Bill Text: MI SB1059 | 2011-2012 | 96th Legislature | Engrossed

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Bill Title: Property tax; classification; qualified forest property tax program; modify. Amends secs. 7jj & 27a of 1893 PA 206 (MCL 211.7jj[1] & 211.27a). TIE BAR WITH: HB 4302'11, HB 4969'11, HB 4970'11, SB 1057'12, SB 1058'12, SB 1061'12, SB 1062'12

Spectrum: Partisan Bill (Republican 4-0)

Status: (Engrossed - Dead) 2012-12-04 - Referred To Second Reading [SB1059 Detail]

Download: Michigan-2011-SB1059-Engrossed.html

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SB-1059, As Passed Senate, September 20, 2012

 

 

 

 

 

 

 

 

 

 

 

 

SUBSTITUTE FOR

 

SENATE BILL NO. 1059

 

 

 

 

 

 

 

 

 

 

 

 

     A bill to amend 1893 PA 206, entitled

 

"The general property tax act,"

 

by amending sections 7jj and 27a (MCL 211.7jj[1] and 211.27a),

 

section 7jj as added by 2006 PA 378 and section 27a as amended by

 

2012 PA 47.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 7jj. (1) Except as otherwise limited in this subsection,

 

qualified Qualified forest property is exempt from the tax levied

 

by a local school district for school operating purposes to the

 

extent provided under section 1211 of the revised school code, 1976

 

PA 451, MCL 380.1211, collection of general ad valorem taxes under

 

this act, according to the provisions of this section. Buildings or

 

structures located on qualified forest property are not eligible

 

for the exemption under this section. If a property owner is

 

interested in obtaining an exemption for qualified forest property

 

under this section, the property owner may contact the local

 

conservation district or the department and the local conservation

 

district or the department shall advise the property owner on the

 

exemption process. If requested by the property owner, the local

 

conservation district or the department shall provide the property

 

owner with a list of qualified foresters to prepare a forest

 

management plan. The department shall maintain a list of qualified

 

foresters throughout the state and shall make the list available to

 

the conservation districts and to interested landowners. The amount

 

of qualified forest property in this state that is eligible for the

 

exemption under this section is limited as follows:

 

     (a) In the fiscal year ending September 30, 2008, 300,000

 

acres.

 

     (b) In the fiscal year ending September 30, 2009, 600,000

 

acres.

 

     (c) In the fiscal year ending September 30, 2010, 900,000

 

acres.

 

     (d) In the fiscal year ending September 30, 2011 and each

 

fiscal year thereafter, 1,200,000 2,400,000 acres. Beginning in the

 

fiscal year ending September 30, 2013 and each fiscal year

 

thereafter, real property eligible for exemption under this section

 

as qualified forest property as a result of the withdrawal of that

 

property from the operation of part 511 of the natural resources

 

and environmental protection act, 1994 PA 451, MCL 324.51101 to

 

324.51120, as provided in section 51108(5) of the natural resources

 

and environmental protection act, 1994 PA 451, MCL 324.51108, shall

 

not be credited against the 2,400,000 acres of property that are

 

eligible for exemption as qualified forest property under this

 

section.

 

     (2) To claim an exemption under subsection (1), a property

 

owner shall obtain a forest management plan from a qualified

 

forester and submit a digital copy of that forest management plan,

 

an application for exemption as qualified forest property, and a

 

fee of $200.00 to the department on a form created by the

 

department by August 1 for the tax year within which the exemption

 

is requested. A forest management plan is not subject to the

 

freedom of information act, 1976 PA 442, MCL 15.231 to 15.246. The

 

department shall forward a copy of the application to the local

 

conservation district for review and to the local tax collecting

 

unit for notification of the application.

 

     (3) A conservation district shall review the application to

 

determine if the applied-for property meets the minimum

 

requirements for enrolling into the qualified forest program. A

 

conservation district shall respond within 45 days of the date of

 

receipt of the application indicating whether the property in the

 

application is eligible for enrollment. If the conservation

 

district does not respond within 45 days of receipt of the

 

application, the property shall be considered eligible for the

 

exemption under this section.

 

     (4) The department shall review the application, comments from

 

the conservation district, and the forest management plan to

 

determine if the property is eligible for the exemption under this

 

section. The department shall review the forest management plan to

 

determine if the elements required in subsection 15(f) are in the

 

plan. Within 90 days of receipt of the application, forest

 

management plan, and fee, the department shall review the

 

application and, if the application and supporting documents are in

 

compliance with the requirements of this section, the department

 

shall approve the application and shall prepare a qualified forest

 

school tax affidavit, in recordable form, indicating all of the

 

following:

 

     (a) The name of the landowner.

 

     (b) The legal description of the property.

 

     (c) The year the application was submitted for the exemption.

 

     (d) A statement that the landowner is attesting that the

 

property for which the exemption is claimed is qualified forest

 

property and will be managed according to the approved forest

 

management plan.

 

     (e) Any other information pertinent to the parcel and the

 

property owner.

