September 14, 2010, Introduced by Senators BARCIA, ALLEN, HUNTER, STAMAS, NOFS and CLARKE and referred to the Committee on Commerce and Tourism.
A bill to amend 1996 PA 381, entitled
"Brownfield redevelopment financing act,"
by amending section 13 (MCL 125.2663), as amended by 2007 PA 202.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 13. (1) Subject to section 15, the board may implement a
brownfield plan. The brownfield plan may apply to 1 or more parcels
of eligible property whether or not those parcels of eligible
property are contiguous and may be amended to apply to additional
parcels of eligible property. Except as otherwise authorized by
this act, if more than 1 eligible property is included within the
plan, the tax increment revenues under the plan shall be determined
individually for each eligible property. Each plan or an amendment
to a plan shall be approved by the governing body of the
municipality and shall contain all of the following:
(a) A description of the costs of the plan intended to be paid
for with the tax increment revenues or, for a plan for eligible
properties qualified on the basis that the property is owned or
under the control of a land bank fast track authority, a listing of
all eligible activities that may be conducted for 1 or more of the
eligible properties subject to the plan.
(b) A brief summary of the eligible activities that are
proposed for each eligible property or, for a plan for eligible
properties qualified on the basis that the property is owned or
under the control of a land bank fast track authority, a brief
summary of eligible activities conducted for 1 or more of the
eligible properties subject to the plan.
(c) An estimate of the captured taxable value and tax
increment revenues for each year of the plan from the eligible
property. The plan may provide for the use of part or all of the
captured taxable value, including deposits in the local site
remediation revolving fund, but the portion intended to be used
shall be clearly stated in the plan. The plan shall not provide
either for an exclusion from captured taxable value of a portion of
the captured taxable value or for an exclusion of the tax levy of 1
or more taxing jurisdictions unless the tax levy is excluded from
tax increment revenues in section 2(dd), or unless the tax levy is
excluded from capture under section 15.
(d) The method by which the costs of the plan will be
financed, including a description of any advances made or
anticipated to be made for the costs of the plan from the
municipality.
(e) The maximum amount of note or bonded indebtedness to be
incurred, if any.
(f) The duration of the brownfield plan for eligible
activities on eligible property which shall not exceed 35 years
following the date of the resolution approving the plan amendment
related to a particular eligible property. Each plan amendment
shall also contain the duration of capture of tax increment
revenues including the beginning date of the capture of tax
increment revenues, which beginning date shall be identified in the
brownfield plan and which beginning date shall not be later than 5
years following the date of the resolution approving the plan
amendment related to a particular eligible property and which
duration shall not exceed the lesser of the period authorized under
subsections (4) and (5) or 30 years from the beginning date of the
capture of tax increment revenues. The date for the beginning of
capture of tax increment revenues may be amended by the authority
but not to a date later than 5 years after the date of the
resolution adopting the plan amendment. The authority may not amend
the date for the beginning of capture of tax increment revenues if
the authority has begun to reimburse eligible activities from the
capture of tax increment revenues. The authority may not amend the
date for the beginning of capture if that amendment would lead to
the duration of capture of tax increment revenues being longer than
30 years or the period authorized under subsections (4) and (5). If
the date for the beginning of capture of tax increment revenues is
amended by the authority and that plan amendment includes the
capture of tax increment revenues for school operating purposes,
then
the authority that amended that plan shall notify the
department and the Michigan economic growth authority within 30
days of the approval of the amendment. For purposes of this
subdivision, "plan amendment" means a plan related to a particular
eligible property, a plan amendment that included a particular
eligible property within a plan, or, if a project for which
eligible activities were identified in a plan fails to occur, a
subsequent plan amendment that identifies eligible activities
associated with a new project on that eligible property if the
authority has not begun to reimburse eligible activities from the
capture of tax increment revenues for that eligible property.
(g) An estimate of the impact of tax increment financing on
the revenues of all taxing jurisdictions in which the eligible
property is located.
(h) A legal description of the eligible property to which the
plan applies, a map showing the location and dimensions of each
eligible property, a statement of the characteristics that qualify
the property as eligible property, and a statement of whether
personal property is included as part of the eligible property. If
the project is on property that is functionally obsolete, the
taxpayer shall include, with the application, an affidavit signed
by a level 3 or level 4 assessor, that states that it is the
assessor's expert opinion that the property is functionally
obsolete and the underlying basis for that opinion.
