property tax overview seminar - msbo.org property tax overview - part i.pdf · property tax...

1

Property

Tax

Overview

Seminar

February 23, 2017

MELG Building, Lansing/Webinar1

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– http://support.blackboardcollaborate.com

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option #2

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888.895.6448, passcode 4113293#

Technical Questions?

2

http://support.blackboardcollaborate.com/

2

Overview of Blackboard Collaborate

Whiteboard ToolsParticipant Window

Chat Room

Audio Controls (mic/speaker level)

Top Toolbar

Whiteboard Screens

3

Speakers

• Phil Boone

Michigan Department of Education

• Bob Dwan

Michigan School Business Officials

• Howard Heideman

Michigan Department of Treasury

• Andrew Lockwood


• Sharon Raschke

Dexter Community Schools4

3

Agenda

• 8:45 am Blackboard Collaborate Overview – Debbie Kopkau, MSBO

• 8:50 School Property Taxes Overview – Robert Dwan, MSBO

• 9:15 Terminology, Ad Valorem Property Tax Millage Levies, K12 and ISD – Howard Heideman and Andrew Lockwood, Michigan Department of Treasury

• 10:15 Break

• 10:30 Millage Rates, Millage Reduction Fractions, and Tax Rate Requests – Howard Heideman and Andrew Lockwood, Michigan Department of Treasury

• 11:15 L-4029 – Sharon Raschke, Dexter Community Schools

• 12:00 pm Lunch

5

Agenda (Cont)

• 12:45 How Property Taxes Fit into State Aid – Phil Boone, Michigan Department of Education

• 1:40 Personal Property Tax Reform, Specific Tax Programs, Renaissance Zones, Tax Increment Financing and Board of Review – Howard Heideman and Andrew Lockwood, Michigan Department of Treasury

• 2:25 Break

• 2:40 County Settlement & Reconciliation of Property Tax Receivable – Sharon Raschke, Dexter Community Schools

• 3:45 Current Topics, Michigan State Tax Commission, Other Issues, Wrap-Up – Andrew Lockwood, Michigan Department of Treasury and Robert Dwan, MSBO

• 4:00 Adjourn

6

4

7

Property Tax Overview

School Property Tax Overview

Presenter: Robert Dwan, MSBO

Tax

Increment

Financing

Authorities

Property Tax Process

Township & City

Assessors

Taxable Value

Information(DS-4410)

County Equalization

Director

A

S

S

E

S

S

M

E

N

T

Updated in May

and at least

annually

thereafter

8

5

9


County Equalization

Director

Taxable Value

Information(DS-4410)

School District

Consolidates

information

for each

school

district

A

S

S

E

S

S

M

E

N

T

Submitted

online by

County

Treasurer to

MDE


School District

Townships & Cities

• School District

prepares L-4029

for each

township/city

• Board approves

after Truth In

Taxation

Tax Levy(Form L-4029)

T

A

X

L

E

V

Y

10

6

Property Tax Flowchart

Townships / Cities

Property Owners

Property Tax

Bills

T

A

X

B

I

L

L

I

N

G 11


Property Owners

Township / City

Treasurer

Pay Bill ?(by Feb 28)

YES

Check

Settlement

Process with

the County

NO

C

O

L

L

E

C

T

I

O

N12

7


Township / City

Treasurer

Tax

Breakdown

School District

Check

C

O

L

L

E

C

T

I

O

N13


School District

Property Tax

Receivables

Worksheet

Deposits

Check in

Bank

C

O

L

L

E

C

T

I

O

N14

8


Township & City

Treasurer

Settlement

County

• Townships &

Cities verify to

the County

parcel by parcel

• Tax collections

• Taxes receivable

• As of March 1

S

E

T

T

L

E

M

E

N

T15

16


County

Treasurer

Tax

Breakdown

School District

Check

D

E

L

I

N

Q

U

E

N

T

C

O

L

L

E

C

T

I

O

N

9


County

Delinquent

Personal

Property

Taxes

Delinquent

Real

Property

Taxes

No Action

Check(Issues debt until

collected)

School District

Township/City collects delinquent

personal property taxes

County collects delinquent real

property taxes (bills back if uncollectible)

DELINQUENT

PAYOFF

17


School District

Property Tax

Receivables

Worksheet

Deposits

Check in

Bank

Used to calculate

taxes receivable

D

E

L

I

N

Q

U

E

N

T

P

A

Y

O

F

F

18

10

School Aid Fund Funding

19

20

11

Glossary of Terms

21

22


Terminology

Presenters: Howard Heideman & Andrew Lockwood


12

Terminology: Real & Personal Property

23

Real Property is land plus buildings and fixtures on the land.