 

     (5) The department shall send a qualified forest school tax

 

affidavit prepared under subsection (5) to the property owner for

 

execution. The 90-day review period by the department may be

 

extended upon request of the property owner. The property owner

 

shall execute the qualified forest school tax affidavit and shall

 

have the executed qualified forest school tax affidavit recorded by

 

the register of deeds in the county in which the property is

 

located. The property owner shall provide a copy of the qualified

 

forest school tax affidavit to the department. The department shall

 

provide 1 copy of the qualified forest school tax affidavit to the

 

conservation district and 1 copy to the department of treasury.

 

These copies may be sent electronically.

 

     (6) If the application is denied, the property owner has 30

 

days from the date of notification of the denial by the department

 

to initiate an appeal of that denial. An appeal of the denial shall

 

be by certified letter to the director of the department.

 

     (7) (2) To claim an exemption under subsection (1), the owner

 

of qualified forest property shall file an affidavit claiming the

 

exemption and an approved forest management plan or a certificate

 

provided by a third-party certifying organization with the provide

 

a copy of the recorded qualified forest school tax affidavit

 

attesting that the land is qualified forest property to the local

 

tax collecting unit by December 31. An owner may claim an exemption

 

under this section for not more than 320 640 acres of qualified

 

forest property in each local tax collecting unit. If an exemption

 

is granted under this section for less than 320 640 acres in a

 

local tax collecting unit, an owner of that property may

 

subsequently claim an exemption for additional property in that

 

local tax collecting unit if that additional property meets the

 

requirements of this section.

 

     (3) The affidavit shall be on a form prescribed by the

 

department of treasury and shall require the person submitting the

 

affidavit to attest that the property for which the exemption is

 

claimed is qualified forest property and will be managed according

 

to the approved forest management plan.

 

     (8) (4) The If a copy of the recorded qualified forest school

 

tax affidavit is provided by the owner, the assessor shall

 

determine if the property is qualified forest property based on a

 

recommendation from the department of natural resources and

 

confirmation that the acreage limitation set forth in subsection

 

(1) has not been reached and if so shall exempt the property from

 

the collection of the tax as provided in subsection (1) until

 

December 31 of the year in which the property is no longer

 

qualified forest property.

 

     (9) (5) Not more than 90 days after all or a portion of the

 

exempted property is no longer qualified forest property, the owner

 

shall rescind the exemption for the applicable portion of the

 

property by filing with the local tax collecting unit register of

 

deeds for the county in which the exempted property is located a

 

rescission form prescribed by the department. of treasury. The

 

rescission form shall include a legal description of the exempted

 

property. An owner who fails to file a rescission as required by

 

this subsection is subject to a penalty of $5.00 per day for each

 

separate failure beginning after the 90 days have elapsed, up to a

 

maximum of $1,000.00. This penalty shall be collected under 1941 PA

 

122, MCL 205.1 to 205.31, and shall be deposited in the general

 

fund of this state.private forestland enhancement fund.

 

     (10) (6) An owner of property that is qualified forest

 

property on December 31 for which an exemption was not on the tax

 

roll may file an appeal with the July or December board of review

 

under section 53b in the year the exemption was claimed or the

 

immediately succeeding year. An owner of property that is qualified

 

forest property on May 1 for which an exemption was denied by the

 

assessor in the year the affidavit was filed may file an appeal

 

with the July board of review for summer taxes or, if there is not

 

a summer levy of school operating taxes, with the December board of

 

review under section 53b.

 

     (7) If the assessor of the local tax collecting unit believes

 

that the property for which an exemption has been granted is not

 

qualified forest property based on a recommendation from the

 

department of natural resources, the assessor may deny or modify an

 

existing exemption by notifying the owner in writing at the time

 

required for providing a notice under section 24c. A taxpayer may

 

appeal the assessor's determination to the board of review meeting

 

under section 30. A decision of the board of review may be appealed

 

to the residential and small claims division of the Michigan tax

 

tribunal.

 

     (11) (8) If property for which an exemption has been granted

 

under this section is not qualified forest property, the property

 

that had been subject to that exemption shall be immediately placed

 

on the tax roll by the local tax collecting unit if the local tax

 

collecting unit has possession of the tax roll or by the county

 

treasurer if the county has possession of the tax roll as though

 

the exemption had not been granted. A corrected tax bill shall be

 

issued for each tax year being adjusted by the local tax collecting

 

unit if the local tax collecting unit has possession of the tax

 

roll or by the county treasurer if the county has possession of the

 

tax roll.

