HOUSE BILL No. 6404

September 27, 2018, Introduced by Reps. Iden and Sheppard and referred to the Committee on Oversight.

A bill to amend 1996 PA 381, entitled

"Brownfield redevelopment financing act,"

by amending sections 2, 8, 13, 13b, and 16 (MCL 125.2652, 125.2658,

125.2663, 125.2663b, and 125.2666), section 2 as amended by 2018 PA

203, section 8 as amended by 2016 PA 471, and sections 13, 13b, and

16 as amended by 2017 PA 46.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 2. As used in this act:

(a) "Authority" means a brownfield redevelopment authority

created under this act.

(b) "Baseline environmental assessment" means that term as

defined in part 201 or 213.

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 by 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 buried subsurface demolition debris

present so that the property is unfit for its intended use.

(d) "Board" means the governing body of an authority.

(e) "Brownfield plan" means a plan that meets the requirements

of section 13 and section 13b and is adopted under section 14.

(f) "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.

(g) "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.

(h) "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(20).

(i) "Construction period tax capture revenues" means funds

equal to the amount of income tax levied and imposed in a calendar

year upon wages paid to individuals physically present and working

within the eligible property for the construction, renovation, or

other improvement of eligible property that is an eligible activity

within a transformational brownfield plan. As used in this

subdivision, "wages" means that term as defined in section 3401 of

the internal revenue code of 1986, 26 USC 3401. To calculate the

amount of construction period tax capture revenues for a calendar

year under a transformational brownfield plan, the state treasurer

shall do all of the following:

(i) Require the owner or developer of the eligible property to

report the total taxable wages paid to individuals for the

construction, renovation, or other improvement of eligible property

that is an eligible activity within the transformational brownfield

plan. The wages reported under this subparagraph shall exclude any

wages paid to employees of the owner or developer.

(ii) Multiply the amount under subparagraph (i) by the

effective rate as determined by the state treasurer at which the

income tax is levied on an individual in this state. The state

treasurer shall estimate the effective rate by taking into account

the effect of any exemptions, additions, subtractions, and credits

allowable under part 1 of the income tax act of 1967, 1967 PA 281,

MCL 206.1 to 206.532. The state treasurer may require the owner or

developer to submit any information necessary for the calculation

under this subparagraph.

(iii) The wage information and other information required

under this subdivision shall be provided to the department of

treasury by the owner or developer in a manner prescribed by the

state treasurer. The state treasurer may require the owner or

developer to provide a review or reconciliation of the wages by an

independent auditing firm.

(j) "Corrective action" means that term as defined in part 111

or part 213.

(k) "Department" means the department of environmental

quality.

(l) "Department specific activities" means baseline

environmental assessments, due care activities, response

activities, and other environmentally related actions that are

eligible activities and are identified as a part of a brownfield

plan that are in addition to the minimum due care activities

required by part 201, including, but not limited to:

(i) Response activities that are more protective of the public

health, safety, and welfare and the environment than required by

section 20107a, 20114, or 21304c of the natural resources and

environmental protection act, 1994 PA 451, MCL 324.20107a,

324.20114, and 324.21304c.

(ii) Removal and closure of underground storage tanks pursuant

to part 211 or 213.

(iii) Disposal of solid waste, as defined in part 115 of the

natural resources and environmental protection act, 1994 PA 451,

MCL 324.11501 to 324.11554, from the eligible property, provided it

was not generated or accumulated by the authority or the developer.

(iv) Dust control related to construction activities.

(v) Removal and disposal of lake or river sediments exceeding

part 201 criteria from, at, or related to an economic development

project where the upland property is either a facility or would

become a facility as a result of the deposition of dredged spoils.

(vi) Industrial cleaning.

(vii) Sheeting and shoring necessary for the removal of

materials exceeding part 201 criteria at projects requiring a

permit pursuant to part 301, 303, or 325 of the natural resources

and environmental protection act, 1994 PA 451, MCL 324.30101 to

324.30113, MCL 324.30301 to 324.30328, or MCL 324.32501 to

324.32515a.

(viii) Lead, mold, or asbestos abatement when lead, mold, or

asbestos pose an imminent and significant threat to human health.

(ix) Environmental insurance.

(m) "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 or 21304c of the natural

resources and environmental protection act, 1994 PA 451, MCL

324.20107a and 324.21304c.

(n) "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 operation 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.

(o) "Eligible activities" or "eligible activity" means 1 or

more of the following:

(i) For all eligible properties, eligible activities include

all of the following:

(A) Department specific activities.

(B) Relocation of public buildings or operations for economic

development purposes.

(D) Reasonable costs incurred to develop and prepare

brownfield plans, combined brownfield plans, or work plans for the

eligible property, including legal and consulting fees that are not

in the ordinary course of acquiring and developing real estate.

(E) Reasonable costs of brownfield plan and work plan

implementation, including, but not limited to, tracking and

reporting of data and plan compliance and the reasonable costs

incurred to estimate and determine actual costs incurred, whether

those costs are incurred by a municipality, authority, or private

developer.

