Most Michigan Municipal League member cities have received Personal Property Tax (PPT) distribution checks in the mail in the past week. These reimbursement checks are the first amounts cities are receiving for operating mills under the PPT reform voters approved in a statewide referendum in August of 2014 and are being distributed by the Local Community Stabilization Authority (LCSA), which is a new creation under the Act.
As one of the first implementation phases under the new law, cities with a positive small taxpayer exemption loss are eligible to be reimbursed for their 2014 and 2015 personal property tax loss from millage not used to pay debt. On October 20, 2015, Treasury certified a partial distribution of $15,736,006 to 214 cities. This distribution reflects 100 percent reimbursement of 2014 and 2015 operating millage less amounts reimbursed to TIF plans for city millage and amounts previously reimbursed to cities under the Act for debt loss.
In addition to this 100% reimbursement, the LCSA also has an additional $3,463,994 available to distribute to these eligible cities. Once all other data related to each city’s 2014 and 2015 debt loss is compiled, these additional dollars will be certified by Treasury to the LCSA for distribution. This additional distribution to cities stems from the design of the proration formula contained in the new law and represents payment in excess of 100 percent reimbursement. This extra payment will be finalized and distributed by early December of this year.
Chris Hackbarth is the League’s director of state affairs. He can be reached at 517-908-0304and [email protected].