 

     (12) (9) If all or a portion of property for which an

 

exemption has been granted under this section is converted by a

 

change in use and is no longer qualified forest property, the

 

property is subject to the qualified forest property recapture tax

 

levied an owner shall immediately notify the local tax collecting

 

unit, the department, and the department of treasury on a form

 

created by the department. The form shall include a legal

 

description of the exempted property. A copy of the form shall be

 

filed with the register of deeds for the county in which the

 

exempted property is located. Upon notice that property is no

 

longer qualified forest property, the local tax collecting unit

 

shall immediately rescind the exemption under this section and

 

shall place the property on the tax roll for the immediately

 

succeeding tax year and the department of treasury shall

 

immediately begin collection of any applicable tax and penalty

 

under this act or under the qualified forest property recapture tax

 

act, 2006 PA 379, MCL 211.1031 to 211.1036. An owner of qualified

 

forest property shall inform a prospective buyer of that qualified

 

forest property that the qualified forest property is subject to

 

the recapture tax provided in the qualified forest property

 

recapture tax act, 2006 PA 379, MCL 211.1031 to 211.1036, if the

 

qualified forest property is converted by a change in use. However,

 

beginning January 1, 2013 and ending September 30, 2013, owners of

 

property exempt as qualified forest property prior to January 1,

 

2013 may execute a new qualified forest school tax affidavit under

 

this section. If an owner of qualified forest property elects not

 

to execute a new qualified forest school tax affidavit under this

 

section, the existing affidavit shall be rescinded without penalty

 

and the property shall be placed on the tax roll as though the

 

exemption under this section had not been granted. If a landowner

 

elects not to execute a qualified forest school tax affidavit under

 

this section, the property is not subject to the recapture tax

 

provided for under the qualified forest property recapture tax act,

 

2006 PA 379, MCL 211.1031 to 211.1036.

 

     (13) (10) If qualified forest property is exempt under this

 

section, an owner of that qualified forest property shall annually

 

report to the department of natural resources on a form prescribed

 

by the department of natural resources the amount of timber

 

produced on that qualified forest property and whether any

 

buildings or structures have been constructed on the qualified

 

forest property. when a forest practice or timber harvest has

 

occurred on the qualified forest property during a calendar year.

 

The report shall indicate the forest practice completed or the

 

volume and value of timber harvested on that qualified forest

 

property. One copy of the form shall be forwarded to the

 

conservation district, and 1 copy shall be retained by the

 

department for 7 years. If it is determined by the department that

 

a forest practice or harvest has occurred in a calendar year and no

 

report was filed, a fine of $500.00 may be collected by the

 

department. Beginning in 2008, and every 3 years thereafter, the

 

department of natural resources shall provide to the standing

 

committees of the senate and house of representatives with primary

 

jurisdiction over forestry issues a report that includes all of the

 

following:

 

     (a) The number of acres of qualified forest property in each

 

county.

 

     (b) The amount of timber produced on qualified forest property

 

each year.

 

     (14) While qualified forest property is exempt under this

 

section, the owner shall retain the current management plan, most

 

recent harvest records, recorded copy of a receipt of the tax

 

exemption, and a map that shows the location and size of any

 

buildings and structures on the property. The owner shall make the

 

documents available to the department upon request. The department

 

shall maintain a database listing all qualified forest properties,

 

including the dates indicated for forest practices and harvests in

 

the forest management plan, and shall notify the landowner and the

 

conservation district in any year that forest practices or harvests

 

are to occur. If an owner does not accomplish forest practices and

 

harvests within 1 year of the current forest management plan, the

 

property is not eligible for the exemption under this section and

 

the qualified forest property shall be placed on the tax roll as

 

provided in this section and shall be subject to repayment as

 

indicated in the qualified forest property recapture tax act, 2006

 

PA 379, MCL 211.1031 to 211.1036.

 

     (15) (11) As used in this section:

 

     (a) "Approved forest management plan" means 1 of the

 

following:

 

     (i) A a forest management plan approved by the department of

 

natural resources. developed by a qualified forester. An owner of

 

property may shall submit a proposed forest management plan to the

 

department of natural resources for approval as prescribed in

 

subsection (2). The proposed forest management plan shall include a

 

statement signed by the owner that he or she agrees to comply with

 

all terms and conditions contained in the approved forest

 

management plan. The department of natural resources may charge a

 

fee of not more than $200.00 for the consideration of each proposed

 

forest management plan submitted. The department of natural

 

resources shall review and either approve or disapprove each

 

proposed forest management plan submitted. If a forest management

 

plan and application are submitted to the department, the

 

department shall review and either approve or disapprove the

 

owner's application within 90 days of submission. Approval of the

 

plan shall be based solely on compliance with the elements required

 

in subdivision (f). Denial of the plan shall be based solely on

 

noncompliance with the requirements listed in subdivision (f). If

 

the department of natural resources disapproves a proposed forest

 

management plan, the department of natural resources shall indicate

 

the changes necessary to qualify the proposed forest management

 

plan for approval on subsequent review. At the request of the owner

 

submitting a proposed forest management plan, the department of

 

natural resources may agree to complete a proposed forest

 

management plan. An owner and the department of natural resources

 

may mutually agree to amend limited amendments of a proposed forest

 

management plan or an approved forest management plan. A forest

 

management plan submitted to the department of natural resources

 

for approval shall not extend beyond a period of 20 years. An be

 

for a minimum of 30 years. To continue receiving an exemption under

 

this section, an owner of property may shall submit a digital copy

 

of any succeeding proposed forest management plan to the department

 

of natural resources for approval together with a fee of $200.00.

