SB-1059, As Passed Senate, November 29, 2012

SUBSTITUTE FOR

SENATE BILL NO. 1059

A bill to amend 1893 PA 206, entitled

"The general property tax act,"

by amending sections 7jj and 27a (MCL 211.7jj[1] and 211.27a),

section 7jj as added by 2006 PA 378 and section 27a as amended by

2012 PA 47.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 7jj. (1) Except as otherwise limited in this subsection,

qualified forest property is exempt 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, according to the provisions of this section.

Buildings or structures located on qualified forest property are

not eligible for the exemption under this section. If a property

owner is interested in obtaining an exemption for qualified forest

property under this section, the property owner may contact the

local conservation district or the department and the local

conservation district or the department shall advise the property

owner on the exemption process. If requested by the property owner,

the local conservation district or the department shall provide the

property owner with a list of qualified foresters to prepare a

forest management plan. The department shall maintain a list of

qualified foresters throughout the state and shall make the list

available to the conservation districts and to interested

landowners. The amount of qualified forest property in this state

that is eligible for the exemption under this section is limited as

follows:

(a) In the fiscal year ending September 30, 2008, 300,000

acres.

(b) In the fiscal year ending September 30, 2009, 600,000

acres.

(d) In the fiscal year ending September 30, 2011 and each

fiscal year thereafter, ~~1,200,000~~ 2,400,000 acres. Beginning in the

fiscal year ending September 30, 2013 and each fiscal year

thereafter, real property eligible for exemption under this section

as qualified forest property as a result of the withdrawal of that

property from the operation of part 511 of the natural resources

and environmental protection act, 1994 PA 451, MCL 324.51101 to

324.51120, as provided in section 51108(5) of the natural resources

and environmental protection act, 1994 PA 451, MCL 324.51108, shall

not be credited against the 2,400,000 acres of property that are

eligible for exemption as qualified forest property under this

section.

(2) To claim an exemption under subsection (1), a property

owner shall obtain a forest management plan from a qualified

forester and submit a digital copy of that forest management plan,

an application for exemption as qualified forest property, and a

fee of $50.00 to the department on a form created by the department

by August 1 for the tax year within which the exemption is

requested. A forest management plan is not subject to the freedom

of information act, 1976 PA 442, MCL 15.231 to 15.246. The

department shall forward a copy of the application to the local

conservation district for review and to the local tax collecting

unit for notification of the application.

(3) A conservation district shall review the application to

determine if the applied-for property meets the minimum

requirements for enrolling into the qualified forest program. A

conservation district shall respond within 45 days of the date of

receipt of the application indicating whether the property in the

application is eligible for enrollment. If the conservation

district does not respond within 45 days of receipt of the

application, the property shall be considered eligible for the

exemption under this section.

(4) The department shall review the application, comments from

the conservation district, and the forest management plan to

determine if the property is eligible for the exemption under this

section. The department shall review the forest management plan to

determine if the elements required in subsection (16)(f) are in the

plan. Within 90 days of receipt of the application, forest

management plan, and fee, the department shall review the

application and, if the application and supporting documents are in

compliance with the requirements of this section, the department

shall approve the application and shall prepare a qualified forest

school tax affidavit, in recordable form, indicating all of the

following:

(a) The name of the landowner.

(b) The legal description of the property.

(d) A statement that the landowner is attesting that the

property for which the exemption is claimed is qualified forest

property and will be managed according to the approved forest

management plan.

(e) Any other information pertinent to the parcel and the

property owner.

(5) The department shall send a qualified forest school tax

affidavit prepared under subsection (5) to the property owner for

execution. The 90-day review period by the department may be

extended upon request of the property owner. The property owner

shall execute the qualified forest school tax affidavit and shall

have the executed qualified forest school tax affidavit recorded by

the register of deeds in the county in which the property is

located. The property owner shall provide a copy of the qualified

forest school tax affidavit to the department. The department shall

provide 1 copy of the qualified forest school tax affidavit to the

conservation district and 1 copy to the department of treasury.

These copies may be sent electronically.

(6) If the application is denied, the property owner has 30

days from the date of notification of the denial by the department

to initiate an appeal of that denial. An appeal of the denial shall

be by certified letter to the director of the department.