(F) Demolition of structures that is not a response activity,

including removal of manufactured debris comprised of discarded,

unused, or unusable manufactured by-products left on the site by a

previous owner. The removal of the manufactured by-products left on

the site described in this sub-subparagraph is not eligible for

interest reimbursement under sub-subparagraph (H).

(G) Lead, asbestos, or mold abatement.

(H) Except as otherwise provided in sub-subparagraph (F), the

repayment of principal of and interest on any obligation issued by

an authority to pay the costs of eligible activities attributable

to an eligible property.

(ii) For eligible properties located in a qualified local unit

of government, or an economic opportunity zone, or that is a former

mill, eligible activities include:

(A) The activities described in subparagraph (i).

(B) Infrastructure improvements that directly benefit eligible

property.

(iii) For eligible properties that are owned by or under the

control of a land bank fast track authority, or a qualified local

unit of government or authority, eligible activities include:

(A) The eligible activities described in subparagraphs (i) and

(ii).

(B) Assistance to a land bank fast track authority in clearing

or quieting title to, or selling or otherwise conveying, property

owned by 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.

authority in clearing or quieting title to, or selling or otherwise

conveying, property owned by 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.

(iv) For eligible activities on eligible property that is

included in a transformational brownfield plan, any demolition,

construction, restoration, alteration, renovation, or improvement

of buildings or site improvements on eligible property, including

infrastructure improvements that directly benefit eligible

property.

(p) "Eligible property" means, except as otherwise provided in

this subdivision, 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 or a site or property as those terms are defined in part

213, 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, historic resource, functionally obsolete, blighted, or a

site or property as those terms are defined in part 213, 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 by or under the control

of a land bank fast track authority.

(iv) Is a transit-oriented development or transit-oriented

property.

(v) Is located in a qualified local governmental unit and

contains a targeted redevelopment area.

(vi) Is undeveloped property that was eligible property in a

previously approved brownfield plan abolished under section 14(8).

(vii) 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.

(q) "Environmental insurance" means liability insurance for

environmental contamination and cleanup that is not otherwise

required by state or federal law.

(r) "Facility" means that term as defined in part 201.

(s) "Fiscal year" means the fiscal year of the authority.

(t) "Former mill" means a former mill that has not been used

for industrial purposes for the immediately preceding 2 years, that

is not located in a qualified local governmental unit, that is a

facility or is a site or a property as those terms are defined in

part 213, functionally obsolete, or blighted, and that is located

within 15 miles of 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 municipality with a population of less than 10,000.

(u) "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.

(v) "Governing body" means the elected body having legislative

powers of a municipality creating an authority under this act.

(w) "Historic resource" means that term as defined in section

90a of the Michigan strategic fund act, 1984 PA 270, MCL 125.2090a.

(x) "Income tax" means the tax levied and imposed under part 1

of the income tax act of 1967, 1967 PA 281, MCL 206.1 to 206.532.

(y) "Income tax capture revenues" means funds equal to the

amount for each tax year by which the aggregate income tax from

individuals domiciled within the eligible property subject to a

transformational brownfield plan exceeds the initial income tax

value. The state treasurer shall calculate annually the income tax

capture revenues associated with each transformational brownfield

plan. In calculating income tax capture revenues, the state

treasurer shall subtract from the aggregate amount of income tax

credits under sections 255, 265, 266, and chapter 9 of the income

tax act of 1967, 1967 PA 281, MCL 206.255, 206.265, 206.266, and

206.501 to 206.532. The state treasurer shall require the owner or

developer of the eligible property to provide to the department of

treasury all of the following information at the end of each

calendar year, including the year in which the resolution adding

that eligible property in the transformational brownfield plan is

adopted:

(i) A list of individuals domiciled within the eligible

property.

(ii) The addresses of those individuals identified in

subparagraph (i).

(iii) Any other information that may be necessary to calculate

the income tax capture revenues. The information required under

this subdivision shall be provided in a manner prescribed by the

state treasurer.

(z) "Industrial cleaning" means cleaning or removal of

contaminants from within a structure necessary to achieve the

intended use of the property.

(aa) "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 property, 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 stormwater management systems.

(bb) "Initial income tax value" means the aggregate amount of

income tax less credits under sections 255, 265, 266, and chapter 9

of the income tax act of 1967, 1967 PA 281, MCL 206.255, 206.265,

206.266, and 206.501 to 206.532, from individuals domiciled within

the eligible property subject to a transformational brownfield plan

for the tax year in which the resolution adding that eligible

property in the transformational brownfield plan is adopted.

(cc) "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.

The initial assessed value may be modified by lowering the initial

assessed value once during the term of the brownfield plan through

an amendment as provided in section 14 after the tax increment

financing plan fails to generate captured ~~assessed value~~ taxes for

3 consecutive years due to declines in assessed value.

(dd) "Initial withholding tax value" means the amount of

income tax withheld under part 3 of the income tax act of 1967,

1967 PA 281, MCL 206.701 to 206.713, from individuals employed

within the eligible property subject to a transformational

brownfield plan for the calendar year in which the resolution

adding the eligible property to the plan is adopted. For purposes

of this act, an individual is employed within the eligible property

if the eligible property is the individual's principal place of

employment. The initial withholding tax value shall not include

construction period tax capture revenues.

(ee) "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.

