Bill Text: MI SB0376 | 2011-2012 | 96th Legislature | Introduced
Bill Title: Economic development; plant rehabilitation; definition of industrial property; expand. Amends sec. 2 of 1974 PA 198 (MCL 207.552).
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2011-11-08 - Referred To Committee On Economic Development [SB0376 Detail]
Download: Michigan-2011-SB0376-Introduced.html
SENATE BILL No. 376
May 12, 2011, Introduced by Senator KOWALL and referred to the Committee on Economic Development.
A bill to amend 1974 PA 198, entitled
"An act to provide for the establishment of plant rehabilitation
districts and industrial development districts in local
governmental units; to provide for the exemption from certain
taxes; to levy and collect a specific tax upon the owners of
certain facilities; to impose and provide for the disposition of an
administrative fee; to provide for the disposition of the tax; to
provide for the obtaining and transferring of an exemption
certificate and to prescribe the contents of those certificates; to
prescribe the powers and duties of the state tax commission and
certain officers of local governmental units; and to provide
penalties,"
by amending section 2 (MCL 207.552), as amended by 2010 PA 273.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2. (1) "Commission" means the state tax commission
created by 1927 PA 360, MCL 209.101 to 209.107.
(2) "Facility" means either a replacement facility, a new
facility, or, if applicable by its usage, a speculative building.
(3) "Next Michigan development corporation" means that term as
defined in section 3 of the next Michigan development act, 2010 PA
275, MCL 125.2953.
(4) "Replacement facility" means 1 of the following:
(a) In the case of a replacement or restoration that occurs on
the same or contiguous land as that which is replaced or restored,
industrial property that is or is to be acquired, constructed,
altered, or installed for the purpose of replacement or restoration
of obsolete industrial property together with any part of the old
altered property that remains for use as industrial property after
the replacement, restoration, or alteration.
(b) In the case of construction on vacant noncontiguous land,
property that is or will be used as industrial property that is or
is to be acquired, constructed, transferred, or installed for the
purpose of being substituted for obsolete industrial property if
the obsolete industrial property is situated in a plant
rehabilitation district in the same city, village, or township as
the land on which the facility is or is to be constructed and
includes the obsolete industrial property itself until the time as
the substituted facility is completed.
(5) "New facility" means new industrial property other than a
replacement facility to be built in a plant rehabilitation district
or industrial development district.
(6) "Local governmental unit" means a city, village, township,
or next Michigan development corporation located in this state. For
purposes of this act, if a next Michigan development corporation
establishes a plant rehabilitation district or an industrial
development district, the next Michigan development corporation
shall act as the local governmental unit in establishing and
operating the plant rehabilitation district or the industrial
development district.
(7) "Industrial property" means land improvements, buildings,
structures, and other real property, and machinery, equipment,
furniture, and fixtures or any part or accessory whether completed
or in the process of construction comprising an integrated whole,
the primary purpose and use of which is the engaging in a high-
technology activity, operation of a strategic response center,
operation of a motorsports entertainment complex, operation of a
logistical optimization center, operation of qualified commercial
activity, operation of a major distribution and logistics facility,
the manufacture of goods or materials, creation or synthesis of
biodiesel fuel, or the processing of goods and materials by
physical or chemical change; property acquired, constructed,
altered, or installed due to the passage of proposal A in 1976; the
operation of a hydro-electric dam by a private company other than a
public utility; or agricultural processing facilities. Industrial
property includes facilities related to a manufacturing operation
under the same ownership, including, but not limited to, office,
engineering, research and development, warehousing, or parts
distribution facilities. Industrial property also includes research
and development laboratories of companies other than those
companies that manufacture the products developed from their
research activities and research development laboratories of a
manufacturing company that are unrelated to the products of the
company. For applications approved by the legislative body of a
local governmental unit between June 30, 1999 and December 31,
2007, industrial property also includes an electric generating
plant that is not owned by a local unit of government, including,
but not limited to, an electric generating plant fueled by biomass.