Personal Property is machinery, tools, computers, furniture or generally property not permanently affixed to a structure. Household personal property is not subject to the ad valorem property tax

Terminology: Principal Residence (Homestead) Property

24

Principal residence property is property used as a property owner’s principal residence or qualified agricultural property or qualified forest property.

Principal residence property is not subject to the local school operating millage.

See MCL 211.7dd

13

Terminology: Non-Principal Residence (Nonhomestead) Property

25

Non-principal residence property is considered to be second homes, business property, and rental housing.

Non-principal residence property is subject to the local school operating millage, except for industrial personal property that is exempt and except for commercial personal property that is exempt from the first 12 mills.

Terminology: Real Property Classifications

26

• Residential

• Agricultural

• Commercial

• Industrial

• Timber-Cutover

• Developmental

See MCL 211.34c for in depth descriptions.

14

Terminology: Personal Property Classifications

27

• Commercial

• Industrial

• Utility

See MCL 211.34c for in depth descriptions.

Terminology: State Equalized Valuation

DETERMINATION OF STATE

EQUALIZED VALUATION

TRUE CASH VALUE = Market Value

ASSESSED VALUE = 50% of True Cash Value

SEV = ASSESSED VALUE times SEV FACTOR

28

15

Terminology: Capped Valuation

DETERMINATION OF CAPPED VALUATION

MCL 211.27a(2)(a)

CAPPED = [(Prior Year Taxable Value minus

VALUE “LOSSES”) times the lesser of 5%

or the Inflation Rate] plus

“ADDITIONS”

Inflation Rate for use in 2017 = 1.009

This rate is used for both capped value calculations and “Headlee” MRF’s

29

Terminology: Taxable Value

DETERMINATION OF TAXABLE VALUE

MCL 211.27a(2)

Sec 27a(2): … for taxes levied in 1995 and for each year after, the taxable value of each parcel of property is the lesser of the following:

a) The property’s calculated capped value

or

b) The property’s current state equalized

valuation.

30

16

31

SEV and Taxable Value Gap

$100

$200

$300

$400

$500

1994 1997 2000 2003 2006 2009 2012 2015

bil

lio

ns

of

do

lla

rs

Source: State Tax Commission.

Taxable Value $327.4

State Equalized Value $396.7

32

2016 SEV and Taxable Value by Classification

Source: State Tax Commission.

2016

Classification 2016 SEV Taxable Value

Agricultural Real $22,795,411,527 $10,479,877,007

Commercial Real $53,870,354,704 $46,766,419,902

Industrial Real $16,849,199,209 $15,362,578,335

Residential Real $274,930,187,551 $226,802,770,667

Timber Cutover Real $238,999,493 $114,315,228

Developmental Real $134,757,533 $71,775,693

Personal Property $27,898,913,829 $27,808,021,575

Total $396,717,823,846 $327,405,758,407

17

33


Ad Valorem Property Tax Millage Levies, K12



Ad Valorem Property Tax Millage Levies

K-12

1. General Operating Levy

2. Hold Harmless Levy

3. Building & Site Sinking Fund Levy

4. Debt Levy

5. Recreational Levy

34

18

Ad Valorem Property Tax Millage Levies, K-12

Millage Taxable Value Base

General Non-Homestead &

Operating Non-Qualified Agricultural/Forest Property

Truth

“Headlee” in Tax

YES YES

General Operating Levy cannot exceed 18 mills or 1993 levy, whichever is less.

35


Industrial Personal Property

Beginning in 2008, industrial personal property is exempt from the State Education Tax and 18 mill local school operating tax.

Prior to FY12, School Aid Fund revenues were reimbursed through the Michigan Business Tax.

36

19


Commercial Personal Property

Also beginning in 2008, commercial personal property is exempt from 12 mills of the local school operating tax.

