SB-0482, As Passed Senate, June 9, 2005

 

 

 

 

 

 

 

 

 

 

SUBSTITUTE FOR

 

SENATE BILL NO. 482

 

 

 

 

 

 

 

 

 

 

 

     A bill to amend 1996 PA 381, entitled

 

"Brownfield redevelopment financing act,"

 

by amending section 13 (MCL 125.2663), as amended by 2003 PA 259.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 13. (1) Subject to section 15, the board may implement a

 

brownfield plan. The brownfield plan may apply to 1 or more parcels

 

of eligible property whether or not those parcels of eligible

 

property are contiguous and may be amended to apply to additional

 

parcels of eligible property. Except as otherwise authorized by

 

this act, if more than 1 parcel of eligible property is included

 

within the plan, the tax increment revenues under the plan shall be

 

determined individually for each parcel of eligible property. Each

 

plan or an amendment to a plan shall be approved by the governing

 

body of the municipality and shall contain all of the following:

 

     (a) A description of the costs of the plan intended to be paid


 

for with the tax increment revenues or, for a plan for eligible

 

properties qualified on the basis that the property is owned or

 

under the control of a land bank fast track authority, a listing of

 

all eligible activities that may be conducted for 1 or more of the

 

eligible properties subject to the plan.

 

     (b) A brief summary of the eligible activities that are

 

proposed for each eligible property or, for a plan for eligible

 

properties qualified on the basis that the property is owned or

 

under the control of a land bank fast track authority, a brief

 

summary of eligible activities conducted for 1 or more of the

 

eligible properties subject to the plan.

 

     (c) An estimate of the captured taxable value and tax

 

increment revenues for each year of the plan from each parcel of

 

eligible property, or from all eligible properties qualified on the

 

basis that the property is owned or under the control of a land

 

bank fast track authority, and in the aggregate. The plan may

 

provide for the use of part or all of the captured taxable value,

 

including deposits in the local site remediation revolving fund,

 

but the portion intended to be used shall be clearly stated in the

 

plan. The plan shall not provide either for an exclusion from

 

captured taxable value of a portion of the captured taxable value

 

or for an exclusion of the tax levy of 1 or more taxing

 

jurisdictions unless the tax levy is excluded from tax increment

 

revenues in section 2(cc), or unless the tax levy is excluded from

 

capture under section 15.

 

     (d) The method by which the costs of the plan will be

 

financed, including a description of any advances made or


 

anticipated to be made for the costs of the plan from the

 

municipality.

 

     (e) The maximum amount of note or bonded indebtedness to be

 

incurred, if any.

 

     (f) The duration of the brownfield plan, which shall not

 

exceed the lesser of the period authorized under subsections (4)

 

and (5) or 30 years.

 

     (g) An estimate of the impact of tax increment financing on

 

the revenues of all taxing jurisdictions in which the eligible

 

property is located.

 

     (h) A legal description of each parcel of eligible property to

 

which the plan applies, a map showing the location and dimensions

 

of each eligible property, a statement of the characteristics that

 

qualify the property as eligible property, and a statement of

 

whether personal property is included as part of the eligible

 

property. If the project is on property that is functionally

 

obsolete, the taxpayer shall include, with the application, an

 

affidavit signed by a level 3 or level 4 assessor, that states that

 

it is the assessor's expert opinion that the property is

 

functionally obsolete and the underlying basis for that opinion.

 

     (i) Estimates of the number of persons residing on each

 

eligible property to which the plan applies and the number of

 

families and individuals to be displaced. If occupied residences

 

are designated for acquisition and clearance by the authority, the

 

plan shall include a demographic survey of the persons to be

 

displaced, a statistical description of the housing supply in the

 

community, including the number of private and public units in


 

existence or under construction, the condition of those in

 

existence, the number of owner-occupied and renter-occupied units,

 

the annual rate of turnover of the various types of housing and the

 

range of rents and sale prices, an estimate of the total demand for

 

housing in the community, and the estimated capacity of private and

 

public housing available to displaced families and individuals.