(7) ~~(2)~~ To claim an exemption under subsection (1), the owner

of qualified forest property shall ~~file an affidavit claiming the~~

~~exemption and an approved forest management plan or a certificate~~

~~provided by a third-party certifying organization with the~~ provide

a copy of the recorded qualified forest school tax affidavit

attesting that the land is qualified forest property to the local

tax collecting unit by December 31. An owner may claim an exemption

under this section for not more than ~~320 acres~~ 640 acres maximum or

the equivalent of 16 survey units consisting of 1/4 of 1/4 of a

section of qualified forest property in each local tax collecting

unit. If an exemption is granted under this section for less than

~~320~~ 640 acres in a local tax collecting unit, an owner of that

property may subsequently claim an exemption for additional

property in that local tax collecting unit if that additional

property meets the requirements of this section.

~~(3) The affidavit shall be on a form prescribed by the~~

~~department of treasury and shall require the person submitting the~~

~~affidavit to attest that the property for which the exemption is~~

~~claimed is qualified forest property and will be managed according~~

~~to the approved forest management plan.~~

(8) ~~(4) The~~ If a copy of the recorded qualified forest school

tax affidavit is provided by the owner, the assessor shall

~~determine if the property is qualified forest property based on a~~

~~recommendation from the department of natural resources and~~

~~confirmation that the acreage limitation set forth in subsection~~

~~(1) has not been reached and if so shall~~ exempt the property from

the collection of the tax as provided in subsection (1) until

December 31 of the year in which the property is no longer

qualified forest property.

(9) Beginning in the year that qualified forest property is

first exempt under this section and each year thereafter, the local

tax collecting unit shall collect a fee equal to 2 mills per acre

of qualified forest property exempt under this section located in

that local tax collecting unit at the same time and in the same

manner as taxes collected under this act. The administration fee

shall be retained by the local tax collecting unit. Each local tax

collecting unit shall disburse the fee collected under this

subsection to the department of treasury for deposit in the private

forestland enhancement fund created in section 51305 of the natural

resources and environmental protection act, 1994 PA 451, MCL

324.51305. If property is no longer exempt as qualified forest

property under this section, the fee under this subsection shall

not be collected on that property.

(10) ~~(5)~~ Not more than 90 days after all or a portion of the

exempted property is no longer qualified forest property, the owner

shall rescind the exemption for the applicable portion of the

property by filing with the ~~local tax collecting unit~~ register of

deeds for the county in which the exempted property is located a

rescission form prescribed by the department. ~~of treasury.~~ The

rescission form shall include a legal description of the exempted

property. An owner who fails to file a rescission as required by

this subsection is subject to a penalty of $5.00 per day for each

separate failure beginning after the 90 days have elapsed, up to a

maximum of $1,000.00. This penalty shall be collected under 1941 PA

122, MCL 205.1 to 205.31, and shall be deposited in the ~~general~~

~~fund of this state.~~private forestland enhancement fund.

(11) ~~(6)~~ An owner of property that is qualified forest

property on December 31 for which an exemption was not on the tax

roll may file an appeal with the July or December board of review

under section 53b in the year the exemption was claimed or the

immediately succeeding year. An owner of property that is qualified

forest property on May 1 for which an exemption was denied by the

assessor in the year the affidavit was filed may file an appeal

with the July board of review for summer taxes or, if there is not

a summer levy of school operating taxes, with the December board of

review under section 53b.

~~(7) If the assessor of the local tax collecting unit believes~~

~~that the property for which an exemption has been granted is not~~

~~qualified forest property based on a recommendation from the~~

~~department of natural resources, the assessor may deny or modify an~~

~~existing exemption by notifying the owner in writing at the time~~

~~required for providing a notice under section 24c. A taxpayer may~~

~~appeal the assessor's determination to the board of review meeting~~

~~under section 30. A decision of the board of review may be appealed~~

~~to the residential and small claims division of the Michigan tax~~

~~tribunal.~~

(12) ~~(8)~~ If property for which an exemption has been granted

under this section is not qualified forest property, the property

that had been subject to that exemption shall be immediately placed

on the tax roll by the local tax collecting unit if the local tax

collecting unit has possession of the tax roll or by the county

treasurer if the county has possession of the tax roll as though

the exemption had not been granted. A corrected tax bill shall be

issued for each tax year being adjusted by the local tax collecting

unit if the local tax collecting unit has possession of the tax

roll or by the county treasurer if the county has possession of the

tax roll.

