HB-5017, As Passed House, November 13, 2013

SUBSTITUTE FOR

HOUSE BILL NO. 5017

     A bill to amend 1893 PA 206, entitled

"The general property tax act,"

by amending section 7ss (MCL 211.7ss), as added by 2012 PA 494.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 7ss. (1) For taxes levied after November 1, 2012 through

December 30, 2013, new construction on development property is

exempt eligible for exemption from the collection of the tax levied

under section 1211 of the revised school code, 1976 PA 451, MCL

380.1211, for 3 years or until the new construction is no longer

located on development property, whichever occurs first, as

provided in this section.

     (2) Beginning November 1, 2013 through December 30, 2015,

development property on which is located new construction exempt

under subsection (1) is exempt from the collection of the tax

levied by a local school district for school operating purposes

under section 1211 of the revised school code, 1976 PA 451, MCL

380.1211, to the same extent provided a principal residence under

section 1211 of the revised school code, 1976 PA 451, MCL 380.1211,

for 2 years or until the property is no longer development

property, whichever occurs first.

     (3) Beginning December 31, 2013, eligible development property

is exempt from the collection of the tax levied by a local school

district for school operating purposes under section 1211 of the

revised school code, 1976 PA 451, MCL 380.1211, to the same extent

provided a principal residence under section 1211 of the revised

school code, 1976 PA 451, MCL 380.1211, for 3 years or until the

property is no longer eligible development property, whichever

occurs first.

(4) (2) To claim an exemption under subsection (1), an owner

of development property shall file an affidavit claiming the

exemption with the local tax collecting unit on or before June 1,

2013 for the immediately succeeding summer tax levy and all

applicable subsequent tax levies or on or before November 1, 2013

for the immediately succeeding winter tax levy and all applicable

subsequent tax levies. The affidavit shall be on a form prescribed

by the department of treasury.

     (5) To claim an exemption under subsection (2), an owner of

development property shall file an affidavit claiming the exemption

with the local tax collecting unit on or before June 1 for the

immediately preceding winter tax levy, immediately succeeding

summer tax levy, and all applicable subsequent tax levies or on or

before November 1 for the immediately succeeding winter tax levy

and all applicable subsequent tax levies. The affidavit shall be on

a form prescribed by the department of treasury.

     (6) To claim an exemption under subsection (3), an owner of

eligible development property shall file an affidavit claiming the

exemption with the local tax collecting unit on or before June 1

for the immediately succeeding summer tax levy and all applicable

subsequent tax levies or on or before November 1 for the

immediately succeeding winter tax levy and all applicable

subsequent tax levies. The affidavit shall be on a form prescribed

by the department of treasury.

(7) (3) Upon receipt of an affidavit filed under subsection

(2), (4), the assessor shall determine if the real property on

which new construction is located is development property. If the

real property is development property, the assessor shall exempt

the new construction located on that development property from the

collection of the tax levied under section 1211 of the revised

school code, 1976 PA 451, MCL 380.1211, for 3 years or until the

new construction is no longer located on development property,

whichever occurs first.

     (8) Upon receipt of an affidavit filed under subsection (5),

the assessor shall determine if the real property on which new

construction is located is development property. If the real

property is development property, the assessor shall exempt the

development property from the collection of the tax levied by a

local school district for school operating purposes under section

1211 of the revised school code, 1976 PA 451, MCL 380.1211, to the

same extent provided a principal residence under section 1211 of

the revised school code, 1976 PA 451, MCL 380.1211, for 2 years or

until the property is no longer development property, whichever

occurs first.

     (9) Upon receipt of an affidavit filed under subsection (6),

the assessor shall determine if the real property on which new

construction is located is eligible development property. If the

real property is eligible development property, the assessor shall

exempt the eligible development property from the collection of the

tax levied by a local school district for school operating purposes

under section 1211 of the revised school code, 1976 PA 451, MCL

380.1211, to the same extent provided a principal residence under

section 1211 of the revised school code, 1976 PA 451, MCL 380.1211,

for 3 years or until the property is no longer eligible development

property, whichever occurs first.

(10) (4) Not more than 90 days after all or a portion of the

exempted new construction exempt under subsection (1) is no longer

located on development property, an owner shall rescind the

exemption for the new construction by filing with the local tax

collecting unit a rescission form. The rescission form shall be as

prescribed by the department of treasury.

     (11) Not more than 90 days after all or a portion of the

development property exempt under subsection (2) is no longer

development property, an owner shall rescind the exemption for that

development property by filing with the local tax collecting unit a

rescission form. The rescission form shall be as prescribed by the

department of treasury.

