Bill Text: MI HB5441 | 2023-2024 | 102nd Legislature | Introduced
Bill Title: Taxation: convention tourism assessments; community convention or tourism marketing act; clarify application to short-term rentals and make other modifications. Amends title & secs. 2, 3, 3a, 4 & 8 of 1980 PA 395 (MCL 141.872 et seq.) & repeals sec. 9 of 1980 PA 395 (MCL 141.879). TIE BAR WITH: HB 5438'24
Spectrum: Partisan Bill (Democrat 21-0)
Status: (Introduced) 2024-02-14 - Per Rule 41 Referred To Committee On Local Government And Municipal Finance [HB5441 Detail]
Download: Michigan-2023-HB5441-Introduced.html
HOUSE BILL NO. 5441
A bill to amend 1980 PA 395, entitled
"Community convention or tourism marketing act,"
by amending the title and sections 2, 3, 3a, 4, and 8 (MCL 141.872, 141.873, 141.873a, 141.874, and 141.878), the title and section 2 as amended by 2018 PA 626, section 3 as amended by 2010 PA 283, section 3a as amended by 1993 PA 224, and sections 4 and 8 as amended by 1984 PA 59; and to repeal acts and parts of acts.
the people of the state of michigan enact:
An act relating to the promotion of convention business or tourism in municipalities in this state; to provide for tourism or convention marketing programs in municipalities through nonprofit convention and tourist bureaus; to allow certain activities as part of tourism or convention marketing programs; to provide for the imposition and collection of assessments on the owners of transient facilities, including short-term rentals, to support tourism or convention marketing programs; to provide for the disbursement of the assessments; to establish the oversight functions and duties of certain state departments, state agencies, and state employees; and to prescribe remedies and penalties.
(a) "Assessment" means the amount levied against an owner of a transient facility within an assessment district, computed by application of the applicable percentage against aggregate room charges with respect to that transient facility during the applicable assessment period.
(b) "Assessment district" means a municipality or combination of municipalities as described in a marketing program. A combination of municipalities is not required to be contiguous.
(c) "Assessment revenues" means the money derived from the assessment, including any interest and penalties on the assessment, imposed by this act.
(d) "Board" means the board of directors elected by the members of a bureau. A majority of the members of a board shall must be owners of transient facilities.
(e) "Bureau" means a nonprofit corporation existing to promote convention business or tourism within this state or a portion of this state.
(f) "Director" means the president of the Michigan strategic fund or his or her the president of the Michigan strategic fund's designee.
(g) "Marketing program" means a program established by a bureau to develop, encourage, solicit, and promote convention business or tourism within this state or a portion of this state within which the bureau operates. The encouragement and promotion of convention business or tourism includes any service, function, or activity, whether or not performed, sponsored, or advertised by a bureau, that intends to attract transient guests to the assessment district. For a bureau described in section 3(8), a marketing program includes a contract with a nonprofit organization formed to promote convention business or tourism that receives funding from a tax levied under 1974 PA 263, MCL 141.861 to 141.867, in a contiguous county to provide for the promotion of convention business or tourism.
(h) "Marketing program notice" means the notice described in section 3.
(i) "Master plan" means the comprehensive, long-range master plan developed by the Michigan travel commission and the travel bureau under section 2c of the Michigan tourism policy act, 1945 PA 106, MCL 2.102c.
(j) "Municipality" means a county with a population of less than 650,000 or a city, village, or township within a county with a population of less than 650,000.
(k) "Owner" means the owner of a transient facility to be served by the bureau or, if the transient facility is operated or managed by a person other than the owner, then the operator or manager of that transient facility.
(l) "Room" means a room or other space provided for sleeping that can be rented independently, including the furnishings and other accessories in the room. Room includes, but is not limited to, a both of the following:
(i) A condominium or time-sharing unit that, pursuant to a management agreement, may be used to provide dwelling, lodging, or sleeping quarters for a transient guest.
(ii) A dwelling offered as a short-term rental.
(m) "Room charge" means the charge imposed for the use or occupancy of a room, excluding charges for food, beverages, state use tax, telephone service, or like services paid in connection with the charge, and excluding reimbursement of the assessment imposed by this act. For a short-term rental, room charge means the occupancy charge as that term is defined in section 2 of the short-term rental regulation act.
(n) "Short-term rental" means that term as defined in section 2 of the short-term rental regulation act.
(o) "State use tax" means the tax levied under the use tax act, 1937 PA 94, MCL 205.91 to 205.111.
(p) (n) "Transient facility" means either of the following facilities, except transient facility does not include a college or school dormitory, a hospital, a nursing home, or a facility owned and operated by an organization qualified for an exemption from federal taxation under section 501(c) of the internal revenue code of 1986, 26 USC 501:
(i) A building or combination of buildings under common ownership, operation, or management that contains 10 1 or more rooms used in the business of providing dwelling, lodging, or sleeping to transient guests, whether or not membership is required for the use of the rooms. Transient facility does not include a college or school dormitory, a hospital, a nursing home, or a facility owned and operated by an organization qualified for an exemption from federal taxation under section 501(c) of the internal revenue code.
(ii) A dwelling offered as a short-term rental.
(q) (o) "Transient guest" means a natural person who occupies a room in a transient facility for less than 30 consecutive days regardless of who pays the room charge.
(r) (p) "Travel bureau" means the Michigan travel bureau created under section 2a of the Michigan tourism policy act, 1945 PA 106, MCL 2.102a, and renamed Travel Michigan by Executive Reorganization Order No. 1997-1, MCL 2.111.