(13) ~~(9)~~ If all or a portion of property for which an

exemption has been granted under this section is converted by a

change in use and is no longer qualified forest property, ~~the~~

~~property is subject to the qualified forest property recapture tax~~

~~levied~~ an owner shall immediately notify the local tax collecting

unit, the department, and the department of treasury on a form

created by the department. The form shall include a legal

description of the exempted property. A copy of the form shall be

filed with the register of deeds for the county in which the

exempted property is located. Upon notice that property is no

longer qualified forest property, the local tax collecting unit

shall immediately rescind the exemption under this section and

shall place the property on the tax roll for the immediately

succeeding tax year and the department of treasury shall

immediately begin collection of any applicable tax and penalty

under this act or under the qualified forest property recapture tax

act, 2006 PA 379, MCL 211.1031 to 211.1036. An owner of qualified

forest property shall inform a prospective buyer of that qualified

forest property that the qualified forest property is subject to

the recapture tax provided in the qualified forest property

recapture tax act, 2006 PA 379, MCL 211.1031 to 211.1036, if the

qualified forest property is converted by a change in use. However,

beginning January 1, 2013 and ending September 30, 2013, owners of

property exempt as qualified forest property prior to January 1,

2013 may execute a new qualified forest school tax affidavit under

this section. If an owner of qualified forest property elects not

to execute a new qualified forest school tax affidavit under this

section, the existing affidavit shall be rescinded without penalty

and the property shall be placed on the tax roll as though the

exemption under this section had not been granted. If a landowner

elects not to execute a qualified forest school tax affidavit under

this section, the property is not subject to the recapture tax

provided for under the qualified forest property recapture tax act,

2006 PA 379, MCL 211.1031 to 211.1036.

(14) ~~(10)~~ If qualified forest property is exempt under this

section, an owner of that qualified forest property shall ~~annually~~

report to the department ~~of natural resources~~ on a form prescribed

by the department ~~of natural resources the amount of timber~~

~~produced on that qualified forest property and whether any~~

~~buildings or structures have been constructed on the qualified~~

~~forest property.~~ when a forest practice or timber harvest has

occurred on the qualified forest property during a calendar year.

The report shall indicate the forest practice completed or the

volume and value of timber harvested on that qualified forest

property. One copy of the form shall be forwarded to the

conservation district, and 1 copy shall be retained by the

department for 7 years. If it is determined by the department that

a forest practice or harvest has occurred in a calendar year and no

report was filed, a fine of $500.00 may be collected by the

department. Beginning in 2008, and every 3 years thereafter, the

department ~~of natural resources~~ shall provide to the standing

committees of the senate and house of representatives with primary

jurisdiction over forestry issues a report that includes all of the

following:

(a) The number of acres of qualified forest property in each

county.

(b) The amount of timber produced on qualified forest property

each year.

(15) While qualified forest property is exempt under this

section, the owner shall retain the current management plan, most

recent harvest records, recorded copy of a receipt of the tax

exemption, and a map that shows the location and size of any

buildings and structures on the property. The owner shall make the

documents available to the department upon request. The department

shall maintain a database listing all qualified forest properties,

including the dates indicated for forest practices and harvests in

the forest management plan, and shall notify the landowner and the

conservation district in any year that forest practices or harvests

are to occur. If an owner does not accomplish forest practices

within 1 year and harvests within 3 years of the current forest

management plan, and the plan has not been amended to extend the

date of forest practices and harvests, the property is not eligible

for the exemption under this section and the qualified forest

property shall be placed on the tax roll as provided in this

section and shall be subject to repayment as indicated in the

qualified forest property recapture tax act, 2006 PA 379, MCL

211.1031 to 211.1036.

(16) ~~(11)~~ As used in this section:

(a) "Approved forest management plan" means ~~1 of the~~

~~following:~~

(i~~) A~~ a forest management plan ~~approved by the department of~~

~~natural resources.~~ developed by a qualified forester. An owner of

property ~~may~~ shall submit a ~~proposed~~ forest management plan to the

department ~~of natural resources~~ for approval as prescribed in

subsection (2). The ~~proposed~~ forest management plan shall include a

statement signed by the owner that he or she agrees to comply with

all terms and conditions contained in the approved forest

management plan. ~~The department of natural resources may charge a~~

~~fee of not more than $200.00 for the consideration of each proposed~~

~~forest management plan submitted. The department of natural~~

~~resources shall review and either approve or disapprove each~~

~~proposed forest management plan submitted.~~ If a forest management

plan and application are submitted to the department, the

department shall review and either approve or disapprove the

owner's application within 90 days of submission. Approval of the

plan shall be based solely on compliance with the elements required

in subdivision (f). Denial of the plan shall be based solely on

noncompliance with the requirements listed in subdivision (f). If

the department ~~of natural resources~~ disapproves a ~~proposed~~ forest

management plan, the department ~~of natural resources~~ shall indicate

the changes necessary to qualify the ~~proposed~~ forest management

plan for approval on subsequent review. ~~At the request of the owner~~

~~submitting a proposed forest management plan, the department of~~

~~natural resources may agree to complete a proposed forest~~

~~management plan.~~ An owner and the department ~~of natural resources~~

may mutually agree to ~~amend~~ limited amendments of a ~~proposed~~ forest

management plan or an approved forest management plan. A forest

management plan submitted ~~to the department of natural resources~~

for approval shall ~~not extend beyond a period of 20 years. An~~ be

for a minimum of 30 years. To continue receiving an exemption under

this section, an owner of property ~~may~~ shall submit a digital copy

of any succeeding proposed forest management plan to the department

~~of natural resources~~ for approval together with a fee of $50.00.

