Bill Text: MI SB0944 | 2009-2010 | 95th Legislature | Engrossed
Bill Title: Michigan business tax; credit; historic rehabilitation credit for combined rehabilitation plans; allow. Amends sec. 435 of 2007 PA 36 (MCL 208.1435).
Spectrum: Moderate Partisan Bill (Republican 5-1)
Status: (Passed) 2010-12-29 - Assigned Pa 0310'10 With Immediate Effect [SB0944 Detail]
Download: Michigan-2009-SB0944-Engrossed.html
SB-0944, As Passed House, December 2, 2010
HOUSE SUBSTITUTE FOR
SENATE BILL NO. 944
A bill to amend 2007 PA 36, entitled
"Michigan business tax act,"
by amending section 435 (MCL 208.1435), as amended by 2009 PA 192.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 435. (1) A qualified taxpayer with a rehabilitation plan
certified after December 31, 2007 or a qualified taxpayer that has
a rehabilitation plan certified before January 1, 2008 under
section 39c of former 1975 PA 228 for the rehabilitation of an
historic resource for which a certification of completed
rehabilitation has been issued after the end of the taxpayer's last
tax year may credit against the tax imposed by this act the amount
determined pursuant to subsection (2) for the qualified
expenditures for the rehabilitation of an historic resource
pursuant to the rehabilitation plan in the year in which the
certification of completed rehabilitation of the historic resource
is issued. Only those expenditures that are paid or incurred during
the time periods prescribed for the credit under section 47(a)(2)
of the internal revenue code and any related treasury regulations
shall be considered qualified expenditures.
(2) The credit allowed under this subsection shall be 25% of
the qualified expenditures that are eligible, or would have been
eligible except that the taxpayer entered into an agreement under
subsection (13), for the credit under section 47(a)(2) of the
internal revenue code if the taxpayer is eligible for the credit
under section 47(a)(2) of the internal revenue code or, if the
taxpayer is not eligible for the credit under section 47(a)(2) of
the internal revenue code, 25% of the qualified expenditures that
would qualify under section 47(a)(2) of the internal revenue code
except that the expenditures are made to an historic resource that
is not eligible for the credit under section 47(a)(2) of the
internal revenue code, subject to both of the following:
(a) A taxpayer with qualified expenditures that are eligible
for the credit under section 47(a)(2) of the internal revenue code
may not claim a credit under this section for those qualified
expenditures unless the taxpayer has claimed and received a credit
for those qualified expenditures under section 47(a)(2) of the
internal revenue code or the taxpayer has entered into an agreement
under subsection (13).
(b) A credit under this subsection shall be reduced by the
amount of a credit received by the taxpayer for the same qualified
expenditures under section 47(a)(2) of the internal revenue code.
(3) To be eligible for the credit under subsection (2), the
taxpayer shall apply to and receive from the Michigan state housing
development authority that the historic significance, the
rehabilitation plan, and the completed rehabilitation of the
historic resource meet the criteria under subsection (6) and either
of the following:
(a) All of the following criteria:
(i) The historic resource contributes to the significance of
the historic district in which it is located.
(ii) Both the rehabilitation plan and completed rehabilitation
of the historic resource meet the federal secretary of the
interior's standards for rehabilitation and guidelines for
rehabilitating historic buildings, 36 CFR part 67.
(iii) All rehabilitation work has been done to or within the
walls, boundaries, or structures of the historic resource or to
historic resources located within the property boundaries of the
property.
(b) The taxpayer has received certification from the national
park service that the historic resource's significance, the
rehabilitation plan, and the completed rehabilitation qualify for
the credit allowed under section 47(a)(2) of the internal revenue
code.
(4) If a qualified taxpayer is eligible for the credit allowed
under section 47(a)(2) of the internal revenue code, the qualified
taxpayer shall file for certification with the authority to qualify
for the credit allowed under section 47(a)(2) of the internal
revenue code. If the qualified taxpayer has previously filed for
certification with the authority to qualify for the credit allowed
under section 47(a)(2) of the internal revenue code, additional
filing for the credit allowed under this section is not required.
(5) The authority may inspect an historic resource at any time
during the rehabilitation process and may revoke certification of
completed rehabilitation if the rehabilitation was not undertaken
as represented in the rehabilitation plan or if unapproved
alterations to the completed rehabilitation are made during the 5
years after the tax year in which the credit was claimed. The
authority shall promptly notify the department of a revocation.
