HOUSE BILL NO. 4350

April 11, 2023, Introduced by Reps. Brixie, Neeley, Wilson, Coleman, Brenda Carter, Scott, Hood, Wegela, Haadsma, Steckloff, Tyrone Carter, Hope, O'Neal, Dievendorf, McFall, Shannon, Tsernoglou, Fitzgerald, Paiz, Conlin, Grant, Hill, Byrnes, Liberati, Price, Farhat and Aiyash and referred to the Committee on Tax Policy.

A bill to establish a state matching grant program for certain property taxes and special assessments levied by certain municipalities; and to provide for the powers and duties of certain state and local governmental officers and entities.

the people of the state of michigan enact:

Sec. 1. This act may be cited as the "raise up local grant act".

Sec. 3. As used in this act:

(a) "Department" means the department of treasury.

(b) "Eligible millage" means the lesser of the following:

(i) The total number of mills levied by an eligible municipality as property taxes or special assessments described in subdivision (c)(ii).

(ii) 2 mills.

(c) "Eligible municipality" means a county, city, township, or village that meets both of the following:

(i) Has a per capita taxable value that is less than the statewide average per capita taxable value.

(ii) Levies 1 or more property taxes or special assessments dedicated to 1 or more of the following purposes:

(A) Funding the construction, maintenance, or repair of roads and bridges.

(B) Funding the construction, maintenance, or repair of water and sewer systems.

(C) Funding police, fire, or emergency medical services.

(D) Payment of unfunded actuarial accrued liability for retiree health care and unfunded actuarial accrued liability for pension and retirement benefits for former employees of the eligible municipality.

(d) "Municipality" means a county, city, township, or village.

(e) "Per capita taxable value" means an amount determined by dividing the total taxable value of all property subject to general ad valorem property taxes in a municipality by the population of the municipality as determined by the department using the most recent population data available from the United States Census Bureau.

(f) "Statewide average per capita taxable value" means an amount determined by dividing the total taxable value of all property subject to general ad valorem property taxes in this state by the population of this state as determined by the department using the most recent population data available from the United States Census Bureau.

(g) "Taxable value" means the value determined under section 27a of the general property tax act, 1893 PA 206, MCL 211.27a.

Sec. 5. The department shall establish and administer a raise up local grant program to provide matching grants from this state to eligible municipalities, subject to all of the following:

(a) An eligible municipality shall apply for the matching grant in a form and manner prescribed by the department not later than December 31 of the calendar year immediately preceding the calendar year in which the eligible municipality will levy the property tax or special assessment described in section 3(c)(ii) for which a matching grant is sought. An application under this section is proper whether the property tax or special assessment will be a continuing levy or a new levy in the year for which a matching grant is sought.

(b) The department shall maintain a database available to municipalities, updated annually by not later than March 31, containing all of the following:

(i) The per capita taxable value for every municipality in this state and the underlying taxable value and population data used to calculate each municipality's per capita taxable value.

(ii) The statewide average per capita taxable value and the underlying taxable value and population data used to calculate that statewide average per capita taxable value.

(iii) A list of all municipalities whose per capita taxable value is less than the statewide average per capita taxable value for purposes of participating in the raise up local grant program in the immediately succeeding calendar year.

(c) The department shall determine whether a municipality that applies for a matching grant is an eligible municipality based on the data described in subdivision (b)(i) and (ii) for the calendar year in which the municipality applies for a matching grant.

(d) A matching grant awarded under this act is subject to appropriation and must not exceed an amount determined by subtracting the amount described in subparagraph (i) from the amount described in subparagraph (ii), as follows:

(i) The total revenue raised by the eligible municipality from its eligible millage.

(ii) The total revenue that the eligible municipality would have raised from its eligible millage if its per capita taxable value were equal to the statewide average per capita taxable value.

(e) An eligible municipality that receives a matching grant under this act shall dedicate that grant money to the same purpose or purposes served by the property taxes or special assessments described in section 3(c)(ii) for which the matching grant was made.

(f) Subject to appropriation, the department shall distribute matching grants not later than July 1 of each year for which 1 or more applications are granted from the raise up local grant fund, as provided in the raise up local grant fund act.

Enacting section 1. This act does not take effect unless Senate Bill No.____ or House Bill No. 4351 (request no. 02449'23) of the 102nd Legislature is enacted into law.