Mutually agreed to limited amendments of the approved forest

management plan shall not be subject to a fee of $50.00.

(ii~~) A forest management plan certified by a third-party~~

~~certifying organization.~~

(b) "Conservation district" means a conservation district

organized under part 93 of the natural resources and environmental

protection act, 1994 PA 451, MCL 324.9301 to 324.9313.

defined in section 2 of the qualified forest property recapture tax

act, 2006 PA 379, MCL 211.1032.

(d) "Department" means the department of agriculture and rural

development.

(e) "Forest management plan" means a written plan prepared and

signed by a qualified forester that prescribes measures to optimize

production, utilization, and regeneration of forest resources. The

forest management plan shall include a schedule and timetables for

the various silvicultural practices used on forestlands, which

shall be a minimum of 30 years in length. A forest management plan

shall include all of the following:

(i) The name and address of each owner of the property.

(ii) The legal description and parcel identification number of

the property or of the parcel on which the property is located.

(iii) A statement of the owner's forest management objectives.

(iv) A map, diagram, or aerial photograph that identifies both

forested and unforested areas of the property, using conventional

map symbols indicating the species, size, and stocking rate and

other major features of the property, including the location of any

buildings. The location and use of any buildings can be established

on a map created by a qualified forester and does not require a

survey by a registered surveyor.

(v) A description of forest practice, including harvesting,

thinning, and reforestation, that will be undertaken, specifying

the approximate period of time before each is completed.

(vi) A description of soil conservation practices that may be

necessary to control any soil erosion that may result from the

forest practice described pursuant to subparagraph (v).

(vii) A description of activities that may be undertaken for

the management of forest resources other than trees, including

wildlife habitat, watersheds, and aesthetic features.

(f) "Forest practice" includes, but is not limited to, any of

the following:

(i) The preparation of forest management plans for forestland.

(ii) The improvement of species of forest trees.

(iii) Reforestation.

(iv) The harvesting of species of forest trees.

(v) Road construction associated with the improvement or

harvesting of forest tree species or reforestation.

(vi) Use of chemicals or fertilizers for the purpose of growing

or managing species of forest trees.

(vii) Applicable silvicultural practices.

(viii) Any other actions intended to improve forestland or

forest resources.

(g) ~~(c)~~ "Forest products" includes, but is not limited to,

timber and pulpwood-related products.

(h) "Harvest" means the point at which timber that has been

cut, severed, or removed for purposes of sale or use is first

measured in the ordinary course of business as determined by

reference to common practice in the timber industry.

~~(d) "Natural resources professional" and "registered forester"~~

~~mean those terms as defined in section 51101 of the natural~~

~~resources and environmental protection act, 1994 PA 451, MCL~~

~~324.51101.~~

~~(e) "Proposed forest management plan" means a proposed plan~~

~~for sustainable forest management that includes, but is not limited~~

~~to, harvesting, planting, and regeneration of forest products on a~~

~~parcel of property that is prepared by a qualified forester. A~~

~~proposed forest management plan shall include all of the following:~~

(i~~) The name and address of each owner of the property.~~

(ii~~) The legal description and parcel identification number of~~

~~the property or of the parcel on which the property is located.~~

(~~iii~~~~) A statement of the owner's forest management objectives.~~

(iv~~) A map, diagram, or aerial photograph that identified both~~

~~forested and unforested areas of the property, using conventional~~

~~map symbols indicating the species, size, and density of vegetation~~

~~and other major features of the property.~~

(v~~) A description of the forestry practices, including~~

~~harvesting, thinning, and reforestation, that will be undertaken,~~

~~specifying the approximate period of time before each is completed.~~

(vi~~) A description of soil conservation practices that may be~~

~~necessary to control any soil erosion that may result from the~~

~~forestry practices described pursuant to subparagraph (~~v).

