HB-5538, As Passed House, May 18, 2004

SUBSTITUTE FOR

HOUSE BILL NO. 5538

                    (As amended May 18, 2004)                               

                                                                             A bill to amend 1893 PA 206, entitled                                             

"The general property tax act,"                                             

(MCL 211.1 to 211.157) by adding sections 7ii and 7jj.                      

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1   Sec. 7ii.  (1) For taxes levied after December 31, 2004, [except as otherwise limited under subsection (9),]

2   residential development property is exempt from the collection of           

3   taxes levied by a local school district for school operating                

4   purposes under section 1211 of the revised school code, 1976 PA             

5   451, MCL 380.1211, to the same extent that a principal residence            

6   is exempt under section 7cc from taxes levied by a local school             

7   district for school operating purposes under section 1211 of the            

8   revised school code, 1976 PA 451, MCL 380.1211.                             

9   (2) To claim an exemption under subsection (1), an owner of                 

10  residential development property shall file an affidavit claiming           

11  the exemption with the local tax collecting unit by May 1.  The             

1   affidavit shall be on a form prescribed by the department of                

2   treasury.                                                                   

3       (3) Upon receipt of an affidavit filed under subsection (2),                

4   the assessor shall determine if the real property is residential            

5   development property.  If the real property is residential                  

6   development property, the assessor shall exempt the property from           

7   the collection of taxes levied by a local school district for               

8   school operating purposes under section 1211 of the revised                 

9   school code, 1976 PA 451, MCL 380.1211, as provided in subsection           

10  (1) until December 31 of the year in which the real property is             

11  no longer residential development property.                                 

12      (4) Not more than 90 days after all or a portion of the                     

13  exempted real property is no longer residential development                 

14  property, an owner shall rescind the exemption for the applicable           

15  portion of the real property by filing with the local tax                   

16  collecting unit a rescission form.  The rescission form shall be            

17  as prescribed by the department of treasury.                                

18      (5) An owner of exempted real property that is no longer                    

19  residential development property who fails to file a rescission             

20  form as required under subsection (4) is subject to a penalty of            

21  $5.00 per day for each separate failure beginning after the 90              

22  days have elapsed, up to a maximum of $200.00.  This penalty                

23  shall be collected under 1941 PA 122, MCL 205.1 to 205.31, and              

24  shall be deposited in the state school aid fund established in              

25  section 11 of article IX of the state constitution of 1963.  This           

26  penalty may be waived by the department of treasury.                        

27  (6) An owner of real property that is residential development               

1   property on May 1 for which an exemption was not on the tax roll            

2   may file an appeal with the July or December board of review in             

3   the year the exemption was claimed or the immediately succeeding            

4   year.  An owner of real property that is residential development            

5   property on May 1 for which an exemption was denied by the                  

6   assessor in the year the affidavit was filed may file an appeal             

7   with the July board of review for summer taxes or, if there is              

8   not a summer levy of school operating taxes, with the December              

9   board of review.                                                            

10      (7) If the assessor of the local tax collecting unit believes               

11  that the real property for which an exemption has been granted is           

12  not residential development property, the assessor may deny or              

13  modify an existing exemption by notifying the owner in writing at           

14  the time required for providing a notice under section 24c.  A              

15  taxpayer may appeal the assessor's determination to the board of            

16  review meeting under section 30.  A decision of the board of                

17  review may be appealed to the residential and small claims                  

18  division of the Michigan tax tribunal.                                      

