HomeMy WebLinkAboutResolutions - 2016.06.16 - 22389REPORT (MISC. #16080) June 16, 2016
BY: General Government Committee, Christine Long, Chairperson
IN RE: MR #16080 - BOARD OF COMMISSIONERS — OPPOSITION TO REPEAL OF
MICHIGAN PROPERTY TAX EXEMPTION FOR DISABLED VETERANS
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
The General Government Committee, having reviewed the above referenced resolution on June
6, 2016, reports with the recommendation the resolution be adopted.
Chairperson, on behalf of the General Government Committee, I move the acceptance of the
foregoing report.
GENERAL GOVERNMENT COMMITTEE
GENERAL GOVERNMENT COMMITTEE
Motion carried unanimously on a roll call vote.
, I move-the ioption of,the foregoing Resolution.
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MISCELLANEOUS RESOLUTION 1116080
BY: Commissioners John Scott, District #5 and Shelley Taub, District #12
IN RE: BOARD OF COMMISSIONERS — OPPOSITION TO REPEAL OF MICHIGAN PROPERTY TAX
EXEMPTION FOR DISABLED VETERANS
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS Michigan House Bill 5169 would eliminate the property tax exemption for veterans who are
totally and permanently disabled as a result of military service, have received specially adapted housing
from the Veterans Administration (VA), or who are rated by the VA as individually unemployable due to a
service connected disability.; and
WHEREAS while HB 5169 would create an income tax credit for disabled veterans, the legislation would
effectively increase the tax burden on veterans by $10,000,000, according to the House Fiscal Agency;
and
WHEREAS the men and women who answered the call to serve in the military and protect our nation
deserve nothing less than our complete gratitude and appreciation; and
WHEREAS many of those veterans of military service paid a dear price for our freedom: limbs lost on far-
flung battlefields, shattered lives and life-long disabilities
WHEREAS there are approximately 2,800,000 veterans receiving benefits from the Department of
Veterans Affairs for disabilities incurred while defending our Nation; and
WHEREAS as the late Secretary of Veterans Affairs Jesse Brown stated, all Americans have a "solemn
obligation to ensure that the men and women disabled in our nation's defense must never be forgotten or
neglected"; and
NOW THEREFORE BE IT RESOLVED that the Oakland County Board of Commissioners opposes
House Bill 5169 and any other measure that would eliminate the Michigan property tax exemption for
qualified disabled veterans.
BE 1T FURTHER RESOLVED that the Clerk of the County of Oakland is directed to submit a copy of this
resolution to the Board's legislative lobbyists, the Office of the Governor, Senate Majority Leader, Senate
Minority Leader, Speaker of the House, House Minority Leader, members of the Senate Appropriations
Committee, members of the House Appropriations Committee and the Oakland County delegation to the
Michigan Legislature.
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Legislative Analysis
MESCAL
VETERAN PROPERTY TAX BENEFIT
House Bill 5169 as introduced
Sponsor: Rep. Earl Poleski
Committee: Tax Policy
Complete to 2-16-16
Phone: (517) 373-8080
http://www.housc.mi.gov/hfa
Analysis available at
http://www.legislature.mi.gov
SUMMARY:
The bill would repeal Section 7b of the General Property Tax Act, which provides a tax
exemption for the homestead of a disabled veteran who is a resident of the state and meets
one of the following criteria: (a) has been determined by the U.S. Department of Veterans
Affairs to be permanently and totally disabled as a result of military service and entitled to
veterans' benefits at the 100% rate; (b) has a certificate from the VA certifying that he or
she is receiving or has received pecuniary assistance due to disability for specially adapted
housing; or (e) has been rated by the VA as individually unemployable. The bill amends
the Income Tax Act, and the repealer can be found in Enacting Section 1 on the last page
of the bill
At the same time, the bill would amend the homestead property tax credit within the Income
Tax Act (MCL 206. 520) so that the current limits on total household resources and on the
value of the residence would not apply to a veteran with a service-connected disability of
100% (or the surviving spouse of that veteran). Currently, a homestead property tax credit
cannot be claimed if total household resources exceed $50,000 (and are phased out
beginning at $41,000); and cannot be claimed if the taxable value on the property exceeds
$135,000 (theoretically about $270,000 in market value). These limits would not apply
under the bill, so that veterans with a service-connected disability of 100% would qualify
for the homestead property tax credit regardless of household resources and value of the
homestead, to the extent that their property taxes exceeded 3.5 percent of total household
resources, up to $1,200.
