The bill amends the Michigan Trust Fund Act by establishing a new Local Government Reimbursement Fund within the state treasury. The state treasurer is tasked with depositing funds received from the use tax act and other sources into this fund, managing its investments, and ensuring that interest and earnings are credited back to it. Notably, the bill changes the status of the fund's money at the end of the fiscal year, specifying that it lapses to the general fund rather than remaining in the fund.

Additionally, the bill outlines the responsibilities of the Department of Treasury regarding the fund, including the appropriation and distribution of funds to municipalities that have lost revenue due to property tax exemptions. Compensation to municipalities is mandated to occur annually by May 31, with provisions for prorating payments if the fund's resources are insufficient to cover all claims. The bill also clarifies definitions related to the fund and municipalities as per existing law.

Statutes affected:
Senate Introduced Bill: 12.253