May 5, 2015, Introduced by Rep. Maturen and referred to the Committee on Tax Policy.
A bill to amend 2014 PA 92, entitled
"State essential services assessment act,"
by amending sections 3, 5, and 7 (MCL 211.1053, 211.1055, and
211.1057).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3. As used in this act:
(a) "Acquisition cost" means the fair market value of personal
property
at the time of acquisition by the current first owner,
including the cost of freight, sales tax, and installation, and
other capitalized costs, except capitalized interest. There is a
rebuttable presumption that the acquisition price paid by the
current
first owner for personal property, and any costs of
freight, sales tax, and installation, and other capitalized costs,
except capitalized interest, reflect the fair market value of the
personal property at the time of acquisition by the first owner.
For property described in subdivision (e)(i) that would otherwise be
exempt under section 7k of the general property tax act, 1893 PA
206, MCL 211.7k, under an industrial facilities exemption
certificate issued under 1974 PA 198, MCL 207.551 to 207.572, and
effective before January 1, 2013, and for property described in
subdivision
(e)(iii) , that
is exempt under an industrial facilities
exemption certificate issued under 1974 PA 198, MCL 207.551 to
207.572, and effective before January 1, 2013, acquisition cost
means 1/2 of the fair market value of that personal property at the
time
of acquisition by the current first
owner. The acquisition
cost for personal property exempt under the Michigan renaissance
zone act, 1996 PA 376, MCL 125.2681 to 125.2696, is $0.00 except
for the 3 years immediately preceding the expiration of the
exemption of that personal property under the Michigan renaissance
zone act, 1996 PA 376, MCL 125.2681 to 125.2696, during which
period of time the acquisition cost for that personal property
means the fair market value of that personal property at the time
of
acquisition by the current first
owner multiplied by the
percentage reduction in the exemption as provided in section 9(3)
of the Michigan renaissance zone act, 1996 PA 376, MCL 125.2689.
The state tax commission may provide guidelines for circumstances
in which the actual acquisition price is not determinative of fair
market value and the basis of determining fair market value in
those circumstances, including when that property is idle,
obsolete, or surplus.
(b) "Assessment" means the state essential services assessment
levied under section 5.
(c) "Assessment year" means the year in which the state
essential services assessment levied under section 5 is due.
(d) "Eligible claimant" means a person that claims an
exemption for eligible personal property.
(e) "Eligible personal property" means all of the following:
(i) Personal property exempt under section 9m or 9n of the
general property tax act, 1893 PA 206, MCL 211.9m and 211.9n.
(ii) Personal property that is eligible manufacturing personal
property as defined in section 9m and that is exempt under section
9f of the general property tax act, 1893 PA 206, MCL 211.9f, which
exemption was approved under section 9f of the general property tax
act, 1893 PA 206, MCL 211.9f, after 2013, unless both of the
following conditions are satisfied:
(A) The application for the exemption was filed with the
eligible local assessing district or next Michigan development
corporation before August 5, 2014.
(B) The resolution approving the exemption states that the
project is expected to have total new personal property of over
$25,000,000.00 within 5 years of the adoption of the resolution by
the eligible local assessing district or next Michigan development
corporation.
(iii) Personal property subject to an extended industrial
facilities exemption certificate under section 11a of 1974 PA 198,
MCL 207.561a.
(iv) Personal property subject to an extended exemption under
section
9f(8) 9f(8)(a) of the general property tax act, 1893 PA
206, MCL 211.9f.
(f) "Fund board" means the board of directors of the Michigan
strategic fund created under the Michigan strategic fund act, 1984
PA 270, MCL 125.2001 to 125.2094.
(g) "Michigan economic development corporation" means the
Michigan economic development corporation, the public body
corporate created under section 28 of article VII of the state
constitution of 1963 and the urban cooperation act of 1967, 1967
(Ex Sess) PA 7, MCL 124.501 to 124.512, by a contractual interlocal
agreement effective April 5, 1999, and subsequently amended,
between local participating economic development corporations
formed under the economic development corporations act, 1974 PA
338, MCL 125.1601 to 125.1636, and the Michigan strategic fund.