The homestead property tax credit, claimed with the state income tax return, allows some
taxpayers to receive a refundable credit against the income tax, up to $1,200, for property
taxes paid in a tax year. The credit is computed for most filers based on the comparison
between property taxes and total household resources. Renters can claim the credit with
20% of rent paid counting as property taxes. However, for a veteran with 100% service
disability, the credit can also be claimed based on a formula using a "taxable value
allowance" (TAV) of $4,500. The percentage of property taxes refundable as a credit is
determined by dividing $4,500 by the taxable value of the homestead. A veteran could
choose which of various calculations allowed in the act would produce the larger tax credit.
FISCAL IMPACT:
As written the bill would repeal the existing property tax exemption for veterans that are
100% disabled. Eliminating this provision would increase property tax revenue by an
estimated $16.0 million, of which about $3.5 million would result from the 6-mill State
House Fiscal Agency Page 1 of 2
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HOUSE BILL No. 5169
December 17, 2015, Introduced by Reps. Poleski, Brett Roberts, Pagel, Bumstead and Forlini
and referred to the Committee on Tax Policy.
A bill to amend 1967 PA 281, entitled
"Income tax act of 1967,"
by amending sections 506 and 520 (MCL 206.506 and 206.520), section
506 as amended by 1996 PA 484 and section 520 as amended by 2015 PA
179; and to repeal acts and parts of acts.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
1 Sec. 506. "Eligible serviceperson", "eligible veteran", and
2 "eligible widow or widower" moans MEAN a serviceperson, veteran, or
3 widow or widower, whose income as defined in this chapter is not
4 more than $7,500.00 per year unless the serviceperson, veteran, or
5 widow or widower receives compensation paid by the veterans
6 administration or the armed forces of the United States for service
7 incurred disabilities and who meets the requirements of the 691-9 `ON 1119 3 Si101-1 03487'15 KAS
3
service-connected
disability or
veteran's widow
or widower
1 presidential
2 executive
3 order or
4 presidential
5 proclamation
6
7 All wars or
B presidential
9 executive
10 order or
11 presidential
12 proclamation
13
14 All wars or
15 presidential
16 executive
17 order or
18 presidential
19 proclamation
20
21 All wars or
22 presidential
23 executive
24 order or
25 presidential
26 proclamation
27
Veteran with
service-connected
disability or
veteran's widow
or widower
Any 60-70-80 $4,000.00
Veteran with
service-connected
disability or
veteran's widow
or widower
Any 90-100 $4,500.00
Widow or widower Any No $4,500.00
of veteran dying requirement
in service
03487'15 KAS
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1 211,27a.
2 (2) A person who rents or leases a homestead may claim a
3 similar credit computed under this section and section 522 based
4 upon 20% of the gross rent paid for tax years before the 2018 tax
5 year or 23% of the gross rent paid for tax years after the 2017 tax
6 year. A person who rents or leases a homestead subject to a service
7 charge in lieu of ad valorem taxes as provided by section 15a of
8 the state housing development authority act of 1966, 1966 PA 346,
9 MCL 125.1415a, may claim a similar credit computed under this
10 section and section 522 based upon 10% of the gross rent paid.
11 (3) If the credit claimed under this section and section 522
12 exceeds the tax liability for the tax year or if there is no tax
13 liability for the tax year, the amount of the claim not used as an
14 offset against the tax liability shall, after examination and
15 review, be approved for payment, without interest, to the claimant.
16 In determining the amount of the payment under this subsection,
17 withholdings and other credits shall be used first to offset any
18 tax liabilities.
19 (4) If the homestead is an integral part of a multipurpose or
20 multidwelling building that is federally aided housing or state
21 aided housing, a claimant who is a senior citizen entitled to a
22 payment under subsection (2) may assign the right to that payment
23 to a mortgagor if the mortgagor reduces the rent charged and
24 collected on the claimant's homestead in an amount equal to the tax
25 credit payment provided in this chapter. The assignment of the
26 claim is valid only if the Michigan state housing development
27 authority, by affidavit, verifies that the claimant's rent has been
03487'15 KAS
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1 aid to families with dependent children does not include child
2 support payments that offset or reduce payments made to the
3 claimant.