(6) Qualified expenditures for the rehabilitation of an
historic resource may be used to calculate the credit under this
section if the historic resource meets 1 of the criteria listed in
subdivision (a) and 1 of the criteria listed in subdivision (b):
(a) The resource is 1 of the following during the tax year in
which a credit under this section is claimed for those qualified
expenditures:
(i) Individually listed on the national register of historic
places or state register of historic sites.
(ii) A contributing resource located within an historic
district listed on the national register of historic places or the
state register of historic sites.
(iii) A contributing resource located within an historic
district designated by a local unit pursuant to an ordinance
adopted under the local historic districts act, 1970 PA 169, MCL
399.201 to 399.215.
(b) The resource meets 1 of the following criteria during the
tax year in which a credit under this section is claimed for those
qualified expenditures:
(i) The historic resource is located in a designated historic
district in a local unit of government with an existing ordinance
under the local historic districts act, 1970 PA 169, MCL 399.201 to
399.215.
(ii) The historic resource is located in an incorporated local
unit of government that does not have an ordinance under the local
historic districts act, 1970 PA 169, MCL 399.201 to 399.215, and
has a population of less than 5,000.
(iii) The historic resource is located in an unincorporated
local unit of government.
(iv) The historic resource is located in an incorporated local
unit of government that does not have an ordinance under the local
historic districts act, 1970 PA 169, MCL 399.201 to 399.215, and is
located within the boundaries of an association that has been
chartered under 1889 PA 39, MCL 455.51 to 455.72.
(v) The historic resource is subject to a historic
preservation easement.
(7) For projects for which a certificate of completed
rehabilitation is issued for a tax year beginning before January 1,
2009, if a qualified taxpayer is a partnership, limited liability
company, or subchapter S corporation, the qualified taxpayer may
assign all or any portion of a credit allowed under this section to
its partners, members, or shareholders, based on the partner's,
member's, or shareholder's proportionate share of ownership or
based on an alternative method approved by the department. A credit
assignment under this subsection is irrevocable and shall be made
in the tax year in which a certificate of completed rehabilitation
is issued. A qualified taxpayer may claim a portion of a credit and
assign the remaining credit amount. A partner, member, or
shareholder that is an assignee shall not subsequently assign a
credit or any portion of a credit assigned to the partner, member,
or shareholder under this subsection. A credit amount assigned
under this subsection may be claimed against the partner's,
member's, or shareholder's tax liability under this act or under
the income tax act of 1967, 1967 PA 281, MCL 206.1 to 206.532. A
credit assignment under this subsection shall be made on a form
prescribed by the department. The qualified taxpayer and assignees
shall attach a copy of the completed assignment form to the
department in the tax year in which the assignment is made and
attach a copy of the completed assignment form to the annual return
required to be filed under this act for that tax year.
(8) For projects for which a certificate of completed
rehabilitation is issued for a tax year beginning after December
31, 2008, a qualified taxpayer may assign all or any portion of the
credit allowed under this section. A credit assignment under this
subsection is irrevocable and shall be made in the tax year in
which a certificate of completed rehabilitation is issued. A
qualified taxpayer may claim a portion of a credit and assign the
remaining amount. If the qualified taxpayer both claims and assigns
portions of the credit, the qualified taxpayer shall claim the
portion it claims in the tax year in which a certificate of
completed rehabilitation is issued pursuant to this section. An
assignee may subsequently assign the credit or any portion of the
credit assigned under this subsection to 1 or more assignees. An
assignment or subsequent reassignment of a credit can be made in
the year the certificate of completed rehabilitation is issued. A
credit assignment or subsequent reassignment under this section
shall be made on a form prescribed by the department. The
department or its designee shall review and issue a completed
assignment or reassignment certificate to the assignee or
reassignee. A credit amount assigned under this subsection may be
claimed against the assignees' tax under this act or under the
income tax act of 1967, 1967 PA 281, MCL 206.1 to 206.532. An
assignee or subsequent reassignee shall attach a copy of the
completed assignment certificate to the annual return required to
be filed under this act or under the income tax act of 1967, 1967
PA 281, MCL 206.1 to 206.532, for the tax year in which the
assignment or reassignment is made and the assignee or reassignee
first claims the credit, which shall be the same tax year.
