Michigan Legislative Update – September 2015

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Michigan State Capitol (Credit: Jan Davis Ruthig)

Michigan State Capitol (Credit: Jan Davis Ruthig)

This is our monthly legislative update tailored for Michiganders who work on challenges related to vacancy, abandonment, and community development. We’re tracking bills in the state legislature to help you stay in the loop on relevant policy activity!

The 2015-2016 Session of the Michigan Legislature continued September 9, 2015, with the reconvening of the Michigan House of Representatives following its summer recess.

During its first week back in session this fall, the state legislature advanced one key bill we are tracking:

Property Tax

Notice of Delinquency

Senate Bill 349 (Pending, House Committee on Tax Policy) – Would clarify when country treasurers may send the June 1 and September 1 notices of delinquent property taxes. Passed the Senate by unanimous vote (38-0) on Sept. 9, 2015. Now pending review in the House.

Sen. Stamas commented, “Under current state law, even if a county treasurer has completed their work prior to June 1, they must wait to send notices to the property owners about unpaid property taxes. Giving county treasurers flexibility on when they can send out these notices is a common sense solution that will make the process more efficient.”

Below is a summary of other laws passed and legislation introduced to date during the 2015-2016 Michigan Legislative Session that may be of interest to Michigan’s vacant and problem properties innovators. We have organized the laws and legislation under following categories for ease of reference. Please note that the categorization is approximate and subject to change as bills move through the legislative process.

Code Enforcement

Senate Bill 394 (Pending, Senate Committee on Local Government) – Would amend Michigan law to allow smaller municipalities (by population) to do code enforcement inspections under Michigan Housing Law. Sen. David B. Robertson (R, Senate District 14) introduced this legislation on June 11, 2015.

Local Government

Senate Bill 394 – See full description under Code Enforcement.

House Bill 4075 (Passed – Public Act 39) – Restricts the fees that county treasurers can charge for responding to public records requests. Rep. Bruce Rendon (R, House District 103), the primary sponsor, introduced this legislation on January 27, 2015. Signed into law by Governor Snyder on June 2, 2015. Governor Snyder stated, “Any Michigan resident who wants to obtain property tax information should be able to do so, easily and without high cost. This new law ensures real estate transactions will be affordable and transparent statewide.”

House Bill 4681 (Pending, House Committee on Tax Policy) – Would allow units of local government to charge user fees for public services that are underfunded through current revenue collected from property taxes. Rep. Scott Dianda (D, House District 110), the primary sponsor, introduced this legislation on June 4, 2015.

Property Tax

Assessment

House Bill 4211 (Pending, Floor of the House) – Would eliminate the State Education Tax levied as an ad valorem tax on real property. Rep. Lisa Lyons (R, House District 86) introduced this legislation on Feb. 17, 2015. Approved by the House Committee on Tax Policy on June 17, 2015.

House Bill 4213 (Pending, House Committee on Tax Policy) – Would limit when a property’s taxable value may increase due to a rise in property value. Rep. Lisa Lyons (R, House District 86) introduced this legislation on Feb. 17, 2015.

House Bill 4681 – See full description under Local Government.

Collection

House Bill 4201 (Pending, House Committee on Local Government) – Would require that when counties collect property taxes, they must spend at least 75% of the proceeds within the city, village, or township where the property is located. Rep. Pat Somerville (R, House District 23) introduced this legislation on Feb. 17, 2015.

Exemptions/Credits

Senate Bill 81 (Pending, Floor of the House) – Would amend current Michigan law that allows banks to claim a principal residence exemption (PRE) on property that the bank acquires through foreclosure or forfeiture under certain conditions. Legislation would reduce the number of years from 3 to 2 that a bank may claim the exemption and would eliminate the requirement that a bank pay an amount equal to the taxes it would have paid, to the local tax-collecting unit for school operating expenses. Sen. Jack Brandenburg (R, Senate District 8), the primary sponsor, introduced this legislation in the Senate on Feb. 5, 2015. Approved by the House Committee on Tax Policy on March 25, 2015.

House Bill 4370 (Pending, House Committee on Tax Policy) – Would expand the homestead income tax credit. Rep. Holly Hughes (R, House District 91), primary sponsor, introduced this legislation on Mar. 24, 2015.

House Bill 4620 (Pending, House Committee on Tax Policy) – Would allow for a principal residence exemption (PRE) reduction in property tax to be applied retroactively in instances when a resident was first denied for PRE but then won an appeal. Rep. Dave Pagel (R, House District 78) introduced this legislation on May 19, 2015.

Notice of Delinquency

Senate Bill 349 (Pending, House Committee on Tax Policy) – Would clarify when country treasurers may send the June 1 and September 1 notices of delinquent property taxes. Sen. Jim Stamas (R, Senate District 36), primary sponsor, introduced this legislation on May 21, 2015.  Passed the Senate by unanimous vote (38-0) and introduced in the House on Sept. 9, 2015.

House Bill 4039 (Pending, Senate Committee on Local Government) – Would allow county treasurers to publish notice of delinquent property taxes only twice (for two weeks) instead of three times (for three weeks) in a published newspaper or online, if no newspaper is published in the county where the property is located. Rep. Jon Bumstead (R, House District 100) introduced this legislation on Jan. 21, 2015. Passed the House (93-17) and introduced in the Senate on June 17, 2015.

Property Tax Foreclosure

Senate Bill 17 (Pending, Senate Committee on Local Government) – Would require that tax auction sale proceeds that exceed the amount of delinquent taxes, interest, penalties, and fees must be refunded to the previous homeowner in certain situations. Sen. Rick Jones (R, Senate District 24) introduced this legislation on Jan. 20, 2015.

Occupied Properties

House Bill 4038 (Passed – Public Act 36) – Allows landlords to deliver electronic notice of eviction under certain conditions and with the tenant’s consent. Rep. Anthony Forlini (R, House District 24) introduced the legislation on January 21, 2015.  Signed into law by Governor Snyder on May 21, 2015.

House Bill 4673 (Pending, House Committee on Judiciary) – Would impose additional requirements on property owners when evicting occupants who are there without the owners’ permission. Rep. LaTanya Garrett (D, House District 7), the primary sponsor, introduced this legislation on June 2, 2015.