(~~vii~~~~) A proposed forest management plan shall also include a~~

~~description of activities that may be undertaken for the management~~

~~of forest resources other than trees, including wildlife habitat,~~

~~watersheds, and aesthetic features.~~

(i) ~~(f)~~ "Qualified forest property" means a parcel of real

property that meets all of the following conditions as determined

by the department of ~~natural resources:~~agriculture and rural

development:

(i) Is not less than 20 10 contiguous acres in size, of which

not less than ~~80%~~ 50% is stocked with productive forest capable of

producing ~~wood~~ forest products. Contiguity is not broken by a road,

a right-of-way, or property purchased or taken under condemnation

proceedings by a public utility for power transmission lines if the

2 parcels separated by the purchased or condemned property were a

single parcel prior to the sale or condemnation. As used in this

subparagraph, "productive forest" means real property capable of

growing not less than 20 cubic feet of wood per acre per year.

However, if property has been considered productive forest, an act

of God that negatively affects that property shall not result in

that property not being considered productive forest.

(ii~~) Is stocked with forest products.~~

(~~iii~~~~) Has no buildings or structures located on the real~~

~~property.~~

(ii) (iv) Is subject to an approved forest management plan.

(iii) For a parcel exempt as qualified agricultural property

under section 7ee, the qualified forest portion of the parcel shall

be not less than 10 contiguous acres of which not less than 50% is

productive forest capable of producing forest products.

(j) ~~(g)~~ "Qualified forester" means ~~natural resources~~

~~professional, a registered forester, or a conservation district~~

~~forester.~~an individual who meets 1 or more of the following

requirements and has registered with the department of agriculture

and rural development under section 51306 of the natural resources

and environmental protection act, 1994 PA 451, MCL 324.51306:

(i) Is a forester certified by the society of American

foresters.

(ii) Is a forest stewardship plan writer.

(iii) Is a technical service provider as registered by the

United States department of agriculture for forest management plan

development.

~~(h) "Third-party certifying organization" means an independent~~

~~third-party organization that assesses and evaluates forest~~

~~management practices according to the standards of a certification~~

~~program that measures whether forest management practices are~~

~~consistent with principles of sustainable forestry. Third-party~~

~~certifying organization includes, but is not limited to, the forest~~

~~stewardship council and the sustainable forest initiative.~~

Sec. 27a. (1) Except as otherwise provided in this section,

property shall be assessed at 50% of its true cash value under

section 3 of article IX of the state constitution of 1963.

(2) Except as otherwise provided in subsection (3), for taxes

levied in 1995 and for each year after 1995, the taxable value of

each parcel of property is the lesser of the following:

(a) The property's taxable value in the immediately preceding

year minus any losses, multiplied by the lesser of 1.05 or the

inflation rate, plus all additions. For taxes levied in 1995, the

property's taxable value in the immediately preceding year is the

property's state equalized valuation in 1994.

(b) The property's current state equalized valuation.

(3) Upon a transfer of ownership of property after 1994, the

property's taxable value for the calendar year following the year

of the transfer is the property's state equalized valuation for the

calendar year following the transfer.

(4) If the taxable value of property is adjusted under

subsection (3), a subsequent increase in the property's taxable

value is subject to the limitation set forth in subsection (2)

until a subsequent transfer of ownership occurs. If the taxable

value of property is adjusted under subsection (3) and the assessor

determines that there had not been a transfer of ownership, the

taxable value of the property shall be adjusted at the July or

December board of review. Notwithstanding the limitation provided

in section 53b(1) on the number of years for which a correction may

be made, the July or December board of review may adjust the

taxable value of property under this subsection for the current

year and for the 3 immediately preceding calendar years. A

corrected tax bill shall be issued for each tax year for which the

taxable value is adjusted by the local tax collecting unit if the

local tax collecting unit has possession of the tax roll or by the

county treasurer if the county has possession of the tax roll. For

purposes of section 53b, an adjustment under this subsection shall

be considered the correction of a clerical error.

(5) Assessment of property, as required in this section and

section 27, is inapplicable to the assessment of property subject

to the levy of ad valorem taxes within voted tax limitation

increases to pay principal and interest on limited tax bonds issued

by any governmental unit, including a county, township, community

college district, or school district, before January 1, 1964, if

the assessment required to be made under this act would be less

than the assessment as state equalized prevailing on the property

at the time of the issuance of the bonds. This inapplicability

shall continue until levy of taxes to pay principal and interest on

the bonds is no longer required. The assessment of property

required by this act shall be applicable for all other purposes.

(6) As used in this act, "transfer of ownership" means the

conveyance of title to or a present interest in property, including

the beneficial use of the property, the value of which is

substantially equal to the value of the fee interest. Transfer of

ownership of property includes, but is not limited to, the

following:

(a) A conveyance by deed.