(9) If the credit allowed under this section for the tax year
and any unused carryforward of the credit allowed by this section
exceed the taxpayer's tax liability for the tax year, that portion
that exceeds the tax liability for the tax year shall not be
refunded but may be carried forward to offset tax liability in
subsequent tax years for 10 years or until used up, whichever
occurs first. If a qualified taxpayer has an unused carryforward of
a credit under this section, the amount otherwise added under
subsection (10), (11), or (12) to the qualified taxpayer's tax
liability may instead be used to reduce the qualified taxpayer's
carryforward under this section. An unused carryforward of a credit
under section 39c of former 1975 PA 228 that was unused at the end
of the last tax year for which former 1975 PA 228 was in effect may
be claimed against the tax imposed under this act for the years the
carryforward would have been available under section 39c of former
1975 PA 228. For projects for which a certificate of completed
rehabilitation is issued for a tax year beginning after December
31, 2008 and for which the credit amount allowed is less than
$250,000.00, a qualified taxpayer may elect to forgo the carryover
period and receive a refund of the amount of the credit that
exceeds the qualified taxpayer's tax liability. The amount of the
refund shall be equal to 90% of the amount of the credit that
exceeds the qualified taxpayer's tax liability. An election under
this subsection shall be made in the year that a certificate of
completed rehabilitation is issued and shall be irrevocable.
(10) For tax years beginning before January 1, 2009, if the
taxpayer sells an historic resource for which a credit was claimed
under this section or under section 39c of former 1975 PA 228 less
than 5 years after the year in which the credit was claimed, the
following percentage of the credit amount previously claimed
relative to that historic resource shall be added back to the tax
liability of the taxpayer in the year of the sale:
(a) If the sale is less than 1 year after the year in which
the credit was claimed, 100%.
(b) If the sale is at least 1 year but less than 2 years after
the year in which the credit was claimed, 80%.
(c) If the sale is at least 2 years but less than 3 years
after the year in which the credit was claimed, 60%.
(d) If the sale is at least 3 years but less than 4 years
after the year in which the credit was claimed, 40%.
(e) If the sale is at least 4 years but less than 5 years
after the year in which the credit was claimed, 20%.
(f) If the sale is 5 years or more after the year in which the
credit was claimed, an addback to the taxpayer's tax liability
shall not be made.
(11) For tax years beginning before January 1, 2009, if a
certification of completed rehabilitation is revoked under
subsection (5) less than 5 years after the year in which a credit
was claimed under this section or under section 39c of former 1975
PA 228, the following percentage of the credit amount previously
claimed relative to that historic resource shall be added back to
the tax liability of the taxpayer in the year of the revocation:
(a) If the revocation is less than 1 year after the year in
which the credit was claimed, 100%.
(b) If the revocation is at least 1 year but less than 2 years
after the year in which the credit was claimed, 80%.
(c) If the revocation is at least 2 years but less than 3
years after the year in which the credit was claimed, 60%.
(d) If the revocation is at least 3 years but less than 4
years after the year in which the credit was claimed, 40%.
(e) If the revocation is at least 4 years but less than 5
years after the year in which the credit was claimed, 20%.
(f) If the revocation is 5 years or more after the year in
which the credit was claimed, an addback to the taxpayer's tax
liability shall not be made.
(12) Except as otherwise provided under subsection (13), for
tax years beginning after December 31, 2008, if a certificate of
completed rehabilitation is revoked under subsection (5), a
preapproval letter is revoked under subsection (23)(b), or an
historic resource is sold or disposed of less than 5 years after
the historic resource is placed in service as defined in section
47(b)(1) of the internal revenue code and related treasury
regulations or if a certificate of completed rehabilitation issued
after December 1, 2008 is revoked under subsection (5) during a tax
year beginning after December 31, 2008, a preapproval letter issued
after December 1, 2008 is revoked under subsection (23)(b) during a
tax year beginning after December 31, 2008, or an historic resource
is sold or disposed of less than 5 years after the historic
resource is placed in service during a tax year beginning after
December 31, 2008, the following percentage of the credit amount
previously claimed relative to that historic resource shall be
added back to the tax liability of the qualified taxpayer that
received the certificate of completed rehabilitation and not the
assignee in the year of the revocation:
(a) If the revocation is less than 1 year after the historic
resource is placed in service, 100%.