4 (8) For tax years before the 2018 tax year, a credit under
5 subsection (1) or (2) shall be reduced by 10% for each claimant
6 whose total household resources exceed the minimum total household
7 resources amount of $41,000.00 and by an additional 10% for each
8 increment of $1,000.00 of total household resources in excess of
9 $41,000.00. Except as otherwise provided under this subsection, for
10 the 2018 tax year and each tax year after 2018, the minimum total
11 household resources amount is $51,000.00. For the 2018 tax year and
12 each tax year after 2018, a credit under subsection (1) or (2)
13 shall be reduced by 10% for each claimant whose total household
14 resources exceed the minimum total household resources amount
15 established under this subsection and by an additional 10% for each
16 increment of $1,000.00 of total household resources in excess of
17 the minimum total household resources amount for that tax year. For
18 the 2021 tax year and each tax year after 2021, the minimum total
19 household resources threshold amount established under this
20 subsection for the immediately preceding tax year shall be adjusted
21 by the percentage increase in the United States consumer price
22 index for the immediately preceding calendar year and rounded to
23 the nearest $100.00 increment. THIS SUBSECTION DOES NOT APPLY TO A
24 CLAIMANT WHO IS A VETERAN WITH A SERVICE-CONNECTED DISABILITY OF
25 100% OR THAT VETERAN'S WIDOW OR WIDOWER.
26 (9) If the credit authorized and calculated under this section
27 and section 522 and adjusted under subsection (7) or (8) does not
03487'15 KAS
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1 (15) on the basis of the annualized final monthly rental payment at
2 his or her previous homestead, if this annualized rental is less
3 than the senior citizen's actual annual rental payments.
4 (14) For a return of less than 12 months, the claim for a
5 credit under subsections (9) to (15) shall be reduced
6 proportionately.
7 (15) For tax years before the 2018 tax year, the total credit
8 allowed by this section and section 522 shall not exceed $1,200.00
9 per year. Except as otherwise provided under this subsection, for
10 the 2018 tax year and each tax year after 2018, the total credit
11 allowed by this section and section 522 shall not exceed $1,500.00
12 per year. Beginning with the 2021 tax year and each tax year after
13 2021, the maximum amount of the credit allowed under this section
14 and section 522 for the immediately preceding tax year shall be
15 adjusted by the percentage increase in the United States consumer
16 price index for the immediately preceding calendar year. The
17 department shall round the amount to the nearest $100.00 increment.
18 (16) As used in this section, "United States consumer price
19 index" means the United States consumer price index for all urban
20 consumers as defined and reported by the United States Department
21 of Labor, Bureau of Labor Statistics.
22 Enacting section 1. Section 7b of the general property tax
23 act, 1893 PA 206, MCL 211.7b, is repealed effective December 31,
24 2015.
03487'15 Final Page KAS
Resolution #16080 March 30, 2016
The Chairperson referred the resolution to the General Government Committee. There were no
objections.
Resolution #16080 June 16, 2016
Moved by Kochenderfer supported by Jackson the resolutions (with fiscal notes attached) on the Consent
Agenda be adopted (with accompanying reports being accepted).
AYES: Dwyer, Fleming, Gershenson, Gingell, Gosselin, Hoffman, Jackson, Kochenderfer,
Kowall, Long, McGillivray, Middleton, Quarles, Scott, Spisz, Weipert, Woodward, Zack, Bowman,
Crawford. (20)
NAYS: None. (0)
A sufficient majority having voted in favor, the resolutions (with fiscal notes attached) on the Consent
Agenda were adopted (with accompanying reports being accepted).
6//
I HEREBY APPROVE THIS RESOLUTION
CHIEF DEPUTY COUNTY EXECUTIVE
ACTING PURSUANT TO MCL 45.559A (7)
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Lisa Brown, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and
accurate copy of a resolution adopted by the Oakland County Board of Commissioners on June 16, 2016,
with the original record thereof now remaining in my office.
in Testimony Whereof, I have hereunto set my hand and affixed the seal of the County of Oakland at
Pontiac, Michigan this 16 th day of June, 2016.
Lisa Brown, Oakland County