The bill amends the Michigan Trust Fund Act by establishing a new Revenue Sharing Trust Fund within the Department of Treasury, effective October 1, 2026. This fund will consist of money deposited as required by the General Sales Tax Act, donations, and interest from investments. The state treasurer is tasked with directing the investment of the fund, and any unspent money at the end of the fiscal year will remain in the trust fund rather than lapse into the general fund.

Additionally, the bill outlines the distribution of funds from the Revenue Sharing Trust Fund. It specifies that a total of $299,126,400 will be allocated to cities, villages, and townships, with distributions based on previous eligibility criteria, and any remaining funds will be divided into three categories: taxable value payments, unit type population payments, and yield equalization payments. Counties will receive $261,069,700, also distributed based on prior eligibility criteria. The bill includes detailed calculations for determining payments to ensure equitable distribution among local governments.

Statutes affected:
Substitute (S-1): 12.251, 12.262
Senate Introduced Bill: 12.251, 12.262
As Passed by the Senate: 12.251, 12.262