HB-5349, As Passed House, December 3, 2010

SENATE SUBSTITUTE FOR

HOUSE BILL NO. 5349

     A bill to amend 1996 PA 376, entitled

"Michigan renaissance zone act,"

by amending sections 3, 6, 8a, and 10 (MCL 125.2683, 125.2686,

125.2688a, and 125.2690), section 3 as amended by 2010 PA 64,

sections 6 and 10 as amended by 2008 PA 242, and section 8a as

amended by 2008 PA 116, and by adding section 8h.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 3. As used in this act:

     (a) "Agricultural processing facility" means 1 or more

facilities or operations that transform, package, sort, or grade

livestock or livestock products, agricultural commodities, or

plants or plant products, excluding forest products, into goods

that are used for intermediate or final consumption including goods

for nonfood use, and surrounding property.

     (b) "Board" means the state administrative board created in

1921 PA 2, MCL 17.1 to 17.3.

     (c) "Border crossing facility" means a business that is 1 or

more of the following as determined by the board of the Michigan

strategic fund:

     (i) That was located in a qualified border local governmental

unit as defined in section 8g and was displaced or otherwise

negatively affected by the development of the international border

crossing and is unable to recover from the displacement or negative

effect without the establishment of a renaissance zone.

     (ii) That is associated with international trade, shipping, or

freight hauling, including, but not limited to, all of the

following:

     (A) Customs brokers.

     (B) Distribution centers.

     (C) Truck supply and repair.

     (d) "Development plan" means a written plan that addresses the

criteria in section 7 and includes all of the following:

     (i) A map of the proposed renaissance zone that indicates the

geographic boundaries, the total area, and the present use and

conditions generally of the land and structures within those

boundaries.

     (ii) Evidence of community support and commitment from

residential and business interests.

     (iii) A description of the methods proposed to increase economic

opportunity and expansion, facilitate infrastructure improvement,

and identify job training opportunities.

     (iv) Current social, economic, and demographic characteristics

of the proposed renaissance zone and anticipated improvements in

education, health, human services, public safety, and employment if

the renaissance zone is created.

     (v) Any other information required by the board.

     (e) "Elected county executive" means the elected county

executive in a county organized under 1966 PA 293, MCL 45.501 to

45.521, or 1973 PA 139, MCL 45.551 to 45.573.

     (f) "Eligible next Michigan business" means a business engaged

in the shipment of tangible personal property via multimodal

commerce; a supply chain business providing a majority of its

services to businesses engaged in the shipment of tangible personal

property, including inventory, via multimodal commerce; a

manufacturing or assembly facility receiving a majority of its

production components via multimodal commerce; a manufacturing or

assembly facility shipping a majority of products via multimodal

commerce; or a light manufacturing or assembly facility that

packages, kits, labels, or customizes products and ships those

products via multimodal commerce.

(g) (f) "Forest products processing facility" means 1 or more

facilities or operations that transform, package, sort, recycle, or

grade forest or paper products into goods that are used for

intermediate or final use or consumption or for the creation of

biomass or alternative fuels through the utilization of forest

products or forest residue, and surrounding property. Forest

products processing facility does not include an existing facility

or operation that is located in this state that relocates to a

renaissance zone for a forest products processing facility. Forest

products processing facility does not include a facility or

operation that engages primarily in retail sales.

(h) (g) "Local governmental unit" means a county, city,

village, or township, or, for taxes levied after 2009, any other

taxing jurisdiction that levies an ad valorem property tax.

     (i) "Multimodal commerce" means the movement of products or

services via 2 or more of the following:

     (i) Air.

     (ii) Road.

     (iii) Rail.

     (iv) Water.

     (j) "Next Michigan development corporation" means that term as

defined in section 3 of the next Michigan development act.

     (k) "Next Michigan development district" means that term as

defined in section 3 of the next Michigan development act.

     (l) "Next Michigan renaissance zone" means a renaissance zone

created under section 8h.

(m) (h) "Person" means an individual, partnership,

corporation, association, limited liability company, governmental

entity, or other legal entity.

     (n) "Qualified eligible next Michigan business" means an

eligible next Michigan business that has been certified in

accordance with section 8h.

(o) (i) "Qualified local governmental unit" means either of

the following:

     (i) A county.

