2013 Senate Bill 257 / Public Act 126

Expand “Business Improvement Zone” tax-and-spend entities

Introduced in the Senate

March 12, 2013

Introduced by Sen. Mike Kowall (R-15)

To expand the items that a “Business Improvement Zone” can spend money on, increase from seven years to 10 years the time one of these zones can operate without reauthorization, revise voting rules in a way that (potentially) reduces the proportion of property owners in the district needed to impose a zone's tax-and-spending powers, increase the proportion of owners needed to dissolve one, reduce notice and public meeting requirements required to establish a zone, allow the "zone" to sell services to particular property owners, increase penalties for not paying the "special assessment" property taxes these entities impose, and make other changes. These zones may be created by owners of a majority of the property in a certain area (not the same as the majority of owners), and have the power to impose property taxes (special assessments) to pay for the debt they incur to pay for projects that are supposed to benefit the property owners. Reportedly the city of Detroit is the main focus of the bill, but the "zones" are not limited to Detroit.

Referred to the Committee on Economic Development

March 21, 2013

Reported without amendment

With the recommendation that the substitute (S-1) be adopted and that the bill then pass.

April 10, 2013

Substitute offered

To adopt a version of the bill that also increases the lifespan of these "zones" from seven to 10 years, and which revises other details.

The substitute passed by voice vote

April 11, 2013

Passed in the Senate 35 to 2 (details)

Received in the House

April 11, 2013

Referred to the Committee on Commerce

May 8, 2013

Reported without amendment

With the recommendation that the substitute (H-1) be adopted and that the bill then pass.

Sept. 12, 2013

Substitute offered

The substitute passed by voice vote

Amendment offered by Rep. Lisa Posthumus Lyons (R-86)

To allow all local governments to create these zones, not just cities and villages.

The amendment passed by voice vote

Amendment offered by Rep. Mike Shirkey (R-65)

To only allow a new "zone" to be created in Detroit.

The amendment failed by voice vote

Amendment offered by Rep. Frank Foster (R-107)

To require the services a "zone" may sell to a particular firm to be described in a written agreement and made available to all the property owners in the zone.

The amendment passed by voice vote

Amendment offered by Rep. Frank Foster (R-107)

To allow the governing body of a "zone" to selectively cut any past-due zone assessments on a property that is sold to a new owner, at its discretion.

The amendment passed by voice vote

Amendment offered by Rep. Frank Foster (R-107)

To reduce the proposed sanctions for a property owner not paying a "zone's" property tax assessments to having a lien placed against the property, rather than also allowing foreclosure against the owner (as happens when regular property taxes go unpaid).

The amendment passed by voice vote

Passed in the House 77 to 31 (details)

To expand the items that a “Business Improvement Zone” can spend money on, increase from seven years to 10 years the time one of these zones can operate without reauthorization, revise voting rules in a way that (potentially) reduces the proportion of property owners in the district needed to impose a zone's tax-and-spending powers, increase the proportion of owners needed to dissolve one, reduce notice and public meeting requirements required to establish a zone, allow the "zone" to sell services to particular property owners, increase penalties for not paying the "special assessments" these entities impose, and make other changes. These zones may be created by owners of a majority of the property in a certain area (not the same as the majority of owners), and have the power to impose property taxes (special assessments) to pay for the debt they incur to pay for projects that are supposed to benefit the property owners. Reportedly the city of Detroit is the main focus of the bill, but the "zones" are not limited to Detroit.

Received in the Senate

Sept. 17, 2013

Sept. 18, 2013

Passed in the Senate 31 to 4 (details)

To concur with the House-passed version of the bill.

Signed by Gov. Rick Snyder

Oct. 8, 2013