Bill Text: MI HB4967 | 2023-2024 | 102nd Legislature | Introduced
Bill Title: Property tax: exemptions; exemption of certain property located in land equity cities under certain circumstances; provide for. Amends secs. 2, 78a & 89b of 1893 PA 206 (MCL 211.2 et seq.) & adds sec. 7yy. TIE BAR WITH: HB 4966'23
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Introduced) 2023-10-04 - Placed On Third Reading [HB4967 Detail]
Download: Michigan-2023-HB4967-Introduced.html
HOUSE BILL NO. 4967
A bill to amend 1893 PA 206, entitled
"The general property tax act,"
by amending sections 2, 78a, and 89b (MCL 211.2, 211.78a, and 211.89b), section 2 as amended by 2002 PA 620, section 78a as amended by 2014 PA 499, and section 89b as amended by 2008 PA 512, and by adding section 7yy.
the people of the state of michigan enact:
Sec. 2. (1) For the purpose of taxation, real property includes all of the following:
(a) All land within this state, all buildings and fixtures on the land, and all appurtenances to the land, except as expressly exempted by law.
(b) All real property owned by this state or purchased or condemned for public highway purposes by any board, officer, commission, or department of this state and sold on land contract, notwithstanding the fact that the deed has not been executed transferring title.
(c) For taxes levied after December 31, 2002, buildings Buildings and improvements located upon on leased real property, except buildings and improvements exempt under section 9f or improvements assessable under section 8(h), if the value of the buildings or improvements is not otherwise included in the assessment of the real property. However, buildings and improvements located on leased real property shall must not be treated as real property unless they would be treated as real property if they were located on real property owned by the taxpayer.
(2) The taxable status of persons and real and personal property for a tax year shall for general property taxes collected under this act and for any specific tax applicable to real or personal property under the laws of this state, including, but not limited to, a specific tax under the land tax equity act, must be determined as of each December 31 of the immediately preceding year, which is considered the tax day, any provisions in the charter of any county, city, or village to the contrary notwithstanding. An assessing officer is not restricted to any particular period in the preparation of the assessment roll but may survey, examine, or review property at any time before or after the tax day.
(3) Notwithstanding a provision to the contrary in any law, if real property is acquired for public purposes by purchase or condemnation, all general property taxes, and any specific taxes applicable to the real property under the laws of this state, including, but not limited to, a specific tax under the land tax equity act, but not penalties, levied during the 12 months immediately preceding, but not including, the day title passes to the public agency shall must be prorated in accordance with this subsection. The seller or condemnee is responsible for the portion of taxes from the levy date or dates to, but not including, the day title passes and the public agency is responsible for the remainder of the taxes. If the date that title will pass cannot be ascertained definitely and an agreement in advance to prorate taxes is desirable, an estimated date for the passage of title may be agreed to. In the absence of Absent an agreement, the public agency shall compute the proration of taxes as of the date title passes. The question of proration of taxes shall must not be considered in any condemnation proceeding. As used in this subsection, "levy date" means the day on which general property taxes become due and payable. In addition to the portion of taxes for which the public agency is responsible under the provisions of this subsection, the public agency is also responsible for all general property taxes and all specific taxes applicable to the real property under the laws of this state, including, but not limited to, a specific tax under the land tax equity act, levied on or after the date title passes and before the property is removed from the tax rolls.
(4) In a real estate transaction between private parties, in the absence of absent an agreement to the contrary, the seller is responsible for that portion of the annual general property taxes and any specific taxes applicable to the real property under the laws of this state, including, but not limited to, a specific tax under the land tax equity act, levied during the 12 months immediately preceding, but not including, the day title passes, from the levy date or dates to, but not including, the day title passes and the buyer is responsible for the remainder of the annual taxes.
(5) As used in this subsection, section, "levy date" means the day on which a general property tax or a specific tax applicable under the laws of this state, including, but not limited to, a specific tax under the land tax equity act, becomes due and payable.