     (ii) A city, village, or township that contains an eligible

distressed area as defined in section 11 of the state housing

development authority act of 1966, 1966 PA 346, MCL 125.1411.

(p) (j) "Recovery zone" means a tool and die renaissance

recovery zone created in section 8d.

(q) (k) "Renaissance zone" means a geographic area designated

under this act.

(r) (l) "Renewable energy facility" means a facility that

creates energy, fuels, or chemicals directly from the wind, the

sun, trees, grasses, biosolids, algae, agricultural commodities,

processed products from agricultural commodities, or residues from

agricultural processes, wood or forest processes, food production

and processing, or the paper products industry. Renewable energy

facility also includes a facility that creates energy, fuels, or

chemicals from solid biomass, animal wastes, or landfill gases.

Renewable energy facility also includes a facility that focuses on

research, development, or manufacturing of systems or components of

systems used to create energy, fuel, or chemicals from the items

described in this subdivision. Renewable energy facility also

includes a facility that focuses on research, development, or

manufacturing of systems or components of systems that involve the

conversion of chemical energy for advanced battery technology.

(s) (m) "Residential rental property" means that term as

defined in section 7ff of the general property tax act, 1893 PA

206, MCL 211.7ff.

(t) (n) "Review board" means the renaissance zone review board

created in section 5.

(u) (o) "Rural area" means an area that lies outside of the

boundaries of an urban area.

(v) (p) "Urban area" means an urbanized area as determined by

the economics and statistics administration, United States bureau

of the census according to the 1990 census.

     Sec. 6. (1) The board shall review all recommendations

submitted by the review board and determine which applications meet

the criteria contained in section 7.

     (2) The board shall do all of the following:

     (a) Designate renaissance zones.

     (b) Subject to subsection (3), approve or reject the duration

of renaissance zone status.

     (c) Subject to subsection (3), approve or reject the

geographic boundaries and the total area of the renaissance zone as

submitted in the application.

     (3) The board shall not alter the geographic boundaries of the

renaissance zone or the duration of renaissance zone status

described in the application unless the qualified local

governmental unit or units and the local governmental unit or units

in which the renaissance zone is to be located consent by

resolution to the alteration.

     (4) The board shall not designate a renaissance zone under

section 8 before November 1, 1996 or after December 31, 1996.

     (5) Except as otherwise provided in this subsection, the

designation of a renaissance zone under this act shall take effect

on January 1 in the year following designation. However, for

purposes of the taxes exempted under section 9(2), the designation

of a renaissance zone under this act shall take effect on December

31 in the year of designation. For designations made pursuant to

section 8a(2), the board of the Michigan strategic fund may choose

a beginning date, provided that the date must be January 1 of a

year and must not be more than 5 years after the date of

designation. The board of the Michigan strategic fund may provide

that the January 1 beginning date be determined under a written

agreement between the board of the Michigan strategic fund and the

qualified local governmental unit in which the renaissance zone is

to be located. However, for purposes of the taxes exempted under

section 9(2), the designation of a renaissance zone under section

8a(2) shall take effect on December 31 in the year immediately

preceding the year in which the designation under section 8a(2)

takes effect.

     (6) The board shall not designate a renaissance zone under

section 8a after December 31, 2002.

     (7) Through December 31, 2002, a qualified local governmental

unit in which a renaissance zone was designated under section 8 or

8a may modify the boundaries of that renaissance zone to include

contiguous parcels of property as determined by the qualified local

governmental unit and approval by the review board. The additional

contiguous parcels of property included in a renaissance zone under

this subsection do not constitute an additional distinct geographic

area under section 4(1)(d). If the boundaries of the renaissance

zone are modified as provided in this subsection, the additional

contiguous parcels of property shall become part of the original

renaissance zone on the same terms and conditions as the original

designation of that renaissance zone.