(i) Estimates of the number of persons residing on each
eligible property to which the plan applies and the number of
families and individuals to be displaced. If occupied residences
are designated for acquisition and clearance by the authority, the
plan shall include a demographic survey of the persons to be
displaced, a statistical description of the housing supply in the
community, including the number of private and public units in
existence or under construction, the condition of those in
existence, the number of owner-occupied and renter-occupied units,
the annual rate of turnover of the various types of housing and the
range of rents and sale prices, an estimate of the total demand for
housing in the community, and the estimated capacity of private and
public housing available to displaced families and individuals.
(j) A plan for establishing priority for the relocation of
persons displaced by implementation of the plan.
(k) Provision for the costs of relocating persons displaced by
implementation of the plan, and financial assistance and
reimbursement of expenses, including litigation expenses and
expenses incident to the transfer of title, in accordance with the
standards and provisions of the uniform relocation assistance and
real property acquisition policies act of 1970, Public Law 91-646.
(l) A strategy for compliance with 1972 PA 227, MCL 213.321 to
213.332.
(m) A description of proposed use of the local site
remediation revolving fund.
(n) Other material that the authority or governing body
considers pertinent.
(2) The percentage of all taxes levied on a parcel of eligible
property for school operating expenses that is captured and used
under a brownfield plan and all tax increment finance plans under
1975 PA 197, MCL 125.1651 to 125.1681, the tax increment finance
authority act, 1980 PA 450, MCL 125.1801 to 125.1830, or the local
development financing act, 1986 PA 281, MCL 125.2151 to 125.2174,
shall not be greater than the combination of the plans' percentage
capture and use of all local taxes levied for purposes other than
for the payment of principal of and interest on either obligations
approved by the electors or obligations pledging the unlimited
taxing power of the local unit of government. This subsection shall
apply only when taxes levied for school operating purposes are
subject to capture under section 15.
(3) Except as provided in this subsection and subsections (5),
(15), and (16), tax increment revenues related to a brownfield plan
shall be used only for costs of eligible activities attributable to
the eligible property, the captured taxable value of which produces
the tax increment revenues, including the cost of principal of and
interest on any obligation issued by the authority to pay the costs
of eligible activities attributable to the eligible property, and
the reasonable costs of preparing a brownfield plan or a work plan
for the eligible property, including the actual cost of the review
of the work plan under section 15. For property owned or under the
control of a land bank fast track authority, tax increment revenues
related to a brownfield plan may be used for eligible activities
attributable to any eligible property owned or under the control of
the land bank fast track authority, the cost of principal of and
interest on any obligation issued by the authority to pay the costs
of eligible activities, the reasonable costs of preparing a work
plan, and the actual cost of the review of the work plan under
section 15. Except as provided in subsection (18), tax increment
revenues captured from taxes levied by this state under the state
education tax act, 1993 PA 331, MCL 211.901 to 211.906, or taxes
levied by a local school district shall not be used for eligible
activities described in section 2(m)(iv)(E).
(4) Except as provided in subsection (5), a brownfield plan
shall not authorize the capture of tax increment revenue from
eligible property after the year in which the total amount of tax
increment revenues captured is equal to the sum of the costs
permitted to be funded with tax increment revenues under this act.
(5) A brownfield plan may authorize the capture of additional
tax increment revenue from an eligible property in excess of the
amount authorized under subsection (4) during the time of capture
for the purpose of paying the costs permitted under subsection (3),
or for not more than 5 years after the time that capture is
required for the purpose of paying the costs permitted under
subsection (3), or both. Excess revenues captured under this
subsection shall be deposited in the local site remediation
revolving fund created under section 8 and used for the purposes
authorized in section 8. If tax increment revenues attributable to
taxes levied for school operating purposes from eligible property
are captured by the authority for purposes authorized under
subsection (3), the tax increment revenues captured for deposit in
the local site remediation revolving fund also may include tax
increment revenues attributable to taxes levied for school
operating purposes in an amount not greater than the tax increment
revenues levied for school operating purposes captured from the
eligible property by the authority for the purposes authorized
under subsection (3). Excess tax increment revenues from taxes
levied for school operating purposes for eligible activities
authorized under subsection (15) by the Michigan economic growth
authority shall not be captured for deposit in the local site
remediation revolving fund.
(6) An authority shall not expend tax increment revenues to
acquire or prepare eligible property, unless the acquisition or
preparation is an eligible activity.
(7) Costs of eligible activities attributable to eligible
property include all costs that are necessary or related to a
release from the eligible property, including eligible activities
on properties affected by a release from the eligible property. For
purposes of this subsection, "release" means that term as defined
in section 20101 of the natural resources and environmental
protection act, 1994 PA 451, MCL 324.20101.