 

Mutually agreed to limited amendments of the approved forest

 

management plan shall not be subject to a fee of $200.00.

 

     (ii) A forest management plan certified by a third-party

 

certifying organization.

 

     (b) "Conservation district" means a conservation district

 

organized under part 93 of the natural resources and environmental

 

protection act, 1994 PA 451, MCL 324.9301 to 324.9313.

 

     (c) (b) "Converted by a change in use" means that term as

 

defined in section 2 of the qualified forest property recapture tax

 

act, 2006 PA 379, MCL 211.1032.

 

     (d) "Department" means the department of agriculture and rural

 

development.

 

     (e) "Forest management plan" means a written plan prepared and

 

signed by a qualified forester that prescribes measures to optimize

 

production, utilization, and regeneration of forest resources. The

 

forest management plan shall include a schedule and timetables for

 

the various silvicultural practices used on forestlands, which

 

shall be a minimum of 30 years in length. A forest management plan

 

shall include all of the following:

 

     (i) The name and address of each owner of the property.

 

     (ii) The legal description and parcel identification number of

 

the property or of the parcel on which the property is located.

 

     (iii) A statement of the owner's forest management objectives.

 

     (iv) A map, diagram, or aerial photograph that identifies both

 

forested and unforested areas of the property, using conventional

 

map symbols indicating the species, size, and stocking rate and

 

other major features of the property, including the location of any

 

buildings. The location and use of any buildings can be established

 

on a map created by a qualified forester and does not require a

 

survey by a registered surveyor.

 

     (v) A description of forest practice, including harvesting,

 

thinning, and reforestation, that will be undertaken, specifying

 

the approximate period of time before each is completed.

 

     (vi) A description of soil conservation practices that may be

 

necessary to control any soil erosion that may result from the

 

forest practice described pursuant to subparagraph (v).

 

     (vii) A description of activities that may be undertaken for

 

the management of forest resources other than trees, including

 

wildlife habitat, watersheds, and aesthetic features.

 

     (f) "Forest practice" includes, but is not limited to, any of

 

the following:

 

     (i) The preparation of forest management plans for forestland.

 

     (ii) The improvement of species of forest trees.

 

     (iii) Reforestation.

 

     (iv) The harvesting of species of forest trees.

 

     (v) Road construction associated with the improvement or

 

harvesting of forest tree species or reforestation.

 

     (vi) Use of chemicals or fertilizers for the purpose of growing

 

or managing species of forest trees.

 

     (vii) Applicable silvicultural practices.

 

     (viii) Any other actions intended to improve forestland or

 

forest resources.

 

     (g) (c) "Forest products" includes, but is not limited to,

 

timber and pulpwood-related products.

 

     (h) "Harvest" means the point at which timber that has been

 

cut, severed, or removed for purposes of sale or use is first

 

measured in the ordinary course of business as determined by

 

reference to common practice in the timber industry.

 

     (d) "Natural resources professional" and "registered forester"

 

mean those terms as defined in section 51101 of the natural

 

resources and environmental protection act, 1994 PA 451, MCL

 

324.51101.

 

     (e) "Proposed forest management plan" means a proposed plan

 

for sustainable forest management that includes, but is not limited

 

to, harvesting, planting, and regeneration of forest products on a

 

parcel of property that is prepared by a qualified forester. A

 

proposed forest management plan shall include all of the following:

 

     (i) The name and address of each owner of the property.

 

     (ii) The legal description and parcel identification number of

 

the property or of the parcel on which the property is located.

 

     (iii) A statement of the owner's forest management objectives.

 

     (iv) A map, diagram, or aerial photograph that identified both

 

forested and unforested areas of the property, using conventional

 

map symbols indicating the species, size, and density of vegetation

 

and other major features of the property.

 

     (v) A description of the forestry practices, including

 

harvesting, thinning, and reforestation, that will be undertaken,

 

specifying the approximate period of time before each is completed.

 

     (vi) A description of soil conservation practices that may be

 

necessary to control any soil erosion that may result from the

 

forestry practices described pursuant to subparagraph (v).

 

     (vii) A proposed forest management plan shall also include a

 

description of activities that may be undertaken for the management

 

of forest resources other than trees, including wildlife habitat,

 

watersheds, and aesthetic features.

 

     (i) (f) "Qualified forest property" means a parcel of real

 

property that meets all of the following conditions as determined

 

by the department of natural resources:agriculture and rural

 

development:

 

     (i) Is not less than 20 10 contiguous acres in size, of which

 

not less than 80% 50% is stocked with productive forest capable of

 

producing wood forest products. Contiguity is not broken by a road,

 

a right-of-way, or property purchased or taken under condemnation

 

proceedings by a public utility for power transmission lines if the

 

2 parcels separated by the purchased or condemned property were a

 

single parcel prior to the sale or condemnation. As used in this

 

subparagraph, "productive forest" means real property capable of

 

growing not less than 20 cubic feet of wood per acre per year.