     (8) Notwithstanding any other provisions of this act, before

July 1, 2004, a qualified local governmental unit in which a

renaissance zone was designated under section 8a(1) as a

renaissance zone located in a rural area may modify the boundaries

of that renaissance zone to include a contiguous parcel of property

as determined by the qualified local governmental unit. The

contiguous parcel of property shall only include property that is

less than .5 acres in size and that the qualified local

governmental unit previously sought to have included in the zone by

submitting an application in February 2002 that was not acted upon

by the review board. The additional contiguous parcel of property

included in a renaissance zone under this subsection does not

constitute an additional distinct geographic area under section

4(1)(d). If the boundaries of the renaissance zone are modified as

provided in this subsection, the additional contiguous parcel of

property shall become part of the original renaissance zone on the

same terms and conditions as the rest of the property in that

renaissance zone.

     (9) A business that is located and conducts business activity

within a renaissance zone designated under this act, except as

designated under section 8a(2) before December 1, 2010, shall not

make a payment in lieu of taxes to any taxing jurisdiction within

the qualified local governmental unit in which the renaissance zone

is located.

     (10) Notwithstanding any other provisions of this act, before

July 1, 2006, a qualified local governmental unit in which a

renaissance zone of less than 50 contiguous acres but more than 20

contiguous acres was designated under section 8 or 8a as a

renaissance zone in a city located in a county with a population of

more than 160,000 and less than 170,000 may modify the boundaries

of that renaissance zone to include a contiguous parcel of property

as determined by the qualified local governmental unit. The

contiguous parcel of property shall only include property that is

less than 12 acres in size. The additional contiguous parcel of

property included in a renaissance zone under this subsection does

not constitute an additional distinct geographic area under section

4(1)(d). If the boundaries of the renaissance zone are modified as

provided in this subsection, the additional contiguous parcel of

property shall become part of the original renaissance zone on the

same terms and conditions as the rest of the property in that

renaissance zone.

     (11) Notwithstanding any other provisions of this act, before

July 1, 2006, a qualified local governmental unit in which a

renaissance zone of more than 500 acres was designated under

section 8 or 8a as a renaissance zone in a county with a population

of more than 61,000 and less than 64,000 may modify the boundaries

of that renaissance zone to include a contiguous parcel of property

as determined by the qualified local governmental unit. The

contiguous parcel of property shall only include property that is

less than 12 acres in size. The additional contiguous parcel of

property included in a renaissance zone under this subsection does

not constitute an additional distinct geographic area under section

4(1)(d). If the boundaries of the renaissance zone are modified as

provided in this subsection, the additional contiguous parcel of

property shall become part of the original renaissance zone on the

same terms and conditions as the rest of the property in that

renaissance zone.

     (12) Notwithstanding any other provisions of this act, before

July 1, 2006, a qualified local governmental unit in which a

renaissance zone of more than 137 acres was designated under

section 8 or 8a as a renaissance zone in a county with a population

of more than 61,000 and less than 63,000 may modify the boundaries

of that renaissance zone to include a parcel of property that is

separated from the existing renaissance zone by a roadway as

determined by the qualified local governmental unit. The parcel of

property shall only include property that is less than 67 acres in

size. The additional contiguous parcel of property included in a

renaissance zone under this subsection does not constitute an

additional distinct geographic area under section 4(1)(d). If the

boundaries of the renaissance zone are modified as provided in this

subsection, the additional contiguous parcel of property shall

become part of the original renaissance zone on the same terms and

conditions as the rest of the property in that renaissance zone.

     Sec. 8a. (1) Except as provided in subsections (2), (3), and

(4), the board shall not designate more than 9 additional

renaissance zones within this state under this section. Not more

than 6 of the renaissance zones shall be located in urban areas and

not more than 5 of the renaissance zones shall be located in rural

areas. For purposes of determining whether a renaissance zone is

located in an urban area or rural area under this section, if any

part of a renaissance zone is located within an urban area, the

entire renaissance zone shall be considered to be located in an

urban area.