Sec. 7yy. (1) Subject to subsection (2), real property located in a land equity city or land equity local unit that is not otherwise exempt by law is exempt from the collection of qualified taxes for each year in which both of the following requirements have been met:
(a) A land value tax has been authorized by the land equity city or land equity local unit and approved by the qualified voters of the land equity city or land equity local unit under the land tax equity act.
(b) The land value tax has been approved and certified mills have been designated to be qualified taxes by the land equity city or land equity local unit.
(2) If approved by a land equity city or land equity local unit, an exemption created under subsection (1) must be phased into effect in equal percentages, as determined by the land equity city, over a period of up to 3 years during which a land value tax is initially imposed. In the last year of the phase-in period and each following year, the exemption must be effective at 100% of the amount of the qualified taxes.
(3) The assessor of a land equity city shall specifically identify in the assessment notice required under section 24c all of the following:
(a) The assessed value and taxable value of the land portion of each parcel of property that is subject to the specific tax under the land tax equity act.
(b) The assessed value and taxable value of each parcel of real property and improvements, other than the land portion of the parcel, that includes land subject to the specific tax under the land tax equity act.
(c) A statement that the taxable value, as identified under subdivision (a), will be the basis of the tax imposed under the land tax equity act.
(4) Unless an alternative method for determining the taxable value of land is prescribed by the state tax commission, the taxable value of the land portion of a parcel of property in each year is the product of the taxable value for the entire property for the year multiplied by the percentage that the state equalized value of the land portion of the parcel for the year represents to the state equalized value of the entire property for the year, including improvements.
(5) If the board of review for a land equity city takes action authorized under this act to correct or change the assessed value of any parcel of property, the assessor of the land equity city shall have the sole responsibility and authority to proportionately adjust the assessed values identified in subsection (3)(a) and (b) to allocate the correction or make the respective assessed values relatively just and proper.
(6) The treasurer of a land equity city shall prepare, in a form prescribed by the treasurer, a tax statement related to the collection of the land value tax. The tax statement required by this act for the land value tax may be separate from or made part of the tax statement prepared under section 44. The treasurer of a land equity city shall include the following information related to the collection of land value taxes under the land tax equity act on the statement required under this section for the land value tax:
(a) The taxable value of the real property subject to tax under the land tax equity act.
(b) The amount of tax levied and to be collected, specified by dollar amount, under the land tax equity act.
(c) Any information required for the statement under the land tax equity act.
(7) As used in this section:
(a) "Authorized ad valorem millage" means the rate of ad valorem millage that a city or local unit of government is authorized to levy for operating purposes under law or charter, after any reduction caused by application of section 34d.
(b) "Equivalent land tax rate" means that term as defined in section 3 of the land tax equity act.
(c) "Land equity city" means a city that has adopted a resolution under section 4 of the land tax equity act authorizing the levy of a land value tax.
(d) "Land equity local unit" means a local unit of government that has adopted a resolution under section 4 of the land tax equity act authorizing the levy of a land value tax.
(e) "Land value tax" means the specific tax authorized under the land tax equity act.
(f) "Local unit of government" means that term as defined in the land tax equity act.
(g) "Operating purposes" means either of the following, as applicable:
(i) Municipal purposes for which a city is authorized under section 3 of the home rule city act, 1909 PA 279, MCL 117.3, to lay and collect taxes under the city's charter.
(ii) Purposes for which ad valorem property taxes collected under this act are levied by a local unit of government, other than the levy of ad valorem property taxes to provide school districts revenue that is deposited in a building and site fund and other than to pay principal and interest due on a bond or note if and to the extent the ad valorem taxes levied for these purposes are in addition to charter or statutory limitations, as authorized by the revised municipal finance act, 2001 PA 34, MCL 141.2101 to 141.2821.
(h) "Qualified tax" means that portion, which must not be less than 50%, of a city's or local unit of government's authorized ad valorem millage that is designated under the land tax equity act as eligible to be converted to an equivalent land tax rate for levy as a land value tax.