(8) Costs of a response activity paid with tax increment
revenues that are captured pursuant to subsection (3) may be
recovered from a person who is liable for the costs of eligible
activities at an eligible property. This state or an authority may
undertake cost recovery for tax increment revenue captured. Before
an authority or this state may institute a cost recovery action, it
must provide the other with 120 days' notice. This state or an
authority that recovers costs under this subsection shall apply
those recovered costs to the following, in the following order of
priority:
(a) The reasonable attorney fees and costs incurred by this
state or an authority in obtaining the cost recovery.
(b) One of the following:
(i) If an authority undertakes the cost recovery action, the
authority shall deposit the remaining recovered funds into the
local site remediation fund created pursuant to section 8, if such
a fund has been established by the authority. If a local site
remediation fund has not been established, the authority shall
disburse the remaining recovered funds to the local taxing
jurisdictions in the proportion that the local taxing
jurisdictions' taxes were captured.
(ii) If this state undertakes a cost recovery action, this
state shall deposit the remaining recovered funds into the
revitalization revolving loan fund established under section 20108a
of the natural resources and environmental protection act, 1994 PA
451, MCL 324.20108a.
(iii) If this state and an authority each undertake a cost
recovery action, undertake a cost recovery action jointly, or 1 on
behalf of the other, the amount of any remaining recovered funds
shall be deposited pursuant to subparagraphs (i) and (ii) in the
proportion that the tax increment revenues being recovered
represent local taxes and taxes levied for school operating
purposes, respectively.
(9) Approval of the brownfield plan or an amendment to a
brownfield plan shall be in accordance with the notice and approval
provisions of this section and section 14.
(10) Before approving a brownfield plan for an eligible
property, the governing body shall hold a public hearing on the
brownfield plan. By resolution, the governing body may delegate the
public hearing process to the authority or to a subcommittee of the
governing body subject to final approval by the governing body.
Notice of the time and place of the hearing shall be given by
publication twice in a newspaper of general circulation designated
by the municipality, not less than 10 or more than 40 days before
the date set for the hearing.
(11) Notice of the time and place of the hearing on a
brownfield plan shall contain all of the following:
(a) A description of the property to which the plan applies in
relation to existing or proposed highways, streets, streams, or
otherwise.
(b) A statement that maps, plats, and a description of the
brownfield plan are available for public inspection at a place
designated in the notice and that all aspects of the brownfield
plan are open for discussion at the public hearing required by this
section.
(c) Any other information that the governing body considers
appropriate.
(12) At the time set for the hearing on the brownfield plan
required under subsection (10), the governing body shall ensure
that interested persons have an opportunity to be heard and that
written communications with reference to the brownfield plan are
received and considered. The governing body shall ensure that a
record of the public hearing is made and preserved, including all
data presented at the hearing.
(13) Not less than 10 days before the hearing on the
brownfield plan, the governing body shall provide notice of the
hearing to the taxing jurisdictions that levy taxes subject to
capture under this act. The authority shall fully inform the taxing
jurisdictions about the fiscal and economic implications of the
proposed brownfield plan. At that hearing, an official from a
taxing jurisdiction with millage that would be subject to capture
under this act has the right to be heard in regard to the adoption
of the brownfield plan. Not less than 10 days before the hearing on
the brownfield plan, the governing body shall provide notice of the
hearing to the department if the brownfield plan involves the use
of taxes levied for school operating purposes to pay for eligible
activities that require the approval of a work plan by the
department under section 15(1)(a) and the Michigan economic growth
authority, or its designee, if the brownfield plan involves the use
of taxes levied for school operating purposes to pay for eligible
activities subject to subsection (15) or (18).
(14) The authority shall not enter into agreements with the
taxing jurisdictions and the governing body of the municipality to
share a portion of the captured taxable value of an eligible
property. Upon adoption of the plan, the collection and
transmission of the amount of tax increment revenues as specified
in this act shall be binding on all taxing units levying ad valorem
property taxes or specific taxes against property located in the
zone.