 

     (j) A plan for establishing priority for the relocation of

 

persons displaced by implementation of the plan.

 

     (k) Provision for the costs of relocating persons displaced by

 

implementation of the plan, and financial assistance and

 

reimbursement of expenses, including litigation expenses and

 

expenses incident to the transfer of title, in accordance with the

 

standards and provisions of the uniform relocation assistance and

 

real property acquisition policies act of 1970, Public Law 91-646

 

, 84 Stat. 1894.

 

     (l) A strategy for compliance with 1972 PA 227, MCL 213.321 to

 

213.332.

 

     (m) A description of proposed use of the local site

 

remediation revolving fund.

 

     (n) Other material that the authority or governing body

 

considers pertinent.

 

     (2) The percentage of all taxes levied on a parcel of eligible

 

property for school operating expenses that is captured and used

 

under a brownfield plan and all tax increment finance plans under

 

1975 PA 197, MCL 125.1651 to 125.1681, the tax increment finance

 

authority act, 1980 PA 450, MCL 125.1801 to 125.1830, or the local

 

development financing act, 1986 PA 281, MCL 125.2151 to 125.2174,


 

shall not be greater than the combination of the plans' percentage

 

capture and use of all local taxes levied for purposes other than

 

for the payment of principal of and interest on either obligations

 

approved by the electors or obligations pledging the unlimited

 

taxing power of the local unit of government. This subsection shall

 

apply only when taxes levied for school operating purposes are

 

subject to capture under section 15.

 

     (3) Except as provided in this subsection and subsections (5),

 

(15), and (16), tax increment revenues related to a brownfield plan

 

shall be used only for costs of eligible activities attributable to

 

the eligible property, the captured taxable value of which produces

 

the tax increment revenues, including the cost of principal of and

 

interest on any obligation issued by the authority to pay the costs

 

of eligible activities attributable to the eligible property, and

 

the reasonable costs of preparing a work plan or remedial action

 

plan for the eligible property, including the actual cost of the

 

review of the work plan or remedial action plan under section 15.

 

For property owned or under the control of a land bank fast track

 

authority, tax increment revenues related to a brownfield plan may

 

be used for eligible activities attributable to any eligible

 

property owned or under the control of the land bank fast track

 

authority, the cost of principal of and interest on any obligation

 

issued by the authority to pay the costs of eligible activities,

 

the reasonable costs of preparing a work plan or remedial action

 

plan, and the actual cost of the review of the work plan or

 

remedial action plan under section 15. Tax increment revenues

 

captured from taxes levied by this state under the state education


 

tax act, 1993 PA 331, MCL 211.901 to 211.906, or taxes levied by a

 

local school district shall not be used for eligible activities

 

described in section 2(l)(iv)(E).

 

     (4) Except as provided in subsection (5), a brownfield plan

 

shall not authorize the capture of tax increment revenue from

 

eligible property after the year in which the total amount of tax

 

increment revenues captured is equal to the sum of the costs

 

permitted to be funded with tax increment revenues under this act.

 

     (5) A brownfield plan may authorize the capture of additional

 

tax increment revenue from an eligible property in excess of the

 

amount authorized under subsection (4) during the time of capture

 

for the purpose of paying the costs permitted under subsection (3),

 

or for not more than 5 years after the time that capture is

 

required for the purpose of paying the costs permitted under

 

subsection (3), or both. Excess revenues captured under this

 

subsection shall be deposited in the local site remediation

 

revolving fund created under section 8 and used for the purposes

 

authorized in section 8. If tax increment revenues attributable to

 

taxes levied for school operating purposes from eligible property

 

are captured by the authority for purposes authorized under

 

subsection (3), the tax increment revenues captured for deposit in

 

the local site remediation revolving fund also may include tax

 

increment revenues attributable to taxes levied for school

 

operating purposes in an amount not greater than the tax increment

 

revenues levied for school operating purposes captured from the

 

eligible property by the authority for the purposes authorized

 

under subsection (3). Excess tax increment revenues from taxes


 

levied for school operating purposes for eligible activities

 

authorized under subsection (15) by the Michigan economic growth

 

authority shall not be captured for deposit in the local site

 

remediation revolving fund.