Prior to FY12, School Aid Fund revenues were reimbursed through the Michigan Business Tax.

37



Supplemental PRE and Qual. Ag./Forest in

“Hold the local school district

Harmless”

Truth


YES YES

Lesser of Annual School Code Limit Millage and the 1994 Certified Millage, as permanently reduced, times the current year millage reduction fraction for all property. (Letter 3-29-99)

38

20

Exemption & Specific Taxation Programs

Hold Harmless School Districts

Because industrial and commercial personal property are treated like PRE and Ag property, hold harmless millage rates are levied on industrial and commercial personal property.

Commercial personal property is only exempt from 12 school operating mills. It is only subjected to the first 12 hold harmless mills.

39

Hold-Harmless Mills

Section 1211 of school code, MCL 380.1211 (3):

• Hold-Harmless Districts must reduce mills to limit increase in combined state and local revenue per pupil to lesser of:– $ increase in foundation allowance

– % increase in general price level

40

21

Hold-Harmless Mills

When foundation allowance increases by more than inflation, hold-harmless districts must reduce their millage rate to limit state/local increase to inflation.

To allow hold-harmless districts to receive full dollar increase in foundation allowance, their foundation increases were limited to inflation. As of today, Sec.20j. payments are no longer being made.

41



Sinking Fund All properties within

the local school district

Truth


Yes No

See Attorney General Opinion 7131

42

22



Debt All properties within


Truth


No No

43



Recreational All properties within


Truth


Yes Yes

44

23

45


Ad Valorem Property Tax Millage Levies, ISD




1. Allocated Operating Levy

2. Special Education

3. Vocational Education

4. Enhancement

46

24


ISD Millage Taxable Value Base

Allocated All properties within

Operating the intermediate school

district

Truth

Maximum “Headlee” in Tax

150% of what Yes Yes

was authorized in 1993

Allocated through voter-approved fixed allocation or by county allocation board.

47



Special All properties within

Education the intermediate school

district

Truth


175% of what Yes Yes

was authorized in 1993

48

25



Vocational All properties within

Education the intermediate school

district

Truth


150% of what was Yes Yes

authorized in 1993.

If not authorized,

1 mill is the limit

49



Enhancement All properties within

the intermediate school

district

Truth


Not to exceed Yes Yes

3 mills

50

26

Ad Valorem Property Tax Millage Levies

STATE EDUCATIONSTATE EDUCATIONTAXTAX

NOT SUBJECTTO “HEADLEE”

NOT SUBJECTTO TRUTH INTAXATION

NOT TO BE REPORTED BY THE LOCAL SCHOOLDISTRICT or ISD ON THE L-4029 - TAX RATE

REQUEST

51

Break

52

27

53


Millage Rates/Millage Reduction Fractions



Terminology: Millage Rate(s)

BRIEFLY EXPLAIN THE DIFFERENCE BETWEEN

A. AUTHORIZED OPERATING MILLAGE RATE

B. PERMANENTLY REDUCED OPERATING

MILLAGE RATE

C. MAXIMUM ALLOWABLE OPERATING

MILLAGE RATE

54

28


AUTHORIZED MILLAGE RATE:

Millage rate or levy authorized by specific statute, charter or vote of the electorate.

55


PERMANENTLY REDUCED MILLAGE RATE:

Beginning in 1994, if an authorized millage was subject to a “Headlee” rollback, the resulting reduced millage was carried forward to serve as the beginning levy for the following year’s calculation.

56

29


MAXIMUM ALLOWABLE MILLAGE RATE:

Prior year permanently reduced millage rate as factored by the applicable current year millage reduction fractions for “Headlee” limitation, Truth in Equalization* and/or Truth in Assessing*.

*K-12 & ISD operating levies are not subject to Truth in Equalization or Truth in Assessing Rollbacks

57

Millage Reduction Fractions

“Headlee” Millage Reduction Fraction

MCL 211.34d

Inflation

MRF = (Prior Year Taxable Value -”LOSSES”) X Rate

(Current Year Taxable Value -”ADDITIONS”

Inflation rate to be utilized for calculation of

2016 MRF is 0.3% (expressed as 1.003)

58

30


“Headlee” Millage Reduction Fraction

MCL 211.34d

For K-12 General Operating, the “Headlee” MRF is

calculated using 100% non-homestead & 100% non-

qualified agricultural (Real & Utility Personal) properties located within the local school district only. Effective date set by local assessing officer.