For an industrial development district created before July 1, 2010,
industrial property also includes an electric generating plant that
is fueled by biomass that is not owned by a unit of local
government if the electric generating plant involves the reuse of a
federal superfund site remediated by the United States
environmental protection agency and an independent study has
concluded that the electric generating plant would not have an
adverse effect on wood supply of the area from which the wood
supply of the electric generating plant would be derived. An
electric generating plant described in the preceding sentence is
presumed not to have an adverse impact on the wood supply of the
area from which the wood supply of the electric generating plant
would be derived if the company has a study funded by the United
States department of energy and managed by the department of
energy, labor, and economic growth that concludes that the electric
generating plant will consume not more than 7.5% of the annual wood
growth within a 60-mile radius of the electric generating plant.
Industrial property also includes convention and trade centers in
which construction begins not later than December 31, 2010 and is
over 250,000 square feet in size or, if located in a county with a
population of more than 750,000 and less than 1,100,000, is over
100,000 square feet in size or, if located in a county with a
population of more than 26,000 and less than 28,000, is over 30,000
square feet in size. Industrial property also includes a hotel or
motel attached to a convention and trade center under this act.
Industrial property also includes a federal reserve bank operating
under 12 USC 341, located in a city with a population of 750,000 or
more. Industrial property may be owned or leased. However, in the
case of leased property, the lessee is liable for payment of ad
valorem property taxes and shall furnish proof of that liability.
For purposes of a local governmental unit that is a next Michigan
development corporation, industrial property includes only property
used in the operation of an eligible next Michigan business, as
that term is defined in section 3 of the Michigan economic growth
authority act, 1995 PA 24, MCL 207.803. Industrial property does
not include any of the following:
(a) Land.
(b) Property of a public utility other than an electric
generating plant that is not owned by a local unit of government as
provided in this subsection.
(c) Inventory.
(8) "Obsolete industrial property" means industrial property
the condition of which is substantially less than an economically
efficient functional condition.
(9) "Economically efficient functional condition" means a
state or condition of property the desirability and usefulness of
which is not impaired due to changes in design, construction,
technology, or improved production processes, or from external
influencing factors that make the property less desirable and
valuable for continued use.
(10) "Research and development laboratories" means building
and structures, including the machinery, equipment, furniture, and
fixtures located in the building or structure, used or to be used
for research or experimental purposes that would be considered
qualified research as that term is used in section 41 of the
internal revenue code, 26 USC 41, except that qualified research
also includes qualified research funded by grant, contract, or
otherwise by another person or governmental entity.
(11) "Manufacture of goods or materials" or "processing of
goods or materials" means any type of operation that would be
conducted by an entity included in the classifications provided by
sector 31-33 — manufacturing, of the North American industry
classification system, United States, 1997, published by the office
of management and budget, regardless of whether the entity
conducting that operation is included in that manual.
(12) "High-technology activity" means that term as defined in
section 3 of the Michigan economic growth authority act, 1995 PA
24, MCL 207.803.
(13) "Logistical optimization center" means a sorting and
distribution center that optimizes transportation and uses just-in-
time inventory management and material handling.
(14) "Commercial property" means that term as defined in
section 2 of the obsolete property rehabilitation act, 2000 PA 146,
MCL 125.2782.
(15) "Qualified commercial activity" means commercial property
that meets all of the following:
(a) At least 90% of the property, excluding the surrounding
green space, is used for warehousing, distribution, or logistic
purposes and is located in a county that borders another state or
Canada or for a communications center.
(b) Occupies a building or structure that is greater than
100,000 square feet in size.
(16) "Motorsports entertainment complex" means a closed-course
motorsports facility, and its ancillary grounds and facilities,
that satisfies all of the following:
(a) Has at least 70,000 fixed seats for race patrons.
(b) Has at least 6 scheduled days of motorsports events each
calendar year, at least 2 of which shall be comparable to nascar
nextel cup events held in 2007 or their successor events.
(c) Serves food and beverages at the facility during
sanctioned events each calendar year through concession outlets, a
majority of which are staffed by individuals who represent or are
members of 1 or more nonprofit civic or charitable organizations
that directly financially benefit from the concession outlets'
sales.
(d) Engages in tourism promotion.
(e) Has permanent exhibitions of motorsports history, events,
or vehicles.
(17) "Major distribution and logistics facility" means a
proposed distribution center that meets all of the following:
(a) Contains at least 250,000 square feet.
(b) Has or will have an assessed value of $5,000,000.00 or
more for the real property.
(c) Is located within 35 miles of the border of this state.
(d) Has as its purpose the distribution of inventory and
materials to facilities owned by the taxpayer whose primary
business is the retail sale of sporting goods and related
inventory.