(15) Except as provided by subsection (18), if a brownfield
plan includes the capture of taxes levied for school operating
purposes approval of a work plan by the Michigan economic growth
authority before January 1, 2013 to use taxes levied for school
operating purposes and a development agreement or reimbursement
agreement between the municipality or authority and an owner or
developer of eligible property are required if the taxes levied for
school operating purposes will be used for infrastructure
improvements that directly benefit eligible property, demolition of
structures that is not response activity under part 201 of the
natural resources and environmental protection act, 1994 PA 451,
MCL 324.20101 to 324.20142, lead or asbestos abatement, site
preparation that is not response activity under section 20101 of
the natural resources and environmental protection act, 1994 PA
451, MCL 324.20101, relocation of public buildings or operations
for economic development purposes, or acquisition of property by a
land bank fast track authority if acquisition of the property is
for economic development purposes. The eligible activities to be
conducted described in this subsection shall be consistent with the
work plan submitted by the authority to the Michigan economic
growth authority. The department's approval is not required for the
capture of taxes levied for school operating purposes for eligible
activities described in this subsection.
(16) The limitations of section 15(1) upon use of tax
increment revenues by an authority shall not apply to the following
costs and expenses:
(a) In each fiscal year of the authority, the amount described
in subsection (19) for the following purposes for tax increment
revenues attributable to local taxes:
(i) Reasonable and actual administrative and operating expenses
of the authority.
(ii) Baseline environmental assessments, due care activities,
and additional response activities conducted by or on behalf of the
authority related directly to work conducted on prospective
eligible properties prior to approval of the brownfield plan.
(b) Reasonable costs of preparing a work plan or the cost of
the review of a work plan for which tax increment revenues may be
used under section 13(3).
(c) For tax increment revenues attributable to local taxes,
reasonable costs of site investigations described in section
15(1)(a)(i), baseline environmental assessments, and due care
activities incurred by a person other than the authority related
directly to work conducted on eligible property or prospective
eligible properties prior to approval of the brownfield plan, if
those costs and the eligible property are included in a brownfield
plan approved by the authority.
(17) A brownfield authority may reimburse advances, with or
without interest, made by a municipality under section 7(3), a land
bank fast track authority, or any other person or entity for costs
of eligible activities with any source of revenue available for use
of the brownfield authority under this act. If an authority
reimburses a person or entity under this section for an advance for
the payment or reimbursement of the cost of eligible activities and
interest thereon, the authority may capture local taxes for the
payment of that interest. If an authority reimburses a person or
entity under this section for an advance for the payment or
reimbursement of the cost of baseline environmental assessments,
due care, and additional response activities and interest thereon
included in a work plan approved by the department, the authority
may capture taxes levied for school operating purposes and local
taxes for the payment of that interest. If an authority reimburses
a person or entity under this section for an advance for the
payment or reimbursement of the cost of eligible activities that
are not baseline environmental assessments, due care, and
additional response activities and interest thereon included in a
work plan approved by the Michigan economic growth authority, the
authority may capture taxes levied for school operating purposes
and local taxes for the payment of that interest provided that the
Michigan economic growth authority grants an approval for the
capture of taxes levied for school operating purposes to pay such
interest. An authority may enter into agreements related to these
reimbursements and payments. A reimbursement agreement for these
purposes and the obligations under that reimbursement agreement
shall not be subject to section 12 or the revised municipal finance
act, 2001 PA 34, MCL 141.2101 to 141.2821.
(18) If a brownfield plan includes the capture of taxes levied
for school operating purposes, approval of a work plan by the
Michigan economic growth authority in the manner required under
section 15(14) to (16) is required in order to use tax increment
revenues attributable to taxes levied for school operating purposes
for purposes of eligible activities described in section 2(m)(iv)(E)
for 1 or more parcels of eligible property. The work plan to be
submitted to the Michigan economic growth authority under this
subsection shall be in a form prescribed by the Michigan economic
growth authority. The eligible activities to be conducted and
described in this subsection shall be consistent with the work plan
submitted by the authority to the Michigan economic growth
authority. The department's approval is not required for the
capture of taxes levied for school operating purposes for eligible
activities described in this section.
(19) In each fiscal year of the authority, the amount of tax
increment revenues attributable to local taxes that an authority
can use for the purposes described in subsection (16)(a) shall be
determined as follows:
(a) For authorities that have 5 or fewer active projects,
$100,000.00.
(b) For authorities that have 6 or more but fewer than 11
active projects, $125,000.00.
(c) For authorities that have 11 or more but fewer than 16
active projects, $150,000.00.
(d) For authorities that have 16 or more but fewer than 21
active projects, $175,000.00.
(e) For authorities that have 21 or more but fewer than 26
active projects, $200,000.00.
(f) For authorities that have 26 or more active projects,
$300,000.00.
(20) As used in subsection (19), "active project" means a
project in which the authority is currently capturing taxes under
this act.