(ff) "Local taxes" means all taxes levied other than taxes

levied for school operating purposes.

(gg) "Michigan strategic fund" means the Michigan strategic

fund created under the Michigan strategic fund act, 1984 PA 270,

MCL 125.2001 to 125.2094.

(hh) "Mixed-use" means a real estate project with planned

integration of some combination of retail, office, residential, or

hotel uses.

(ii) "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.

(jj) "Owned by or under the control of" means that a land bank

fast track authority or a qualified local unit of government 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.

(kk) "Part 111", "part 201", "part 211", or "part 213" means

that part as described as follows:

(i) Part 111 of the natural resources and environmental

protection act, 1994 PA 451, MCL 324.11101 to 324.11153.

(ii) Part 201 of the natural resources and environmental

protection act, 1994 PA 451, MCL 324.20101 to 324.20142.

(iii) Part 211 of the natural resources and environmental

protection act, 1994 PA 451, MCL 324.21101 to 324.21113.

(iv) Part 213 of the natural resources and environmental

protection act, 1994 PA 451, MCL 324.21301a to 324.21334.

(ll) "Qualified local governmental unit" means that term as

defined in the obsolete property rehabilitation act, 2000 PA 146,

MCL 125.2781 to 125.2797.

(mm) "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.

(nn) "Release" means that term as defined in part 201 or part

213.

(oo) "Response activity" means either of the following:

(i) Response activity as that term is defined in part 201.

(ii) Corrective action.

(pp) "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.

(qq) "State brownfield redevelopment fund" means the state

brownfield redevelopment fund created in section 8a.

(rr) "Targeted redevelopment area" means not fewer than 40 and

not more than 500 contiguous parcels of real property located in a

qualified local governmental unit and designated as a targeted

redevelopment area by resolution of the governing body and approved

by the Michigan strategic fund. 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 targeted

redevelopment areas for the purposes of this section in a calendar

year.

(ss) "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 under

1975 PA 197, MCL 125.1651 to 125.1681, tax increment finance

authority under the tax increment finance authority act, 1980 PA

450, MCL 125.1801 to 125.1830, corridor improvement authority,

under the corridor improvement authority act, 2005 PA 280, MCL

125.2871 to 125.2899, or local development finance authority under

the local development financing act, 1986 PA 281, MCL 125.2151 to

125.2174, 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.

(tt) "Taxable value" means the value determined under section

27a of the general property tax act, 1893 PA 206, MCL 211.27a.

(uu) "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).

(vv) "Transformational brownfield plan" means a brownfield

plan that meets the requirements of section 13c and is adopted

under section 14a and, as designated by resolution of the governing

body and approved by the Michigan strategic fund, will have a

transformational impact on local economic development and community

revitalization based on the extent of brownfield redevelopment and

growth in population, commercial activity, and employment that will

result from the plan. To be designated a transformational

brownfield plan, a transformational brownfield plan under this

subdivision shall be for mixed-use development and shall be

expected to result in the following levels of capital investment:

(i) In a municipality that is not a county and that has a

population of at least 600,000, $500,000,000.00.

(ii) In a municipality that is not a county and that has a

population of at least 150,000 and not more than 599,999,

$100,000,000.00.

(iii) In a municipality that is not a county and that has a

population of at least 100,000 and not more than 149,999,

$75,000,000.00.

(iv) In a municipality that is not a county and that has a

population of at least 50,000 and not more than 99,999,

$50,000,000.00.

(v) In a municipality that is not a county and that has a

population of at least 25,000 and not more than 49,999,

$25,000,000.00.

(vi) In a municipality that is not a county and that has a

population of less than 25,000, $15,000,000.00.

(ww) "Transit-oriented development" means infrastructure

improvements that are located within 1/2 mile of a transit station

or transit-oriented property that promotes transit ridership or

passenger rail use as determined by the board and approved by the

municipality in which it is located.

(xx) "Transit-oriented property" means property that houses a

transit station in a manner that promotes transit ridership or

passenger rail use.

(yy) "Withholding tax capture revenues" means the amount for

each calendar year by which the income tax withheld under part 3 of

the income tax act of 1967, 1967 PA 281, MCL 206.701 to 206.713,

from individuals employed within the eligible property subject to a

transformational brownfield plan exceeds the initial withholding

tax value. Withholding tax capture revenues shall not include

income tax from individuals domiciled within the eligible property

or construction period tax capture revenues. To calculate

withholding tax capture revenues for a calendar year under a

transformational brownfield plan, the state treasurer or the

Michigan strategic fund shall do all of the following:

(i) The state treasurer shall require the owner or developer

of the eligible property to provide the department of treasury with

notice not more than 10 days from the date an employer commences or

terminates occupancy within the eligible property. As used in this

subdivision, "employer" means that term as defined in section 8 of

the income tax act of 1967, 1967 PA 281, MCL 206.8.

(ii) The state treasurer shall develop methods and processes

that are necessary for each employer occupying the eligible

property to report the amount of withholding under part 3 of the

income tax act of 1967, 1967 PA 281, MCL 206.701 to 206.713, from

individuals employed within the eligible property.