(b) If the revocation is at least 1 year but less than 2 years
after the historic resource is placed in service, 80%.
(c) If the revocation is at least 2 years but less than 3
years after the historic resource is placed in service, 60%.
(d) If the revocation is at least 3 years but less than 4
years after the historic resource is placed in service, 40%.
(e) If the revocation is at least 4 years but less than 5
years after the historic resource is placed in service, 20%.
(f) If the revocation is at least 5 years or more after the
historic resource is placed in service, an addback to the qualified
taxpayer tax liability shall not be required.
(13) Subsection (12) shall not apply if the qualified taxpayer
enters into a written agreement with the authority that will allow
for the transfer or sale of the historic resource and provides the
following:
(a) Reasonable assurance that subsequent to the transfer the
property will remain a historic resource during the 5-year period
after the historic resource is placed in service.
(b) A method that the department can recover an amount from
the taxpayer equal to the appropriate percentage of credit added
back as described under subsection (12).
(c) An encumbrance on the title to the historic resource being
sold or transferred, stating that the property must remain a
historic resource throughout the 5-year period after the historic
resource is placed in service.
(d) A provision for the payment by the taxpayer of all legal
and professional fees associated with the drafting, review, and
recording of the written agreement required under this subsection.
(14) The authority may impose a fee to cover the
administrative cost of implementing the program under this section.
(15) The qualified taxpayer shall attach all of the following
to the qualified taxpayer's annual return required under this act
or under the income tax act of 1967, 1967 PA 281, MCL 206.1 to
206.532, if applicable, on which the credit is claimed:
(a) Certification of completed rehabilitation.
(b) Certification of historic significance related to the
historic resource and the qualified expenditures used to claim a
credit under this section.
(c) A completed assignment form if the qualified taxpayer or
assignee has assigned any portion of a credit allowed under this
section or if the taxpayer is an assignee of any portion of a
credit allowed under this section.
(16) The authority may promulgate rules to implement this
section pursuant to the administrative procedures act of 1969, 1969
PA 306, MCL 24.201 to 24.328.
(17) The total of the credits claimed under subsection (2) and
section 266 of the income tax act of 1967, 1967 PA 281, MCL
206.266, for a rehabilitation project shall not exceed 25% of the
total qualified expenditures eligible for the credit under
subsection (2) for that rehabilitation project.
(18) The authority shall report all of the following to the
legislature annually for the immediately preceding state fiscal
year:
(a) The fee schedule used by the authority and the total
amount of fees collected.
(b) A description of each rehabilitation project certified.
(c) The location of each new and ongoing rehabilitation
project.
(19) In addition to the credit allowed under subsection (2)
and subject to the criteria under this subsection and subsections
(21), (22), and (23), for tax years that begin on and after January
1, 2009 a qualified taxpayer that has a preapproval letter issued
on or before December 31, 2013 may claim an additional credit that
has been approved under this subsection or subsection (20) against
the tax imposed by this act equal to a percentage established in
the taxpayer's preapproval letter of the qualified taxpayer's
qualified expenditures for the rehabilitation of an historic
resource or the actual amount of the qualified taxpayer's qualified
expenditures incurred during the completion of the rehabilitation
of an historic resource, whichever is less. The authority may
approve 1 credit under this subsection for a qualified taxpayer
that receives a certificate of completed rehabilitation for a
credit under subsection (2) on or after January 1, 2009 and before
November 15, 2009 notwithstanding that the qualified taxpayer has
not received a preapproval letter for a credit under this
subsection. The qualified taxpayer must apply for the additional
credit under this subsection before January 1, 2010. If the
additional credit approved under this subsection for a qualified
taxpayer that has not received a preapproval letter on or before
December 31, 2009 exceeds the allotted amount available for
additional credits approved under this subsection in the calendar
year ending December 31, 2009, then $2,800,000.00 of the allotted
amount available in the calendar year ending December 31, 2010 may
be allocated to that 1 credit. The total amount of all additional
credits approved under this subsection shall not exceed
$8,000,000.00 in calendar year ending December 31, 2009;
$9,000,000.00 in calendar year ending December 31, 2010;
$10,000,000.00 in calendar year ending December 31, 2011;
$11,000,000.00 in calendar year ending December 31, 2012; and
$12,000,000.00 in calendar year ending December 31, 2013 and,
except as otherwise provided under this subsection, at least, 25%
of the allotted amount for additional credits approved under this
