HB-5673, As Passed House, April 28, 2004

SUBSTITUTE FOR

HOUSE BILL NO. 5673

                                                                             A bill to amend 1893 PA 206, entitled                                             

"The general property tax act,"                                             

by amending section 34c (MCL 211.34c), as amended by 2002                   

PA 620.                                                                     

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1       Sec. 34c.  (1) Not later than the first Monday in March in                  

2   each year, the assessor shall classify every item of assessable             

3   property according to the definitions contained in this section.            

4   Following the March board of review, the assessor shall tabulate            

5   the total number of items and the valuations as approved by the             

6   board of review for each classification and for the totals of               

7   real and personal property in the local tax collecting unit.  The           

8   assessor shall transmit to the county equalization department and           

9   to the state tax commission the tabulation of assessed valuations           

10  and other statistical information the state tax commission                  

House Bill No. 5673 (H-1) as amended April 28, 2004                         

1   considers necessary to meet the requirements of this act and 1911           

2   PA 44, MCL 209.1 to 209.8.                                                  

3       (2) The classifications of assessable real property are                     

4   described as follows:                                                       

5       (a) Agricultural real property includes parcels used                        

6   partially or wholly for agricultural operations, with or without            

7   buildings, and parcels assessed to the department of natural                

8   resources and valued by the state tax commission.  For taxes                

9   levied after December 31, 2002, agricultural real property                  

10  includes buildings on leased land used for agricultural                     

11  operations.  As used in this subdivision, "agricultural                     

12  operations" means the following:                                            

13                                                                               (i) Farming in all its branches, including cultivating soil.                        

14      (ii) Growing and harvesting any agricultural, horticultural,                 

15  or floricultural commodity.                                                 

16      (iii) Dairying.                                                              

17      (iv) Raising livestock, [                                 ] bees,            

18  fish, fur-bearing animals, or poultry [. As used in this subparagraph,

19  "livestock" includes, but is not limited to, cattle, sheep, new world camelids, goats, bison, privately owned cervids, ratites, swine, equine, poultry, aquaculture, and rabbits.  Livestock does not include dogs and cats.

(v) Operating a pay-to-hunt animal farm or game preserve. 

20  (vi) (v)] Turf and tree farming.                                        

21  [(vii) (vi)] Performing any practices on a farm incident to, or in         

22  conjunction with, farming operations.  A commercial storage,                

23  processing, distribution, marketing, or shipping operation [is not may be considered]

24  part of agricultural operations.                                            

25      (b) Commercial real property includes the following:                        

26                                                                               (i) Platted or unplatted parcels used for commercial                                

27  purposes, whether wholesale, retail, or service, with or without            

1   buildings.                                                                  

2       (ii) Parcels used by fraternal societies.                                    

3       (iii) Parcels used as golf courses, boat clubs, ski areas, or                

4   apartment buildings with more than 4 units.                                 

5       (iv) For taxes levied after December 31, 2002, buildings on                  

6   leased land used for commercial purposes.                                   

7       (c) Developmental real property includes parcels containing                 

8   more than 5 acres without buildings, or more than 15 acres with a           

9   market value in excess of its value in use.  Developmental real             

10  property may include farm land or open space land adjacent to a             

11  population center, or farm land subject to several competing                

12  valuation influences.                                                       

13      (d) Industrial real property includes the following:                        

14                                                                               (i) Platted or unplatted parcels used for manufacturing and                         

15  processing purposes, with or without buildings.                             

16      (ii) Parcels used for utilities sites for generating plants,                 

17  pumping stations, switches, substations, compressing stations,              

18  warehouses, rights-of-way, flowage land, and storage areas.                 

19      (iii) Parcels used for removal or processing of gravel,                      

20  stone, or mineral ores, whether valued by the local assessor or             

21  by the state geologist.                                                     

22      (iv) For taxes levied after December 31, 2002, buildings on                  

23  leased land used for industrial purposes.                                   

24      (v) For taxes levied after December 31, 2002, buildings on                  

25  leased land for utility purposes.                                           

26      (e) Residential real property includes the following:                       

27                                                                               (i) Platted or unplatted parcels, with or without buildings,                        

1   and condominium apartments located within or outside a village or           

2   city, which are used for, or probably will be used for,                     

3   residential purposes.                                                       

4       (ii) Parcels that are used for, or probably will be used for,                

5   recreational purposes, such as lake lots and hunting lands,                 

6   located in an area used predominantly for recreational purposes.            

