development area. The taxing jurisdictions may present

their recommendations at the public hearing on the tax increment

financing plan. The authority may enter into agreements with the

taxing jurisdictions and the governing body of the municipality in

which the development area is located to share a portion of the

captured assessed value of the development area.

(4) A tax increment financing plan may be modified if the

modification is approved by the governing body upon notice and

after public hearings and agreements as are required for approval

of the original plan.

(5) Not more than 60 days after the public hearing, the

governing body in a taxing jurisdiction levying ad valorem property

taxes that would otherwise be subject to capture may exempt its

taxes from capture by adopting a resolution to that effect and

filing a copy with the clerk of the municipality proposing to

create the authority. ~~In the event that the governing body levies a~~

~~separate millage for public library purposes, at the request of the~~

~~public library board, that separate millage shall be exempt from~~

~~the capture.~~ The resolution shall take effect when filed with the

clerk and remains effective until a copy of a resolution rescinding

that resolution is filed with that clerk. If a separate millage for

public library purposes was levied before January 1, 2016, and all

obligations of the authority are paid or defeased, then the levy is

exempt from capture under this act, unless the library board or

commission allows all or a portion of its taxes levied to be

included as tax increment revenues and subject to capture under

this act under the terms of a written agreement between the library

board or commission and the authority. The written agreement shall

be filed with the clerk of the municipality. However, if a separate

millage for public library purposes was levied before January 1,

2016, and the authority alters or amends the boundaries of a

development area or extends the duration of the existing finance

plan, then the library board or commission may, not later than 60

days after a public hearing is held under this subsection, exempt

all or a portion of its taxes from capture by adopting a resolution

to that effect and filing a copy with the clerk of the municipality

that created the authority. For ad valorem property taxes or

specific local taxes attributable to those ad valorem property

taxes levied for a separate millage for public library purposes

approved by the electors after December 31, 2015, a library board

or commission may allow all or a portion of its taxes levied to be

included as tax increment revenues and subject to capture under

this act under the terms of a written agreement between the library

board or commission and the authority. The written agreement shall

be filed with the clerk of the municipality. However, if the

library was created under section 1 or 10a of 1877 PA 164, MCL

397.201 and 397.210a, then any action of the library board or

commission under this subsection shall have the concurrence of the

chief executive officer of the city that created the library to be

effective.