subsection during each calendar year shall be allocated to
rehabilitation plans that have $1,000,000.00 or less in qualified
expenditures. On October 1 of each calendar year, if the total of
all credits approved under subdivision (a) for the calendar year is
less than the minimum allotted amount, the authority may use the
remainder of that allotted amount to approve applications for
additional credits submitted under subdivision (b) for that
calendar year. To be eligible for the additional credit under this
subsection, the taxpayer shall apply to and receive a preapproval
letter and comply with the following:
(a) For a rehabilitation plan that has $1,000,000.00 or less
in qualified expenditures, the taxpayer shall apply to the
authority for approval of the additional credit under this
subsection. Subject to the limitation provided under this
subsection, the authority is authorized to approve an application
under this subdivision and determine the percentage of at least 10%
but not more than 15% of the taxpayer's qualified expenditures for
which he or she may claim an additional credit. If the authority
approves the application under this subdivision, then the authority
shall issue a preapproval letter to the taxpayer that states that
the taxpayer is a qualified taxpayer and the maximum percentage of
the qualified expenditures on which a credit may be claimed for the
rehabilitation plan when it is complete and a certification of
completed rehabilitation is issued.
(b) For a rehabilitation plan that has more than $1,000,000.00
in qualified expenditures, the taxpayer shall apply to the
authority for approval of the additional credit under this
subsection. The authority, subject to the approval of the president
of the Michigan strategic fund or his or her designee, is
authorized to approve an application under this subdivision and
determine the percentage of up to 15% of the taxpayer's qualified
expenditures for which he or she may claim an additional credit. An
application shall be approved or denied not more than 15 business
days after the authority has reviewed the application, determined
the percentage amount of the credit for that applicant, and
submitted the same to the president of the Michigan strategic fund
or his or her designee. If the president of the Michigan strategic
fund or his or her designee does not approve or deny the
application within 15 business days after the application is
received from the authority, the application is considered approved
and the credit awarded in the amount as determined by the
authority. If the president of the Michigan strategic fund or his
or her designee approves the application under this subdivision,
the director of the authority shall issue a preapproval letter to
the taxpayer that states that the taxpayer is a qualified taxpayer
and the maximum percentage of the qualified expenditures on which a
credit may be claimed for the rehabilitation plan when it is
complete and a certification of completed rehabilitation is issued.
(20) Except as otherwise provided under this subsection, the
authority, subject to the approval of the president of the Michigan
strategic fund and the state treasurer, may approve 3 additional
credits during the 2009 calendar year of up to 15% of the qualified
taxpayer's qualified expenditures, and 2 additional credits during
the 2010, 2011, 2012, and 2013 calendar years of up to 15% of the
qualified taxpayer's qualified expenditures, for certain
rehabilitation plans that the authority determines is a high
community impact rehabilitation plan that will have a significantly
greater historic, social, and economic impact than those plans
described under subsection (19)(a) and (b). The authority, subject
to the approval of the president of the Michigan strategic fund and
the state treasurer, may use 1 of the 2 additional credits
available during the 2010 calendar year to approve an additional
credit during the 2009 calendar year of up to 15% of the qualified
taxpayer's qualified expenditures and 1 of the 2 additional credits
available during the 2011 calendar year to approve an additional
credit during the 2010 calendar year of up to 15% of the qualified
taxpayer's qualified expenditures. Subject to the limitations
provided under subsection (21), for the 2011, 2012, and 2013
calendar years, of the additional credits available under this
subsection the authority may use 1 of those credits to approve a
combined rehabilitation plan that the authority determines would
allow for the rehabilitation of several multiple historic resources
within the same geographic district and would have a greater impact
on the community than the approval of a plan for the rehabilitation
of a single larger historic resource. To be eligible for the
additional credit under this subsection, the taxpayer shall apply
to and receive a preapproval letter from the authority. The
authority, subject to the approval of the president of the Michigan
strategic fund and the state treasurer, may combine applications
that are received for the rehabilitation of historic resources that
are located within the same geographic district and that taken as a
whole satisfy the additional requirements under subsection (28) and
consider the approval of the combination of those applications as
the approval of a single credit for a combined rehabilitation plan.