 

     (6) An authority shall not expend tax increment revenues to

 

acquire or prepare eligible property, unless the acquisition or

 

preparation is an eligible activity.

 

     (7) Costs of eligible activities attributable to eligible

 

property include all costs that are necessary or related to a

 

release from the eligible property, including eligible activities

 

on properties affected by a release from the eligible property. For

 

purposes of this subsection, "release" means that term as defined

 

in section 20101 of the natural resources and environmental

 

protection act, 1994 PA 451, MCL 324.20101.

 

     (8) Costs of a response activity paid with tax increment

 

revenues that are captured pursuant to subsection (3) may be

 

recovered from a person who is liable for the costs of eligible

 

activities at an eligible property. This state or an authority may

 

undertake cost recovery for tax increment revenue captured. Before

 

an authority or this state may institute a cost recovery action, it

 

must provide the other with 120 days' notice. This state or an

 

authority that recovers costs under this subsection shall apply

 

those recovered costs to the following, in the following order of

 

priority:

 

     (a) The reasonable attorney fees and costs incurred by this

 

state or an authority in obtaining the cost recovery.

 

     (b) One of the following:


 

     (i) If an authority undertakes the cost recovery action, the

 

authority shall deposit the remaining recovered funds into the

 

local site remediation fund created pursuant to section 8, if such

 

a fund has been established by the authority. If a local site

 

remediation fund has not been established, the authority shall

 

disburse the remaining recovered funds to the local taxing

 

jurisdictions in the proportion that the local taxing

 

jurisdictions' taxes were captured.

 

     (ii) If this state undertakes a cost recovery action, this

 

state shall deposit the remaining recovered funds into the

 

revitalization revolving loan fund established under section 20108a

 

of the natural resources and environmental protection act, 1994 PA

 

451, MCL 324.20108a.

 

     (iii) If this state and an authority each undertake a cost

 

recovery action, undertake a cost recovery action jointly, or 1 on

 

behalf of the other, the amount of any remaining recovered funds

 

shall be deposited pursuant to subparagraphs (i) and (ii) in the

 

proportion that the tax increment revenues being recovered

 

represent local taxes and taxes levied for school operating

 

purposes, respectively.

 

     (9) Approval of the brownfield plan or an amendment to a

 

brownfield plan shall be in accordance with the notice and approval

 

provisions of this section and section 14.

 

     (10) Before approving a brownfield plan for an eligible

 

property, the governing body shall hold a public hearing on the

 

brownfield plan. Notice of the time and place of the hearing shall

 

be given by publication twice in a newspaper of general circulation


 

designated by the municipality, the first of which shall be not

 

less than 20 or more than 40 days before the date set for the

 

hearing.

 

     (11) Notice of the time and place of the hearing on a

 

brownfield plan shall contain all of the following:

 

     (a) A description of the property to which the plan applies in

 

relation to existing or proposed highways, streets, streams, or

 

otherwise.

 

     (b) A statement that maps, plats, and a description of the

 

brownfield plan are available for public inspection at a place

 

designated in the notice and that all aspects of the brownfield

 

plan are open for discussion at the public hearing required by this

 

section.

 

     (c) Any other information that the governing body considers

 

appropriate.

 

     (12) At the time set for the hearing on the brownfield plan

 

required under subsection (10), the governing body shall provide an

 

opportunity for interested persons to be heard and shall receive

 

and consider communications in writing with reference to the

 

brownfield plan. The governing body shall make and preserve a

 

record of the public hearing, including all data presented at the

 

hearing.