 

However, if property has been considered productive forest, an act

 

of God that negatively affects that property shall not result in

 

that property not being considered productive forest.

 

     (ii) Is stocked with forest products.

 

     (iii) Has no buildings or structures located on the real

 

property.

 

     (ii) (iv) Is subject to an approved forest management plan.

 

     (iii) For a parcel exempt as qualified agricultural property

 

under section 7ee, the qualified forest portion of the parcel shall

 

be not less than 10 contiguous acres of which not less than 50% is

 

productive forest capable of producing forest products.

 

     (j) (g) "Qualified forester" means natural resources

 

professional, a registered forester, or a conservation district

 

forester.an individual who meets 1 or more of the following

 

requirements and has registered with the department of agriculture

 

and rural development under section 51306 of the natural resources

 

and environmental protection act, 1994 PA 451, MCL 324.51306:

 

     (i) Is a forester certified by the society of American

 

foresters.

 

     (ii) Is a forest stewardship plan writer.

 

     (iii) Is a technical service provider as registered by the

 

United States department of agriculture for forest management plan

 

development.

 

     (h) "Third-party certifying organization" means an independent

 

third-party organization that assesses and evaluates forest

 

management practices according to the standards of a certification

 

program that measures whether forest management practices are

 

consistent with principles of sustainable forestry. Third-party

 

certifying organization includes, but is not limited to, the forest

 

stewardship council and the sustainable forest initiative.

 

     Sec. 27a. (1) Except as otherwise provided in this section,

 

property shall be assessed at 50% of its true cash value under

 

section 3 of article IX of the state constitution of 1963.

 

     (2) Except as otherwise provided in subsection (3), for taxes

 

levied in 1995 and for each year after 1995, the taxable value of

 

each parcel of property is the lesser of the following:

 

     (a) The property's taxable value in the immediately preceding

 

year minus any losses, multiplied by the lesser of 1.05 or the

 

inflation rate, plus all additions. For taxes levied in 1995, the

 

property's taxable value in the immediately preceding year is the

 

property's state equalized valuation in 1994.

 

     (b) The property's current state equalized valuation.

 

     (3) Upon a transfer of ownership of property after 1994, the

 

property's taxable value for the calendar year following the year

 

of the transfer is the property's state equalized valuation for the

 

calendar year following the transfer.

 

     (4) If the taxable value of property is adjusted under

 

subsection (3), a subsequent increase in the property's taxable

 

value is subject to the limitation set forth in subsection (2)

 

until a subsequent transfer of ownership occurs. If the taxable

 

value of property is adjusted under subsection (3) and the assessor

 

determines that there had not been a transfer of ownership, the

 

taxable value of the property shall be adjusted at the July or

 

December board of review. Notwithstanding the limitation provided

 

in section 53b(1) on the number of years for which a correction may

 

be made, the July or December board of review may adjust the

 

taxable value of property under this subsection for the current

 

year and for the 3 immediately preceding calendar years. A

 

corrected tax bill shall be issued for each tax year for which the

 

taxable value is adjusted by the local tax collecting unit if the

 

local tax collecting unit has possession of the tax roll or by the

 

county treasurer if the county has possession of the tax roll. For

 

purposes of section 53b, an adjustment under this subsection shall

 

be considered the correction of a clerical error.

 

     (5) Assessment of property, as required in this section and

 

section 27, is inapplicable to the assessment of property subject

 

to the levy of ad valorem taxes within voted tax limitation

 

increases to pay principal and interest on limited tax bonds issued

 

by any governmental unit, including a county, township, community

 

college district, or school district, before January 1, 1964, if

 

the assessment required to be made under this act would be less

 

than the assessment as state equalized prevailing on the property

 

at the time of the issuance of the bonds. This inapplicability

 

shall continue until levy of taxes to pay principal and interest on

 

the bonds is no longer required. The assessment of property

 

required by this act shall be applicable for all other purposes.

 

     (6) As used in this act, "transfer of ownership" means the

 

conveyance of title to or a present interest in property, including

 

the beneficial use of the property, the value of which is

 

substantially equal to the value of the fee interest. Transfer of

 

ownership of property includes, but is not limited to, the

 

following:

 

     (a) A conveyance by deed.

 

     (b) A conveyance by land contract. The taxable value of

 

property conveyed by a land contract executed after December 31,

 

1994 shall be adjusted under subsection (3) for the calendar year

 

following the year in which the contract is entered into and shall

 

not be subsequently adjusted under subsection (3) when the deed

 

conveying title to the property is recorded in the office of the

 

register of deeds in the county in which the property is located.

 

     (c) A conveyance to a trust after December 31, 1994, except if

 

the settlor or the settlor's spouse, or both, conveys the property

 

to the trust and the sole present beneficiary or beneficiaries are

 

the settlor or the settlor's spouse, or both.