     (12) Not more than 90 days after all or a portion of eligible

development property exempt under subsection (3) is no longer

eligible development property, an owner shall rescind the exemption

for that eligible development property by filing with the local tax

collecting unit a rescission form. The rescission form shall be as

prescribed by the department of treasury.

(13) (5) An owner of exempted new construction, that is no

longer located on development property development property, or

eligible development property who fails to file a rescission form

as required under subsection (4) this section is subject to a

penalty of $5.00 per day for each separate failure beginning after

the 90 days have elapsed, up to a maximum of $200.00. This penalty

shall be collected under 1941 PA 122, MCL 205.1 to 205.31, and

shall be deposited in the state school aid fund established in

section 11 of article IX of the state constitution of 1963. This

penalty may be waived by the department of treasury.

(14) (6) An owner of new construction that is located on

development property or eligible development property for which an

exemption was not on the tax roll may file an appeal with the July

or December board of review in the year the exemption was claimed

or the immediately succeeding year. An owner of new construction

that is located on development property for which If an exemption

under this section was denied by the assessor in the year the an

affidavit was filed under this section, an owner may file an appeal

with the July board of review for summer taxes or, if there is not

a summer levy of school operating taxes, with the December board of

review.

(15) (7) If the assessor of the local tax collecting unit

believes that new construction for which an exemption has been

granted is not located on development property, for new

construction, development property, or eligible development

property not properly eligible for exemption under this section,

the assessor may deny or modify an existing exemption by notifying

the owner in writing at the time required for providing a notice

under section 24c. A taxpayer may appeal the assessor's

determination to the board of review meeting under section 30. A

decision of the board of review may be appealed to the residential

and small claims division of the Michigan tax tribunal.

(16) (8) If an exemption under this section is erroneously

granted, an owner may request in writing that the local tax

collecting unit withdraw the exemption. If an owner requests that

an exemption be withdrawn, the local assessor shall notify the

owner that the exemption issued under this section has been denied

based on that owner's request. If an exemption is withdrawn, the

new construction, development property, or eligible development

property that had been subject to that exemption shall be

immediately placed on the tax roll by the local tax collecting unit

if the local tax collecting unit has possession of the tax roll or

by the county treasurer if the county has possession of the tax

roll as though the exemption had not been granted. A corrected tax

bill shall be issued for the tax year being adjusted by the local

tax collecting unit if the local tax collecting unit has possession

of the tax roll or by the county treasurer if the county has

possession of the tax roll. If an owner requests that an exemption

under this section be withdrawn before that owner is contacted in

writing by the local assessor regarding that owner's eligibility

for the exemption and that owner pays the corrected tax bill issued

under this subsection within 30 days after the corrected tax bill

is issued, that owner is not liable for any penalty or interest on

the additional tax. An owner who pays a corrected tax bill issued

under this subsection more than 30 days after the corrected tax

bill is issued is liable for the penalties and interest that would

have accrued if the exemption had not been granted from the date

the taxes were originally levied.

(17) (9) As used in this section:

     (a) "Development property" means real property on which a

residential dwelling, condominium unit, or other residential

structure is located, which residential dwelling, condominium unit,

or other residential structure meets all of the following

conditions:

     (i) Is not occupied and has never been occupied.

     (ii) Is available for sale.

     (iii) Is not leased.

     (iv) Is not used for any business or commercial purpose. This

restriction does not apply to real property used as an on-site

office in a specific development. However, in the case of a

specific development that consists of multiple units, only 1 such

unit is eligible for exclusion from this restriction as an on-site

office.

     (b) "Eligible development property" means all of the following

real property not previously exempt under this section:

     (i) A residential dwelling, condominium unit, or other

residential structure that was new construction after December 30,

2012 and that meets all of the following conditions:

     (A) Is not occupied and has never been occupied. In the case

of a condominium or other residential structure that consists of

multiple units, occupancy does not occur until all of the units are

occupied. However, any unit that is occupied is not eligible for

exemption under this section.

     (B) Is available for sale.

     (C) Is not leased.

     (D) Is not used for any business or commercial purpose. This

restriction does not apply to real property used as an on-site

office in a specific development. However, in the case of a

specific development that consists of multiple units, only 1 such

unit is eligible for exclusion from this restriction as an on-site

office.

     (ii) The land on which the residential dwelling, condominium

unit, or other residential structure identified in subparagraph (i)

is located.

(c) (b) "New construction" means that term as defined in

section 34d.