For: K-12 Hold Harmless, Sinking Fund, and Recreation; & ISD levies, the Headlee”

MRF is calculated using ALL properties (Real &

Personal) located within the specific district.59


Base Tax Rate Fraction - Truth in Taxation

MCL 211.24e

BTRF = (Prior Year Taxable - “LOSSES”)

(Current Year Taxable - “ADDITIONS”)

60

31


CALCULATION OF BASE TAX RATE

BTR = Prior Year Operating Levy times BTRF

Note: A tax authority may forego the requirements

of Truth in Taxation if it meets the optional

requirements of Truth in Budgeting

61

62


“LOSSES”

MCL 211.34d(1)(h)

Property Destroyed Property Removed

Exempt Property Decrease in Occupancy

Environmental Contamination

“LOSSES” NOT:

Platting, Splits, Combinations, Zoning Changes

32

63


“ADDITIONS”MCL 211.34d(1)(b)

Omitted Real Property Omitted Personal Property

New ConstructionPreviously Exempt PropertyReplacement Construction

Remediation of Environmental ContaminationIncrease in Occupancy (Ruled unconstitutional, WpW)Public Services (Ruled unconstitutional, Toll Northville)


“ADDITIONS” NOT:

Platting, Splits, Combinations

Zoning Changes

Transfers of Ownership

64

44

87

Property Tax

L-4028

88

Michigan Department of

Treasury 612 (Rev. 3-16)

(Page 2 OF 3)

MUSKEGON COUNTY EQUALIZATION DEPARTMENT L-4028 IC

All Properties

2016 Millage Reduction Fraction Computation (HEADLEE)

L-4029 Column (6)

(T in A)

L-4029 Column (8)(T in T) Not On L-4029

2015 Taxable 2016 Taxable Taxable Taxable Millage Truth in Base Tax

Code Taxing Value Value Value of Value of Reduction Assess/Equal Rate

Number Jurisdiction (1) As of 5/25/15 As of 5/23/16 Losses Additions Fraction (2) Fraction Fraction

SCHOOL DISTRICTS

SCHOOL DISTRICTS

41-150 Kent City Public 33,613,963 33,547,480 648,345 381,400 IC NA IC

61-010 Muskegon Public 509,595,232 507,878,698 13,665,917 20,874,555 1.0000 NA 1.0183

Less Renaissance Zone (2,858,464) (2,219,936) (790,800) (170,500)

Non Renaissance Zone 506,736,768 505,658,762 12,875,117 20,704,055 1.0000 NA 1.0184

61-020 Muskegon Heights Public 101,543,583 92,260,705 7,593,832 2,605,000 1.0000 NA 1.0479

Less Renaissance Zone (408,699) 0 0 409,175


61-060 Mona Shores Public 810,045,517 809,428,691 18,686,876 17,284,797 1.0000 NA 0.9990

Less Renaissance Zone (849,800) (746,277) (76,600) (300)


61-065 Oakridge Public 173,123,703 167,199,998 10,537,769 4,334,382 1.0000 NA 0.9983

Less Renaissance Zone (243,200) (237,451) 0 0


61-080 Fruitport Public 566,237,444 579,033,043 4,785,188 14,767,007 0.9980 NA 0.9950

Less Renaissance Zone (280,400) (158,300) (118,300) 0


61-120 Holton Public 147,273,911 149,131,563 1,109,459 2,093,738 0.9970 NA 0.9941

61-180 Montague Public 345,703,837 333,481,672 18,269,524 5,795,782 1.0000 NA 0.9992

45

89



(Page 2 OF 3)


All Properties


L-4029 Column (6)

(T in A)





SCHOOL DISTRICTS

SCHOOL DISTRICTS

61-190 Orchard View Public 307,875,366 287,832,029 27,524,981 11,695,385 1.0000 NA 1.0153

Less Renaissance Zone (1,201,491) (842,894) (319,000) 0


61-210 Ravenna Public 171,568,788 170,536,491 5,797,059 3,951,872 0.9981 NA 0.9951