 

     (d) A conveyance by distribution from a trust, except if the

 

distributee is the sole present beneficiary or the spouse of the

 

sole present beneficiary, or both.

 

     (e) A change in the sole present beneficiary or beneficiaries

 

of a trust, except a change that adds or substitutes the spouse of

 

the sole present beneficiary.

 

     (f) A conveyance by distribution under a will or by intestate

 

succession, except if the distributee is the decedent's spouse.

 

     (g) A conveyance by lease if the total duration of the lease,

 

including the initial term and all options for renewal, is more

 

than 35 years or the lease grants the lessee a bargain purchase

 

option. As used in this subdivision, "bargain purchase option"

 

means the right to purchase the property at the termination of the

 

lease for not more than 80% of the property's projected true cash

 

value at the termination of the lease. After December 31, 1994, the

 

taxable value of property conveyed by a lease with a total duration

 

of more than 35 years or with a bargain purchase option shall be

 

adjusted under subsection (3) for the calendar year following the

 

year in which the lease is entered into. This subdivision does not

 

apply to personal property except buildings described in section

 

14(6) and personal property described in section 8(h), (i), and

 

(j). This subdivision does not apply to that portion of the

 

property not subject to the leasehold interest conveyed.

 

     (h) Except as otherwise provided in this subdivision, a

 

conveyance of an ownership interest in a corporation, partnership,

 

sole proprietorship, limited liability company, limited liability

 

partnership, or other legal entity if the ownership interest

 

conveyed is more than 50% of the corporation, partnership, sole

 

proprietorship, limited liability company, limited liability

 

partnership, or other legal entity. Unless notification is provided

 

under subsection (10), the corporation, partnership, sole

 

proprietorship, limited liability company, limited liability

 

partnership, or other legal entity shall notify the assessing

 

officer on a form provided by the state tax commission not more

 

than 45 days after a conveyance of an ownership interest that

 

constitutes a transfer of ownership under this subdivision. Both of

 

the following apply to a corporation subject to 1897 PA 230, MCL

 

455.1 to 455.24:

 

     (i) A transfer of stock of the corporation is a transfer of

 

ownership only with respect to the real property that is assessed

 

to the transferor lessee stockholder.

 

     (ii) A cumulative conveyance of more than 50% of the

 

corporation's stock does not constitute a transfer of ownership of

 

the corporation's real property.

 

     (i) A transfer of property held as a tenancy in common, except

 

that portion of the property not subject to the ownership interest

 

conveyed.

 

     (j) A conveyance of an ownership interest in a cooperative

 

housing corporation, except that portion of the property not

 

subject to the ownership interest conveyed.

 

     (7) Transfer of ownership does not include the following:

 

     (a) The transfer of property from 1 spouse to the other spouse

 

or from a decedent to a surviving spouse.

 

     (b) A transfer from a husband, a wife, or a husband and wife

 

creating or disjoining a tenancy by the entireties in the grantors

 

or the grantor and his or her spouse.

 

     (c) A transfer of that portion of property subject to a life

 

estate or life lease retained by the transferor, until expiration

 

or termination of the life estate or life lease. That portion of

 

property transferred that is not subject to a life lease shall be

 

adjusted under subsection (3).

 

     (d) A transfer through foreclosure or forfeiture of a recorded

 

instrument under chapter 31, 32, or 57 of the revised judicature

 

act of 1961, 1961 PA 236, MCL 600.3101 to 600.3285 and MCL 600.5701

 

to 600.5759, or through deed or conveyance in lieu of a foreclosure

 

or forfeiture, until the mortgagee or land contract vendor

 

subsequently transfers the property. If a mortgagee does not

 

transfer the property within 1 year of the expiration of any

 

applicable redemption period, the property shall be adjusted under

 

subsection (3).

 

     (e) A transfer by redemption by the person to whom taxes are

 

assessed of property previously sold for delinquent taxes.

 

     (f) A conveyance to a trust if the settlor or the settlor's

 

spouse, or both, conveys the property to the trust and the sole

 

present beneficiary of the trust is the settlor or the settlor's

 

spouse, or both.

 

     (g) A transfer pursuant to a judgment or order of a court of

 

record making or ordering a transfer, unless a specific monetary

 

consideration is specified or ordered by the court for the

 

transfer.

 

     (h) A transfer creating or terminating a joint tenancy between

 

2 or more persons if at least 1 of the persons was an original

 

owner of the property before the joint tenancy was initially

 

created and, if the property is held as a joint tenancy at the time

 

of conveyance, at least 1 of the persons was a joint tenant when

 

the joint tenancy was initially created and that person has

 

remained a joint tenant since the joint tenancy was initially

 

created. A joint owner at the time of the last transfer of

 

ownership of the property is an original owner of the property. For

 

purposes of this subdivision, a person is an original owner of

 

property owned by that person's spouse.

 

     (i) A transfer for security or an assignment or discharge of a

 

security interest.

