Bill Text: MI HB5170 | 2019-2020 | 100th 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: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2019-10-30 - Bill Electronically Reproduced 10/30/2019 [HB5170 Detail]
Download: Michigan-2019-HB5170-Introduced.html
HOUSE BILL NO. 5170
October 29, 2019, Introduced by Reps. Byrd and Wittenberg
and referred to the Committee on Local Government and Municipal Finance.
A bill to amend 1893 PA 206, entitled
"The general property tax act,"
by amending section 78q (MCL 211.78q), as amended by 2019 PA 35.
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.
(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 shall 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
shall 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 at least 10% of
the delinquent taxes owed on the property. While a tax foreclosure avoidance
agreement is effective, the property shall 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 shall 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 shall 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.
