HOUSE BILL NO. 4788
A bill to provide for the exemption of certain property from certain taxes; to levy and collect a specific tax on the owners of certain property; to provide for the disposition of the tax; to prescribe the powers and duties of certain state and local governmental officers and entities; and to provide penalties.
the people of the state of michigan enact:
Sec. 1. This act may be cited as the "replacement electric distribution infrastructure specific tax act".
(a) "Cooperative electric utility" means that term as defined in section 2 of the electric cooperative member-regulation act, 2008 PA 167, MCL 460.32.
(b) "Michigan public service commission" means the Michigan public service commission created in section 1 of 1939 PA 3, MCL 460.1.
(c) "Qualified replacement electric distribution infrastructure" means utility personal property that is part of or constitutes electric distribution system infrastructure, including, but not limited to, poles, wires, conductors, crossarms, insulators, switches, capacitors, and other supporting hardware, that meets all of the following:
(i) Is installed by an electric utility regulated by the Michigan public service commission or by a cooperative electric utility.
(ii) Replaces depreciated electric distribution infrastructure that was located in the same service territory.
(iii) Serves a similar functional purpose as the replaced electric distribution infrastructure.
(iv) Is not part of a generation facility or transmission system.
(v) Does not expand the service territory beyond the footprint of the replaced electric distribution infrastructure.
(vi) Is placed in service on or after the effective date of this act.
(d) "Replacement electric distribution infrastructure specific tax" or "specific tax" means the specific tax levied under section 4.
(e) "State tax commission" means the state tax commission created by 1927 PA 360, MCL 209.101 to 209.107.
(f) "Taxable value" means the taxable value as determined under section 27a of the general property tax act, 1893 PA 206, MCL 211.27a.
(g) "Utility personal property" means property classified as utility personal property under section 34c of the general property tax act, 1893 PA 206, MCL 211.34c.
Sec. 3. For taxes levied after December 31, 2025, qualified replacement electric distribution infrastructure is exempt from ad valorem property taxes collected under the general property tax act, 1893 PA 206, MCL 211.1 to 211.155, as provided in section 7yy of the general property tax act, 1893 PA 206, MCL 211.7yy.
Sec. 4. (1) There is levied on qualified replacement electric distribution infrastructure subject to the exemption described in section 3 an annual statewide tax to be known as the replacement electric distribution infrastructure specific tax.
(2) The amount of the specific tax is determined as follows:
(a) For the first year that the specific tax is levied on an item of qualified replacement electric distribution infrastructure, by applying the rate of 30 mills to the taxable value of the replaced depreciated electric distribution infrastructure in the calendar year immediately preceding its replacement, as described in section 2(c)(ii).
(b) For each year after the first year described in subdivision (a), by adjusting the amount determined under subdivision (a) to reflect the cumulative annual percentage change in the Consumer Price Index for the immediately preceding calendar year. As used in this subdivision, "Consumer Price Index" means the most comprehensive index of consumer prices available for this state from the Bureau of Labor Statistics of the United States Department of Labor.
(3) The replacement electric distribution infrastructure specific tax is an annual tax, payable at the same times, in the same installments, and to the same collecting officer or officers as taxes collected under the general property tax act, 1893 PA 206, MCL 211.1 to 211.155.
(4) The collecting officer or officers shall disburse the replacement electric distribution infrastructure specific tax to and among this state and cities, townships, villages, school districts, counties, or other taxing units, at the same times and in the same proportions as required by law for the disbursement of taxes collected under the general property tax act, 1893 PA 206, MCL 211.1 to 211.155.
(5) The collecting officer or officers shall send a copy of the amount of disbursement made to each taxing unit under this section to the state tax commission on a form provided by the state tax commission.
Sec. 5. Unpaid replacement electric distribution infrastructure specific taxes are subject to forfeiture, foreclosure, and sale in the same manner and at the same time as taxes returned as delinquent under the general property tax act, 1893 PA 206, MCL 211.1 to 211.155.
Enacting section 1. This act does not take effect unless House Bill No. 4787 (request no. H02451'25) of the 103rd Legislature is enacted into law.