Bill Text: MI SB0579 | 2015-2016 | 98th Legislature | Engrossed
Bill Title: Economic development; brownfield redevelopment authority; tax capture districts; provide opt-in and opt-out provisions for certain entities. Amends secs. 2 & 4 of 1996 PA 381 (MCL 125.2652 & 125.2654).
Spectrum: Partisan Bill (Republican 1-0)
Status: (Engrossed - Dead) 2016-11-30 - Referred To Second Reading [SB0579 Detail]
Download: Michigan-2015-SB0579-Engrossed.html
SB-0579, As Passed Senate, March 16, 2016
SUBSTITUTE FOR
SENATE BILL NO. 579
A bill to amend 1996 PA 381, entitled
"Brownfield redevelopment financing act,"
by amending sections 2 and 4 (MCL 125.2652 and 125.2654), section 2
as amended by 2013 PA 67 and section 4 as amended by 2012 PA 502.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2. As used in this act:
(a) "Additional response activities" means response activities
identified as part of a brownfield plan that are in addition to
baseline environmental assessment activities and due care
activities for an eligible property.
(b) "Authority" means a brownfield redevelopment authority
created under this act.
(c) "Baseline environmental assessment" means that term as
defined in section 20101 of the natural resources and environmental
protection act, 1994 PA 451, MCL 324.20101.
(d) "Baseline environmental assessment activities" means those
response activities identified as part of a brownfield plan that
are necessary to complete a baseline environmental assessment for
an eligible property in the brownfield plan.
(e) "Blighted" means property that meets any of the following
criteria as determined by the governing body:
(i) Has been declared a public nuisance in accordance with a
local housing, building, plumbing, fire, or other related code or
ordinance.
(ii) Is an attractive nuisance to children because of physical
condition, use, or occupancy.
(iii) Is a fire hazard or is otherwise dangerous to the safety
of persons or property.
(iv) Has had the utilities, plumbing, heating, or sewerage
permanently disconnected, destroyed, removed, or rendered
ineffective so that the property is unfit for its intended use.
(v) Is tax reverted property owned by a qualified local
governmental unit, by a county, or by this state. The sale, lease,
or transfer of tax reverted property by a qualified local
governmental unit, county, or this state after the property's
inclusion in a brownfield plan shall not result in the loss to the
property of the status as blighted property for purposes of this
act.
(vi) Is property owned or under the control of a land bank
fast track authority, whether or not located within a qualified
local governmental unit. Property included within a brownfield plan
prior to the date it meets the requirements of this subdivision to
be eligible property shall be considered to become eligible
property as of the date the property is determined to have been or
becomes qualified as, or is combined with, other eligible property.
The sale, lease, or transfer of the property by a land bank fast
track authority after the property's inclusion in a brownfield plan
shall not result in the loss to the property of the status as
blighted property for purposes of this act.
(vii) Has substantial subsurface demolition debris buried on
site so that the property is unfit for its intended use.
(f) "Board" means the governing body of an authority.
(g) "Brownfield plan" means a plan that meets the requirements
of section 13 and is adopted under section 14.
(h) "Captured taxable value" means the amount in 1 year by
which the current taxable value of an eligible property subject to
a brownfield plan, including the taxable value or assessed value,
as appropriate, of the property for which specific taxes are paid
in lieu of property taxes, exceeds the initial taxable value of
that eligible property. The state tax commission shall prescribe
the method for calculating captured taxable value.
(i) "Chief executive officer" means the mayor of a city, the
village manager of a village, the township supervisor of a
township, or the county executive of a county or, if the county
does not have an elected county executive, the chairperson of the
county board of commissioners.
(j) "Combined brownfield plan" means a brownfield plan that
also includes the information necessary to submit the plan to the
department or Michigan strategic fund under section 15(25).
(k) "Department" means the department of environmental
quality.
(l) "Due care activities" means those response activities
identified as part of a brownfield plan that are necessary to allow
the owner or operator of an eligible property in the plan to comply
with the requirements of section 20107a of the natural resources
and environmental protection act, 1994 PA 451, MCL 324.20107a.
(m) "Economic opportunity zone" means 1 or more parcels of
property that meet all of the following:
(i) That together are 40 or more acres in size.
(ii) That contain or contained a manufacturing facility that
consists or consisted of 500,000 or more square feet.
(iii) That are located in a municipality that has a population
of 30,000 or less and that is contiguous to a qualified local
governmental unit.
