The bill amends the Recodified Tax Increment Financing Act (2018 PA 57) by updating key definitions and clarifying terms related to tax increment financing. Notable changes include a refined definition of "advance," which now requires evidence of intent to repay through an executed agreement, provisions in an approved tax increment financing plan, or a resolution from the authority or municipality. The term "catalyst development project" is also specified to necessitate a minimum capital investment of $300 million, with a limit of one such project designated per authority. Additionally, the definition of "initial assessed value" is clarified to be determined at the approval of the ordinance establishing the tax increment financing plan, including properties exempt from taxation as zero.

The bill further modifies the management of qualified refunding obligations, extending the development program's duration to one year after their final maturity date, allowing payments through 2025 at a legally permissible interest rate. It exempts qualified refunding obligations from certain requirements of the revised municipal finance act and caps repayment revenues at $750,000, with provisions for allocating excess revenues for future debt service. New definitions are introduced for terms such as "qualified township," "specific local tax," and "tax increment revenues," with specific guidelines for calculating assessed values and utilizing tax increment revenues for development projects, including demolition costs and catalyst development projects in larger cities.

Statutes affected:
House Introduced Bill: 125.4201