     (2) The board of the Michigan strategic fund described in

section 4 of the Michigan strategic fund act, 1984 PA 270, MCL

125.2004, may designate not more than 17 27 additional renaissance

zones within this state in 1 or more cities, villages, or townships

if that city, village, or township or combination of cities,

villages, or townships consents to the creation of a renaissance

zone within their boundaries. The board of the Michigan strategic

fund may designate not more than 1 of the 17 27 additional

renaissance zones described in this subsection as an alternative

energy zone. An alternative energy zone shall promote and increase

the research, development, testing, and manufacturing of

alternative energy technology, alternative energy systems, and

alternative energy vehicles, as those terms are defined in the

Michigan next energy authority act, 2002 PA 593, MCL 207.821 to

207.827. An alternative energy zone shall have a duration of

renaissance zone status for a period not to exceed 20 years as

determined by the board of the Michigan strategic fund. The board

of the Michigan strategic fund may designate not more than 8 of the

additional 17 27 renaissance zones described in this subsection as

a redevelopment renaissance zone. A redevelopment renaissance zone

shall promote the redevelopment of existing industrial facilities

or the development of property for industrial purposes. The board

of the Michigan strategic fund may designate not more than 1 of the

17 27 additional renaissance zones described in this subsection as

a pharmaceutical recovery renaissance zone. A pharmaceutical

recovery renaissance zone shall promote the development or

redevelopment of existing underutilized facilities currently

occupied or formerly occupied by a pharmaceutical company. Before

designating a renaissance zone under this subsection, the board of

the Michigan strategic fund may enter into a development agreement

with the city, township, or village in which the renaissance zone

will be located and the owner or developer of the facility or

property located in the renaissance zone. The development agreement

for a redevelopment renaissance zone described only in subsection

(6)(b)(vi) or (vii) may provide for the payment of 1 or more of the

taxes described in section 9. Not fewer than 3 of the 10 additional

renaissance zones created under this subsection on or after

December 1, 2010 shall be located in rural areas. Until the maximum

number of qualified eligible next Michigan businesses are certified

under section 8h(10), the board shall not designate an additional

renaissance zone under this subsection if that additional

renaissance zone would include a business that is an eligible next

Michigan business that is eligible to be certified as a qualified

eligible next Michigan business under this act.

     (3) In addition to the not more than 9 additional renaissance

zones described in subsection (1), the board may designate

additional renaissance zones within this state in 1 or more

qualified local governmental units if that qualified local

governmental unit or units contain a military installation that was

operated by the United States department of defense and was closed

in 1977 or after 1990.

     (4) Land owned by a county or the qualified local governmental

unit or units adjacent to a zone as described in subsection (3) may

be included in this zone.

     (5) Notwithstanding any other provision of this act, property

located in the alternative energy zone that is classified as

commercial real property under section 34c of the general property

tax act, 1893 PA 206, MCL 211.34c, and that the authority, with the

concurrence of the assessor of the local tax collecting unit,

determines is not used to directly promote and increase the

research, development, testing, and manufacturing of alternative

energy technology, alternative energy systems, and alternative

energy vehicles as those terms are defined in the Michigan next

energy authority act, 2002 PA 593, MCL 207.821 to 207.827, is not

eligible for any exemption, deduction, or credit under section 9.

     (6) As used in this section:

     (a) "Pharmaceutical recovery renaissance zone" means a

renaissance zone that includes a geographic area that is located in

1 or both of the following:

     (i) In a city with a population of more than 70,000 and less

than 85,000 and in a county with a population of more than 235,000

and less than 250,000.

     (ii) In a city with a population of more than 42,000 and less

than 55,000 and in a county with a population of more than 235,000

and less than 250,000.

     (b) "Redevelopment renaissance zone" means a renaissance zone

that meets 1 of the following:

     (i) All of the following:

     (A) Is located in a city with a population of more than 7,500

and less than 8,500 and is located in a county with a population of

more than 60,000 and less than 70,000.

     (B) Contains only all or a portion of an industrial site of

200 or more acres.

     (ii) All of the following:

     (A) Is located in a city with a population of more than 13,000

and less than 14,000 and is located in a county with a population

of more than 1,000,000 and less than 1,300,000.

     (B) Contains only all or a portion of an industrial site of

300 or more contiguous acres.

     (iii) All of the following:

     (A) Is located in a township with a population of more than

5,500 and is located in a county with a population of less than

24,000.

     (B) Contains only all or a portion of an industrial site of

more than 850 acres and has railroad access.

     (iv) All of the following:

     (A) Is located in a city with a population of more than 40,000

and less than 44,000 and is located in a county with a population

of more than 81,000 and less than 87,000.

     (B) Contains only all or a portion of an industrial site of

more than 475 acres.

     (v) All of the following:

     (A) Is located in a city with a population of more than 21,000

and less than 26,000 and is located in a county with a population

of more than 573,000 and less than 625,000.