 

     (13) Not less than 20 days before the hearing on the

 

brownfield plan, the governing body shall provide notice of the

 

hearing to the taxing jurisdictions that levy taxes subject to

 

capture under this act. The authority shall fully inform the taxing

 

jurisdictions about the fiscal and economic implications of the


 

proposed brownfield plan. At that hearing, an official from a

 

taxing jurisdiction with millage that would be subject to capture

 

under this act has the right to be heard in regard to the adoption

 

of the brownfield plan.

 

     (14) The authority shall not enter into agreements with the

 

taxing jurisdictions and the governing body of the municipality to

 

share a portion of the captured taxable value of an eligible

 

property. Upon adoption of the plan, the collection and

 

transmission of the amount of tax increment revenues as specified

 

in this act shall be binding on all taxing units levying ad valorem

 

property taxes or specific taxes against property located in the

 

zone.

 

     (15) Except as provided by subsection (18), if a brownfield

 

plan includes the capture of taxes levied for school operating

 

purposes or the use of tax increment revenues related to a

 

brownfield plan for the cost of eligible activities attributable to

 

more than 1 eligible property that is adjacent and contiguous to

 

all other eligible properties covered by the development agreement,

 

whether or not the captured taxes are levied for school operating

 

purposes, approval of a work plan by the Michigan economic growth

 

authority before January 1, 2008 to use school operating taxes and

 

a development agreement between the municipality and an owner or

 

developer of eligible property are required if the revenues will be

 

used for infrastructure improvements that directly benefit eligible

 

property, demolition of structures that is not response activity

 

under part 201 of the natural resources and environmental

 

protection act, 1994 PA 451, MCL 324.20101 to 324.20142, lead or


 

asbestos abatement, or site preparation that is not response

 

activity under section 20101 of the natural resources and

 

environmental protection act, 1994 PA 451, MCL 324.20101. The

 

eligible activities to be conducted described in this subsection

 

shall be consistent with the work plan submitted by the authority

 

to the Michigan economic growth authority. The department's

 

approval is not required for the capture of taxes levied for school

 

operating purposes for eligible activities described in this

 

subsection.

 

     (16)  The limitations of section 15(1) upon use of tax

 

increment revenues by an authority shall not apply to the following

 

costs and expenses:

 

     (a) In each fiscal year of the authority, $75,000.00 for the

 

following purposes for tax increment revenues attributable to local

 

taxes:

 

     (i) Reasonable and actual administrative and operating expenses

 

of the authority.

 

     (ii) Baseline environmental assessments, due care activities,

 

and additional response activities related directly to work

 

conducted on prospective eligible properties prior to approval of

 

the brownfield plan.

 

     (b) Reasonable costs of preparing a work plan or remedial

 

action plan or the cost of the review of a work plan for which tax

 

increment revenues may be used under section 13(3).

 

     (17) A brownfield authority may reimburse advances, with or

 

without interest, made by a municipality under section 7(3), a land

 

bank fast track authority, or any other person or entity for costs


 

of eligible activities with any source of revenue available for use

 

of the brownfield authority under this act and may enter into

 

agreements related to those reimbursements. A reimbursement

 

agreement for these purposes and the obligations under that

 

reimbursement agreement shall not be subject to section 12 or the

 

revised municipal finance act, 2001 PA 34, MCL 141.2101 to

 

141.2821.

 

     (18) If a brownfield plan includes the capture of taxes levied

 

for school operating purposes, approval of a work plan by the

 

Michigan economic growth authority in the manner required under

 

section 15(14) to (16) is required in order to use tax increment

 

revenues attributable to taxes levied for school operating purposes

 

for purposes of eligible activities described in section 2(l)(iv)(E)

 

for 1 or more parcels of eligible property. The work plan to be

 

submitted to the Michigan economic growth authority under this

 

subsection shall be in a form prescribed by the Michigan economic

 

growth authority. The eligible activities to be conducted and

 

described in this subsection shall be consistent with the work plan

 

submitted by the authority to the Michigan economic growth

 

authority. The department's approval is not required for the

 

capture of taxes levied for school operating purposes for eligible

 

activities described in this section.