Less Renaissance Zone (860,106) (972,753) 0 (173,600)


61-220 Reeths-Puffer Public 598,563,772 592,142,441 17,764,346 9,752,578 1.0000 NA 0.9973

Less Renaissance Zone (3,425,734) (1,809,980) (1,509,400) 0


61-230 North Muskegon Public 142,701,369 143,170,994 2,080,931 1,420,300 0.9950 NA 0.9920

61-240 Whitehall Public 474,734,788 449,084,285 33,070,524 10,493,958 1.0000 NA 1.0070

Less Renaissance Zone (3,037,400) (1,512,886) (1,557,200) (119,800)


62-040 Fremont Public 6,471,395 6,591,239 38,923 197,644 IC NA IC

62-050 Grant Public 35,646,817 35,982,188 105,384 225,900 IC NA IC

70-010 Grand Haven Public 131,896,983 130,177,977 6,778,346 5,696,500 IC NA IC

Less Renaissance Zone (1,407,100) (1,423,400) (1,700) (62,200)

Non Renaissance Zone 130,489,883 128,754,577 6,776,646 5,634,300 IC NA IC

70-120 Coopersville Public 13,532,334 14,237,653 151,305 387,300 IC NA IC

90



(Page 2 OF 3)


All Properties


L-4029 Column (6)

(T in A)





41-000 Kent County 33,613,963 33,547,480 648,345 381,400 IC NA IC61-000 Muskegon County 4,348,967,310 4,281,180,610 160,886,406 105,069,354 1.0000 NA 1.0029


Non Renaissance Zone 4,335,802,016 4,272,680,133 156,515,106 105,014,329 1.0000 NA 1.0028

62-000 Newaygo County 42,118,212 42,573,427 144,307 423,544 IC NA IC

70-000 Ottawa County 145,429,317 144,415,630 6,929,651 6,083,800 IC NA ICLess Renaissance Zone (1,407,100) (1,423,400) (1,700) (62,200)

Non Renaissance Zone 144,022,217 142,992,230 6,927,951 6,021,600 IC NA IC

INTERMEDIIATE SCHOOLS

Muskegon Community 4,344,410,177 4,273,173,736 166,021,498 106,613,650 1.0000 NA 1.0028



COMMUNITY COLLEGE

Hackley Public Library 604,479,091 580,808,361 38,017,804 26,180,655 1.0000 NA 1.0213



Muskegon Area District 3,264,049,126 2,769,629,673 554,490,788 58,523,423 1.0000 NA 0.9994

Less Renaissance Zone (7,704,439) (5,408,461) (1,871,900) 173,075


White Lake Community 474,734,788 449,084,285 33,070,524 10,493,958 1.0000 NA 1.0070



LIBRARIES

46

91



(Page 3 OF 3)


Non-P.R.E. and Non-Qualified Agricultural Properties


L-4029 Column (6)

(T in A)





SCHOOL DISTRICTS

41-150 Kent City Public 4,243,655 4,483,327 36,655 256,600 IC NA IC

61-010 Muskegon Public 266,354,707 271,033,211 1,862,249 13,631,858 1.0000 NA 1.0275

Less Renaissance Zone (1,205,599) (1,330,957) 0 (98,900) NA


61-020 Muskegon Heights Public 59,937,271 58,007,321 234,400 1,347,500 1.0000 NA 1.0537

Less Renaissance Zone (158,699) 0 0 159,175 NA

Non Renaissance Zone 59,778,572 58,007,321 234,400 1,506,675 1.0000 NA 1.0539

61-060 Mona Shores Public 243,745,312 247,446,555 1,030,562 6,252,700 1.0000 NA 1.0063

Less Renaissance Zone (535,200) (527,277) 0 0 NA


61-065 Oakridge Public 51,508,682 51,368,812 2,161,598 1,497,152 0.9924 NA 0.9895



61-080 Fruitport Public 165,172,875 171,297,345 663,656 5,107,400 0.9929 NA 0.9899



61-120 Holton Public 40,572,307 41,617,539 263,130 1,067,503 0.9970 NA 0.9941

61-180 Montague Public 132,139,770 136,015,890 449,357 2,512,679 0.9894 NA 0.9864

61-190 Orchard View Public 123,557,919 125,380,381 1,914,419 5,417,589 1.0000 NA 1.0140