Sec. 3. (1) A bureau that intends to establish a marketing program and assessment district shall file a marketing program notice with the director. The marketing program notice shall must state that the bureau proposes to create a marketing program under this act and cause an assessment to be collected from owners of transient facilities within the assessment district to pay the costs of the marketing program.
(2) The marketing program notice shall must describe the structure, membership, and activities of the bureau.
(3) The marketing program notice shall must describe the marketing program to be implemented by the bureau with the assessment revenues, specify the amount of the assessment proposed to be levied, which , except as provided in this subsection, shall must not exceed 5% of the room charges in the applicable payment period, and describe the municipalities comprising the assessment district.
(4) Except as provided in section 10, an area shall must not be included in the marketing program notice filed under this act and the assessment district specified in the notice if the area is part of an existing assessment district under this act for which a marketing program is in effect.
(5) If on the date of the mailing of the marketing program notice under this act an excise tax or other tax based on a room charge is not being collected, a municipality included in the marketing program notice shall is not be subject to the collection of an excise tax imposed under 1974 PA 263, MCL 141.861 to 141.867, or another tax based on a room charge.
(6) If a part of a municipality is subject to an assessment under the convention and tourism marketing act, 1980 PA 383, MCL 141.881 to 141.889, that part of the municipality shall must not be included in a marketing program notice or assessment district under this act.
(7) Simultaneously with the filing of the marketing program notice with the director, the bureau shall mail a copy of the notice, by registered or certified mail, to each owner of a transient facility located in the assessment district specified in the notice, in care of the respective transient facility. In assembling the list of owners to whom the notices shall must be mailed, the bureau shall use any data that is reasonably available to the bureau, including, but not limited to, the short-term rental database as that term is defined in section 2 of the short-term rental regulation act.
Sec. 3a. (1) Within Not later than 30 days after a marketing program notice is filed, the director shall approve or disapprove the marketing program. The director shall not disapprove a marketing program unless the program violates this act.
(2) Within Not later than 40 days after approval of a marketing program, the director shall require a written referendum to be held by mail or in person, as determined by the director, among all owners of transient facilities in each municipality in the proposed assessment district. For the purpose of the referendum, each owner shall have has 1 vote for each room in an owner's transient facility. For purposes of this subsection, a dwelling offered as a short-term rental is considered 1 room.
(3) The marketing program and assessment set forth in the notice shall become becomes effective on the first day of the month that is more than 30 days after certification by the director that the program was approved by a majority of the votes actually cast in each municipality in the assessment district. If a majority of the votes actually cast in any municipality counted separately is not in favor of the program and assessment, the program and assessment shall do not go into effect in the assessment district. However, for purposes of tabulating the votes in the referendum for a marketing program proposed on or after April 12, 1984, each municipality in the proposed assessment district requiring a majority of votes cast in favor of the proposed assessment district shall must be defined in the marketing program notice required under section 3. A bureau may file and serve another marketing program notice not less than 60 days after certification of the results of a referendum.
Sec. 4. A marketing program may include all or any 1 or more of the following:
(a) Provisions for establishing and paying the costs of advertising, marketing, and promotional programs to encourage convention business or tourism in the assessment district.
(b) Provisions for assisting transient facilities within the assessment district in promoting convention business or tourism.
(c) Provisions for the acquisition of personal property considered appropriate by the bureau in furtherance of the purposes of the marketing program.
(d) Provisions for the hiring of and payment for personnel employed by the bureau to implement the marketing program.
(e) Provisions for contracting with organizations, agencies, or persons for carrying out activities in furtherance of the purposes of the marketing program.
(f) Programs for establishing and paying the costs of research designed to encourage convention business or tourism in the assessment district.
(g) Provisions or programs to assist with or provide child care.
(h) Housing activities.
(i) (g) Provisions for incurring any other expense or cost which that the board, in the exercise of its reasonable business judgment, considers reasonably related to promotion of the convention business or tourism within the assessment district.
(j) (h) Procedures for election of the board.
(k) Provisions clarifying the assessment on room charges for short-term rentals.
Sec. 8. (1) At any time 2 years or more after the effective date of an assessment, and upon on the written request of owners of transient facilities located within an assessment district representing not less than 40% of the total number of owners or not less than 40% of the total number of rooms in all of the transient facilities in the assessment district, the bureau shall conduct a referendum on whether the assessment shall be discontinued. The bureau shall cause a written referendum to be held by mail or in person, as the bureau chooses, among all owners of transient facilities in the petitioning assessment district within 60 days of the receipt of the requests. For the purposes of the referendum, each owner shall have has 1 vote for each room in each of the owner's transient facilities within the petitioning assessment district. If a majority of the votes actually cast at the referendum for the assessment district supports discontinuance of the assessment, the assessment shall be is discontinued for that area or county on the first day of the month following expiration of 60 days after the certification of the results of the referendum by the bureau. For purposes of this subsection, a dwelling offered as a short-term rental is considered 1 room.
(2) Passage of a resolution discontinuing the assessment shall does not prevent a bureau from proposing a new marketing program notice during or after the 60-day period, in which case the procedures set forth in section 3 shall must be followed.
(3) If a referendum is conducted under subsection (1) and if a resolution to discontinue the assessment is not adopted, a further referendum on the discontinuation of that assessment for the assessment district for which the referendum was held shall must not be held for a period of 2 years.
Enacting section 1. Section 9 of the community convention or tourism marketing act, 1980 PA 395, MCL 141.879, is repealed.
Enacting section 2. This amendatory act does not take effect unless Senate Bill No.____ or House Bill No. 5438 (request no. 03372'23 **) of the 102nd Legislature is enacted into law.