     (B) Contains only all or a portion of an industrial site of

less than 45 acres in size.

     (vi) All of the following:

     (A) Is located in a city with a population of more than

190,000 and less than 250,000 and is located in a county with a

population of more than 573,000 and less than 625,000.

     (B) Contains only all or a portion of an industrial site of

more than 14 acres and less than 16 acres in size.

     (C) Is approved by the board of the Michigan strategic fund on

or before April 1, 2007.

     (vii) All of the following:

     (A) Is located in a city with a population of more than 35,500

and less than 36,800 and is located in a county with a population

of more than 157,000 and less than 162,000.

     (B) Contains only all or a portion of an industrial site

comprised of 1 or more adjacent parcels totaling 5 or more acres.

     (C) Is approved by the board of the Michigan strategic fund on

or before April 1, 2007.

     (viii) All of the following:

     (A) Is located in a city with a population of more than 40,000

and less than 44,000 and is located in a county with a population

of more than 81,000 and less than 87,000.

     (B) Contains only all or a portion of an industrial site

composed of 1 or more adjacent parcels totaling 100 or more acres.

     (C) Is approved by the board of the Michigan strategic fund on

or before April 1, 2008.

     Sec. 8h. (1) The board of the Michigan strategic fund

described in section 4 of the Michigan strategic fund act, 1984 PA

270, MCL 125.2004, upon the application of a next Michigan

development corporation, may designate next Michigan renaissance

zones for eligible next Michigan businesses within the boundaries

of a next Michigan development district. The number of next

Michigan renaissance zones to be designated for a next Michigan

development district that does not include an eligible urban entity

as defined in the next Michigan development act shall equal the

cumulative number of initial or subsequent local governmental unit

parties to the next Michigan development corporation interlocal

agreement, plus 1 additional next Michigan renaissance zone for

each county party to the interlocal agreement, but shall not exceed

12 for each next Michigan development district. The number of next

Michigan renaissance zones to be designated for a next Michigan

development district that includes an eligible urban entity as

defined in the next Michigan development act shall not exceed 12 as

determined by the president of the Michigan strategic fund. The

number shall not be reduced on account of a reduction in the number

of local government unit parties to the interlocal agreement from

time to time. The next Michigan development corporation shall make

recommendations to the board of the Michigan strategic fund as to

which areas shall be designated as next Michigan renaissance zones

for eligible next Michigan businesses under this act. The aggregate

territory of all next Michigan renaissance zones designated for a

next Michigan development corporation shall not exceed the lesser

of 200 acres times the number of next Michigan renaissance zones

designated for a next Michigan development corporation or 1,675

acres. A next Michigan renaissance zone shall have a duration of

renaissance zone status for a period of not less than 5 years and

not more than 10 years as determined by the board of the Michigan

strategic fund. Except as otherwise provided in this act, if the

board of the Michigan strategic fund determines that the duration

of renaissance zone status for a next Michigan renaissance zone is

less than 10 years, then the board of the Michigan strategic fund,

with the consent of the next Michigan development corporation and

with the consent of the city, village, or township in which the

next Michigan renaissance zone is located, may extend the duration

of renaissance zone status for the next Michigan renaissance zone

for 1 or more periods that when combined do not exceed 10 years.