Sec. 78a. (1) For taxes levied after December 31, 1998, all property returned for delinquent taxes, and upon which taxes, interest, penalties, and fees remain unpaid after the property is returned as delinquent to the county treasurers of this state under this act or other laws of this state, including, but not limited to, property returned for delinquent specific taxes under the land tax equity act, is subject to forfeiture, foreclosure, and sale for the enforcement and collection of the delinquent taxes as provided in section 78, this section, and sections 78b to 79a. As used in section 78, this section, and sections 78b to 79a, "taxes" includes interest, penalties, and fees imposed before the taxes become delinquent and unpaid special assessments or other assessments that are due and payable up to and including the date of the foreclosure hearing under section 78k.
(2) On March 1 in each year, taxes levied in the immediately preceding year that remain unpaid shall must be returned as delinquent for collection. However, if the last day in a year that taxes are due and payable before being returned as delinquent is on a Saturday, Sunday, or legal holiday, the last day taxes are due and payable before being returned as delinquent is on the next business day and taxes levied in the immediately preceding year that remain unpaid shall must be returned as delinquent on the immediately succeeding business day. Except as otherwise provided in section 79 for certified abandoned property, property delinquent for taxes levied in the second year preceding the forfeiture under section 78g or in a prior year to which this section applies shall must be forfeited to the county treasurer for the total of the unpaid taxes, interest, penalties, and fees for those years as provided under section 78g.
(3) A county property tax administration fee of 4% and, except as provided in section 78g(3)(c), interest computed at a noncompounded rate of 1% per month or fraction of a month on the taxes that were originally returned as delinquent, computed from the date that the taxes originally became delinquent, shall must be added to property returned as delinquent under this section. A county property tax administration fee provided for under this subsection shall must not be less than $1.00.
(4) Any person with an unrecorded property interest or any other person who wishes at any time wants to receive notice of the return of delinquent taxes on a parcel of property may pay an annual fee not to exceed $5.00 by February 1 to the county treasurer and specify the parcel identification number, the address of the property, and the address to which the notice shall should be sent. Holders of any undischarged mortgages wishing to receive notice of the return of delinquent taxes on a parcel or parcels of property may provide a list of such parcels in a form prescribed by the county treasurer and pay an annual fee not to exceed $1.00 per parcel to the county treasurer and specify for each parcel the parcel identification number, the address of the property, and the address to which the notice should be sent. The county treasurer shall notify the person or holders of undischarged mortgages if delinquent taxes on the property or properties are returned within that year.
(5) Notwithstanding any charter provision to the contrary, the governing body of a local governmental unit that collects delinquent taxes may establish for any property, by ordinance, procedures for the collection of delinquent taxes and the enforcement of tax liens and the schedule for the forfeiture or foreclosure of delinquent tax liens. The procedures and schedule established by ordinance shall must conform at a minimum to those procedures and schedules established under sections 78a to 78l, 79a, except that those taxes subject to a payment plan approved by the treasurer of the local governmental unit as of July 1, 1999 shall must not be considered delinquent if payments are not delinquent under that payment plan.
Sec. 89b. For taxes levied after December 31, 2003, notwithstanding the provisions of a charter of a county adopted pursuant to under 1966 PA 293, MCL 45.501 to 45.521, or the provisions of the charter of a home rule city, to the contrary, a city with a population of 600,000 500,000 or more shall do all of the following:
(a) Prepare and submit to each taxpayer a statement indicating the amount of tax levied on real and personal property by all taxing jurisdictions authorized to levy a general ad valorem property tax in that city or a specific tax applicable under the laws of this state to real or personal property in that city, including, but not limited to, a specific tax under the land tax equity act.
(b) Collect the tax levied on real and personal property by all taxing jurisdictions authorized to levy a general ad valorem property tax in that city or a specific tax applicable under the laws of this state to real or personal property in that city, including, but not limited to, a specific tax under the land tax equity act.
Enacting section 1. This amendatory act does not take effect unless Senate Bill No.____ or House Bill No. 4966 (request no. 03630'23) of the 102nd Legislature is enacted into law.
Enacting section 2. If any portion of this amendatory act or application of any portion of this amendatory act to any person, property, or circumstance is found to be invalid by a court, the invalidity must not affect the remaining portions or applications of this amendatory act that can be given effect without the invalid portion or application if the remaining portions are not determined by the court to be inoperable. The provisions of this amendatory act are severable.