19      (8) If an exemption under this section is erroneously                       

20  granted, an owner may request in writing that the local tax                 

21  collecting unit withdraw the exemption.  If an owner requests               

22  that an exemption be withdrawn, the local assessor shall notify             

23  the owner that the exemption issued under this section has been             

24  denied based on that owner's request.  If an exemption is                   

25  withdrawn, the real property that had been subject to that                  

26  exemption shall be immediately placed on the tax roll by the                

27  local tax collecting unit if the local tax collecting unit has              

House Bill No. 5538 (H-2) as amended May 18, 2004

1   possession of the tax roll or by the county treasurer if the                

2   county has possession of the tax roll as though the exemption had           

3   not been granted.  A corrected tax bill shall be issued for the             

4   tax year being adjusted by the local tax collecting unit if the             

5   local tax collecting unit has possession of the tax roll or by              

6   the county treasurer if the county has possession of the tax                

7   roll.  If an owner requests that an exemption under this section            

8   be withdrawn before that owner is contacted in writing by the               

9   local assessor regarding that owner's eligibility for the                   

10  exemption and that owner pays the corrected tax bill issued under           

11  this subsection within 30 days after the corrected tax bill is              

12  issued, that owner is not liable for any penalty or interest on             

13  the additional tax.  An owner who pays a corrected tax bill                 

14  issued under this subsection more than 30 days after the                    

15  corrected tax bill is issued is liable for the penalties and                

16  interest that would have accrued if the exemption had not been              

17  granted from the date the taxes were originally levied.                     

[(9) Residential development property shall not be exempt under this section for more than 3 years from the issuance of an occupancy permit.

18      (10)] As used in this section:                                              

19      (a) "Contiguous" means being in contact along a boundary or a               

20  point.  Contiguity is not broken by a road, a right-of-way, or              

21  property purchased or taken under condemnation proceedings by a             

22  public utility for power transmission lines if the 2 parcels                

23  separated by the purchased or condemned property were a single              

24  parcel prior to the sale or condemnation.                                   

25      (b) "Principal residence" means that term as defined in                     

26  section 7dd.                                                                

27      (c) "Residential development property" means real property                  

House Bill No. 5538 (H-2) as amended May 18, 2004

1   that meets all of the following criteria:                                   

2                                                                                (i) Is classified as residential real property under section                        

3   34c[, except hunting lands located in an area used predominantly for recreational purposes that are classified as residential real property pursuant to section 34c(2)(e)(ii)].                                                          

4   (ii) Is subject to 1 of the following conditions or is                       

5   contiguous to and associated with property that is subject to 1             

6   of the following conditions:                                                

7       (A) A final plat for the real property is recorded pursuant                 

8   to the land division act, 1967 PA 288, MCL 560.101 to 560.293,              

9   after the effective date of the amendatory act that added this              

10  section.                                                                    

11      (B) A condominium subdivision plan is completed and a master                

12  deed for all or a portion of the real property is recorded                  

13  pursuant to the condominium act, 1978 PA 59, MCL 559.101 to                 

14  559.276, after the effective date of the amendatory act that                

15  added this section.                                                         

16      (C) The real property is included in a planned unit                         

17  development approved under section 16c of the county zoning act,            

18  1943 PA 183, MCL 125.216c, section 16c of the township zoning               

19  act, 1943 PA 184, MCL 125.286c, or section 4b of the city and               

20  village zoning act, 1921 PA 207, MCL 125.584b.                              

21      (D) The real property is included in a development under an                 

22  open space preservation provision or similar zoning ordinance               

23  provision described in section 16h of the county zoning act, 1943           

24  PA 183, MCL 125.216h, section 16h of the township zoning act,               

25  1943 PA 184, MCL 125.286h, or section 4f of the city and village            

26  zoning act, 1921 PA 207, MCL 125.584f.                                      

27      (iii) A residential dwelling or condominium unit that is                     

House Bill No. 5538 (H-2) as amended May 18, 2004

1   occupied or that has ever been occupied is not located on the               

2   real property.  Residential development property may include real           

3   property on which is located a partially completed residential              

4   dwelling, a partially completed condominium unit, a fully                   

5   completed residential dwelling that is not occupied and has never           

6   been occupied, or a fully completed condominium unit that is not            

7   occupied and has never been occupied.  Residential development              

8   property does not include real property on which is located a               

9   residential dwelling or condominium unit used for commercial                

10  purposes or as an office, showroom, or model.

11  Sec. 7jj.  (1) For taxes levied after December 31, 2004, new                

12  construction on residential development property is exempt from             

13  the collection of taxes under this act.                                     

14      (2) As used in this section:                                                

15      (a) "New construction" means that term as defined in section                

16  34d.                                                                        

17      (b) "Residential development property" means [real property exempt

18  under   ] section 7ii.