     (2) The next Michigan development corporation shall make

recommendations to the board of the Michigan strategic fund to

certify an eligible next Michigan business as a qualified eligible

next Michigan business entitled to the exemptions, deductions, or

credits as provided in section 9. Upon the recommendation of a next

Michigan development corporation and subject to subsection (10),

the board of the Michigan strategic fund may determine whether an

eligible next Michigan business should receive the benefits of a

renaissance zone and certify that eligible next Michigan business

as a qualified eligible next Michigan business under this act and

subject to a written agreement as provided in subsection (8). The

board of the Michigan strategic fund shall establish a standard

process to evaluate applications for certification as a qualified

eligible next Michigan business and shall appoint a committee to

review the applications. The standard application process developed

by the board of the Michigan strategic fund shall be approved by a

resolution of the board of the Michigan strategic fund before an

eligible next Michigan business is certified as a qualified

eligible next Michigan business. The board of the Michigan

strategic fund shall certify or deny the application to certify an

eligible next Michigan business as a qualified eligible next

Michigan business within 49 days of receipt of the application that

is complete in all material respects as determined by the president

of the Michigan strategic fund. If the board of the Michigan

strategic fund fails to certify or deny the application for

certification within 49 days of receipt of the application that is

complete in all material respects as determined by the president of

the Michigan strategic fund, the application for certification is

considered approved. If the board of the Michigan strategic fund

denies the application for certification, the applicant may appeal

that denial to the board of the Michigan strategic fund for

reconsideration. The president of the Michigan strategic fund shall

notify the next Michigan development corporation that the Michigan

strategic fund has certified a qualified eligible next Michigan

business in a next Michigan development district. The next Michigan

development corporation shall develop an application process for

eligible next Michigan businesses, which process shall be approved

by the board of the Michigan strategic fund. A next Michigan

development corporation shall not use the incentives provided in

this act primarily to recruit an eligible next Michigan business to

relocate from a location in this state to another location in this

state. A next Michigan development corporation shall not recommend

and the board of the Michigan strategic fund shall not certify an

eligible next Michigan business as a qualified eligible next

Michigan business unless that eligible next Michigan business opens

a new location in this state, locates in this state, or is an

existing business located in this state that will materially expand

its business in this state as determined by the board of the

Michigan strategic fund. However, the board of the Michigan

strategic fund shall not certify an eligible next Michigan business

as a qualified eligible next Michigan business if the principal

economic effect of the expansion or location of the eligible next

Michigan business into a next Michigan development district is the

transfer of employment from 1 or more cities, villages, or

townships in this state to the next Michigan development district

and each order or resolution certifying an eligible next Michigan

business as a qualified eligible next Michigan business shall

contain an express finding, based upon competent and material

evidence in the record, of compliance with the requirements of this

subsection. Any transfer of employment from 1 or more cities,

villages, and townships in this state to a next Michigan

development district resulting from the expansion or location of an

eligible next Michigan business into a next Michigan development

district in which the aggregate number of transferred full-time

employees is less than 15% of the total number of full-time

employees proposed to be located in the next Michigan development

district by the eligible next Michigan business shall be

conclusively presumed to not be a principal economic effect of the

expansion or location. In the event that a transfer of employment

will occur resulting from the expansion or location of an eligible

next Michigan business into a next Michigan development district,

the board of the Michigan strategic fund shall provide written

notice of the order or resolution certifying the eligible next

Michigan business as a qualifying next Michigan business to the

chief executive officer of each county, city, village, and township

from which the transfer of employment will occur within 10 days of

the order or resolution certifying the qualified eligible next

Michigan business. The chief executive officer of each county,

city, village, and township notified under this subsection shall

have 30 days to file an appeal of the certification with the board

of the Michigan strategic fund. The board of the Michigan strategic

fund shall decide the appeal within 45 days of the receipt of the

appeal. The board of the Michigan strategic fund shall not certify

an eligible next Michigan business as a qualified eligible next

Michigan business if the business applicant has been convicted of a

felony and the board of the Michigan strategic fund has determined

that the conviction will have a material impact on the business

applicant's ability to fulfill its obligations under this act. As

used in this subsection, the business applicant includes the

business entity, affiliates, subsidiaries, officers, directors,

managerial employees, and any person who, directly or indirectly,

holds a pecuniary interest in that business entity of 20% or more.

     (3) Upon request of the next Michigan development corporation,

the board of the Michigan strategic fund may modify an existing

next Michigan renaissance zone to add additional property under the

same terms and conditions as the existing next Michigan renaissance

zone if all of the following are met:

     (a) The additional real property is located within the

boundaries of the next Michigan development district and will be

owned or operated by a qualified eligible next Michigan business

once it is brought into operation as determined by the board of the

Michigan strategic fund.

     (b) The next Michigan development corporation and the city,

village, or township in which the qualified eligible next Michigan

business is located consent to the modification.

     (c) The aggregate territory limitations provided in subsection

(1) will not be exceeded.

     (4) A qualified eligible next Michigan business in a next

Michigan renaissance zone shall be granted the benefits of

renaissance zone status for a period of up to 15 years.

