Supervisor: Clerk: Treasurer: Fire Dept.: 989-684-8931 989-684-8041 989-684-8531 989-684-8504 Assessor: Inspection: Enforcement: Fax: 989-684-7100 989-684-5427 989-684-9700 989-684-5644 INDUSTRIAL FACILITY EXEMPTION CERTIFICATE POLICY REVISED: 8/23/10 REVISED: 8/10/10 REVISED: 7/09/02 REVISED: 12/11/90 ADOPTED: 9/12/89 180 State Park Drive Bay City MI 48706 www.bangortownship.org Page 1 of 9
INTRODUCTION The procedures and policies pertaining to Public Act 198 of 1974 as amended, and adopted by the Charter Township of Bangor as of July 9, 2002 and amended on August 10, 2010. The purpose of Public Act 198 of 1974 as amended is to provide an incentive to: prevent loss of existing industry and jobs, encourage new industries to locate in Michigan, and to motivate existing industries to expand and create or retain existing jobs. This incentive is accomplished by issuing an Industrial Facilities Exemption Certificate (IFEC). There are two types of Industrial Facility Exemption Certificates: New Facilities allow a property tax break of approximately 50% for up to 12 years. The IFEC may cover building and land improvements as well as personal property. An IFEC does not include land. Rehabilitation Facilities allows the existing tax base to be frozen on real and personal property. The new value of improvements and equipment is taxed based on the obsolete property value. An IFEC does not include land. The Charter Township of Bangor has adopted this policy to promote the growth of industry, to create and/retain jobs, and to demonstrate that Bangor Township supports development. A written policy was adopted to help the industrial property owner become aware of the available tax abatements, to aid in the timely filing of required reports, to assist in the paper trail, and to adopt a policy so that all applicants are treated uniformly in the abatement process. Following is a list of steps that are required to achieve the goal of tax abatement. 1) Creation of the Industrial Development District or Plant Rehabilitation District. The district must be established before any construction is started or before any personal property is installed. The government unit or the property owner may start the establishment of an Industrial Development District or Plant Rehabilitation District. A township review committee will examine the application and make a recommendation to the township board to either approval or disapproval the establishment of a district. A public hearing will be scheduled by the township to consider the establishment of the Industrial Development or Rehabilitation District. Page 2 of 9
AFTER THE DISTRICT IS CREATED 2) File an application for an Industrial Facility Exemption Certificate. A sample application is include in this information packet. The applicant is to file the original and four copies of the application along with the filing fee of $250.00 as established by the Bangor Township Board on September 12, 1989. Upon receipt of the application, the review committee will check the application for completeness and will complete the point tally sheet to determine the number of years allowed under the tax abatement if approved. 3) The township has 60 days to approve or disapprove the application. If approved, the State Tax Commission must be notified within 60 days or by October 31 st (which ever occurs first). If disapproved, the local unit shall return the application to the applicant who has ten days from the denial date to appeal to the State Tax Commission. The State Tax Commission is the final authority in issuing or denying Industrial Facility Exemption Certificates. 4) The State Tax Commission will act upon the application within 60 days (if filed before October 31 st ). 5) The original exemption certificate will be mailed to the property owner and a copy to the township assessor. If you have any questions regarding this policy, please contact the Bangor Township Supervisor at (989) 684-8931. If you have any questions regarding Public Act 198 of 1974 as amended, please contact the State Tax Commission at (517) 373-3302. The Bangor Township Review Committee is comprised of the following elected positions: Supervisor, Treasurer and Clerk. Page 3 of 9
Charter Township of Bangor New Industrial Facilities Award Point System Applicants Name: Points Points Allowed Earned 1. Cost of new construction and/or new personal property: $ 250,000 to $ 999,999... 3 $ 1,000,000 or more... 6 2.a. 2.b. Job Creation Number of new jobs 1to 4... 2 5 to 10... 4 11 or more... 6 Job Retention Only if Michigan unemployment rate is 8% or above 95% jobs retained... 2 97% of jobs retained... 3 100% jobs retained... 4 3. Need for tax abatement - a or b a. Project started before clerk received application for tax abatement... 0 b. Project started after clerk has received application for tax abatement... 2 4. The project includes landscaping, screening or similar improvements to act as a buffer between building and existing roads. a, b or c a. 1% of project cost (Section 1) with a minimum of $10,000... 1 b. 2% to 5% of project cost (Section 1) with a minimum of $15,000... 2 c. 6% or more of project cost (Section 1) with a minimum of $20,000... 3 5. Business is new to Bangor Township... 1 Maximum Points - 22 TOTAL POINTS Points are allotted by tax abatement committee 1 or 2 points=no abatement 3 to 5 points= 4 years 6 to 9 points= 8 years 10 or more points= 12 years Years Awarded: Page 4 of 9