(iii) The Michigan strategic fund shall include the following

provisions in the development or reimbursement agreement for any

transformational brownfield plan that utilizes withholding tax

capture revenues:

(A) That the owner or developer of the eligible property shall

require each employer occupying the eligible property to comply

with the reporting requirements under this section through a

contract requirement, lease requirement, or other such means.

(B) That reimbursement of withholding tax capture revenues is

limited to amounts that are reported in accordance with part 3 of

the income tax act of 1967, 1967 PA 281, MCL 206.701 to 206.713,

and this state has no obligation with respect to withholding tax

capture revenues that are not reported or paid.

(zz) "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.

(aaa) "Zone" means, for an authority established before June

6, 2000, a brownfield redevelopment zone designated under this act.

Sec. 8. (1) An authority may establish a local brownfield

revolving fund. A local brownfield revolving fund shall consist of

funds deposited from the following sources:

(a) Funds appropriated or otherwise made available from public

or private sources.

(b) Local tax and school operating tax increment revenue

captured in excess of the amount authorized for eligible expenses

under section 13(4) only when all of the following conditions are

met:

(i) The excess capture occurs during the time of capture for

the purpose of paying the costs permitted under section 13(4), or

for not more than 5 years after the time that capture is required

for the purpose of paying the costs permitted under section 13(4),

or both.

(ii) The excess local tax ~~excess~~ capture shall not exceed the

total of the cost of eligible activities approved in the brownfield

plan.

(iii) The excess capture of taxes for school operating

purposes shall not exceed the total of the cost of eligible

department specific activities approved in the applicable

brownfield plan, combined brownfield plan, or work plan. The total

excess tax capture shall not exceed the total of the cost of

eligible activities approved in the brownfield plan.

(iv) Excess tax increment revenues from taxes levied for

school operating purposes for eligible activities authorized under

section 13b(4) by the Michigan strategic fund shall not be captured

for deposit in the local brownfield revolving fund.

(2) The capture of school operating tax increment revenue

described in subsection (1)(b) is subject to the 50% capture

specified in section 13b(14).

(3) The tax increment revenues from eligible property for

deposit in the local brownfield revolving fund may include tax

increment revenues attributable to taxes levied for school

operating purposes in an amount not greater than the tax increment

revenues levied for school operating purposes captured from the

eligible property pursuant to section 13(4).

(4) The local brownfield revolving fund may be used only to

pay the costs of eligible activities on ~~eligible~~ property that is

located within the municipality and meets at least 1 of the

conditions under section 2(o). However, activities outlined in

section 13b(8) may be conducted and funded on prospective

properties.

(5) An authority or a municipality on behalf of an authority

may incur an obligation for the purpose of funding a local

brownfield revolving fund.

Sec. 13. (1) When adopting a brownfield plan, the board shall

comply with the notice and approval provisions of section 14.

(2) Subject to section 15, the board may implement a

brownfield plan. The brownfield plan may apply to 1 or more parcels

of eligible property whether or not those parcels of eligible

property are contiguous and may be amended to apply to additional

parcels of eligible property. Except as otherwise authorized by

this act, if more than 1 eligible property is included within the

plan, the tax increment revenues under the plan shall be determined

individually for each eligible property. Each plan or an amendment

to a plan shall be approved by the governing body of the

municipality and shall contain all of the following:

(a) A description of the costs of the plan intended to be paid

for with the tax increment revenues or, for a plan for eligible

properties qualified on the basis that the property is owned by or

under the control of a land bank fast track authority, a listing of

all eligible activities that may be conducted for 1 or more of the

eligible properties subject to the plan.

(b) A brief summary of the eligible activities that are

proposed for each eligible property or, for a plan for eligible

properties qualified on the basis that the property is owned by or

under the control of a land bank fast track authority, a brief

summary of eligible activities conducted for 1 or more of the

eligible properties subject to the plan.

increment revenues for each year of the plan from the eligible

property. The plan may provide for the use of part or all of the

captured taxable value, including deposits in the local brownfield

revolving fund, but the portion intended to be used shall be

clearly stated in the plan. The plan shall not provide either for

an exclusion from captured taxable value of a portion of the

captured taxable value or for an exclusion of the tax levy of 1 or

more taxing jurisdictions unless the tax levy is excluded from tax

increment revenues in section 2(ss), or unless the tax levy is

excluded from capture under section 15.

(d) The method by which the costs of the plan will be

financed, including a description of any advances made or

anticipated to be made for the costs of the plan from the

municipality.

(e) The maximum amount of note or bonded indebtedness to be

incurred, if any.

(f) The proposed beginning date and duration of capture of tax

increment revenues for each eligible property as determined under

section 13b(16).

(g) An estimate of the future tax revenues of all taxing

jurisdictions in which the eligible property is located to be

generated during the term of the plan.

(h) A legal description of the eligible property to which the

plan applies, a map showing the location and dimensions of each

eligible property, a statement of the characteristics that qualify

the property as eligible property, and a statement of whether

personal property is included as part of the eligible property. If

the project is on property that is functionally obsolete, the

taxpayer shall include, with the application, an affidavit signed

by a level 3 or level 4 assessor, that states that it is the

assessor's expert opinion that the property is functionally

obsolete and the underlying basis for that opinion.

