Michigan House Bill HB5865

Michigan 2025-2026 Regular Session

• Introduced: 4/22/26
• Refer: 4/22/26

Caption

Property tax: other; HOPE zone exemption; provide for. Amends sec. 5 of 2003 PA 260 (MCL 211.1025). TIE BAR WITH: HB 5852'26, HB 5856'26

Impact

The bill is expected to significantly impact the assessment and collection of property taxes at the local level. By requiring owners of eligible tax reverted properties to pay this specific tax, local governments could see increased revenue that directly supports local services and education. Furthermore, the disbursement of funds is divided, with half going to municipalities and the other half available to authorities managing the properties, which incentivizes the maintenance and rehabilitation of tax-reverted lands.

Summary

House Bill 5865 amends the Tax Reverted Clean Title Act to introduce the eligible tax reverted property specific tax. Under this legislation, every owner of eligible tax reverted property is subjected to an annual specific tax that mimics the tax amount which would have been assessed under the General Property Tax Act unless exempted. Homeowners who occupy the property as their principal residence may claim certain exemptions, particularly regarding taxes levied for local school districts. This provision aims to ensure that property owners contribute fairly to local school funding despite their properties' tax-exempt status under specific conditions.

Contention

Points of contention surrounding HB 5865 include concerns over the financial burden it might impose on struggling homeowners who may be unable to shoulder additional taxes. Opponents of the bill argue that subjecting eligible tax reverted properties to this specific tax could lead to further financial instability for low-income families while aiming to improve local tax conditions. There is also a debate regarding the equitable distribution of funds collected from this tax, with potential calls for clarity on how these resources would be utilized by municipalities and land bank authorities.