HB-5539, As Passed House, December 13, 2007
SUBSTITUTE FOR
HOUSE BILL NO. 5539
A bill to amend 1996 PA 381, entitled
"Brownfield redevelopment financing act,"
(MCL 125.2651 to 125.2672) by adding section 15a.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 15a. (1) If the amount of tax increment revenues lost as
a result of the personal property tax exemptions provided by
section 1211(4) of the revised school code, 1976 PA 451, MCL
380.1211, section 3 of the state education tax act, 1993 PA 331,
MCL 211.903, section 14(4) of 1974 PA 198, MCL 207.564, and section
9k of the general property tax act, 1893 PA 206, MCL 211.9k, will
reduce the allowable school tax capture received in a fiscal year
by an authority under section 16 used to repay an advance made not
later than 120 days after the effective date of the amendatory act
that added this section or an obligation issued or incurred not
later than 120 days after the effective date of the amendatory act
that added this section, notwithstanding any other provision of
this act, the authority, with approval of the department under
subsection (3), may request the local tax collecting treasurer to
retain and pay to the authority taxes levied under the state
education tax act, 1993 PA 331, MCL 211.901 to 211.906.
(2) Not later than May 1, 2008 and April 1, 2009 and yearly
thereafter, an authority eligible under subsection (1) to have
taxes levied under the state education tax act, 1993 PA 331, MCL
211.901 to 211.906, retained and paid to the authority under this
section, shall apply for approval with the department of treasury.
The application for approval shall include the following
information:
(a) The property tax millage rates expected to be levied by
local school districts within the jurisdictional area of the
authority for school operating purposes for that fiscal year.
(b) The tax increment revenues estimated to be received by the
authority for that fiscal year based upon actual property tax
levies of all taxing jurisdictions within the jurisdictional area
of the authority.
(c) The tax increment revenues the authority estimates it
would have received for that fiscal year if the personal property
tax exemptions described in subsection (1) were not in effect.
(d) A list of advances and obligations described in subsection
(1), and the payments due on each of those obligations and advances
in that fiscal year, and the total amount of all the payments due
on those obligations and advances in that fiscal year.
(e) The amount of money, other than tax increment revenues,
estimated to be received in that fiscal year by the authority that
is primarily pledged to, and to be used for, the repayment of an
advance or the payment of an obligation described in subsection
(1). That amount shall not include excess tax increment revenues of
the authority that are permitted by law to be retained by the
authority for purposes that further the development program.
However, that amount shall include money to be obtained from
sources authorized by law, which law is enacted on or after
December 1, 1993, for use by the municipality or authority to
finance a development plan.
(f) The amount of a distribution received pursuant to this act
for a fiscal year in excess of or less than the distribution that
would have been required if calculated upon actual tax increment
revenues received for that fiscal year.
(3) Not later than August 15, 2008 and August 1, 2009 and
yearly thereafter, based on the calculations under subsection (5),
the department of treasury shall approve, modify, or deny the
application for approval to have taxes levied under the state
education tax act, 1993 PA 331, MCL 211.901 to 211.906, retained
and paid to the authority under this section. If the application
for approval is approved or modified by the department of treasury,
the local tax collecting treasurer shall retain and pay to the
authority the amount described in subsection (5) as approved by the
department. If the department of treasury denies the authority's
application for approval, the local tax collecting treasurer shall
not retain or pay to the authority the taxes levied under the state
education tax act, 1993 PA 331, MCL 211.901 to 211.906.
(4) Each year the legislature shall appropriate and distribute
an amount sufficient to pay each authority the following:
(a) If the amount to be retained and paid under subsection (3)
is less than the amount calculated under subsection (5), the
difference between those amounts.
(b) If the application for approval is denied by the
department of treasury, an amount verified by the department equal
to the amount calculated under subsection (5).
(5) Subject to subsection (6), the aggregate amount under this
section shall be the sum of the amounts determined under
subdivisions (a) and (b) minus the amount determined under
subdivision (c), as follows:
(a) The amount by which the tax increment revenues the
authority would have received and retained for the fiscal year,
excluding taxes exempt under section 7ff of the general property
tax act, 1893 PA 206, MCL 211.7ff, if the personal property tax
exemptions described in subsection (1) were not in effect, exceed
the tax increment revenues the authority actually received for the
fiscal year.
(b) A shortfall required to be reported under subsection
(2)(f) that had not previously increased a distribution.
(c) An excess amount required to be reported under subsection
(2)(f) that had not previously decreased a distribution.
(6) A distribution or taxes retained under this section
replacing tax increment revenues pledged by an authority or a
municipality are subject to the lien of the pledge, whether or not
House Bill No. 5539 (H-1) as amended December 13, 2007
there has been physical delivery of the distribution.
(7) Obligations for which distributions are made under this
section are not a debt or liability of this state; do not create or
constitute an indebtedness, liability, or obligation of this state;
and are not and do not constitute a pledge of the faith and credit
of this state.
(8) Not later than September 1 of each year, the authority
shall provide a copy of the application for approval approved by
the department of treasury to the local tax collecting treasurer
and provide the amount of the taxes retained and paid to the
authority under subsection (5).
(9) Calculations of amounts retained and paid and
appropriations to be distributed under this section shall be made
on the basis of each development area of the authority.
(10) The state tax commission may provide that the
reimbursement calculations under this section and the calculation
of allowable capture of school taxes shall be made for each
calendar year's tax increment revenues using a 12-month debt
payment period used by the authority and approved by the state tax
commission.
[(11) It is the intent of the legislature that, to the extent that the total amount of taxes levied under the state education tax act, 1993 PA 331, MCL 211.901 to 211.906, that are allowed to be retained under this section and section 11b of the local development financing act, 1986 PA 281, MCL 125.2161b, section 12b of the tax increment financing act, 1980 PA 450, MCL 125.1812b, and section 13c of 1975 PA 197, MCL 125.1663c, exceeds the difference of the total school aid fund revenue for the tax year minus the estimated amount of revenue the school aid fund would have received for the tax year had the tax exemptions described in subsection (1) and the earmark created by section 515 of the Michigan business tax act, 2007 PA 36, MCL 208.1515, not taken effect, the general fund shall reimburse the school aid fund the difference.
(12)] As used in this section:
(a) "Advance" means that term as defined in section 1 of 1975
PA 197, MCL 125.1651.
(b) "Obligation" means that term as defined in section 1 of
1975 PA 197, MCL 125.1651.