(i) Estimates of the number of persons residing on each

eligible property to which the plan applies and the number of

families and individuals to be displaced. If occupied residences

are designated for acquisition and clearance by the authority, the

plan shall include a demographic survey of the persons to be

displaced, a statistical description of the housing supply in the

community, including the number of private and public units in

existence or under construction, the condition of those in

existence, the number of owner-occupied and renter-occupied units,

the annual rate of turnover of the various types of housing and the

range of rents and sale prices, an estimate of the total demand for

housing in the community, and the estimated capacity of private and

public housing available to displaced families and individuals.

(j) A plan for establishing priority for the relocation of

persons displaced by implementation of the plan.

(k) Provision for the costs of relocating persons displaced by

implementation of the plan, and financial assistance and

reimbursement of expenses, including litigation expenses and

expenses incident to the transfer of title, in accordance with the

standards and provisions of the uniform relocation assistance and

real property acquisition policies act of 1970, Public Law 91-646.

(l) A strategy for compliance with 1972 PA 227, MCL 213.321 to

213.332.

(m) Other material that the authority or governing body

considers pertinent to the brownfield plan.

(3) When taxes levied for school operating purposes are

subject to capture under section 15, the percentage of school

operating tax increment revenues captured relating to a parcel of

eligible property under a brownfield plan shall not be greater than

the percentage of local tax increment revenues that are captured

under the brownfield plan relating to that parcel of eligible

property.

(4) Except as provided in subsection (5) and sections 8,

13b(4) and (5), and 13c(12), tax increment revenues related to a

brownfield plan shall be used only for 1 or more of the following:

(a) Costs of eligible activities attributable to the eligible

property that produces the tax increment revenues.

(b) Eligible activities attributable to any eligible property

for property that is owned by or under the control of a land bank

fast track authority or a qualified local unit of government.

(5) A brownfield plan ~~shall not~~ may only authorize the capture

of tax increment revenue from eligible property ~~after~~ until the

year in which the total amount of tax increment revenues captured

is equal to the sum of the costs permitted to be funded with tax

increment revenues under this act or for not more than 30 years

from the beginning date of the capture of the tax increment

revenues for that eligible property, whichever occurs first. ,

~~except that a~~ A brownfield plan may authorize the capture of

additional local and school operating tax increment revenue from an

eligible property if for the local brownfield revolving fund

created under section 8 during 1 or more of the following

~~apply:~~time frames:

(a) ~~During the~~ The time of capture described in this

subsection for the purpose of paying the costs permitted under

subsection (4) or section 13b(4).

(b) For not more than 5 years after the date specified in

subdivision (a). ~~, for payment to the local brownfield revolving~~

~~fund created under section 8.~~

Sec. 13b. (1) An authority shall not expend tax increment

revenues to acquire or prepare eligible property unless the

acquisition or preparation is an eligible activity.

(2) An authority shall not enter into agreements with the

taxing jurisdictions and the governing body of the municipality to

share a portion of the taxes captured from an eligible property

under this act. Upon adoption of the plan, the collection and

transmission of the amount of tax increment revenues as specified

in this act shall be binding on all taxing units levying ad valorem

property taxes or specific taxes against property located in the

zone.

(3) Tax increment revenues captured from taxes levied by this

state under the state education tax act, 1993 PA 331, MCL 211.901

to 211.906, or taxes levied by a local school district shall not be

used to assist a land bank fast track authority with clearing or

quieting title, acquiring, selling, or conveying property, except

as provided in subsection (4).

(4) If a brownfield plan includes the use of taxes levied for

school operating purposes captured from an eligible property for

eligible activities that are not department specific activities,

then 1 or more of the following apply:

(a) A combined brownfield plan or a work plan shall be

approved by the Michigan strategic fund and a development agreement

or reimbursement agreement between the municipality or authority

and an owner or developer of eligible property is required before

such tax increment may be used for infrastructure improvements that

directly benefit eligible property, demolition of structures that

is not response activity, lead, mold, or asbestos abatement that is

not a department specific activity, site preparation that is not

response activity, relocation of public buildings or operations for

economic development purposes, or acquisition of property by a land

bank fast track authority if acquisition of the property is for

economic development purposes.

(b) Approval of a combined brownfield plan or a work plan by

the Michigan strategic fund in the manner required under section

15(12) to (14) or (20) is required in order to use the tax

increment revenues to assist a land bank fast track authority or

qualified local governmental unit with clearing or quieting title,

acquiring, selling, or conveying property.

to the Michigan strategic fund under this subsection shall be in a

form prescribed by the Michigan strategic fund.

(d) The eligible activities to be conducted and described in

this subsection shall be consistent with the combined brownfield

plan or work plan submitted by the authority to the Michigan

strategic fund.

(e) The department's approval is not required for the capture

of taxes levied for school operating purposes for eligible

activities described in this section.

(5) If a brownfield plan includes the use of taxes levied for

school operating purposes captured from eligible property for

department specific activities, a combined brownfield plan or a

work plan must be approved by the department with the exception of

those activities identified in subsections (8) and (9).

