Bill Text: MI HB4496 | 2021-2022 | 101st Legislature | Introduced
Bill Title: Property tax: delinquent taxes; delinquent property tax installment payment plans and tax foreclosure avoidance agreements; make available for certain commercial real property returned for delinquent taxes. Amends sec. 78q of 1893 PA 206 (MCL 211.78q).
Spectrum: Moderate Partisan Bill (Democrat 31-6)
Status: (Introduced - Dead) 2021-03-16 - Bill Electronically Reproduced 03/11/2021 [HB4496 Detail]
Download: Michigan-2021-HB4496-Introduced.html
HOUSE BILL NO. 4496
A bill to amend 1893 PA 206, entitled
"The general property tax act,"
by amending section 78q (MCL 211.78q), as amended by 2020 PA 33.
the people of the state of michigan enact:
Sec. 78q. (1) Notwithstanding any provision of this act or charter to the contrary, a foreclosing governmental unit may create a delinquent property tax installment payment plan for eligible property, the title to which is held by a financially distressed person. A delinquent property tax installment payment plan created under this subsection may be combined with and made subject to a delinquent property tax payment reduction under section 78g(8)(c). Any payment under that delinquent property tax installment payment plan made during a calendar year in which an owner of property is subject to a payment reduction under section 78g(8) must be credited to the amount owed under section 78g(8) and the credit must not exceed the amount owed under section 78g(8).
(2) If a financially distressed person agrees to participate in a delinquent property tax installment payment plan created under subsection (1) and makes the initial payment required under that delinquent property tax installment payment plan, the foreclosing governmental unit may remove eligible property the title to which is held by that financially distressed person from the petition for foreclosure as provided in section 78h(3)(c).
(3) If a financially distressed person successfully completes a delinquent property tax installment payment plan created under subsection (1), interest under section 78g(3)(b) and any additional interest otherwise applicable must be waived.
(4) If a financially distressed person does not successfully complete a delinquent property tax installment payment plan created under subsection (1), both of the following apply:
(a) Interest under section 78g(3)(b) and any additional interest otherwise applicable apply to any unpaid taxes on the property.
(b) The eligible property must be included in the immediately succeeding petition for foreclosure under section 78h.
(5) Notwithstanding any provision of this act or charter to the contrary, until June 30, 2026, a county treasurer may enter into a tax foreclosure avoidance agreement for a term of up to 5 years with an owner of property returned as delinquent to the county treasurer under this act or forfeited to the county treasurer under section 78g if the property is classified under section 34c as residential real property under section 34c, or as commercial real property, if the property is eligible property, and if the owner makes an initial payment of the delinquent taxes owed on the property in an amount determined by the county treasurer. A tax foreclosure avoidance agreement entered into under this subsection may be combined with and made subject to a delinquent property tax payment reduction under section 78g(8)(c). Any payment under that tax foreclosure avoidance agreement made during a calendar year in which an owner of property is subject to a payment reduction under section 78g(8) must be credited to the amount owed under section 78g(8) and the credit must not exceed the amount owed under section 78g(8). While a tax foreclosure avoidance agreement is effective, the property must be withheld or removed from the petition for foreclosure as provided under section 78h(3)(c), interest at the rate provided in section 78g(3)(c)(ii) applies, and the owner shall make timely payments as provided under the tax foreclosure avoidance agreement, including timely payment of all nondelinquent taxes on the property. A tax foreclosure avoidance agreement must require regular periodic installment payments. The final payment must not be disproportionately larger than a regular periodic installment payment and regular periodic installment payments in the final year must not be disproportionately larger than regular periodic installment payments in prior years. A county treasurer may refuse to enter into a tax foreclosure avoidance agreement with an owner under this subsection if that owner is not in compliance with another tax foreclosure avoidance agreement with the county treasurer or with a delinquent property tax installment plan with the county treasurer under this section. A county treasurer may not enter into more than 2 tax foreclosure avoidance agreements with an owner. If an owner fails to comply with a tax foreclosure avoidance agreement or if the tax foreclosure avoidance agreement is no longer effective, all of the following apply:
(a) Interest under section 78g(3)(b) and any additional interest otherwise applicable apply to any unpaid taxes on the property.
(b) The property must be included in the immediately succeeding petition for foreclosure under section 78h.
(c) The owner shall not bid on property subject to sale under section 78m, if that property was subject to the tax foreclosure avoidance agreement.
(6) A delinquent property tax installment payment plan or a tax foreclosure avoidance agreement may not be approved under this section if the delinquent property tax installment payment plan or tax foreclosure avoidance agreement would impermissibly impair an outstanding debt of the county.
(7) If a foreclosing governmental unit has created a delinquent property tax installment payment plan under this section, the department of treasury may audit the books and records of that foreclosing governmental unit concerning the details of that delinquent property tax installment payment plan.
(8) Property classified as industrial real property under section 34c that is occupied at less than 10% of its facility capacity for more than 3 years and that is located in a county with a population of more than 1,500,000 according to the most recent federal decennial census is not eligible to participate in a delinquent property tax installment payment plan and is subject to section 78m, including sale under section 78m(2) to the person bidding the highest amount above the minimum bid.
(9) If a delinquent property tax installment payment plan is in effect for property for which a county has issued notes under this act that are secured by the delinquent taxes and interest on that property, at any time 2 years after the date that those taxes were returned as delinquent, the county treasurer may charge back to any taxing unit the face amount of the delinquent taxes that were owed to that taxing unit on the date those taxes were returned as delinquent, less the amount of any principal installments received by the county treasurer on that property under the delinquent property tax installment payment plan. All subsequent payments of delinquent taxes and interest on that property must be retained by the county treasurer in a separate account and either paid to or credited to the account of that taxing unit.
(10) As used in this section:
(a) "Eligible property" means property that meets 1 of the following:
(i) Is residential real property under section 34c and is a principal residence exempt from the tax levied by a local school district for school operating purposes under section 7cc.
(ii) Is commercial real property under section 34c.
(b) "Financially distressed person" means a person who meets all of the following conditions:
(i) Is eligible to have property to which he or she holds title withheld from a petition for foreclosure under section 78h(3)(b).
(ii) Is not delinquent in satisfying a delinquent property tax installment payment plan or tax foreclosure avoidance agreement under this section for any other property within the foreclosing governmental unit.