An application shall be approved or denied not more than 15
business days after the authority has reviewed the application,
determined the percentage amount of the credit for that applicant,
and submitted the same to the president of the Michigan strategic
fund and the state treasurer. If the president of the Michigan
strategic fund and the state treasurer do not approve or deny the
application within 15 business days after the application is
received from the authority, the application is considered approved
and the credit awarded in the amount as determined by the
authority. If the president of the Michigan strategic fund and the
state
treasurer approve the application under this subdivision
subsection, the authority shall issue a preapproval letter to the
taxpayer that states that the taxpayer is a qualified taxpayer and
the maximum percentage of the qualified expenditures on which a
credit may be claimed for the high community impact rehabilitation
plan when it is complete and a certification of completed
rehabilitation is issued. Before approving a credit under this
subsection, the authority shall consider all of the following
criteria to the extent reasonably applicable:
(a) The importance of the historic resource to the community
in which it is located.
(b) If the rehabilitation of the historic resource will act as
a catalyst for additional rehabilitation or revitalization of the
community in which it is located.
(c) The potential that the rehabilitation of the historic
resource will have for creating or preserving jobs and employment
in the community in which it is located.
(d) Other social benefits the rehabilitation of the historic
resource will bring to the community in which it is located.
(e) The amount of local community and financial support for
the rehabilitation of the historic resource.
(f) The taxpayer's financial need of the additional credit.
(g) Whether the taxpayer is eligible for the credit allowed
under section 47(a)(2) of the internal revenue code.
(h) Any other criteria that the authority, the president of
the Michigan strategic fund, and the state treasurer consider
appropriate for the determination of approval under this
subsection.
(21) The maximum amount of credit that a taxpayer or an
assignee may claim under subsection (20) during a tax year is
$3,000,000.00. If the amount of the credit approved in the
taxpayer's certificate of completed renovation is greater than
$3,000,000.00 that portion that exceeds the cap shall be carried
forward to offset tax liability in subsequent tax years until used
up. The aggregate amount of credits approved under subsection (20)
for a combined rehabilitation plan shall not exceed $24,000,000.00.
Except as otherwise provided in the preapproval letter, the amount
of the credit allowed for a combined rehabilitation plan shall be
applied pro rata to each of the qualified taxpayers that submitted
an application under subsection (20) that was considered a part of
a combined rehabilitation plan. The taxpayer's pro rata share shall
be the total amount of the credit allowed multiplied by a fraction
the numerator of which is the amount of investment made by the
taxpayer for the rehabilitation of the taxpayer's historic resource
during the tax year and the denominator of which is the sum of the
investments made by all taxpayers for the rehabilitation of all
historic resources included within the combined rehabilitation plan
during the tax year.
(22) Before approving a credit, determining the amount of such
credit, and issuing a preapproval letter for such credit under
subsection (19) or before considering an amendment to the
preapproval letter, the authority shall consider the following
criteria to the extent reasonably applicable:
(a) The importance of the historic resource to the community.
(b) The physical condition of the historic resource.
(c) The taxpayer's financial need of the additional credit.
(d) The overall economic impact the renovation will have on
the community.
(e) Any other criteria that the authority and the president of
the Michigan strategic fund, as applicable, consider appropriate
for the determination of approval under subsection (19).
(23) The authority may at any time before a certification of
completed rehabilitation is issued for a credit for which a
preapproval letter was issued pursuant to subsection (19) do the
following:
(a) Subject to the limitations and parameters under subsection
(19), make amendments to the preapproval letter, which may include
revising the amount of qualified expenditures for which the
taxpayer may claim the additional credit under subsection (19).
(b) Revoke the preapproval letter if the authority determines
that there has not been substantial progress toward completion of
the rehabilitation plan or that the rehabilitation plan cannot be
completed. The authority shall provide the qualified taxpayer with
a notice of his or her intent to revoke the preapproval letter 45
days prior to the proposed date of revocation.
(24) If a preapproval letter is revoked under subsection
(23)(b), the amount of the credit approved under that preapproval
letter shall be added to the annual cap in the calendar year that
the preapproval letter is revoked. After a certification of
completed rehabilitation is issued for a rehabilitation plan
approved under subsection (19), if the authority determines that
the actual amount of the additional credit to be claimed by the
taxpayer for the calendar year is less than the amount approved
under the preapproval letter, the difference shall be added to the
annual cap in the calendar year that the certification of completed
rehabilitation is issued.