     (5) The board of the Michigan strategic fund may revoke the

designation of all or a portion of a next Michigan renaissance zone

or the certification of a qualified eligible next Michigan business

if the board of the Michigan strategic fund determines 1 or more of

the following:

     (a) The qualified eligible next Michigan business proposed in

the application fails, or a preponderance of businesses proposed in

the application fail, to commence operation within 2 years from the

date of the certification as a qualified eligible next Michigan

business.

     (b) The qualified eligible next Michigan business proposed in

the application to commence operation within the next Michigan

renaissance zone ceases operation, provided that designation shall

not be revoked if the qualified eligible next Michigan business has

assigned its rights to a successor entity engaged in a qualified

eligible next Michigan business.

     (c) The qualified eligible next Michigan business proposed in

the application to commence operation within the next Michigan

renaissance zone fails to commence construction or renovation

within 1 year from the date of the certification as a qualified

eligible next Michigan business.

     (d) The qualified eligible next Michigan business fails to

meet jobs and investment criteria set forth in the application and

approved as a condition by the president or the board of the

Michigan strategic fund.

(e) The local governmental unit in which the qualified

eligible next Michigan business is located withdraws from the next

Michigan development corporation interlocal agreement, provided

that the tax incentives previously granted to the qualified

eligible next Michigan business shall remain in full force and

effect for the stated term of the tax incentives so long as the

qualified eligible next Michigan business satisfies all of the

conditions upon which the tax incentives were granted.

     (6) If the designation of all or a portion of a next Michigan

renaissance zone or the certification of a qualified eligible next

Michigan business is revoked, a qualified eligible next Michigan

business affected may appeal that revocation to the board of the

Michigan strategic fund. The designation may subsequently be

restored by the board of the Michigan strategic fund to the same

site and in respect of a qualified eligible next Michigan business,

but the duration of the restored designation shall not exceed the

term of the original designation.

     (7) Upon request of the next Michigan development corporation,

the board of the Michigan strategic fund may extend the duration of

renaissance zone status for 1 or more portions of a next Michigan

renaissance zone if the extension will increase capital investment

or job creation, and the next Michigan development corporation and

the city, village, or township in which that portion of the next

Michigan renaissance zone is located consents to extend the

duration of renaissance zone status. The board of the Michigan

strategic fund may extend renaissance zone status for 1 or more

portions of the next Michigan renaissance zone under this

subsection for a period of time not to exceed 5 additional years as

determined by the board of the Michigan strategic fund.

     (8) Before an eligible next Michigan business is certified as

a qualified eligible next Michigan business, the board of the

Michigan strategic fund shall enter into a written agreement with

the next Michigan development corporation and a qualified eligible

next Michigan business in respect of the terms and conditions of

granting and retaining renaissance zone status, certification as a

qualified eligible next Michigan business, and any other related

matters. The written agreement also shall contain a remedy

provision that includes, but is not limited to, all of the

following:

     (a) A requirement that all or a portion of the exemptions,

deductions, or credits described in section 9 shall be revoked

under the procedures set forth in this act if the qualified

eligible next Michigan business is determined to be in violation of

the provisions of this act or the written agreement or relocates

outside the next Michigan development district for a period of

years after renaissance zone status expires as set forth in the

written agreement.

     (b) A requirement that the qualified eligible next Michigan

business may be required to repay all or a portion of the

exemptions, deductions, or credits described in section 9 if the

qualified eligible next Michigan business is determined to be in

violation of the provisions of this act or the written agreement or

relocates outside the next Michigan development district for a

period of years after renaissance zone status expires as set forth

in the written agreement.

     (9) Except as otherwise provided in this subsection, the

commencement of renaissance zone status under this section shall

take effect on January 1 in the year following designation.

However, for purposes of the taxes exempted under section 9(2), the

commencement of renaissance zone status under this section shall

take effect on December 31 in the year immediately preceding the

year in which the commencement under this section takes effect.

     (10) The board of the Michigan strategic fund shall not

certify more than 25 eligible businesses as qualified eligible next

Michigan businesses under this act. The board of the Michigan

strategic fund shall not certify more than 10 eligible businesses

as qualified eligible next Michigan businesses in a next Michigan

development district as defined in the next Michigan development

act.

