Bill Summary – FastDemocracy

Legislative Analysis
                                                                             Phone: (517) 373-8080
TRANSFER OF CERTAIN PROPERTY TO HEIR
                                                                             http://www.house.mi.gov/hfa
NOT REQUIRING COURT APPROVAL
                                                                             Analysis available at
House Bill 4417 (H-1) as reported from committee                             http://www.legislature.mi.gov
Sponsor: Rep. Graham Filler
House Bills 4418 and 4419 (H-1) as reported from committee
Sponsor: Rep. Kelly Breen
Committee: Judiciary
Complete to 6-28-23
                                                        (Enacted as Public Acts 2, 3, and 4 of 2024)
SUMMARY:
       House Bills 4417 and 4419 would amend the Michigan Vehicle Code and the Natural
       Resources and Environmental Protection Act, respectively, to increase the total value of
       vehicles or watercraft for which a surviving spouse or an heir may apply to transfer title, if
       otherwise appropriate, and to require the new amount to be adjusted annually for inflation.
       House Bill 4418 would amend the Michigan Uniform Transfers to Minors Act to increase the
       total value of property that may be transferred to a minor, or to a person nominated as a
       custodian for the minor, that would not have to be authorized by a court.
       House Bill 4417 would amend the Michigan Vehicle Code. Currently, if the owner of one or
       more vehicles with a total value of up to $60,000 dies and administration of the estate does not
       require letters issued by a court to name a person as a personal representative of the decedent
       under the Estates and Protected Individuals Code (EPIC), the owner’s surviving spouse or an
       heir (in the order specified under EPIC) may apply for a title after providing proof to the
       secretary of state of the owner’s death and a certification that the applicant is the surviving
       spouse or an heir.
       The bill would provide that the total value of the vehicle or vehicles must be based on the date
       of the presented title transfer application. The bill also would increase the maximum total value
       of the vehicles to which this provision applies to $100,000 for the 2024 and 2025 calendar
       years. For the 2026 calendar year and each following year, the maximum total value would be
       a dollar amount equal to the product of the dollar amount applicable for the immediately
       preceding calendar year multiplied by the cost-of-living adjustment factor, rounded to the
       nearest $1,000.
           Cost-of-living adjustment factor would mean a fraction whose numerator is the United
           States Consumer Price Index for the year before the prior calendar year and whose
           denominator is the United States Consumer Price Index for the 2023 calendar year.
           United States Consumer Price Index would mean the annual average of the United States
           Consumer Price Index for All Urban Consumers as defined and reported by the Bureau of
           Labor Statistics of the U.S. Department of Labor or its successor agency.
House Fiscal Agency                                                                           Page 1 of 3
       By September 1, 2025, and by September 1 each year after that, the Department of Treasury
       would have to certify and publish the dollar amount applicable for the following calendar year.
        The bill would take effect 90 days after its enactment.
        MCL 257.236
       House Bill 4418 would amend the Michigan Uniform Transfers to Minors Act, which provides
       for gifts of money, securities, and insurance policy proceeds to minors under the protection of
       a custodian. Among other things, the act establishes conditions under which an irrevocable
       transfer to another adult may be made for the benefit of the minor, except that if a transfer
       exceeds $10,000 in value, it must be authorized by the court. The bill would increase the
       maximum value of a transfer that does not require authorization by a court to $50,000.
       The act also establishes the right of a person to nominate a custodian or custodians to receive
       property for a minor beneficiary upon the occurrence of a future event (e.g., upon reaching a
       certain age) and provides that the nomination may be made in a will, trust, deed, or other
       documents. If a nomination is not made, or all persons nominated die before the transfer or
       decline or are unable or ineligible to serve, a transfer under this provision may be made to an
       adult member of the minor’s family or to a trust company. However, if the value of the property
       exceeds $10,000, a transfer can be made only if authorized by a court. The bill would increase
       the maximum value of a transfer that does not need authorization by a court to $50,000.
       MCL 554.530 and 554.531
       House Bill 4419 would amend the Natural Resources and Environmental Protection Act to
       increase the current maximum total value ($100,000) of all watercraft for which the deceased
       owner’s surviving spouse or an heir (in the order specified by EPIC) may petition the secretary
       of state for a certificate of title if the owner did not leave other property for which letters issued
       by a court to designate a personal representative to administer the estate would be required.
       The bill would provide that the total value of the watercraft must be based on the date of the
       petition. The bill also would increase the maximum total value of the watercraft to which this
       provision applies to $300,000 for the 2024 and 2025 calendar years. For the 2026 calendar year
       and each following year, the maximum total value would be a dollar amount equal to the
       product of the dollar amount applicable for the immediately preceding calendar year multiplied
       by the cost-of-living adjustment factor, rounded to the nearest $1,000.
           Cost-of-living adjustment factor would mean a fraction whose numerator is the United
           States Consumer Price Index (defined as in HB 4417, above) for the year before the prior
           calendar year and whose denominator is the United States Consumer Price Index for 2023.
       By September 1, 2025, and by September 1 each year after that, the Department of Treasury
       would have to certify and publish the dollar amount applicable for the following calendar year.
       The bill would take effect 90 days after its enactment.
       MCL 324.80312
House Fiscal Agency                            HBs 4417 (H-1), 4418, and 4419 (H-1) as reported   Page 2 of 3
BACKGROUND:
       According to the Probate and Estate Planning Section of the State Bar of Michigan, the bills
       would update financial thresholds and allow future thresholds to be adjusted for inflation,
       saving citizens and lawyers from having to file probate motions and petitions as frequently.
       The bills are reintroductions of House Bills 4899 to 4901 of the 2021-22 legislative session,
       which were passed by the House of Representatives.
FISCAL IMPACT:
       House Bills 4417 and 4419 would have no fiscal impact on the state but could have an
       indeterminate fiscal impact on local courts. An increase in the value of a vehicle (HB 4417) or
       watercraft (HB 4419) to be transferred to a surviving spouse or to an heir could result in a
       reduced need for court involvement. There is not a practical way to determine how court
       caseloads and the related administrative costs would be affected under provisions of the bill,
       so an amount of savings to local courts cannot be determined.
       The bills would not significantly change the number of vehicle (HB 4417) or watercraft (HB
       4419) title transfers and corresponding title transfer fee revenue and would have no fiscal
       impact on the state or on local units of government in that regard.
       House Bill 4418 would have no fiscal impact on the state but could have an indeterminate
       fiscal impact on local courts. An increase in allowable gifts that could be made without the
       court’s permission could result in a reduced need for court involvement in the disposition of
       assets. There is not a practical way to determine how court caseloads and the related
       administrative costs would be affected under provisions of the bill, so an amount of savings to
       local courts cannot be determined.
POSITIONS:
       Representatives of the Probate and Estate Planning Section of the State Bar of Michigan
       testified in support of the bills. (5-24-23)
       The Michigan Bankers Association indicated support for the bills. (5-24-23)
       The Department of State indicated support for House Bills 4417 and 4419. (5-24-23)
                                                           Legislative Analyst: Susan Stutzky
                                                              Fiscal Analysts: Robin Risko
                                                                                Michael Cnossen
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations and does not constitute an official statement of legislative intent.
House Fiscal Agency                           HBs 4417 (H-1), 4418, and 4419 (H-1) as reported   Page 3 of 3
Statutes affected: 
Substitute (H-1): 324.80312
House Introduced Bill: 324.80312
As Passed by the House: 324.80312
As Passed by the Senate: 324.80312
House Concurred Bill: 324.80312
Public Act: 324.80312
House Enrolled Bill: 324.80312