September 27, 2011, Introduced by Senator HUNTER and referred to the Committee on Finance.
A bill to amend 1893 PA 206, entitled
"The general property tax act,"
by amending sections 78a, 78g, and 78h (MCL 211.78a, 211.78g, and
211.78h), section 78a as amended by 2008 PA 352, section 78g as
amended by 2003 PA 263, and section 78h as amended by 2001 PA 96.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
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, 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 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 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 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 otherwise provided in section 78h(4), 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 be
added to property returned as delinquent under this section. A
county property tax administration fee provided for under this
subsection shall not be less than $1.00.
(4) Any person with an unrecorded property interest or any
other person who wishes at any time 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 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 conform at a minimum to those
procedures and schedules established under sections 78a to 78l,
except that those taxes subject to a payment plan approved by the
treasurer of the local governmental unit as of July 1, 1999 shall
not be considered delinquent if payments are not delinquent under
that payment plan.
Sec. 78g. (1) Except as otherwise provided in this subsection,
on March 1 in each tax year, certified abandoned property and
property that is delinquent for taxes, interest, penalties, and
fees for the immediately preceding 12 months or more is forfeited
to the county treasurer for the total amount of those unpaid
delinquent taxes, interest, penalties, and fees. If property is
forfeited to a county treasurer under this subsection, the
foreclosing governmental unit does not have a right to possession
of the property until the April 1 immediately succeeding the entry
of a judgment foreclosing the property under section 78k or in a
contested case until 22 days after the entry of a judgment
foreclosing the property under section 78k. If property is
forfeited to a county treasurer under this subsection, the county
treasurer shall add a $175.00 fee to each parcel of property for
which those delinquent taxes, interest, penalties, and fees remain
unpaid. A county treasurer shall withhold a parcel of property from
forfeiture for any reason determined by the state tax commission.
The procedure for withholding a parcel of property from forfeiture
under this subsection shall be determined by the state tax
commission.
(2) Not more than 45 days after property is forfeited under
subsection (1), the county treasurer shall record with the county
register of deeds a certificate in a form determined by the
department of treasury for each parcel of property forfeited to the
county treasurer, specifying that the property has been forfeited
to the county treasurer and not redeemed and that absolute title to
the property shall vest in the county treasurer on the March 31
immediately succeeding the entry of a judgment foreclosing the
property under section 78k or in a contested case 21 days after the
entry of a judgment foreclosing the property under section 78k. If
a certificate of forfeiture is recorded in error, the county
treasurer shall record with the county register of deeds a
certificate of error in a form prescribed by the department of
treasury. A certificate submitted to the county register of deeds
for recording under this subsection need not be notarized and may
be authenticated by a digital signature of the county treasurer or
by other electronic means. If the county has elected under section
78 to have this state foreclose property under this act forfeited
to the county treasurer under this section, the county treasurer
shall immediately transmit to the department of treasury a copy of
each certificate recorded under this subsection. The county
treasurer shall upon collection transmit to the department of
treasury within 30 days the fee added to each parcel under
subsection (1), which may be paid from the county's delinquent tax
revolving fund and shall be deposited in the land reutilization
fund created under section 78n.
(3) Property forfeited to the county treasurer under
subsection (1) may be redeemed at any time on or before the March
31 immediately succeeding the entry of a judgment foreclosing the
property under section 78k or in a contested case within 21 days of
the entry of a judgment foreclosing the property under section 78k
upon payment to the county treasurer of all of the following:
(a) The total amount of unpaid delinquent taxes, interest,
penalties, and fees for which the property was forfeited.
(b) In addition to the interest calculated under sections
60a(1) or (2) and 78a(3), except as otherwise provided in section
78h(4), additional interest computed at a noncompounded rate of
1/2% per month or fraction of a month on the taxes that were
originally returned as delinquent, computed from the March 1
preceding the forfeiture.
(c) All recording fees and all fees for service of process or
notice.
(4) If property is redeemed by a person with a legal interest
as provided under subsection (3), any unpaid taxes not returned as
delinquent to the county treasurer under section 78a are not
extinguished.
(5) If property is redeemed by a person with a legal interest
as provided under subsection (3), the person redeeming does not
acquire a title or interest in the property greater than that
person would have had if the property had not been forfeited to the
county treasurer, but the person redeeming, other than the owner,
is entitled to a lien for the amount paid to redeem the property in
addition to any other lien or interest the person may have, which
shall be recorded within 30 days with the register of deeds by the
person entitled to the lien. The lien acquired shall have the same
priority as the existing lien, title, or interest.