Charter Township of Bangor Rehabilitation Industrial Facilities Award Point System Applicants Name: Points Points 1. Cost of project as a percent of cash value of property based on Allowed Earned the current assessment roll. Proposed investment $ a. up to 50%... 1 Current assessed value: b. over 50%... 3 2. Cost of new construction and/or new personal property: $ a. $250,000 to $999,999... 1 b. $1,000,000 and over... 3 3. Number of existing jobs retained as a result of the project: a. 1 to 5... 1 b. 6 to 10... 2 c. 11 or More... 3 4.a. Job Creation Table 1 or 2 Table 1 - Number of new jobs 1 to 5... 1 6 to 10... 2 11 or More... 3 Table 2 - Percent increase in jobs 1% to 15%... 1 New jobs: 16% to 25%... 2 26% or more... 3 Existing jobs: 4.b. Job Retention Only if Michigan unemployment rate is 8% or above 95% jobs retained... 2 97% of jobs retained... 3 100% jobs retained... 4 5. Need for Tax Abatement: a or b a. Project started before clerk received application for tax abatement... 0 b. Project started after clerk has received application for tax abatement... 2 6. The project includes landscaping, screening or similar improvements to act as a buffer between building and existing roads. a, b, or c a. 1% of project cost (Section 1) with a minimum of $10,000... 1 b. 2% to 5% of project cost (Section 1) with a minimum of $15,000... 2 c. 6% or more of project cost (Section 1) with a minimum of $20,000... 3 Maximum Points - 21 TOTAL POINTS Points are allotted by tax abatement committee Points to years: up to 3 points = no abatement 4 to 6 points = 4 years 7 to 11 points = 8 years 12 or more points = 12 years Years Awarded: Page 5 of 9
REVOCATION OF AN INDUSTRIAL EXEMPTION CERTIFICATE The Township Board may request that the State Tax Commission revoke an I.F.E.C. upon grounds that: A) the completion of the facility has not occurred within two years of the estimated completion date as stated in the application. B) The purpose on which the certificate was issued is not being met. C) If commitments made by the applicant have not been met such as: employment numbers, 85% of estimated cost, and/or landscaping as described on the application. See sections: 12, 13 and 15 of P.A. 198 of 1974 as amended. DURATION OF AN INDUSTRIAL FACILITIES EXEMPTION CERTIFICATE All I.F.E.C. s shall be given for a period of one, six or twelve years, based on the information supplied by the applicant, with said information applied to the award sheet. TRANSFERRING OF AN INDUSTRIAL FACILITIES EXEMPTION CERTIFICATE The Township Board and the State Tax Commission must approve all transfers of an I.F.E.C. from one owner to another. To transfer an I.F.E.C. the applicant must file a written request with the Township Clerk and re-file an I.F.E.C. Application under the new name. IT IS NOT THE TOWNSHIP S RESPONSIBILITY TO REQUEST A TRANSFER OF AN I.F.E.C. OR TO NOTIFY THE NEW OWNER THAT IT IS THEIR OBLIGATION TO REQUEST A TRANSFER OF THE I.F.E.C. IF A TRANSFER IS NOT REQUESTED, THEN THE I.F.E.C. IS APT TO BE REVOKED. NOTIFICATION OF JOB COMPLETION AND FINAL COST State Tax Commission Rule Number 209.55 requires the following: 1. The applicant for an I.F.E.C. or a holder of a I.F.E.C. shall notify the assessing officer and the State Tax Commission of the date of completion as explained in Section 16 of P.A. 198 of 1974 as amended, being 207.566 of the Michigan Compiled Laws. 2. The notification of completion of the project shall be filled within 30 days of the completion. 3. The final cost of the facility shall be filed with the assessing officer and the state tax commission within 90 days after completion. FAILING TO FOLLOW THE S.T.C. RULE NUMBER 209.55 IS REASON FOR REVOCATION OF THE I.F.E.C. Page 6 of 9