(h) "Michigan strategic fund" means the Michigan strategic
fund created under the Michigan strategic fund act, 1984 PA 270,
MCL 125.2001 to 125.2094.
(i) "Next Michigan development corporation" means that term as
defined under the next Michigan development act, 2010 PA 275, MCL
125.2951 to 125.2959.
Sec. 5. (1) Beginning January 1, 2016, the state essential
services assessment is levied on all eligible personal property as
provided in this section.
(2) The assessment under this section is a state specific tax
on the eligible personal property owned by, leased to, or in the
possession of an eligible claimant on December 31 of the year
immediately preceding the assessment year and shall be calculated
as follows:
(a)
For eligible personal property acquired by the eligible
claimant
first owner in a year 1 to 5 years before the assessment
year, multiply the acquisition cost of the eligible personal
property by 2.4 mills.
(b)
For eligible personal property acquired by the eligible
claimant
first owner in a year 6 to 10 years before the assessment
year, multiply the acquisition cost of the eligible personal
property by 1.25 mills.
(c)
For eligible personal property acquired by the eligible
claimant
first owner in a year more than 10 years before the
assessment year, multiply the acquisition cost of the eligible
personal property by 0.9 mills.
Sec. 7. (1) The department of treasury shall collect and
administer the assessment as provided in this section.
(2) Not later than May 1 in each assessment year, the
department of treasury shall make available in electronic form to
each eligible claimant a statement for calculation of the
assessment as provided in section 5.
(3)
Not later than September August
15 in each assessment
year, each eligible claimant shall submit electronically to the
department of treasury the completed statement, in a form and
manner prescribed by the department of treasury, and full payment
of the assessment levied under section 5 for that assessment year
as calculated in section 5(2). The department of treasury may waive
or delay the electronic filing requirement at its discretion. The
department of treasury may accept a timely filed statement using
reporting software approved by the department of treasury, subject
to audit under subsection (6). A statement submitted by an eligible
claimant shall include all of the eligible claimant's eligible
personal property located in this state subject to the assessment
levied
under section 5. and, beginning in 2019, specify the
location
of that property on December 31 of the year immediately
preceding
the assessment year.The
completed statement required
under this subsection shall not be subject to disclosure under the
freedom of information act, 1976 PA 442, MCL 15.231 to 15.246.
(4) If an eligible claimant does not submit the statement and
full
payment of the assessment levied under section 5 by September
August 15, the department of treasury shall issue a notice to the
eligible
claimant not later than October September
15. The notice
shall include a statement explaining the consequences of nonpayment
as set forth in subsection (5) and instructing the eligible
claimant of its potential responsibility under subsection (5)(e).
An
eligible claimant shall submit payment in full by November 1
October 15 of the assessment year along with a penalty of 1% per
week on the unpaid balance for each week payment is not made in
full up to a maximum of 5% of the total amount due and unpaid. For
the eligible claimant's first assessment year, the penalty shall be
waived if the eligible claimant submits the statement and full
payment
of the assessment levied under section 5 within 7 business
days
of by September 15. An eligible claimant may amend a filed
statement for the current year up to September 15. Payments made
due to an amended statement are subject to the penalties as
described in this subsection. The department of treasury may issue
refunds for overpayments due to an amended statement. All refunds
due to overpayment shall be remitted without interest.
(5)
If For any assessment year
in which an eligible claimant
does not submit payment in full and any penalty due under
subsection
(4) or (6) by November 1, October 15, all of the
following shall apply:
(a)
The state tax commission shall direct the assessor to
rescind
issue an order to rescind no
later than the first Monday in
December for the assessment year any exemption described in section
9m or 9n of the general property tax act, 1893 PA 206, MCL 211.9m
and
211.9n, granted for the eligible personal property.any parcel
for which payment in full and any penalty due have not been
received.