(n) "Eligible activities" or "eligible activity" means 1 or
more of the following:
(i) Baseline environmental assessment activities.
(ii) Due care activities.
(iii) Additional response activities.
(iv) For eligible activities on eligible property that was
used or is currently used for commercial, industrial, or
residential purposes that is in a qualified local governmental
unit, that is owned or under the control of a land bank fast track
authority, or that is located in an economic opportunity zone, and
is a facility, historic resource, functionally obsolete, or
blighted, and except for purposes of section 38d of former 1975 PA
228, the following additional activities:
(A) Infrastructure improvements that directly benefit eligible
property.
(B) Demolition of structures that is not response activity
under section 20101 of the natural resources and environmental
protection act, 1994 PA 451, MCL 324.20101.
(C) Lead or asbestos abatement.
(D) Site preparation that is not response activity under
section 20101 of the natural resources and environmental protection
act, 1994 PA 451, MCL 324.20101.
(E) Assistance to a land bank fast track authority in clearing
or quieting title to, or selling or otherwise conveying, property
owned or under the control of a land bank fast track authority or
the acquisition of property by the land bank fast track authority
if the acquisition of the property is for economic development
purposes.
(F) Assistance to a qualified local governmental unit or
authority in clearing or quieting title to, or selling or otherwise
conveying, property owned or under the control of a qualified local
governmental unit or authority or the acquisition of property by a
qualified local governmental unit or authority if the acquisition
of the property is for economic development purposes.
(v) Relocation of public buildings or operations for economic
development purposes.
(vi) For eligible activities on eligible property that is a
qualified facility that is not located in a qualified local
governmental unit and that is a facility, functionally obsolete, or
blighted, the following additional activities:
(A) Infrastructure improvements that directly benefit eligible
property.
(B) Demolition of structures that is not response activity
under section 20101 of the natural resources and environmental
protection act, 1994 PA 451, MCL 324.20101.
(C) Lead or asbestos abatement.
(D) Site preparation that is not response activity under
section 20101 of the natural resources and environmental protection
act, 1994 PA 451, MCL 324.20101.
(vii) For eligible activities on eligible property that is not
located in a qualified local governmental unit and that is a
facility, historic resource, functionally obsolete, or blighted,
the following additional activities:
(A) Demolition of structures that is not response activity
under section 20101 of the natural resources and environmental
protection act, 1994 PA 451, MCL 324.20101.
(B) Lead or asbestos abatement.
(viii) Reasonable costs of developing and preparing brownfield
plans, combined brownfield plans, and work plans.
(ix) For property that is not located in a qualified local
governmental unit and that is a facility, functionally obsolete, or
blighted, that is a former mill that has not been used for
industrial purposes for the immediately preceding 2 years, that is
located along a river that is a federal superfund site listed under
the comprehensive environmental response, compensation, and
liability act of 1980, 42 USC 9601 to 9675, and that is located in
a city with a population of less than 10,000 persons, the following
additional activities:
(A) Infrastructure improvements that directly benefit the
property.
(B) Demolition of structures that is not response activity
under section 20101 of the natural resources and environmental
protection act, 1994 PA 451, MCL 324.20101.
(C) Lead or asbestos abatement.
(D) Site preparation that is not response activity under
section 20101 of the natural resources and environmental protection
act, 1994 PA 451, MCL 324.20101.
(x) For eligible activities on eligible property that is
located north of the 45th parallel, that is a facility,
functionally obsolete, or blighted, and the owner or operator of
which makes new capital investment of $250,000,000.00 or more in
this state, the following additional activities:
(A) Demolition of structures that is not response activity
under section 20101 of the natural resources and environmental
protection act, 1994 PA 451, MCL 324.20101.
(B) Lead or asbestos abatement.
(xi) Reasonable costs of environmental insurance.
(o) Except as otherwise provided in this subdivision,
"eligible property" means property for which eligible activities
are identified under a brownfield plan that was used or is
currently used for commercial, industrial, public, or residential
purposes, including personal property located on the property, to
the extent included in the brownfield plan, and that is 1 or more
of the following:
(i) Is in a qualified local governmental unit and is a
facility, historic resource, functionally obsolete, or blighted and
includes parcels that are adjacent or contiguous to that property
if the development of the adjacent and contiguous parcels is
estimated to increase the captured taxable value of that property.