(6) An authority shall not do any of the following:

(a) Use taxes captured from eligible property to pay for

eligible activities conducted before approval of the brownfield

plan.

(b) Use taxes captured from eligible property to pay for

administrative and operating activities of the authority or the

municipality on behalf of the authority for activities, other than

those identified in subsection (7).

~~an authority shall not use~~ Use taxes levied for school operating

purposes captured from eligible property ~~unless the eligible~~

~~activities to be conducted on the eligible property are eligible~~

~~department specific activities, consistent with a combined~~

~~brownfield plan or a work plan approved by the department after~~

~~July 24, 1996.~~for activities other than those identified in

subsections (4), (5), and (12).

(d) Use construction period tax capture revenues, withholding

tax capture revenues, or income tax capture revenues to pay for

eligible activities conducted before approval of the

transformational brownfield plan except for costs described in

section 13c(10).

(e) Use construction period tax capture revenues, withholding

tax capture revenues, and income tax capture revenues for any

expense other than as provided for in section 13c(2), except for

the reasonable costs for preparing a transformational brownfield

plan and the additional administrative and operating expenses of

the authority or municipality as are specifically associated with

the implementation of a transformational brownfield plan. For

purposes of this subsection, the reasonable costs of preparing a

transformational brownfield plan include the reasonable costs of

preparing an associated work plan, combined brownfield plan, and

development or reimbursement agreement.

(7) An authority may use taxes captured from eligible property

to pay for the administrative and operating costs under 1 or more

of the following:

(a) Local taxes captured may be used for 1 or more of the

following administrative and operating purposes:

(i) Reasonable and actual administrative and operating

expenses of the authority.

(ii) Department specific activities conducted by or on behalf

of the authority related directly to work conducted on prospective

eligible properties prior to approval of the brownfield plan.

(iii) Reasonable costs of developing and preparing brownfield

plans, combined plans, or work plans for which tax increment

revenues may be used under subsection (4), including, but not

limited to, legal and consulting fees that are not in the ordinary

course of acquiring and developing real estate.

(iv) Reasonable cost of brownfield plan or work plan

implementation, including, but not limited to, tracking and

reporting data and plan compliance.

(b) Taxes levied for school operating purposes may be used for

1 or more of the following administrative and operating purposes:

(i) Reasonable costs of developing and preparing brownfield

plans, combined brownfield plans, or work plans for which tax

increment revenues may be used under section 13(4), including, but

not limited to, legal and consulting fees that are not in the

ordinary course of acquiring and developing real estate, not to

exceed $30,000.00.

(ii) Reasonable costs of brownfield plan or work plan

implementation, including, but not limited to, tracking and

reporting of data and plan compliance, not to exceed $30,000.00.

increment revenues attributable to local taxes that an authority

can use for the purposes described in subdivisions (a) and (b)

shall be determined as follows:

(i) For authorities that have 5 or fewer active projects,

$100,000.00.

(ii) For authorities that have 6 or more but fewer than 11

active projects, $125,000.00.

(iii) For authorities that have 11 or more but fewer than 16

active projects, $150,000.00.

(iv) For authorities that have 16 or more but fewer than 21

active projects, $175,000.00.

(v) For authorities that have 21 or more but fewer than 26

active projects, $200,000.00.

(vi) For authorities that have 26 or more but fewer than 31

active projects, $300,000.00.

(vii) For authorities that have 31 or more active projects,

$500,000.00.

(d) Nothing contained in this subsection shall limit the

amount of funds that may be granted, loaned, or expended by a local

brownfield revolving fund for eligible activities.

(e) As used in this subsection, "active project" means a

project in which the authority is currently capturing taxes under

this act. The amounts of tax increment revenues attributable to

local taxes listed in this subsection that an authority can use for

the purposes described in this subsection may be increased by 2%

for each written agreement entered into by an authority in either

of the following situations up to a total maximum increase of 10%:

(i) The authority is an authority established by a county and

that authority enters into a written agreement with 1 or more

municipalities within that county to serve as the only authority

for those other municipalities.

(ii) The authority enters into a written agreement with 1 or

more other authorities to administer 1 or more administrative

operations of those other authorities.

(8) The limitations of subsections (4), (5), and (6) upon the

use of taxes levied for school operating purposes shall not apply

to the costs of 1 or more of the following incurred by a person

other than the authority:

(a) Site investigation activities required to conduct a

baseline environmental assessment and to evaluate compliance with

sections 20107a and 21304c of the natural resources and

environmental protection act, 1994 PA 451, MCL 324.20107a and

324.21304c.

(b) Completing a baseline environmental assessment.

21304c of the natural resources and environmental protection act,

1994 PA 451, MCL 324.20107a and 324.21304c.

(d) Performing pre-demolition and building hazardous materials

surveys.

(e) Asbestos, mold, and lead surveys.

(9) The limitations of subsections (4), (5), and (6) upon the

use of local taxes and taxes levied for school operating purposes

shall not apply to the following costs and expenses:

(a) For tax increment revenues attributable to taxes levied

for school operating purposes, eligible activities associated with

unanticipated response activities conducted on eligible property if

that eligible property has been included in a brownfield plan, if

the department is consulted in writing on the unanticipated

response activities before they are conducted and the costs of

those activities are subsequently included in a brownfield plan,

combined brownfield plan or a work plan or amendment approved by

the authority and approved by the department.