(b) A conveyance by land contract. The taxable value of

property conveyed by a land contract executed after December 31,

1994 shall be adjusted under subsection (3) for the calendar year

following the year in which the contract is entered into and shall

not be subsequently adjusted under subsection (3) when the deed

conveying title to the property is recorded in the office of the

the settlor or the settlor's spouse, or both, conveys the property

to the trust and the sole present beneficiary or beneficiaries are

the settlor or the settlor's spouse, or both.

(d) A conveyance by distribution from a trust, except if the

distributee is the sole present beneficiary or the spouse of the

sole present beneficiary, or both.

(e) A change in the sole present beneficiary or beneficiaries

of a trust, except a change that adds or substitutes the spouse of

the sole present beneficiary.

(f) A conveyance by distribution under a will or by intestate

succession, except if the distributee is the decedent's spouse.

(g) A conveyance by lease if the total duration of the lease,

including the initial term and all options for renewal, is more

than 35 years or the lease grants the lessee a bargain purchase

option. As used in this subdivision, "bargain purchase option"

means the right to purchase the property at the termination of the

lease for not more than 80% of the property's projected true cash

value at the termination of the lease. After December 31, 1994, the

taxable value of property conveyed by a lease with a total duration

of more than 35 years or with a bargain purchase option shall be

adjusted under subsection (3) for the calendar year following the

year in which the lease is entered into. This subdivision does not

apply to personal property except buildings described in section

14(6) and personal property described in section 8(h), (i), and

(j). This subdivision does not apply to that portion of the

property not subject to the leasehold interest conveyed.

(h) Except as otherwise provided in this subdivision, a

conveyance of an ownership interest in a corporation, partnership,

sole proprietorship, limited liability company, limited liability

partnership, or other legal entity if the ownership interest

conveyed is more than 50% of the corporation, partnership, sole

proprietorship, limited liability company, limited liability

partnership, or other legal entity. Unless notification is provided

under subsection (10), the corporation, partnership, sole

proprietorship, limited liability company, limited liability

partnership, or other legal entity shall notify the assessing

officer on a form provided by the state tax commission not more

than 45 days after a conveyance of an ownership interest that

constitutes a transfer of ownership under this subdivision. Both of

the following apply to a corporation subject to 1897 PA 230, MCL

455.1 to 455.24:

(i) A transfer of stock of the corporation is a transfer of

ownership only with respect to the real property that is assessed

to the transferor lessee stockholder.

(ii) A cumulative conveyance of more than 50% of the

corporation's stock does not constitute a transfer of ownership of

the corporation's real property.

(i) A transfer of property held as a tenancy in common, except

that portion of the property not subject to the ownership interest

conveyed.

(j) A conveyance of an ownership interest in a cooperative

housing corporation, except that portion of the property not

subject to the ownership interest conveyed.

(7) Transfer of ownership does not include the following:

(a) The transfer of property from 1 spouse to the other spouse

or from a decedent to a surviving spouse.

(b) A transfer from a husband, a wife, or a husband and wife

creating or disjoining a tenancy by the entireties in the grantors

or the grantor and his or her spouse.

estate or life lease retained by the transferor, until expiration

or termination of the life estate or life lease. That portion of

property transferred that is not subject to a life lease shall be

adjusted under subsection (3).

(d) A transfer through foreclosure or forfeiture of a recorded

instrument under chapter 31, 32, or 57 of the revised judicature

act of 1961, 1961 PA 236, MCL 600.3101 to 600.3285 and MCL 600.5701

to 600.5759, or through deed or conveyance in lieu of a foreclosure

or forfeiture, until the mortgagee or land contract vendor

subsequently transfers the property. If a mortgagee does not

transfer the property within 1 year of the expiration of any

applicable redemption period, the property shall be adjusted under

subsection (3).

(e) A transfer by redemption by the person to whom taxes are

assessed of property previously sold for delinquent taxes.

(f) A conveyance to a trust if the settlor or the settlor's

spouse, or both, conveys the property to the trust and the sole

present beneficiary of the trust is the settlor or the settlor's

spouse, or both.

(g) A transfer pursuant to a judgment or order of a court of

record making or ordering a transfer, unless a specific monetary

consideration is specified or ordered by the court for the

transfer.