(ii) Is not in a qualified local governmental unit and is a
facility, and includes parcels that are adjacent or contiguous to
that property if the development of the adjacent and contiguous
parcels is estimated to increase the captured taxable value of that
property.
(iii) Is tax reverted property owned or under the control of a
land bank fast track authority.
(iv) Is not in a qualified local governmental unit, is a
qualified facility, and is a facility, functionally obsolete, or
blighted, if the eligible activities on the property are limited to
the eligible activities identified in subdivision (n)(vi).
(v) Is not in a qualified local governmental unit and is a
facility, historic resource, functionally obsolete, or blighted, if
the eligible activities on the property are limited to the eligible
activities identified in subdivision (n)(vii).
(vi) Is not in a qualified local governmental unit and is a
facility, functionally obsolete, or blighted, if the eligible
activities on the property are limited to the eligible activities
identified in subdivision (n)(ix).
(vii) Is located north of the 45th parallel, is a facility,
functionally obsolete, or blighted, and the owner or operator makes
new capital investment of $250,000,000.00 or more in this state.
Eligible property does not include qualified agricultural property
exempt under section 7ee of the general property tax act, 1893 PA
206, MCL 211.7ee, from the tax levied by a local school district
for school operating purposes to the extent provided under section
1211 of the revised school code, 1976 PA 451, MCL 380.1211.
(viii) Is a transit-oriented development.
(ix) Is a transit-oriented facility.
(x) Is located in a qualified local governmental unit and
contains a targeted redevelopment area, as designated by resolution
of the governing body and approved by the Michigan strategic fund,
of not less than 40 and not more than 500 contiguous parcels. A
qualified local governmental unit is limited to designating no more
than 2 targeted redevelopment areas for the purposes of this
section in a calendar year. The Michigan strategic fund may approve
no more than 5 redevelopment areas for the purposes of this section
in a calendar year.
(p) "Environmental insurance" means liability insurance for
environmental contamination and cleanup that is not otherwise
required by state or federal law.
(q) "Facility" means that term as defined in section 20101 of
the natural resources and environmental protection act, 1994 PA
451, MCL 324.20101.
(r) "Fiscal year" means the fiscal year of the authority.
(s) "Functionally obsolete" means that the property is unable
to be used to adequately perform the function for which it was
intended due to a substantial loss in value resulting from factors
such as overcapacity, changes in technology, deficiencies or
superadequacies in design, or other similar factors that affect the
property itself or the property's relationship with other
surrounding property.
(t) "Governing body" means the elected body having legislative
powers of a municipality creating an authority under this act.
(u) "Historic resource" means that term as defined in section
90a of the Michigan strategic fund act, 1984 PA 270, MCL 125.2090a.
(v) "Infrastructure improvements" means a street, road,
sidewalk, parking facility, pedestrian mall, alley, bridge, sewer,
sewage treatment plant, property designed to reduce, eliminate, or
prevent the spread of identified soil or groundwater contamination,
drainage system, waterway, waterline, water storage facility, rail
line, utility line or pipeline, transit-oriented development,
transit-oriented facility, or other similar or related structure or
improvement, together with necessary easements for the structure or
improvement, owned or used by a public agency or functionally
connected to similar or supporting property owned or used by a
public agency, or designed and dedicated to use by, for the benefit
of, or for the protection of the health, welfare, or safety of the
public generally, whether or not used by a single business entity,
provided that any road, street, or bridge shall be continuously
open to public access and that other property shall be located in
public easements or rights-of-way and sized to accommodate
reasonably foreseeable development of eligible property in
adjoining areas. Infrastructure improvements also include 1 or more
of the following whether publicly or privately owned or operated or
located on public or private property:
(i) Underground parking.
(ii) Multilevel parking structures.
(iii) Urban storm water management systems.
(w) "Initial taxable value" means the taxable value of an
eligible property identified in and subject to a brownfield plan at
the time the resolution adding that eligible property in the
brownfield plan is adopted, as shown either by the most recent
assessment roll for which equalization has been completed at the
time the resolution is adopted or, if provided by the brownfield
plan, by the next assessment roll for which equalization will be
completed following the date the resolution adding that eligible
property in the brownfield plan is adopted. Property exempt from
taxation at the time the initial taxable value is determined shall
be included with the initial taxable value of zero. Property for
which a specific tax is paid in lieu of property tax shall not be
considered exempt from taxation. The state tax commission shall
prescribe the method for calculating the initial taxable value of
property for which a specific tax was paid in lieu of property tax.