(b) For tax increment revenues attributable to local taxes,

any eligible activities conducted on eligible property or

prospective eligible properties prior to approval of the brownfield

plan, if those costs and the eligible property are subsequently

included in a brownfield plan approved by the authority.

for school operating purposes, eligible activities described in

subsection (4) and conducted on eligible property or prospective

eligible properties prior to approval of the brownfield plan, if

those costs and the eligible property are subsequently included in

a brownfield plan approved by the authority and a combined

brownfield plan or work plan approved by the Michigan strategic

fund.

(d) Reasonable cost of developing and preparing brownfield

plans, combined brownfield plans, or work plans for which tax

increment revenues may be used under section 13(4), including, but

not limited to, legal and consulting fees that are not in the

ordinary course of acquiring and developing real estate.

(e) Reasonable cost of brownfield plan or work plan

implementation, including, but not limited to, tracking and

reporting of data and plan compliance.

(10) An authority shall not use taxes levied for school

operating purposes captured from eligible property for response

activities that benefit a party responsible for an activity causing

a release under section 20126 or 21323a of the natural resources

and environmental protection act, 1994 PA 451, MCL 324.20126 and

324.21323a, except that a municipality that established the

authority may use taxes levied for school operating purposes

captured from eligible property for response activities associated

with a landfill.

(11) A brownfield authority may reimburse advances, with or

without interest, made by a municipality under section 7(3), a land

bank fast track authority, or any other person or entity for costs

of eligible activities with any source of revenue available for use

of the brownfield authority under this act.

(12) A brownfield authority may capture taxes for the payment

of interest, as follows:

(a) If an authority reimburses a person or entity under this

section for an advance for the payment or reimbursement of the cost

of eligible activities and interest thereon, the authority may

capture local taxes for the payment of that interest.

(b) If an authority reimburses a person or entity under this

section for an advance for the payment or reimbursement of the cost

of department specific activities and interest thereon included in

a combined brownfield plan or a work plan approved by the

department, the authority may capture taxes levied for school

operating purposes and local taxes for the payment of that

interest.

section for an advance for the payment or reimbursement of the cost

of eligible activities that are not department specific activities

and interest thereon included in a combined brownfield plan or a

work plan approved by the Michigan strategic fund, the authority

may capture taxes levied for school operating purposes and local

taxes for the payment of that interest provided that the Michigan

strategic fund grants an approval for the capture of taxes levied

for school operating purposes to pay such interest.

(13) An authority may enter into agreements related to these

reimbursements and payments described in this section. A

reimbursement agreement for these purposes and the obligations

under that reimbursement agreement shall not be subject to section

13 or the revised municipal finance act, 2001 PA 34, MCL 141.2101

to 141.2821.

(14) Notwithstanding anything to the contrary in this act, for

a brownfield plan that includes the capture of taxes levied for

school operating purposes from each eligible property included in a

brownfield plan after January 1, 2013, an authority shall pay to

the department of treasury at least once annually an amount equal

to 50% of the taxes levied under the state education tax act, 1993

PA 331, MCL 211.901 to 211.906, including 50% of that portion of

specific taxes attributable to, but not levied under, the state

education tax act, 1993 PA 331, MCL 211.901 to 211.906, that are

captured under the brownfield plan until the expiration of the

earlier of the following:

(a) Twenty-five years of capture of tax increment revenues

from such eligible property included in the brownfield plan.

(b) The later of:

(i) The date of repayment of all eligible expenses relative to

such eligible property.

(ii) The date excess capture is terminated under subsection

(16).

(15) The department of treasury shall deposit the amounts

described in subsection (14) into the state brownfield

redevelopment fund. If an authority makes a payment as required

under subsection (14) to the department of treasury, the local

taxes levied on that parcel and used to reimburse eligible

activities under a brownfield plan shall not be increased or

decreased due to that payment. If, due to an appeal of any tax

assessment, an authority is required to reimburse a taxpayer for

any portion of the amount paid to the department of treasury under

this subsection, the department of treasury shall reimburse that

amount to the authority within 30 days after receiving a request

from the authority for reimbursement.

(16) The brownfield plan shall include a proposed beginning

date of capture. ~~The~~ If the actual beginning date of capture of tax

increment revenues ~~shall not be~~ is later than 5 years following the

date of the adoption of the brownfield plan resolution, ~~including~~

~~the eligible property in the brownfield plan.~~ then the maximum

number of years of capture will decrease. The end date of capture

must be no later than 35 years after the date of the adoption of

the brownfield plan resolution. The authority may amend the

beginning date of capture of tax increment revenues for a

particular eligible property ~~to a date not later than 5 years~~

~~following the date of the resolution including the eligible~~

~~property in the brownfield plan. The authority may not amend the~~

~~beginning date of capture of tax increment revenues for a~~

~~particular eligible property if~~ as long as the authority has not

begun to reimburse eligible activities from the capture of tax

increment revenues from that eligible property. Any tax increment

revenues captured from an eligible property before the beginning

date of capture of tax increment revenues for that eligible

property shall revert proportionately to the respective tax bodies.