7       (iii) For taxes levied after December 31, 2002, a home,                      

8   cottage, or cabin on leased land, and a mobile home that would be           

9   assessable as real property under section 2a except that the land           

10  on which it is located is not assessable because the land is                

11  exempt.                                                                     

12      (f) Timber-cutover real property includes parcels that are                  

13  stocked with forest products of merchantable type and size,                 

14  cutover forest land with little or no merchantable products, and            

15  marsh lands or other barren land.  However, when a typical                  

16  purchase of this type of land is for residential or recreational            

17  uses, the classification shall be changed to residential.                   

18      (3) The classifications of assessable personal property are                 

19  described as follows:                                                       

20      (a) Agricultural personal property includes any agricultural                

21  equipment and produce not exempt by law.                                    

22      (b) Commercial personal property includes the following:                    

23                                                                               (i) All equipment, furniture, and fixtures on commercial                            

24  parcels, and inventories not exempt by law.                                 

25      (ii) All outdoor advertising signs and billboards.                           

26      (iii) Well drilling rigs and other equipment attached to a                   

27  transporting vehicle but not designed for operation while the               

1   vehicle is moving on the highway.                                           

2       (iv) Unlicensed commercial vehicles or commercial vehicles                   

3   licensed as special mobile equipment or by temporary permits.               

4       (c) Industrial personal property includes the following:                    

5                                                                                (i) All machinery and equipment, furniture and fixtures, and                        

6   dies on industrial parcels, and inventories not exempt by law.              

7       (ii) Personal property of mining companies valued by the                     

8   state geologist.                                                            

9       (d) For taxes levied before January 1, 2003, residential                    

10  personal property includes a home, cottage, or cabin on leased              

11  land, and a mobile home that would be assessable as real property           

12  under section 2a except that the land on which it is located is             

13  not assessable because the land is exempt.                                  

14      (e) Utility personal property includes the following:                       

15                                                                               (i) Electric transmission and distribution systems,                                 

16  substation equipment, spare parts, gas distribution systems, and            

17  water transmission and distribution systems.                                

18      (ii) Oil wells and allied equipment such as tanks, gathering                 

19  lines, field pump units, and buildings.                                     

20      (iii) Inventories not exempt by law.                                         

21      (iv) Gas wells with allied equipment and gathering lines.                    

22      (v) Oil or gas field equipment stored in the open or in                     

23  warehouses such as drilling rigs, motors, pipes, and parts.                 

24      (vi) Gas storage equipment.                                                  

25      (vii) Transmission lines of gas or oil transporting                          

26  companies.                                                                  

27      (4) For taxes levied before January 1, 2003, buildings on                   

1   leased land of any classification are improvements where the                

2   owner of the improvement is not the owner of the land or fee, the           

3   value of the land is not assessed to the owner of the building,             

4   and the improvement has been assessed as personal property                  

5   pursuant to section 14(6).                                                  

6       (5) If the total usage of a parcel includes more than 1                     

7   classification, the assessor shall determine the classification             

8   that most significantly influences the total valuation of the               

9   parcel.                                                                     

10      (6) An owner of any assessable property who disputes the                    

11  classification of that parcel shall notify the assessor and may             

12  protest the assigned classification to the March board of                   

13  review.  An owner or assessor may appeal the decision of the                

14  March board of review by filing a petition with the state tax               

15  commission not later than June 30 in that tax year.  The state              

16  tax commission shall arbitrate the petition based on the written            

17  petition and the written recommendations of the assessor and the            

18  state tax commission staff.  An appeal may not be taken from the            

19  decision of the state tax commission regarding classification               

20  complaint petitions and the state tax commission's determination            

21  is final and binding for the year of the petition.                          

22      (7) The department of treasury may appeal the classification                

23  of any assessable property to the residential and small claims              

24  division of the Michigan tax tribunal not later than December 31            

25  in the tax year for which the classification is appealed.                   

26      (8) This section shall not be construed to encourage the                    

27  assessment of property at other than the uniform percentage of              

1   true cash value prescribed by this act.