     Sec. 10. (1) An individual who is a resident of a renaissance

zone or a business that is located and conducts business activity

within a renaissance zone or a person that owns property located in

a renaissance zone is not eligible for the exemption, deduction, or

credit listed in section 9(1) or (2) for that taxable year if 1 or

more of the following apply:

     (a) The resident, business, or property owner is delinquent on

December 31 of the prior tax year under 1 or more of the following:

     (i) Former 1975 PA 228 or the Michigan business tax act, 2007

PA 36, MCL 208.1101 to 208.1601.

     (ii) The income tax act of 1967, 1967 PA 281, MCL 206.1 to

206.532.

     (iii) 1974 PA 198, MCL 207.551 to 207.572.

     (iv) The commercial redevelopment act, 1978 PA 255, MCL 207.651

to 207.668.

     (v) The enterprise zone act, 1985 PA 224, MCL 125.2101 to

125.2123.

     (vi) 1953 PA 189, MCL 211.181 to 211.182.

     (vii) The technology park development act, 1984 PA 385, MCL

207.701 to 207.718.

     (viii) Part 511 of the natural resources and environmental

protection act, 1994 PA 451, MCL 324.51101 to 324.51120.

     (ix) The neighborhood enterprise zone act, 1992 PA 147, MCL

207.771 to 207.786.

     (x) The city utility users tax act, 1990 PA 100, MCL 141.1151

to 141.1177.

     (b) The resident, business, or property owner is substantially

delinquent as defined in a written policy by the qualified local

governmental unit in which the renaissance zone is located on

December 31 of the prior tax year under 1 or both of the following:

     (i) The city income tax act, 1964 PA 284, MCL 141.501 to

141.787.

     (ii) Taxes, fees, and special assessments collected under the

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

     (c) For residential rental property in a renaissance zone, the

residential rental property is not in substantial compliance with

all applicable state and local zoning, building, and housing laws,

ordinances, or codes and, except as otherwise provided in this

subdivision, the residential rental property owner has not filed an

affidavit before December 31 in the immediately preceding tax year

with the local tax collecting unit in which the residential rental

property is located as required under section 7ff of the general

property tax act, 1893 PA 206, MCL 211.7ff. Beginning December 31,

2004, a residential rental property owner is not required to file

an affidavit if the qualified local governmental unit in which the

residential rental property is located determines that the

residential rental property is in substantial compliance with all

applicable state and local zoning, building, and housing laws,

ordinances, and codes on December 31 of the immediately preceding

tax year.

     (2) An individual who is a resident of a renaissance zone is

eligible for an exemption, deduction, or credit under section 9(1)

and (2) until the department of treasury determines that the

aggregate state and local tax revenue forgone as a result of all

exemptions, deductions, or credits granted under this act to that

individual reaches $10,000,000.00.

     (3) A casino located and conducting business activity within a

renaissance zone is not eligible for the exemption, deduction, or

credit listed in section 9(1) or (2). Real property in a

renaissance zone on which a casino is operated, personal property

of a casino located in a renaissance zone, and all property

associated or affiliated with the operation of a casino is not

eligible for the exemption, deduction, or credit listed in section

9(1) or (2). As used in this subsection, "casino" means a casino or

a parking lot, hotel, motel, or retail store owned or operated by a

casino, an affiliate, or an affiliated company, regulated by this

state pursuant to the Michigan gaming control and revenue act, 1996

IL 1, MCL 432.201 to 432.226.

     (4) For tax years beginning on or after January 1, 1997, an

individual who is a resident of a renaissance zone shall not be

denied the exemption under subsection (1) if the individual failed

to file a return on or before December 31 of the prior tax year

under subsection (1)(a)(ii) and that individual was entitled to a

refund under that act.

     (5) A business that is located and conducts business activity

within a renaissance zone shall not be denied the exemption under

subsection (1) if the business failed to file a return on or before

December 31 of the prior tax year under subsection (1)(a)(i) and

that business had no tax liability under that act for the tax year

for which the return was not filed.

     (6) In a next Michigan renaissance zone, only property owned

or leased by a qualified eligible next Michigan business and

business activity conducted in a next Michigan renaissance zone by

a qualified eligible next Michigan business are eligible for the

exemptions, deductions, or credits described in section 9.