~~If an authority amends the beginning date for capture of tax~~

~~increment revenues that includes the capture of tax increment~~

~~revenues for school operating purposes, then the authority shall~~

~~notify the department or the Michigan strategic fund, as~~

~~applicable, within 30 days after amending the beginning date.~~

Sec. 16. (1) The municipal and county treasurers shall

transmit tax increment revenues to the authority not more than 30

days after tax increment revenues are collected.

(2) The authority shall expend the tax increment revenues

received only in accordance with the brownfield plan. All surplus

funds not deposited in the local brownfield revolving fund of the

authority under section 8 shall revert proportionately to the

respective taxing bodies, except as provided in section 15(16).

(3) The authority shall submit annually to the governing body,

the department, and the Michigan strategic fund a financial report

on the status of the activities of the authority for each calendar

year. The report shall include all of the following:

(a) The ~~amount and source of tax increment revenues~~

~~received.~~total amount of local taxes that are approved for capture

and the total amount of taxes levied for school operating purposes

that are approved for capture for each parcel included in a

brownfield plan.

(b) The amount and purpose of expenditures of tax increment

revenues.

~~indebtedness.~~and source of tax increment revenues received for each

active brownfield plan, including the amount of tax increment

revenues captured in the most recent tax year and the cumulative

amount of tax increment revenues captured for each brownfield plan.

(d) The initial taxable value of all eligible property subject

to the brownfield plan.

(e) The captured taxable value realized by the authority for

each eligible property subject to the brownfield plan.

(f) The amount of actual capital investment made for each

project.

(g) The amount of tax increment revenues attributable to taxes

levied for school operating purposes used for activities described

in section 13b(6)(c), section ~~2(o)(~~i~~)(H),~~ 2(o)(i)(F) and (G), and

section ~~2(o)(~~i~~)(B)~~ 2(o)(ii)(B) and (C).

(h) The number of residential units constructed or

rehabilitated for each project.

(i) The amount, by square foot, of new or rehabilitated

residential, retail, commercial, or industrial space for each

project.

(j) The number of new jobs created at the project.

(k) A copy of all brownfield plan amendments approved by the

local unit of government.

(l) ~~(k)~~ All additional information that the governing body,

the department, or the Michigan strategic fund considers necessary.

(4) The department and the Michigan strategic fund shall

collect the financial reports submitted under subsection (3),

compile a combined report, which includes the use of local taxes,

taxes levied for school operating purposes, and the state

brownfield redevelopment fund, based on the information contained

in those reports and any additional information considered

necessary, and submit annually a report based on that information

to each member of the legislature.

(5) Beginning on January 1, 2013, all of the following

reporting obligations apply:

(a) The department shall on a quarterly basis post on its

website the name, location, and amount of tax increment revenues,

including taxes levied for school operating purposes, for each

project approved by the department under this act during the

immediately preceding quarter.

(b) The Michigan strategic fund shall on a quarterly basis

post on its website the name, location, and amount of tax increment

revenues, including taxes levied for school operating purposes, for

each project approved by the Michigan strategic fund under this act

during the immediately preceding quarter.

(6) In addition to any other requirements under this act, not

less than once every 3 years beginning not later than June 30,

2008, the auditor general shall conduct and report a performance

postaudit on the effectiveness of the program established under

this act. As part of the performance postaudit, the auditor general

shall assess the extent to which the implementation of the program

by the department and the Michigan strategic fund facilitate and

affect the redevelopment or reuse of eligible property and identify

any factors that inhibit the program's effectiveness. The

performance postaudit shall also assess the extent to which the

interpretation of statutory language, the development of guidance

or administrative rules, and the implementation of the program by

the department and the Michigan strategic fund is consistent with

the fundamental objective of facilitating and supporting timely and

efficient brownfield redevelopment of eligible properties.

(7) The owner or developer for an active project included

within a brownfield plan must annually submit to the authority a

report on the status of the project. The report shall be in a form

developed by the authority and must contain information necessary

for the authority to report under subsection (3)(f), (h), (i), (j),

and (k). The authority may waive the requirement to submit a report

under this subsection. As used in this subsection, "active project"

means a project for which the authority is currently capturing

taxes under this act.

(8) For a transformational brownfield plan, all of the

following shall also apply:

(a) The state treasurer shall transfer to the state brownfield

redevelopment fund each fiscal year an amount equal to the

construction period tax capture revenues, withholding tax capture

revenues, and income tax capture revenues under all approved plans

as provided for in section 8a(4). Funds shall be transmitted to the

authority, or owner or developer of the eligible property to which

the revenues are attributable, within 30 days of transfer to the

state brownfield redevelopment fund.

(b) The authority, the department, and the Michigan strategic

fund shall follow the reporting requirements of subsections (3),

(4), and (5) with respect to all approved transformational

brownfield plans, and shall provide information on the amount and

use of construction period tax capture revenues, withholding tax

capture revenues, and income tax capture revenues to the same

extent required for tax increment revenues.

a transformational brownfield plan shall provide the information

required for the authority, the department, and the Michigan

strategic fund to satisfy the reporting and audit requirements of

this section.