CHECKLIST ESTABLISH OF A PLANT REHABILITATION DISTRICT OR AN INDUSTRIAL DEVELOPMENT DISTRICT Check Activity Responsible Party File request to establish district Owner/Township Establish district boundaries Township Notice of Public Hearing Written to all owners of real property within the proposed district, published or posted for residents and taxpayers, consistent with established local practice. Township Clerk Hold public hearing Township *Resolution approving district Township Determination of **obsolescence in Plant Rehabilitation District Resolution Township APPLICATION FOR INDUSTRIAL FACILITIES EXEMPTION CERTIFICATE Application filed with Township Clerk (One original and 4 copies and fees paid) Applicant Notification of public hearing to applicant, Assessor and each affected ad valorem taxing authority Township Clerk Public Hearing Township Resolution approving application Township Copies of application with *** attachments forwarded to the State Tax Commission Township Clerk Conformity with Section 9 of P.A. 198 of 1974 as amended S.T.C. and Commerce Dept. Issuance or Denial of Certification S.T.C. Third year review and report Township Clerk Possible hearing with Township Board Certificate Holder *Possible revocation request by Township Board at public hearing. Township * Copy filed with application ** Usually determined by assessor *** Fiscal Statement for Tax Abatement Request Information plus any other attachments Page 7 of 9
PUBLIC ACT 198 OF 1974 AS AMENDED PLANT REHABILITATION AND INDUSTRIAL DEVELOPMENT DISTRICT APPLICATION Complete the information for the following and attach this sheet to your response to items 1 12. District Type: Plant Rehabilitation District Industrial Development District Legal Name: Contact Person: Telephone Number: Address: Project Address: Signature of Applicant: Date: 1. List the name and the type of applicant s business that this application is pertaining to. 2. For building improvements, list the extent of the construction and the cost (Show sketches or attach a blue print). 3. When will construction begin and when is it scheduled to be completed? 4. For personal property, list the individual items, the cost of each item, the date that these items will be ordered, and the date that the items are to be delivered. 5. What is the total current number of full-time employees for this industry? 6. What is the total current number of part-time employees for this industry? 7. How many full-time jobs are to be created because of this project? 8. How many part-time jobs are to be created because of this project? 9. Are the jobs being created skilled and/or unskilled? 10. Legal description of the real property that the district is to cover. 11. Name and address of the legal owner of the property. 12. Attach a site plan for the project. Show where the building construction (if any) will occur and/or where the personal property will be located. 13. If landscaping is a part of the project, show an estimated itemized cost and layout. A response to all items is necessary before the Township can act on the application to create the district requested. A project that is started prior to the creation of the requested district is immediately disqualified for consideration (State Law). This form and attachments are to be mailed to: Charter Township of Bangor Attn: Clerk s Office 180 State Park Drive Bay City, Michigan 48706 Page 8 of 9
INDUSTRIAL FACILITES EXECPTION CERTIFICATE LETTER OF AGREEMENT This Agreement between Street address: City, state, zip: of: Company Name and the Charter Township of Bangor, A Municipal Corporation, of 180 State Park Drive, Bay City Michigan, is for the purpose of fulfilling the requirement of Act 198 of Public Acts of 1974 as amended. The above mentioned company acknowledges as a prerequisite to obtaining an Industrial Facilities Exemption Certificate, that the Company has made certain representations to the Township upon which the Township has relied and based upon which the Company will receive certain monetary benefits (tax abatements) to which it otherwise would not be entitled. The above-mentioned company also understands that any tax abatement granted by the Township is also based on the representations made by the Company in its application for an Industrial Facilities Exemption Certificate. Further, that these representations include the obligations to be performed by the Company. It is expressly agreed by the Company that should any of the representations of the Company prove to be erroneous or should the Company fail to fully perform any future promises, duties or obligations, the Township shall cancel the Industrial Facilities Exemption Certificate and the Company shall pay to the affected taxing units an amount equal to all taxes it would have paid have the abatement not been in effect. Said payment of taxes to include interest from the dates that the tax amounts would have originally been due. The above mentioned Company further specifically agrees that it shall remain within the Charter Township of Bangor during the entire period of time for which the Industrial Facilities boundaries within that period of time, the Company shall pay to the affected taxing units an amount equal to all taxes it would have paid had the abatement not been in effect. Said payment of taxes to include interest from the dates that the tax amounts would have originally been due. Dates this day of,. Witnesses: Company: Witnesses: Township: Township Supervisor or Designee Page 9 of 9