(6) If property is redeemed as provided under subsection (3),
the county treasurer shall issue a redemption certificate in
quadruplicate in a form prescribed by the department of treasury.
One of the quadruplicate certificates shall be delivered to the
person making the redemption payment, 1 shall be filed in the
office of the county treasurer, 1 shall be recorded in the office
of the county register of deeds, and 1 shall be immediately
transmitted to the department of treasury if this state is the
foreclosing governmental unit. The county treasurer shall also make
a note of the redemption certificate in the tax record kept in his
or her office, with the name of the person making the final
redemption payment, the date of the payment, and the amount paid.
If the county treasurer accepts partial redemption payments, the
county treasurer shall include in the tax record kept in his or her
office the name of the person or persons making each partial
redemption payment, the date of each partial redemption payment,
the amount of each partial redemption payment, and the total amount
of all redemption payments. A certificate and the entry of the
certificate in the tax record by the county treasurer is prima
facie evidence of a redemption payment in the courts of this state.
A certificate submitted to the county register of deeds for
recording under this subsection need not be notarized and may be
authenticated by a digital signature of the county treasurer or by
other electronic means. If a redemption certificate is recorded in
error, the county treasurer shall record with the county register
of deeds a certificate of error in a form prescribed by the
department of treasury. A copy of a certificate of error recorded
under this section shall be immediately transmitted to the
department of treasury if this state is the foreclosing
governmental unit.
(7) If a foreclosing governmental unit has reason to believe
that a property forfeited under this section may be the site of
environmental contamination, the foreclosing governmental unit
shall provide the department of environmental quality with any
information in the possession of the foreclosing governmental unit
that suggests the property may be the site of environmental
contamination.
Sec. 78h. (1) Not later than June 15 in each tax year, the
foreclosing governmental unit shall file a single petition with the
clerk of the circuit court of that county listing all property
forfeited and not redeemed to the county treasurer under section
78g to be foreclosed under section 78k for the total of the
forfeited unpaid delinquent taxes, interest, penalties, and fees.
If available to the foreclosing governmental unit, the petition
shall include the street address of each parcel of property set
forth in the petition. The petition shall seek a judgment in favor
of the foreclosing governmental unit for the forfeited unpaid
delinquent taxes, interest, penalties, and fees listed against each
parcel of property. The petition shall request that a judgment be
entered vesting absolute title to each parcel of property in the
foreclosing governmental unit, without right of redemption.
(2) If property is redeemed after the petition for foreclosure
is filed under this section, the foreclosing governmental unit
shall request that the circuit court remove that property from the
petition for foreclosure before entry of judgment foreclosing the
property under section 78k.
(3) The foreclosing governmental unit may withhold the
following property from the petition for foreclosure filed under
this section:
(a) Property the title to which is held by minor heirs or
persons who are incompetent, persons without means of support, or
persons unable to manage their affairs due to age or infirmity,
until a guardian is appointed to protect that person's rights and
interests.
(b) Property the title to which is held by a person undergoing
substantial financial hardship, as determined under a written
policy developed and adopted by the foreclosing governmental unit.
The foreclosing governmental unit shall make available to the
public the written policy adopted under this subdivision. The
written policy adopted under this subdivision shall include, but is
not limited to, all of the following:
(i) The person requesting that the property be withheld from
the petition for foreclosure holds the title to the property.
(ii) The household income of the person requesting that the
property be withheld from the petition for foreclosure meets the
federal poverty income standards as defined and determined annually
by the United States office of management and budget or alternative
guidelines adopted by the foreclosing governmental unit, provided
that the alternative guidelines include all persons who would
otherwise meet the federal poverty income standards under this
subparagraph. As used in this subparagraph, "household income"
means that term as defined in section 508 of the income tax act of
1967, 1967 PA 281, MCL 206.508.
(4) If a foreclosing governmental unit withholds property from
the
petition for foreclosure under subsection (3), a all of the
following apply:
(a) A taxing unit's lien for taxes due or the foreclosing
governmental unit's right to include the property in a subsequent
petition for foreclosure is not prejudiced.
(b) The interest due on the taxes returned as delinquent will
be recalculated to a rate of 0.75% per month or fraction of a month
and the interest accrued at a rate of 1% per month under section
78a(3) and the additional interest accrued at a rate of 1/2% per
month under section 78g(3)(b) will not apply.
(5) The clerk of the circuit court in which the petition is
filed shall immediately set the date, time, and place for a hearing
on the petition for foreclosure, which hearing shall be held not
more than 30 days before the March 1 immediately succeeding the
date the petition for foreclosure is filed.