(h) A transfer creating or terminating a joint tenancy between

2 or more persons if at least 1 of the persons was an original

owner of the property before the joint tenancy was initially

created and, if the property is held as a joint tenancy at the time

of conveyance, at least 1 of the persons was a joint tenant when

the joint tenancy was initially created and that person has

remained a joint tenant since the joint tenancy was initially

created. A joint owner at the time of the last transfer of

ownership of the property is an original owner of the property. For

purposes of this subdivision, a person is an original owner of

property owned by that person's spouse.

(i) A transfer for security or an assignment or discharge of a

security interest.

(j) A transfer of real property or other ownership interests

among members of an affiliated group. As used in this subsection,

"affiliated group" means 1 or more corporations connected by stock

ownership to a common parent corporation. Upon request by the state

tax commission, a corporation shall furnish proof within 45 days

that a transfer meets the requirements of this subdivision. A

corporation that fails to comply with a request by the state tax

commission under this subdivision is subject to a fine of $200.00.

(k) Normal public trading of shares of stock or other

ownership interests that, over any period of time, cumulatively

represent more than 50% of the total ownership interest in a

corporation or other legal entity and are traded in multiple

transactions involving unrelated individuals, institutions, or

other legal entities.

(l) A transfer of real property or other ownership interests

among corporations, partnerships, limited liability companies,

limited liability partnerships, or other legal entities if the

entities involved are commonly controlled. Upon request by the

state tax commission, a corporation, partnership, limited liability

company, limited liability partnership, or other legal entity shall

furnish proof within 45 days that a transfer meets the requirements

of this subdivision. A corporation, partnership, limited liability

company, limited liability partnership, or other legal entity that

fails to comply with a request by the state tax commission under

this subdivision is subject to a fine of $200.00.

(m) A direct or indirect transfer of real property or other

ownership interests resulting from a transaction that qualifies as

a tax-free reorganization under section 368 of the internal revenue

code, 26 USC 368. Upon request by the state tax commission, a

property owner shall furnish proof within 45 days that a transfer

meets the requirements of this subdivision. A property owner who

fails to comply with a request by the state tax commission under

this subdivision is subject to a fine of $200.00.

(n) A transfer of qualified agricultural property, if the

person to whom the qualified agricultural property is transferred

files an affidavit with the assessor of the local tax collecting

unit in which the qualified agricultural property is located and

with the register of deeds for the county in which the qualified

agricultural property is located attesting that the qualified

agricultural property shall remain qualified agricultural property.

The affidavit under this subdivision shall be in a form prescribed

by the department of treasury. An owner of qualified agricultural

property shall inform a prospective buyer of that qualified

agricultural property that the qualified agricultural property is

subject to the recapture tax provided in the agricultural property

recapture act, 2000 PA 261, MCL 211.1001 to 211.1007, if the

qualified agricultural property is converted by a change in use. If

property ceases to be qualified agricultural property at any time

after being transferred, all of the following shall occur:

(i) The taxable value of that property shall be adjusted under

subsection (3) as of the December 31 in the year that the property

ceases to be qualified agricultural property.

(ii) The property is subject to the recapture tax provided for

under the agricultural property recapture act, 2000 PA 261, MCL

211.1001 to 211.1007.

(o) A transfer of qualified forest property, if the person to

whom the qualified forest property is transferred files an a

qualified forest taxable value affidavit with the assessor of the

local tax collecting unit in which the qualified forest property is

located and with the register of deeds for the county in which the

qualified forest property is located attesting that the qualified

forest property shall remain qualified forest property. The

qualified forest taxable value affidavit under this subdivision

shall be in a form prescribed by the department of ~~treasury.~~

agriculture and rural development. The qualified forest taxable

value affidavit shall include a legal description of the qualified

forest property, the name of the new property owner, the year the

transfer of the property occurred, a statement indicating that the

property owner is attesting that the property for which the

exemption is claimed is qualified forest property and will be

managed according to the approved forest management plan, and any

other information pertinent to the parcel and the property owner.

The property owner shall provide a copy of the qualified forest

taxable value affidavit to the department. The department shall

provide 1 copy of the qualified forest taxable value affidavit to

the local tax collecting unit, 1 copy to the conservation district,

and 1 copy to the department of treasury. These copies may be sent

electronically. An owner of qualified forest property shall inform

a prospective buyer of that qualified forest property that the

qualified forest property is subject to the recapture tax provided

in the qualified forest property recapture tax act, 2006 PA 379,

MCL 211.1031 to 211.1036, if the qualified forest property is

converted by a change in use. If property ceases to be qualified

forest property at any time after being transferred, all of the

following shall occur:

(i) The taxable value of that property shall be adjusted under

subsection (3) as of the December 31 in the year that the property

ceases to be qualified forest property.

