Item Coversheet

Resolution

NO. 30

A Resolution Amending the City Industrial Facilities Tax Abatement Guidelines/Tax Increment Guidelines and the Discontinuance of Granting New Industrial Personal Property Exemptions.

BATTLE CREEK, MICHIGAN - 12/20/2016

Resolved by the Commission of the City of Battle Creek:

 

WHEREAS, the use of economic tools such as Industrial Facilities Tax (IFT) Exemption is recognized to help reduce unemployment, promote economic growth, increase tax base, attract new business, encourage expansion of existing industry and create new jobs; and

 

WHEREAS, it is desirable to keep the current Tax Abatement Guidelines updated to help support these goals; and WHEREAS, certain changes in state law have made industrial personal property exempt from ad valorem property taxes rendering local abatement of industrial personal property tax under Public Act 198 of 1974 and Public Act 328 of 1998 obsolete;

 

NOW, THEREFORE, BE IT RESOLVED THAT: 1. Abatements for new industrial personal property investments are discontinued.  Existing industrial personal property abatements will remain until they reach their expiration date. 2. The attached, revised, City Tax Abatement Guidelines are adopted. 3. This resolution does not change the current availability of real property abatements.









I, Victoria Houser, City Clerk of the City of Battle Creek, hereby certify the above and foregoing is a true and correct copy of a Resolution adopted by the Battle Creek City Commission at a Regular meeting held on December 20, 2016.


Victoria Houser

Battle Creek City Commission
12/20/2016
Action Summary

Staff Member: Steven M. Hudson 
Department:Assessing 
SUMMARY 
A Resolution Amending the City Industrial Facilities Tax Abatement Guidelines/Tax Increment Guidelines and the Discontinuance of Granting New Industrial Personal Property Exemptions.
BUDGETARY CONSIDERATIONS

With new industrial personal property classified as exempt beginning in 2016, the local granting of industrial personal property abatements became obsolete.  Discontinuing the granting of industrial personal property abatements will have no budgetary impact.


HISTORY, BACKGROUND and  DISCUSSION

Guidelines for approving IFT applications (PA 198) for both real and industrial personal property were first introduced in 1983.  These guidelines have been amended as circumstances changed.  Resolution 321 of September 21, 2004 was the last amendment.  It changed the minimum required investment.  Guidelines exempting new industrial personal property (PA 328) were adopted by Resolution No. 197 of May 30, 2001.

 

Starting with the passage of Public Acts 397, 398, 399 and 400 of 2012, with their amendments, all new industrial personal property became exempt beginning in 2016. This removed the incentive for local governments to offer further industrial personal property abatements.  The State Treasury, in a letter dated September 20, 2016, has requested we review our local abatement guidelines.  The existing industrial personal property abatements will continue until they reach their expiration date.  The offering of real property abatements is not affected by this resolution.


DISCUSSION OF THE ISSUE

POSITIONS
ATTACHMENTS:
File NameDescription
198_Current_Guidelines_revised_11-21-16_markups.pdfRevised Tax Abatement Guidelines Showing Changes
Treasury_Letter_9-20-16_Requesting_Guideline_Review.pdfTreasury Request Letter 9-20-16
Abatement_Committee_Minutes_4.21.15.pdfAbatement Committee Minutes 4-21-15
Resolution_Number_321_of_9-21-2004_establishing_guidelines.pdfResolution No. 321 September 21, 2004 Updating Guidelines
Resolution_197_of_5.30.01.pdfResolution No 197 May 30 2001
198_Current_Guidelines_revised_11-21-16_clean.pdfRevised Tax Abatement Guidelines Clean