MBT BROWNFIELD CREDIT

House Bill 6093

Sponsor:  Rep. Judy Nerat

Committee:  New Economy and Quality of Life

Complete to9-20-10

A SUMMARY OF HOUSEBILL 6093 AS INTRODUCED4-29-10

The bill would amend the Michigan Business Tax (MCL 208.1437) to require the issuance of a brownfield tax credit to a firm whose circumstances meet special criteria.

Generally speaking, brownfield credits are available under theMBT for eligible investments in projects that redevelop contaminated, blighted, or functionally obsolete property.

Specifically, House Bill 6093 would consider a specified project to have been approved beforeApril 8, 2008, and would allow a taxpayer to claim a credit for that project, if the project meets the following criteria (notwithstanding any other provision in theMBT Act):

** The project was on property located in a city with a population between 9,000 and 10,000 and located in a county with a population under 30,000.  (This appears to apply to the city ofMenominee inMenomineeCounty.)

** The property was included in a brownfield plan in December 2005 that was subsequently approved by the city's governing body in February 2006.

To claim the credit, the taxpayer would have to submit an affidavit to the chair of the Michigan Economic Growth Authority (or a designee) with 14 days after the effective date of the bill.  If the taxpayer does so, the firm would receive the certificate of completion needed for the credit.

The affidavit would have to state all of the following:  the level and extent of rehabilitation necessary for the blighted area or the level and extent of contamination alleviated; the cost of the firm's eligible investment; and any other criteria imposed by MEGA.  Within 45 days after receiving the affidavit, MEGA would have to verify the project is complete and issue a certificate of completion.

FISCAL IMPACT:

As written, the bill would reduceMBT revenue by an unknown amount. Any reductions inMBT revenue would subsequently reduce GF/GP revenue.

                                                                                           Legislative Analyst:   Chris Couch  

                                                                                                   Fiscal Analyst:   Jim Stansell

■ This analysis was prepared by nonpartisan House staff for use by House members in their deliberations, and does not constitute an official statement of legislative intent.