 

     (j) A transfer of real property or other ownership interests

 

among members of an affiliated group. As used in this subsection,

 

"affiliated group" means 1 or more corporations connected by stock

 

ownership to a common parent corporation. Upon request by the state

 

tax commission, a corporation shall furnish proof within 45 days

 

that a transfer meets the requirements of this subdivision. A

 

corporation that fails to comply with a request by the state tax

 

commission under this subdivision is subject to a fine of $200.00.

 

     (k) Normal public trading of shares of stock or other

 

ownership interests that, over any period of time, cumulatively

 

represent more than 50% of the total ownership interest in a

 

corporation or other legal entity and are traded in multiple

 

transactions involving unrelated individuals, institutions, or

 

other legal entities.

 

     (l) A transfer of real property or other ownership interests

 

among corporations, partnerships, limited liability companies,

 

limited liability partnerships, or other legal entities if the

 

entities involved are commonly controlled. Upon request by the

 

state tax commission, a corporation, partnership, limited liability

 

company, limited liability partnership, or other legal entity shall

 

furnish proof within 45 days that a transfer meets the requirements

 

of this subdivision. A corporation, partnership, limited liability

 

company, limited liability partnership, or other legal entity that

 

fails to comply with a request by the state tax commission under

 

this subdivision is subject to a fine of $200.00.

 

     (m) A direct or indirect transfer of real property or other

 

ownership interests resulting from a transaction that qualifies as

 

a tax-free reorganization under section 368 of the internal revenue

 

code, 26 USC 368. Upon request by the state tax commission, a

 

property owner shall furnish proof within 45 days that a transfer

 

meets the requirements of this subdivision. A property owner who

 

fails to comply with a request by the state tax commission under

 

this subdivision is subject to a fine of $200.00.

 

     (n) A transfer of qualified agricultural property, if the

 

person to whom the qualified agricultural property is transferred

 

files an affidavit with the assessor of the local tax collecting

 

unit in which the qualified agricultural property is located and

 

with the register of deeds for the county in which the qualified

 

agricultural property is located attesting that the qualified

 

agricultural property shall remain qualified agricultural property.

 

The affidavit under this subdivision shall be in a form prescribed

 

by the department of treasury. An owner of qualified agricultural

 

property shall inform a prospective buyer of that qualified

 

agricultural property that the qualified agricultural property is

 

subject to the recapture tax provided in the agricultural property

 

recapture act, 2000 PA 261, MCL 211.1001 to 211.1007, if the

 

qualified agricultural property is converted by a change in use. If

 

property ceases to be qualified agricultural property at any time

 

after being transferred, all of the following shall occur:

 

     (i) The taxable value of that property shall be adjusted under

 

subsection (3) as of the December 31 in the year that the property

 

ceases to be qualified agricultural property.

 

     (ii) The property is subject to the recapture tax provided for

 

under the agricultural property recapture act, 2000 PA 261, MCL

 

211.1001 to 211.1007.

 

     (o) A transfer of qualified forest property, if the person to

 

whom the qualified forest property is transferred files an a

 

qualified forest taxable value affidavit with the assessor of the

 

local tax collecting unit in which the qualified forest property is

 

located and with the register of deeds for the county in which the

 

qualified forest property is located attesting that the qualified

 

forest property shall remain qualified forest property. The

 

qualified forest taxable value affidavit under this subdivision

 

shall be in a form prescribed by the department of treasury.

 

agriculture and rural development. The qualified forest taxable

 

value affidavit shall include a legal description of the qualified

 

forest property, the name of the new property owner, the year the

 

transfer of the property occurred, a statement indicating that the

 

property owner is attesting that the property for which the

 

exemption is claimed is qualified forest property and will be

 

managed according to the approved forest management plan, and any

 

other information pertinent to the parcel and the property owner.

 

The property owner shall provide a copy of the qualified forest

 

taxable value affidavit to the department. The department shall

 

provide 1 copy of the qualified forest taxable value affidavit to

 

the local tax collecting unit, 1 copy to the conservation district,

 

and 1 copy to the department of treasury. These copies may be sent

 

electronically. An owner of qualified forest property shall inform

 

a prospective buyer of that qualified forest property that the

 

qualified forest property is subject to the recapture tax provided

 

in the qualified forest property recapture tax act, 2006 PA 379,

 

MCL 211.1031 to 211.1036, if the qualified forest property is

 

converted by a change in use. If property ceases to be qualified

 

forest property at any time after being transferred, all of the

 

following shall occur:

 

     (i) The taxable value of that property shall be adjusted under

 

subsection (3) as of the December 31 in the year that the property

 

ceases to be qualified forest property.

 

     (ii) The Except as otherwise provided in subparagraph (iii), the

 

property is subject to the recapture tax provided for under the

 

qualified forest property recapture tax act, 2006 PA 379, MCL

 

211.1031 to 211.1036.