(x) "Land bank fast track authority" means an authority
created under the land bank fast track act, 2003 PA 258, MCL
124.751 to 124.774.
(y) "Local taxes" means all taxes levied other than taxes
levied for school operating purposes.
(z) "Michigan strategic fund" means the Michigan strategic
fund created under the Michigan strategic fund act, 1984 PA 270,
MCL 125.2001 to 125.2094.
(aa) "Municipality" means all of the following:
(i) A city.
(ii) A village.
(iii) A township in those areas of the township that are
outside of a village.
(iv) A township in those areas of the township that are in a
village upon the concurrence by resolution of the village in which
the zone would be located.
(v) A county.
(bb) "Owned or under the control of" means that a land bank
fast track authority has 1 or more of the following:
(i) An ownership interest in the property.
(ii) A tax lien on the property.
(iii) A tax deed to the property.
(iv) A contract with this state or a political subdivision of
this state to enforce a lien on the property.
(v) A right to collect delinquent taxes, penalties, or
interest on the property.
(vi) The ability to exercise its authority over the property.
(cc) "Qualified facility" means a landfill facility area of
140 or more contiguous acres that is located in a city and that
contains a landfill, a material recycling facility, and an asphalt
plant that are no longer in operation.
(dd) "Qualified local governmental unit" means that term as
defined in the obsolete property rehabilitation act, 2000 PA 146,
MCL 125.2781 to 125.2797.
(ee) "Qualified taxpayer" means that term as defined in
sections 38d and 38g of former 1975 PA 228, or section 437 of the
Michigan business tax act, 2007 PA 36, MCL 208.1437, or a recipient
of a community revitalization incentive as described in section 90a
of the Michigan strategic fund act, 1984 PA 270, MCL 125.2090a.
(ff) "Response activity" means either of the following:
(i) Response activity as that term is defined in section 20101
of the natural resources and environmental protection act, 1994 PA
451, MCL 324.20101.
(ii) Corrective action as that term is defined in section
21302 of the natural resources and environmental protection act,
1994 PA 451, MCL 324.21302.
(gg) "Specific taxes" means a tax levied under 1974 PA 198,
MCL 207.551 to 207.572; the commercial redevelopment act, 1978 PA
255, MCL 207.651 to 207.668; the enterprise zone act, 1985 PA 224,
MCL 125.2101 to 125.2123; 1953 PA 189, MCL 211.181 to 211.182; the
technology park development act, 1984 PA 385, MCL 207.701 to
207.718; the obsolete property rehabilitation act, 2000 PA 146, MCL
125.2781 to 125.2797; the neighborhood enterprise zone act, 1992 PA
147, MCL 207.771 to 207.786; the commercial rehabilitation act,
2005 PA 210, MCL 207.841 to 207.856; or that portion of the tax
levied under the tax reverted clean title act, 2003 PA 260, MCL
211.1021 to 211.1025a, that is not required to be distributed to a
land bank fast track authority.
(hh) "State brownfield redevelopment fund" means the state
brownfield redevelopment fund created in section 8a.
(ii) "Tax increment revenues" means the amount of ad valorem
property taxes and specific taxes attributable to the application
of the levy of all taxing jurisdictions upon the captured taxable
value of each parcel of eligible property subject to a brownfield
plan and personal property located on that property, regardless of
whether those taxes began to be levied after the brownfield plan
was adopted. Tax increment revenues do not include any of the
following:
(i) Ad valorem property taxes specifically levied 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 governmental unit, and specific taxes attributable to
those ad valorem property taxes.
(ii) For tax increment revenues attributable to eligible
property also exclude the amount of ad valorem property taxes or
specific taxes captured by a downtown development authority, tax
increment finance authority, or local development finance authority
if those taxes were captured by these other authorities on the date
that eligible property became subject to a brownfield plan under
this act.
(iii) Ad valorem property taxes levied under 1 or more of the
following or specific taxes attributable to those ad valorem
property taxes:
(A) The zoological authorities act, 2008 PA 49, MCL 123.1161
to 123.1183.
(B) The art institute authorities act, 2010 PA 296, MCL
123.1201 to 123.1229.
(C) Except as otherwise provided in section 4(7), ad valorem
property taxes or specific local taxes attributable to those ad
valorem property taxes levied for a separate millage for public
library purposes approved by the electors after December 31, 2015.
