New PPT bills would affect heavy equipment, solar

The House Committee on Tax Policy took testimony this week on House Bills 5778 and 5779, by Rep. Jim Ellison (D-Oakland), that would change the way rented heavy equipment is taxed in Michigan. Currently, heavy equipment is taxed as personal property (PPT) and credited to the taxing jurisdiction where it physically sits on Dec. 31 of each year. 

Since this equipment is rented and movable, neither the companies paying the taxes are clear what their obligations will be on a year to year basis nor can the local tax collecting units forecast the revenue in an efficient manner. The bills seek to eliminate PPT on this equipment and instead replace it with a 2 percent tax on the rental of the equipment. This tax would be paid by the customer, collected by the company renting the equipment and submitted quarterly to the Michigan Department of Treasury.

By May 20 of each year, Treasury would be required to send 90 percent of this revenue to the local tax collecting unit where the rental transaction originated, and 10 percent of the revenue to the other counties, cities, villages and townships not receiving a share of the distribution. Within 35 days of receiving the revenue, the tax collecting unit would be required to disburse the revenue to the taxing units (counties, et al) in the same proportion as it distributes property taxes. 

In addition to the equipment rental bills, bills affecting the PPT on solar energy facilities have been introduced. Senate Bill 1105, by Sen. Curt VanderWall (R-Mason) and SB 1101, by Sen. Kevin Daley (R-Tuscola), would exempt solar energy facilities and storage systems from the PPT and instead create a PILT (payment in lieu of taxes) system. 

Proponents are seeking a standardized, statewide system that will provide predictability in the taxes owed, regardless of the jurisdiction; escape the variability in assessments and millage rates; and provide a flat stream of revenue for those communities that host this equipment. The legislation would create a PILT of $3,500 per megawatt maximum annual payment, as opposed to a tax based on an assessed value and depreciation schedule.

In order to qualify for PILT as opposed to a tax, the owner of the facility would be required to file for and receive an exemption certificate, which would not expire unless they permanently ceased production, received a judicial determination that they failed to make their payments, or upon the jointly agreed upon termination date. MAC is seeking clarification on the equitable amount per megawatt hour, the assumptions that brought them to that amount, the efforts of the Michigan Tax Tribunal to make recommendations on standardizing the assessment of the equipment and the overall financial impact to counties.

MAC has not yet taken a position on any of these bills. The legislation will be discussed at our September Finance and General Government Committee session.

 For more information on this issue, contact Deena Bosworth at bosworth@micounties.org.

State launches health IT input campaign

A new effort by the state Health and Human Services Department (DHHS) to create a “roadmap” for health information technology will include a series of 16 virtual engagement sessions on a variety of topics such as care coordination, racial disparities in health, coronavirus response, and behavioral health. The sessions get under way on Sept. 15 and will continue into November.

Click here for full schedule. 

“These sessions will provide an opportunity to collect input from stakeholders across Michigan on using data from health IT systems to address business needs as well as the needs of individuals they serve,” the department stated.

For more information, visit the MDHHS Health IT Commission web page.  

Registration is now open for the Great Lakes PFAS Summit

The Great Lakes PFAS Summit has been moved to a virtual, week-long event to be held Oct. 26-30, 2020. The goals of this conference are to provide the most current and reliable science and policy, facilitate networking and information sharing, and explore current and future research topics related to per- and polyfluoroalkyl substances (PFAS).

One of the biggest stories in chemical contamination emerging over the past several years has been PFAS. States throughout the nation, including the Great Lakes region, are finding PFAS contamination in a growing number of locations where these persistent chemicals pose a threat to people and the environment. The Great Lakes Virtual PFAS Summit will bring together environmental program managers, policy experts, researchers, and contractors from around the Great Lakes region to share the challenges of addressing this contamination and present innovative technical solutions developed to address these “forever” chemicals.  

Participants may include local, state, and federal government officials; environmental consultants and vendors; academic researchers and students; industry managing PFAS contamination; and community organizations. The cost is $50 and professional development hours will be available.

Property tax exemptions are growing problem for counties, lawyer says

The misapplication of a 2006 court decision has led to a growing number of businesses avoiding local property taxes, putting more stress on already-strained county revenues, a tax law expert told a Wednesday workshop during the 2020 Annual Conference.

Via a virtual session, Jessica Wood of the firm of Dickinson Wright showed county leaders how the 2006 Wexford has led Michigan awry. Pre-Wexford, Wood said, the state had a “common sense, relatively intuitive, straightforward test” for determining whether a business qualified as a charity and therefore received a tax break. But the Wexford decision, she said, “the truck that drove the hole through” state law.

Duo: Invest in tech to deal with COVID in facilities

In the conference’s first workshop on Tuesday, Gary Nauts of the city of Rochester Hills and Terry Van Doren of MMRMA discussed experiences and best practices on handling public facilities in the first few months of the coronavirus pandemic. 

Among the points highlighted by the pair:

• Communication is key.
• Invest in technology.
• Facilities and maintenance leaders will lead the return to normal.

“We are off to a fast start with the amount of information in our workshops,” said MAC Executive Director Stephan Currie. “While we can’t meet in-person, the digital format still allows us to support continuing education for our members.”

Whitmer vetoes health facility immunity provisions

An extension of legal immunity to certain health facilities, including Medical Care Facilities (MCFs) was vetoed by Gov. Gretchen Whitmer.

The immunity would have applied to civil or criminal liability during a state of disaster or state of emergency declaration under Senate Bill 899, by Sen. Mike MacDonald (R-Macomb County). 

Per the governor’s veto letter: “If this bill only attempted to restore the protections I offered under my orders, I would consider signing it. But the bill goes much further in ways that are directly counter to the interests of those receiving care. For example, this bill would give health care providers and the facilities that employ them broad immunity every time an emergency or disaster is declared, regardless of whether the circumstances demand this extreme measure.”

House Speaker Lee Chatfield (R-Emmet) said in a statement that the state’s “health care heroes” are working on the frontlines in difficult decisions and “deserve to know we all have their back.”

“It’s strange that the governor felt our frontline health care workers deserved this protection two months ago but not today, since she did not include any legitimate explanation of her veto,” he said. “But I know my commitment to doctors, nurses and hospitals has not changed. The House of Representatives will continue to look for ways to partner with them, support them, and help them combat this pandemic.”

Also this week, the governor extended the Executive Order titled “Enhanced protections for residents and staff of long-term care facilities during the COVID-19 pandemic,” through Sept. 7. 

For more information on this issue, contact Meghann Keit at keit@micounties.org.