Taxation: specific tax; specific tax on certain utility personal property; provide for. Creates new act. TIE BAR WITH: HB 4787'25
Impact
The bill redefines how electric distribution infrastructure is taxed in Michigan. The exemptions under this bill specifically apply to property defined as 'qualified replacement electric distribution infrastructure,' which includes utility assets that support electric distribution yet do not include generation or transmission facilities. The impact of this legislation is significant as it aims to promote investment in electric utilities by alleviating some of the tax burdens associated with maintaining and replacing aging infrastructure. By doing so, it may foster improvements in service delivery and reliability for consumers.
Summary
House Bill 4788, known as the Replacement Electric Distribution Infrastructure Specific Tax Act, aims to establish a specific tax regime for certain utility infrastructure properties within Michigan. Specifically, the bill exempts qualified replacement electric distribution infrastructure from ad valorem property taxes starting from taxes levied after December 31, 2025. Instead, these properties will be subject to an annual statewide specific tax. This transition in tax treatment is intended to incentivize the modernization of utility infrastructure while reducing the tax burden on replacement assets.
Provision
The specific tax is structured to be adjusted yearly based on changes in the Consumer Price Index, with an initial rate set at 30 mills on the taxable value of the replaced infrastructure. This allows for a predictable revenue stream, which is to be distributed among various state and local taxing units, including cities, townships, and school districts. The bill also includes provisions for the disbursement of taxes and penalties for non-compliance, establishing a comprehensive framework for implementing and managing this new tax structure effectively.
Contention
Notably, the legislation is tied to House Bill 4787, which suggests that the enactment of HB 4788 is contingent upon the passage of this related legislation. Some stakeholders may express concerns regarding the state-level control over tax exemptions and the potential for diminished local revenue sources, as municipalities might experience financial implications due to the shifts in property tax revenues. Additionally, there may be debates surrounding how this bill aligns with broader goals of energy efficiency and sustainability in Michigan's utility sector. The efficacy of the revenue generated from this specific tax versus the ad valorem tax was also a subject of discussion among policymakers.
Same As
Property tax: exemptions; property tax exemption for certain utility personal property; provide for. Amends 1893 PA 206 (MCL 211.1 - 211.155) by adding sec. 7yy. TIE BAR WITH: HB 4788'25
Taxation: specific tax; specific tax on certain homesteads of disabled veterans and their surviving spouses; provide for. Creates new act. TIE BAR WITH: HB 4444'25
Property tax: exemptions; property tax exemption for certain utility personal property; provide for. Amends 1893 PA 206 (MCL 211.1 - 211.155) by adding sec. 7yy. TIE BAR WITH: HB 4788'25
Taxation: specific tax; application of tax reverted property specific tax to certain tax delinquent property sold or otherwise conveyed by a foreclosing governmental unit; provide for. Amends secs. 4 & 5 of 2003 PA 260 (MCL 211.1024 & 211.1025). TIE BAR WITH: SB 484'25
Taxation: excise taxes; excise tax on certain services; provide for. Creates new act. TIE BAR WITH: HB 5878'26, HB 5879'26, HB 5873'26, HB 5874'26, HB 5875'26, HB 5876'26, HB 5877'26
Public utilities: rates; reduction of residential rates in correlation to personal property tax savings; require. Amends sec. 6a of 1939 PA 3 (MCL 460.6a). TIE BAR WITH: HB 5880'26
Taxation: administration; administration of certain accommodation taxes; provide for. Amends title & secs. 13, 19 & 30a of 1941 PA 122 (MCL 205.13 et seq.). TIE BAR WITH: HB 5139'25, HB 5140'25
Property tax: exemptions; property tax exemption for certain utility personal property; provide for. Amends 1893 PA 206 (MCL 211.1 - 211.155) by adding sec. 7yy. TIE BAR WITH: HB 4788'25
A bill for an act related to using electric transmission and distribution easements held by electric cooperatives for broadband service, and including effective date provisions.
Including aboveground and belowground lines, cables and wires in the definition of a critical infrastructure facility used for telecommunications or video services for the crimes of trespassing on a critical infrastructure facility and criminal damage to a critical infrastructure facility.