(jj) "Taxable value" means the value determined under section
27a of the general property tax act, 1893 PA 206, MCL 211.27a.
(kk) "Taxes levied for school operating purposes" means all of
the following:
(i) The taxes levied by a local school district for operating
purposes.
(ii) The taxes levied under the state education tax act, 1993
PA 331, MCL 211.901 to 211.906.
(iii) That portion of specific taxes attributable to taxes
described under subparagraphs (i) and (ii).
(ll) "Transit-oriented development" means infrastructure
improvements that are located within 1/2 mile of a transit station
or transit-oriented facility that promotes transit ridership or
passenger rail use as determined by the board and approved by the
municipality in which it is located.
(mm) "Transit-oriented facility" means a facility that houses
a transit station in a manner that promotes transit ridership or
passenger rail use.
(nn) "Work plan" means a plan that describes each individual
activity to be conducted to complete eligible activities and the
associated costs of each individual activity.
(oo) "Zone" means, for an authority established before June 6,
2000, a brownfield redevelopment zone designated under this act.
Sec. 4. (1) A governing body may declare by resolution adopted
by a majority of its members elected and serving its intention to
create and provide for the operation of an authority.
(2) In the resolution of intent, the governing body shall set
a date for holding a public hearing on the adoption of a proposed
resolution creating the authority. The notice of the public hearing
shall state the date, time, and place of the hearing. At that
hearing, a citizen, taxpayer, official from a taxing jurisdiction
whose millage may be subject to capture under a brownfield plan, or
property owner of the municipality has the right to be heard in
regard to the establishment of the authority.
(3) Not more than 30 days after the public hearing, if the
governing body intends to proceed with the establishment of the
authority, the governing body shall adopt, by majority vote of its
members elected and serving, a resolution establishing the
authority. The adoption of the resolution is subject to all
applicable statutory or charter provisions with respect to the
approval or disapproval by the chief executive or other officer of
the municipality and the adoption of a resolution over his or her
veto. This resolution shall be filed with the secretary of state
promptly after its adoption.
(4) The proceedings establishing an authority shall be
presumptively valid unless contested in a court of competent
jurisdiction within 60 days after the filing of the resolution with
the secretary of state.
(5) The exercise by an authority of the powers conferred by
this act shall be considered to be an essential governmental
function and benefit to, and a legitimate public purpose of, the
state, the authority, and the municipality or units.
(6) If the board implements or modifies a brownfield plan that
contains a qualified facility, the governing body shall mail notice
of that implementation or modification to each taxing jurisdiction
that levies ad valorem property taxes in the municipality. Not more
than 60 days after receipt of that notice, the governing body of a
taxing jurisdiction levying ad valorem property taxes that would
otherwise be subject to capture may exempt its taxes from capture
by adopting a resolution to that effect and filing a copy with the
clerk of the municipality in which the qualified facility is
located. The resolution takes effect when filed with that clerk and
remains effective until a copy of a resolution rescinding that
resolution is filed with that clerk.
(7) If a separate millage for public library purposes was
levied before January 1, 2016, and all obligations of the authority
are paid or defeased, then the levy is exempt from capture under
this act, unless the library board or commission allows all or a
portion of its taxes levied to be included as tax increment
revenues and subject to capture under this act under the terms of a
written agreement between the library board or commission and the
authority. The written agreement shall be filed with the clerk of
the municipality. However, if a separate millage for public library
purposes was levied before January 1, 2016, and the authority
modifies its brownfield plan to include additional activities or
extends the duration of the existing finance plan, then the library
board or commission may, not later than 60 days after a public
hearing is held under this subsection, exempt all or a portion of
its taxes from capture by adopting a resolution to that effect and
filing a copy with the clerk of the municipality that created the
authority. For ad valorem property taxes or specific local taxes
attributable to those ad valorem property taxes levied for a
separate millage for public library purposes approved by the
electors after December 31, 2015, a library board or commission may
allow all or a portion of its taxes levied to be included as tax
increment revenues and subject to capture under this act under the
terms of a written agreement between the library board or
commission and the authority. The written agreement shall be filed
with the clerk of the municipality. However, if the library was
created under section 1 or 10a of 1877 PA 164, MCL 397.201 and
397.210a, then any action of the library board or commission under
this subsection shall have the concurrence of the chief executive
officer of the city that created the library to be effective.