(b)
The state tax commission shall rescind issue an order to
rescind no later than the first Monday in December for the
assessment year any exemption under section 9f of the general
property tax act, 1893 PA 206, MCL 211.9f, which exemption was
approved under section 9f of the general property tax act, 1893 PA
206, MCL 211.9f, after 2013 for any parcel for which payment in
full and any penalty due have not been received.
(c)
The state tax commission shall rescind issue an order to
rescind no later than the first Monday in December for the
assessment year any exemption for eligible personal property
subject to an extended industrial facilities exemption certificate
under section 11a of 1974 PA 198, MCL 207.561a, for any parcel for
which payment in full and any penalty due have not been received.
(d)
The state tax commission shall rescind issue an order to
rescind no later than the first Monday in December for the
assessment year any extended exemption for eligible personal
property under section 9f(8)(a) of the general property tax act,
1893 PA 206, MCL 211.9f, for any parcel for which payment in full
and any penalty due have not been received.
(e)
The eligible claimant shall file not later than November
10
with the assessor of the
township or city within 30 days of the
date of the state tax commission order to rescind issued under
subdivisions (a) to (d) a statement under section 19 of the general
property tax act, 1893 PA 206, MCL 211.19, for all property for
which the exemption has been rescinded under this section.
(f)
All taxes due as a result of a rescission by the
department
of treasury or Within 60 days
of an order of rescission
by the state tax commission under subdivisions (a) to (d), the
treasurer of the local tax collecting unit shall issue amended tax
bills for any taxes, including penalty and interest, that were not
billed under the general property tax act, 1893 PA 206, MCL 211.1
to
211.155, or under 1974 PA 198, MCL 207.551 to 207.572, on the
summer
bill shall be billed under the general property tax act,
1893
PA 206, MCL 211.1 to 211.155, or under 1974 PA 198, MCL
207.551
to 207.572, on the winter tax bill.and
that are owed as a
result of the order of rescission.
(6) (g)
A person who files a statement under section 7 An
eligible claimant shall provide access to the books and records,
for audit purposes, relating to the location and description; the
date of purchase, lease, or acquisition; and the purchase price,
lease
amount, or value of all industrial personal property and
commercial
personal property owned by, leased
by, or in the
possession of that person or a related entity if requested by the
assessor
of the local tax collecting unit, township or city, county
equalization department, or department of treasury for the year in
which the statement is filed and the immediately preceding 3 years.
The department of treasury shall develop and implement an audit
program which includes, but is not limited to, the audit of
statements submitted under subsection (3) and amended statements
submitted under subsection (4) for the current calendar year and
the 3 calendar years immediately preceding the commencement of an
audit. An assessment as a result of an audit shall be paid in full
within 35 days of issuance and shall include penalties and interest
as described in section 154(3) of the general property tax act,
1893 PA 206, MCL 211.154. Refunds as a result of an audit under
this subsection shall be without interest. The exemption for
personal property for which an assessment has been issued as a
result of an audit under this subsection shall be subject to the
rescission provisions of subsection (5) for the years of the
assessment if full payment is not timely made as required by this
subsection.
(7) (6)
An eligible claimant may appeal an
assessment levied
under section 5 or a penalty or rescission under this section to
the state tax commission by filing a petition not later than
December 31 in that tax year. An eligible claimant may appeal an
assessment issued, including penalties, interest, or rescission, as
a result of an audit conducted under subsection (6) by filing a
petition with the state tax commission within 30 days of the date
of that assessment's issuance. The department of treasury may
appeal to the state tax commission by filing a petition for the
current calendar year and 3 immediately preceding calendar years.
The state tax commission shall decide any appeal based on the
written petition and the written recommendation of state tax
commission staff and any other relevant information. The department
of
treasury or any eligible claimant may appeal the decision
determination of the state tax commission to the Michigan tax
tribunal within 35 days of the date of the determination.