SB-1139, As Passed House, July 1, 2010
February 23, 2010, Introduced by Senators NOFS and BISHOP and referred to the Committee on Commerce and Tourism.
A bill to amend 1986 PA 281, entitled
"The local development financing act,"
by amending section 11b (MCL 125.2161b), as added by 2008 PA 155.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 11b. (1) If the amount of tax increment revenues lost as
a result of the personal property tax exemptions provided by
section 1211(4) of the revised school code, 1976 PA 451, MCL
380.1211, section 3 of the state education tax act, 1993 PA 331,
MCL 211.903, section 14(4) of 1974 PA 198, MCL 207.564, and section
9k of the general property tax act, 1893 PA 206, MCL 211.9k, will
reduce the allowable school tax capture received in a fiscal year,
then, notwithstanding any other provision of this act, the
authority, with approval of the department of treasury under
subsection (3), may request the local tax collecting treasurer to
retain and pay to the authority taxes levied under the state
education tax act, 1993 PA 331, MCL 211.901 to 211.906, to be used
for the following:
(a) To repay an eligible advance.
(b) To repay an eligible obligation.
(c) To repay an other protected obligation.
(d) To pay an advance or an obligation identified in a
development plan, or an amendment to that plan for property located
in a certified technology park approved by board of the authority
not later than 90 days after the effective date of the amendatory
act that added this section if the plan contains all of the
following and the plan for the capture of school taxes has been
approved within 1 year after the effective date of the amendatory
act that added this section:
(i) A detailed description of the project.
(ii) A statement of the estimated cost of the project.
(iii) The specific location of the project.
(iv) The name of any developer of the project.
(2)
Not later than June 15, of 2008, not later than September
30, 2009, and not later than June 1 of each subsequent year, an
authority eligible under subsection (1) to have taxes levied under
the state education tax act, 1993 PA 331, MCL 211.901 to 211.906,
retained and paid to the authority under this section, shall apply
for approval with the department of treasury. The application for
approval shall include the following information:
(a) The property tax millage rates expected to be levied by
local school districts within the jurisdictional area of the
authority for school operating purposes for that fiscal year.
(b) The tax increment revenues estimated to be received by the
authority for that fiscal year based upon actual property tax
levies of all taxing jurisdictions within the jurisdictional area
of the authority.
(c) The tax increment revenues the authority estimates it
would have received for that fiscal year if the personal property
tax exemptions described in subsection (1) were not in effect.
(d) A list of eligible obligations, eligible advances, other
protected obligations, and advances and obligations described in
subsection (1)(d) for expenditures authorized in a certified
technology park; the payments due on each of those in that fiscal
year; and the total amount of payments due on all of those in that
fiscal year.
(e) The amount of money, other than tax increment revenues,
estimated to be received in that fiscal year by the authority that
is primarily pledged to, and to be used for, the payment of an
eligible obligation, the repayment of an eligible advance, the
payment of another protected obligation, or the payment of
obligations or advances described in subsection (1)(d) for
expenditures authorized in a certified technology park. That amount
shall not include excess tax increment revenues of the authority
that are permitted by law to be retained by the authority for
purposes that further the development program. However, that amount
shall include money to be obtained from sources authorized by law,
which law is enacted on or after December 1, 1993, for use by the
municipality or authority to finance a development plan.
(f) The amount of a distribution received pursuant to this act
for a fiscal year in excess of or less than the distribution that
would have been required if calculated upon actual tax increment
revenues received for that fiscal year.
(3) Not later than August 15, 2008; for 2009 only, not later
than 30 days after the effective date of the amendatory act that
amended this sentence; and not later than August 15 of each
subsequent year, based on the calculations under subsection (5),
the department of treasury shall approve, modify, or deny the
application for approval to have taxes levied under the state
education tax act, 1993 PA 331, MCL 211.901 to 211.906, retained
and paid to the authority under this section. If the application
for approval contains the information required under subsection
(2)(a) through (f) and appears to be in substantial compliance with
the provisions of this section, then the department of treasury
shall approve the application. If the application is denied by the
department of treasury, then the department of treasury shall
provide the opportunity for a representative of the authority to
discuss the denial within 21 days after the denial occurs and shall
sustain or modify its decision within 30 days after receiving
information from the authority. If the application for approval is
approved or modified by the department of treasury, the local tax
collecting treasurer shall retain and pay to the authority the
amount described in subsection (5) as approved by the department.
If the department of treasury denies the authority's application
for approval, the local tax collecting treasurer shall not retain
or pay to the authority the taxes levied under the state education
tax act, 1993 PA 331, MCL 211.901 to 211.906. An approval by the
department does not prohibit a subsequent audit of taxes retained
in accordance with the procedures currently authorized by law.
(4) Each year, the legislature shall appropriate and
distribute an amount sufficient to pay each authority the
following:
(a) If the amount to be retained and paid under subsection (3)
is less than the amount calculated under subsection (5), the
difference between those amounts.
(b) If the application for approval is denied by the
department of treasury, an amount verified by the department equal
to the amount calculated under subsection (5).
(5) Subject to subsection (6), the aggregate amount under this
section shall be the sum of the amounts determined under
subdivisions (a) and (b) minus the amount determined under
subdivision (c), as follows:
(a) The amount by which the tax increment revenues the
authority would have received and retained for the fiscal year,
excluding taxes exempt under section 7ff of the general property
tax act, 1893 PA 206, MCL 211.7ff, if the personal property tax
exemptions described in subsection (1) were not in effect, exceed
the tax increment revenues the authority actually received for the
fiscal year.
(b) A shortfall required to be reported under subsection
(2)(f) that had not previously increased a distribution.
(c) An excess amount required to be reported under subsection
(2)(f) that had not previously decreased a distribution.
(6) A distribution or taxes retained under this section
replacing tax increment revenues pledged by an authority or a
municipality are subject to any lien of the pledge described in
subsection (1), whether or not there has been physical delivery of
the distribution.
(7) Obligations for which distributions are made under this
section are not a debt or liability of this state; do not create or
constitute an indebtedness, liability, or obligation of this state;
and are not and do not constitute a pledge of the faith and credit
of this state.
(8) Not later than September 15 of each year, the authority
shall provide a copy of the application for approval approved by
the department of treasury to the local tax collecting treasurer
and provide the amount of the taxes retained and paid to the
authority under subsection (5).
(9) Calculations of amounts retained and paid and
appropriations to be distributed under this section shall be made
on the basis of each development area of the authority.
(10) The state tax commission may provide that the
reimbursement calculations under this section and the calculation
of allowable capture of school taxes shall be made for each
calendar year's tax increment revenues using a 12-month debt
payment period used by the authority and approved by the state tax
commission.
(11) It is the intent of the legislature that, to the extent
that the total amount of taxes levied under the state education tax
act, 1993 PA 331, MCL 211.901 to 211.906, that are allowed to be
retained under this section and section 15a of the brownfield
redevelopment financing act, 1996 PA 381, MCL 125.2665a, section
12b of the tax increment financing act, 1980 PA 450, MCL 125.1812b,
and section 13c of 1975 PA 197, MCL 125.1663c, exceeds the
difference of the total school aid fund revenue for the tax year
minus the estimated amount of revenue the school aid fund would
have received for the tax year had the tax exemptions described in
subsection (1) and the earmark created by section 515 of the
Michigan business tax act, 2007 PA 36, MCL 208.1515, not taken
effect, the general fund shall reimburse the school aid fund the
difference.