HB-5060, As Passed Senate, June 22, 2006

 

 

 

 

 

 

 

 

 

 

 

 

 

SENATE SUBSTITUTE FOR

 

HOUSE BILL NO. 5060

 

 

 

 

 

 

 

 

 

 

 

 

     A bill to amend 1911 PA 149, entitled

 

"An act to provide for the acquisition by purchase, condemnation

and otherwise by state agencies and public corporations of private

property for the use or benefit of the public, and to define the

terms "public corporations," "state agencies" and "private

property" as used herein,"

 

by amending section 3 (MCL 213.23).

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 3. (1) Any public corporation or state agency is

 

authorized to take private property necessary for a public

 

improvement or for the purposes of its incorporation or  for public

 

purposes within the scope of its powers  for  the  public use  or

 

benefit of the public  and to institute and prosecute proceedings

 

for that purpose. When funds have been appropriated by the

 

legislature to a state agency,  or  a division  thereof or  of a


 

state agency, the office of the governor, or a division  thereof  

 

of the office of the governor for the purpose of acquiring lands or

 

property for a designated public  purpose, such  use, the unit of a

 

state agency to which the appropriation has been made is authorized

 

on behalf of the people of the state of Michigan to acquire the

 

lands or property either by purchase, condemnation, or otherwise.

 

For the purpose of condemnation, the unit of a state agency may

 

proceed under  the provisions of  this act.

 

     (2) The taking of private property by a public corporation or

 

a state agency for transfer to a private entity is not a public use

 

unless the proposed use of the property is invested with public

 

attributes sufficient to fairly deem the entity's activity

 

governmental by 1 or more of the following:

 

     (a) A public necessity of the extreme sort exists that

 

requires collective action to acquire property for

 

instrumentalities of commerce, including a public utility or a

 

state or federally regulated common carrier, whose very existence

 

depends on the use of property that can be assembled only through

 

the coordination that central government alone is capable of

 

achieving.

 

     (b) The property or use of the property will remain subject to

 

public oversight and accountability after the transfer of the

 

property and will be devoted to the use of the public, independent

 

from the will of the private entity to which the property is

 

transferred.

 

     (c) The property is selected on facts of independent public

 

significance or concern, including blight, rather than the private


House Bill No. 5060 as amended June 21, 2006                  (1 of 2)

 

interests of the entity to which the property is eventually

 

transferred.

 

     (3) As used in subsection (1), "public use" does not include

 

the taking of private property for the purpose of transfer to a

 

private entity for either general economic development or the

 

enhancement of tax revenue.

 

     (4) In a condemnation action, the burden of proof is on the

 

condemning authority to demonstrate, by the preponderance of the

 

evidence, that the taking of a private property is for a public

 

use, unless the condemnation action involves a taking of private

 

property because the property is blighted, in which case the burden

 

of proof is on the condemning authority to demonstrate, by clear

 

and convincing evidence, that the taking of that property is for a

 

public use.

 

     (5) If private property consisting of an individual's

 

principal residence is taken for public use, the amount of

 

compensation made and determined for that taking shall be not less

 

than 125% of that property's fair market value, in addition to any

 

other reimbursement allowed by law. <<In order to be eligible for

reimbursement under this subsection, the individual's principal residential structure must be actually taken or the amount of the individual's private property taken leaves less property contiguous to the individual's principal residential structure than the minimum lot size if the local governing unit has implemented a minimum lot size by zoning ordinance.>>

 

     (6) A taking of private property for public use, as allowed

 

under this section, does not include a taking for a public use that

 

is a pretext to confer a private benefit on a known or unknown

 

private entity. <<For purposes of this subsection, the taking of private

 property for the purposes of a drain project by a drainage district as allowed under the drain code of 1956, 1956 PA 40, MCL 280.1 to 280.630, does not constitute a pretext to confer a private benefit on a private entity.>>

 

     (7) Any existing right, grant, or benefit afforded to property

 

owners as of December 22, 2006, whether provided by the state

 

constitution of 1963, by this section or other statute, or

 

otherwise, shall be preserved and shall not be abrogated or


 

impaired by the 2006 amendatory act that added this subsection.

 

     (8) As used in this section:

 

     (a) "Blighted" means property that meets any of the following

 

criteria:

 

     (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 because of physical condition or

 

use.

 

     (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

 

disconnected, destroyed, removed, or rendered ineffective for a

 

period of 1 year or more 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 shall not result in the

 

loss to the property of the status as blighted for purposes of this

 

act.

 

     (vi) Is property owned or under the control of a land bank fast

 

track authority under the land bank fast track act, 2003 PA 258,

 

MCL 124.751 to 124.774, whether or not located within a qualified

 

local governmental unit. The sale, lease, or transfer of the

 

property by a land bank fast track authority shall not result in

 

the loss to the property of the status as blighted for purposes of


 

this act.

 

     (vii) Is improved real property that has remained vacant for 5

 

consecutive years and that is not maintained in accordance with

 

applicable local housing or property maintenance codes or

 

ordinances.

 

     (viii) Any property that has code violations posing a severe and

 

immediate health or safety threat and that has not been

 

substantially rehabilitated within 1 year after the receipt of

 

notice to rehabilitate from the appropriate code enforcement agency

 

or final determination of any appeal, whichever is later.

 

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

 

defined in section 2 of the brownfield redevelopment financing act,

 

1996 PA 381, MCL 125.2652.

 

     Enacting section 1. This amendatory act takes effect December

 

23, 2006.

 

     Enacting section 2. This amendatory act does not take effect

 

unless both of the following occur:

 

     (a) Senate Bill No. 693 of the 93rd Legislature is enacted

 

into law.

 

     (b) Senate Joint Resolution E of the 93rd Legislature becomes

 

part of the state constitution of 1963 as provided in section 1 of

 

article XII of the state constitution of 1963.