The bill amends the Recodified Tax Increment Financing Act (2018 PA 57) by updating definitions and clarifying terms related to tax increment financing. Key changes include a revised definition of "advance," which now requires evidence of intent to repay to include an executed agreement, and a new definition for "authority" as a downtown development authority. The definition of "catalyst development project" is also modified to require a minimum capital investment of $300,000,000 and limits the designation of such projects to one per authority. Additionally, the bill allows for multiple distinct geographic areas within a business district under certain conditions and clarifies the initial assessed value of properties within development areas.

The bill further proposes amendments regarding the issuance and management of qualified refunding obligations, extending the duration of the development program related to these obligations to one year after their final maturity date, with payments allowed through 2025 at a legally permissible interest rate. It defines qualified refunding obligations with specific revenue limits, ensuring total revenues for repayment do not exceed $750,000, and exempts these obligations from certain requirements of the revised municipal finance act. New definitions are introduced for "qualified townships," "specific local taxes," and "tax increment revenues," with clarifications on the calculation of assessed values and the use of tax increment revenues for purposes such as demolition and financing catalyst development projects in larger cities. Overall, these amendments aim to enhance the clarity, efficiency, and effectiveness of tax increment financing mechanisms for local governments in Michigan.

Statutes affected:
Senate Introduced Bill: 125.4201