 

     (iii) Beginning January 1, 2013 and ending September 30, 2013,

 

owners of property enrolled as qualified forest property prior to

 

January 1, 2013 may execute a new qualified forest taxable value

 

affidavit with the department of agriculture and rural development.

 

If a landowner elects not to execute a qualified forest taxable

 

value affidavit, the existing affidavit shall be rescinded, without

 

subjecting the property to the recapture tax provided for under the

 

qualified forest property recapture tax act, 2006 PA 379, MCL

 

211.1031 to 211.1036, and the taxable value of that property shall

 

be adjusted under subsection (3).

 

     (p) Beginning on the effective date of the amendatory act that

 

added this subdivision, a transfer of land, but not buildings or

 

structures located on the land, which meets 1 or more of the

 

following requirements:

 

     (i) The land is subject to a conservation easement under

 

subpart 11 of part 21 of the natural resources and environmental

 

protection act, 1994 PA 451, MCL 324.2140 to 324.2144. As used in

 

this subparagraph, "conservation easement" means that term as

 

defined in section 2140 of the natural resources and environmental

 

protection act, 1994 PA 451, MCL 324.2140.

 

     (ii) A transfer of ownership of the land or a transfer of an

 

interest in the land is eligible for a deduction as a qualified

 

conservation contribution under section 170(h) of the internal

 

revenue code, 26 USC 170.

 

     (q) A transfer of real property or other ownership interests

 

resulting from a consolidation or merger of a domestic nonprofit

 

corporation that is a boy or girl scout or camp fire girls

 

organization, a 4-H club or foundation, a young men's Christian

 

association, or a young women's Christian association and at least

 

50% of the members of that organization or association are

 

residents of this state.

 

     (r) A change to the assessment roll or tax roll resulting from

 

the application of section 16a of 1897 PA 230, MCL 455.16a.

 

     (8) If all of the following conditions are satisfied, the

 

local tax collecting unit shall revise the taxable value of

 

qualified agricultural property taxable on the tax roll in the

 

possession of that local tax collecting unit to the taxable value

 

that qualified agricultural property would have had if there had

 

been no transfer of ownership of that qualified agricultural

 

property since December 31, 1999 and there had been no adjustment

 

of that qualified agricultural property's taxable value under

 

subsection (3) since December 31, 1999:

 

     (a) The qualified agricultural property was qualified

 

agricultural property for taxes levied in 1999 and each year after

 

1999.

 

     (b) The owner of the qualified agricultural property files an

 

affidavit with the assessor of the local tax collecting unit under

 

subsection (7)(n).

 

     (9) If the taxable value of qualified agricultural property is

 

adjusted under subsection (8), the owner of that qualified

 

agricultural property shall not be entitled to a refund for any

 

property taxes collected under this act on that qualified

 

agricultural property before the adjustment under subsection (8).

 

     (10) The register of deeds of the county where deeds or other

 

title documents are recorded shall notify the assessing officer of

 

the appropriate local taxing unit not less than once each month of

 

any recorded transaction involving the ownership of property and

 

shall make any recorded deeds or other title documents available to

 

that county's tax or equalization department. Unless notification

 

is provided under subsection (6), the buyer, grantee, or other

 

transferee of the property shall notify the appropriate assessing

 

office in the local unit of government in which the property is

 

located of the transfer of ownership of the property within 45 days

 

of the transfer of ownership, on a form prescribed by the state tax

 

commission that states the parties to the transfer, the date of the

 

transfer, the actual consideration for the transfer, and the

 

property's parcel identification number or legal description. Forms

 

filed in the assessing office of a local unit of government under

 

this subsection shall be made available to the county tax or

 

equalization department for the county in which that local unit of

 

government is located. This subsection does not apply to personal

 

property except buildings described in section 14(6) and personal

 

property described in section 8(h), (i), and (j).

 

     (11) As used in this section:

 

     (a) "Additions" means that term as defined in section 34d.

 

     (b) "Beneficial use" means the right to possession, use, and

 

enjoyment of property, limited only by encumbrances, easements, and

 

restrictions of record.

 

     (c) "Converted by a change in use" means that term as defined

 

in the agricultural property recapture act, 2000 PA 261, MCL

 

211.1001 to 211.1007.

 

     (d) "Inflation rate" means that term as defined in section

 

34d.

 

     (e) "Losses" means that term as defined in section 34d.

 

     (f) "Qualified agricultural property" means that term as

 

defined in section 7dd.

 

     (g) "Qualified forest property" means that term as defined in

 

section 7jj[1].

 

     Enacting section 1. This amendatory act does not take effect

 

unless all of the following bills of the 96th Legislature are

 

enacted into law:

 

     (a) Senate Bill No. 1057.

 

     (b) Senate Bill No. 1058.

 

     (c) Senate Bill No. 1061.

 

     (d) Senate Bill No. 1062.

 

     (e) House Bill No. 4302.

 

     (f) House Bill No. 4969.

 

     (g) House Bill No. 4970.

 

     Enacting section 2. This amendatory act takes effect January

 

1, 2013.