(25) Unless otherwise specifically provided under subsections
(19) through (24), all other provisions under this section such as
the recapture of credits, assignment of credits, and refundability
of credits in excess of a qualified taxpayer's tax liability apply
to the additional credits issued under subsections (19) and (20).
(26) In addition to meeting the criteria in subsection (20)(a)
through (h), 3 of the credits available under subsection (20),
including the credit used from the 2010 calendar year, and approved
during the 2009 calendar year for a high community impact
rehabilitation plan shall be for an application meeting 1 of the
following criteria:
(a) All of the following:
(i) The historic resource must be at least 70 years old.
(ii) The historic resource must comprise at least 500,000 total
square feet.
(iii) The historic resource must be located in a county with a
population of more than 1,500,000.
(iv) The historic resource must be located in a city with an
unemployment rate that is at least 2% higher than the current state
average unemployment rate at the time of the application.
(b) All of the following:
(i) The historic resource must be at least 85 years old.
(ii) The historic resource must comprise at least 120,000 total
square feet.
(iii) The historic resource must be located in a county with a
population of more than 400,000 and less than 500,000.
(iv) The historic resource must be located in a city with a
population of more than 100,000 and less than 125,000.
(v) The historic resource must be located in a city with an
unemployment rate that is at least 2% higher than the current state
average unemployment rate at the time of the application.
(c) All of the following:
(i) The historic resource must be at least 70 years old.
(ii) The historic resource must comprise at least 180,000 total
square feet but not more than 250,000 square feet and must exceed
30 stories in height.
(iii) The historic resource must be located in a county with a
population of more than 1,500,000.
(iv) The historic resource must be located in a city with an
unemployment rate that is at least 2% higher than the current state
average unemployment rate at the time of the application.
(v) The historic resource must be located in a historic
district that contains a park bifurcated by an all-American road
designated by the federal highway administration in a city with a
population of more than 750,000.
(vi) The historic resource must have been included in a
rehabilitation plan for which an application was submitted by the
application deadline for consideration of an additional credit for
the 2009 calendar year for a high community impact rehabilitation
plan.
(27) In addition to meeting the criteria in subsection (20)(a)
through (h), 1 of the credits available under subsection (20),
including the credit used from the 2011 calendar year, and approved
during the 2010 calendar year for a high community impact
rehabilitation plan shall be for an application that meets all of
the following criteria:
(a) The historic resource must be at least 85 years old.
(b) The historic resource must comprise at least 85,000 total
square feet.
(c) The historic resource must be located in a county with a
population of more than 500,000 but less than 600,000 according to
the official 2000 federal decennial census.
(d) The historic resource must be located in a city with a
population of more than 180,000 but less than 200,000 according to
the official 2000 federal decennial census.
(e) The historic resource is or was formerly owned by the
United States government or formerly housed agencies of the United
States government, or both.
(f) The historic resource houses facilities operated in
conjunction with a public university.
(28) In addition to meeting the criteria in subsection (20)(a)
through (h), the credit available during the 2011, 2012, and 2013
calendar years and approved for a combined rehabilitation plan
under subsection (20) shall be for applications that taken as a
whole meet all of the following criteria:
(a) The geographic district in which the historic resources to
be rehabilitated are located must not exceed 1 square mile.
(b) The historic resources to be rehabilitated combined must
comprise more than 1,000,000 square feet.
(c) The historic resources to be rehabilitated combined must
be redeveloped into residential, commercial, and retail
establishments.
(d) The combined investment associated with the historic
resources to be rehabilitated must be at least $150,000,000.00.
(e) Each historic resource to be rehabilitated must be at
least 50,000 square feet.
(f) The historic resources to be rehabilitated combined must
be at least 80% vacant.
(29) (28)
For purposes of this section,
taxpayer includes a
person subject to the tax imposed under chapter 2A or 2B.
(30) (29)
As used in this section:
(a) "Combined rehabilitation plan" means a rehabilitation plan
for the rehabilitation of 1 or more historic resources that are
located within the same geographic district.
(b) (a)
"Contributing resource"
means an historic resource
that contributes to the significance of the historic district in
which it is located.