(ii) ~~The~~ Except as otherwise provided in subparagraph (iii), the

property is subject to the recapture tax provided for under the

qualified forest property recapture tax act, 2006 PA 379, MCL

211.1031 to 211.1036.

(iii) Beginning January 1, 2013 and ending September 30, 2013,

owners of property enrolled as qualified forest property prior to

January 1, 2013 may execute a new qualified forest taxable value

affidavit with the department of agriculture and rural development.

If a landowner elects not to execute a qualified forest taxable

value affidavit, the existing affidavit shall be rescinded, without

subjecting the property to the recapture tax provided for under the

qualified forest property recapture tax act, 2006 PA 379, MCL

211.1031 to 211.1036, and the taxable value of that property shall

be adjusted under subsection (3).

(p) Beginning on the effective date of the amendatory act that

added this subdivision, a transfer of land, but not buildings or

structures located on the land, which meets 1 or more of the

following requirements:

(i) The land is subject to a conservation easement under

subpart 11 of part 21 of the natural resources and environmental

protection act, 1994 PA 451, MCL 324.2140 to 324.2144. As used in

this subparagraph, "conservation easement" means that term as

defined in section 2140 of the natural resources and environmental

protection act, 1994 PA 451, MCL 324.2140.

(ii) A transfer of ownership of the land or a transfer of an

interest in the land is eligible for a deduction as a qualified

conservation contribution under section 170(h) of the internal

revenue code, 26 USC 170.

(q) A transfer of real property or other ownership interests

resulting from a consolidation or merger of a domestic nonprofit

corporation that is a boy or girl scout or camp fire girls

organization, a 4-H club or foundation, a young men's Christian

association, or a young women's Christian association and at least

50% of the members of that organization or association are

residents of this state.

(r) A change to the assessment roll or tax roll resulting from

the application of section 16a of 1897 PA 230, MCL 455.16a.

(8) If all of the following conditions are satisfied, the

local tax collecting unit shall revise the taxable value of

qualified agricultural property taxable on the tax roll in the

possession of that local tax collecting unit to the taxable value

that qualified agricultural property would have had if there had

been no transfer of ownership of that qualified agricultural

property since December 31, 1999 and there had been no adjustment

of that qualified agricultural property's taxable value under

subsection (3) since December 31, 1999:

(a) The qualified agricultural property was qualified

agricultural property for taxes levied in 1999 and each year after

1999.

(b) The owner of the qualified agricultural property files an

affidavit with the assessor of the local tax collecting unit under

subsection (7)(n).

(9) If the taxable value of qualified agricultural property is

adjusted under subsection (8), the owner of that qualified

agricultural property shall not be entitled to a refund for any

property taxes collected under this act on that qualified

agricultural property before the adjustment under subsection (8).

(10) The register of deeds of the county where deeds or other

title documents are recorded shall notify the assessing officer of

the appropriate local taxing unit not less than once each month of

any recorded transaction involving the ownership of property and

shall make any recorded deeds or other title documents available to

that county's tax or equalization department. Unless notification

is provided under subsection (6), the buyer, grantee, or other

transferee of the property shall notify the appropriate assessing

office in the local unit of government in which the property is

located of the transfer of ownership of the property within 45 days

of the transfer of ownership, on a form prescribed by the state tax

commission that states the parties to the transfer, the date of the

transfer, the actual consideration for the transfer, and the

property's parcel identification number or legal description. Forms

filed in the assessing office of a local unit of government under

this subsection shall be made available to the county tax or

equalization department for the county in which that local unit of

government is located. This subsection does not apply to personal

property except buildings described in section 14(6) and personal

property described in section 8(h), (i), and (j).

(11) As used in this section:

(a) "Additions" means that term as defined in section 34d.

(b) "Beneficial use" means the right to possession, use, and

enjoyment of property, limited only by encumbrances, easements, and

restrictions of record.

in the agricultural property recapture act, 2000 PA 261, MCL

211.1001 to 211.1007.

(d) "Inflation rate" means that term as defined in section

34d.

(e) "Losses" means that term as defined in section 34d.

(f) "Qualified agricultural property" means that term as

defined in section 7dd.

(g) "Qualified forest property" means that term as defined in

section 7jj[1].

Enacting section 1. This amendatory act does not take effect

unless all of the following bills of the 96th Legislature are

enacted into law:

(a) Senate Bill No. 1057.

(b) Senate Bill No. 1058.

(d) Senate Bill No. 1062.

(e) House Bill No. 4302.

(f) House Bill No. 4969.

(g) House Bill No. 4970.

Enacting section 2. This amendatory act takes effect January

1, 2013.