(c) (b)
"Historic district" means
an area, or group of areas
not necessarily having contiguous boundaries, that contains 1
resource or a group of resources that are related by history,
architecture, archaeology, engineering, or culture.
(d) (c)
"Historic resource" means
a publicly or privately
owned historic building, structure, site, object, feature, or open
space located within an historic district designated by the
national register of historic places, the state register of
historic sites, or a local unit acting under the local historic
districts act, 1970 PA 169, MCL 399.201 to 399.215, or that is
individually listed on the state register of historic sites or
national register of historic places, and includes all of the
following:
(i) An owner-occupied personal residence or a historic resource
located within the property boundaries of that personal residence.
(ii) An income-producing commercial, industrial, or residential
resource or an historic resource located within the property
boundaries of that resource.
(iii) A resource owned by a governmental body, nonprofit
organization, or tax-exempt entity that is used primarily by a
taxpayer lessee in a trade or business unrelated to the
governmental body, nonprofit organization, or tax-exempt entity and
that is subject to tax under this act.
(iv) A resource that is occupied or utilized by a governmental
body, nonprofit organization, or tax-exempt entity pursuant to a
long-term lease or lease with option to buy agreement.
(v) Any other resource that could benefit from rehabilitation.
(e) (d)
"Last tax year" means the
taxpayer's tax year under
former 1975 PA 228 that begins after December 31, 2006 and before
January 1, 2008.
(f) (e)
"Local unit" means a
county, city, village, or
township.
(g) (f)
"Long-term lease" means a
lease term of at least 27.5
years for a residential resource or at least 31.5 years for a
nonresidential resource.
(h) (g)
"Michigan state housing
development authority" or
"authority" means the public body corporate and politic created by
section 21 of the state housing development authority act of 1966,
1966 PA 346, MCL 125.1421.
(i) (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.
(j) (i)
"Open space" means
undeveloped land, a naturally
landscaped area, or a formal or man-made landscaped area that
provides a connective link or a buffer between other resources.
(k) (j)
"Person" means an
individual, partnership,
corporation, association, governmental entity, or other legal
entity.
(l) (k)
"Preapproval letter"
means a letter issued by the
authority that indicates the date that the complete part 2
application was received and the amount of the credit allocated to
the project based on the estimated rehabilitation cost included in
the application.
(m) (l) "Qualified
expenditures" means capital expenditures
that qualify, or would qualify except that the taxpayer entered
into an agreement under subsection (13), for a rehabilitation
credit under section 47(a)(2) of the internal revenue code if the
taxpayer is eligible for the credit under section 47(a)(2) of the
internal revenue code or, if the taxpayer is not eligible for the
credit under section 47(a)(2) of the internal revenue code, the
qualified expenditures that would qualify under section 47(a)(2) of
the internal revenue code except that the expenditures are made to
an historic resource that is not eligible for the credit under
section 47(a)(2) of the internal revenue code that were paid.
Qualified expenditures do not include capital expenditures for
nonhistoric additions to an historic resource except an addition
that is required by state or federal regulations that relate to
historic preservation, safety, or accessibility.
(n) (m)
"Qualified taxpayer"
means a person that either owns
the resource to be rehabilitated or has a long-term lease agreement
with the owner of the historic resource and that has qualified
expenditures for the rehabilitation of the historic resource equal
to or greater than 10% of the state equalized valuation of the
property. If the historic resource to be rehabilitated is a portion
of an historic or nonhistoric resource, the state equalized
valuation of only that portion of the property shall be used for
purposes of this subdivision. If the assessor for the local tax
collecting unit in which the historic resource is located
determines the state equalized valuation of that portion, that
assessor's determination shall be used for purposes of this
subdivision. If the assessor does not determine that state
equalized valuation of that portion, qualified expenditures, for
purposes of this subdivision, shall be equal to or greater than 5%
of the appraised value as determined by a certified appraiser. If
the historic resource to be rehabilitated does not have a state
equalized valuation, qualified expenditures for purposes of this
subdivision shall be equal to or greater than 5% of the appraised
value of the resource as determined by a certified appraiser.
(o) (n)
"Rehabilitation plan" means
a plan for the
rehabilitation of an historic resource that meets the federal
secretary of the interior's standards for rehabilitation and
guidelines for rehabilitation of historic buildings under 36 CFR
part 67.