92



(Page 3 OF 3)


Non-P.R.E. and Non-Qualified Agricultural Properties


L-4029 Column (6)

(T in A)





SCHOOL DISTRICTS

61-210 Ravenna Public 29,772,953 31,289,211 194,053 1,433,539 0.9934 NA 0.9905



61-220 Reeths-Puffer Public 149,640,612 150,672,554 5,328,975 6,092,100 1.0000 NA 0.9981



61-230 North Muskegon Public 33,687,652 34,214,142 133,137 657,100 1.0000 NA 0.9999

61-240 Whitehall Public 157,139,151 161,156,017 792,084 3,497,800 0.9947 NA 0.9917

Less Renaissance Zone (495,900) (617,186) 0 (119,800) NA


62-040 Fremont Public 1,852,946 1,886,667 27,700 98,900 IC NA IC

62-050 Grant Public 6,353,379 6,416,613 32,000 142,700 IC NA IC

70-010 Grand Haven Public 70,223,015 70,828,375 415,900 1,449,900 IC NA IC


Non Renaissance Zone 69,358,415 69,985,075 415,900 1,449,900 IC NA IC

70-120 Coopersville Public 1,590,517 1,758,213 4,300 132,200 IC NA IC

47

93

Property Tax

Preparation of L-4029

Taxable Values

94

• Obtain the L-

4028 from

County

Equalization

• If you are in

more than one

county, you

will need the

L-4028 IC.

48

Taxable Values by Municipality

95

Taxable Values

96

• Total taxable values used for Debt,

Sinking, and Special Ed

• Non-PRE/MBT (non-homestead) used

for Operating (General Fund)

• Use to budget by municipality

– GF operating tax revenue (11-0111-xxxx)

– Debt tax revenue (30-011-xxxx)

• Common debt fund makes splitting debt

levy not necessary

49

L-4029 Tax Rate Request

97

• Use an excel version of the L-4029

– Just update from year to year

– Calculated cells

– Reduce inadvertent errors

• Have last year’s L-4029 available for

reference


98

50


99


100

Enter the source for each millage.

This may include charter, extra-voted,

debt

51


101

•Enter the purpose of the millage and on what

properties it applies.

•Examples are operating-non PRE, debt-all

properties, sinking-all properties, special ed-

all properties.


102

Record the election date and year for

each millage authorized by district voter

approval.

52


103

•List the millage rate for each rate

authorized by voters, charter, or debt

service.

•This is the originally authorized rate

before any millage reductions.


104

•List the millage rate for each rate

authorized by voters, charter, or debt

service.

•This is the originally authorized rate

before any millage reductions.

•Always use four (4) decimals.

53


105

Look at last year’s

Column 7

• This is the permanently reduced rate recorded in column 7 of last year’s L-

4029.

• Enter the full millage rate approved by voters if it was approved after April

30 of this year. Current year approvals are NOT subject to reduction this

year.


106

•List Millage Reduction Fraction

reported by county equalization on

form L-4028 (IC) for the current

year

•Use four decimal places

•Operating, sinking, and special

ed levies may roll back

•Column 6 does not exceed 1.0000.

This prevents roll up of millage rates.

•Enter 1.0000 for any current year

approved millage (after April 30).

•Enter 1.0000 for debt, as debt

millage is not subject to roll back.

54


107

Calculation Column

•Multiply rate in Column 5 by the Millage

Reduction Fraction in Column 6

•Round DOWN to fourth decimal place because

you may not levy MORE than and if it rounds

up, it would be MORE than

18.0000 x 0.9969 = 17.9442

3.0000 x 0.9969 = 2.9907


108

• This column is always 1.0000 for

school districts, since schools are not

subject to Truth in Assessing or

Equalization millage rollback

fractions

55


109

Calculation Column

•Multiply rate in Column 7 by the rollback fraction in Column 8

•Since Column 8 is always 1.0000 for schools, Column 9 is always

Column 7 for schools


110

Calculation Column

• Indicate your summer requested levy in column 10

• Indicate your winter requested levy in column 11

• This district only levies winter taxes

• Operating non-PRE may not exceed 18.0000

• List debt splits if you account for debt issuance separately

56


111

•Record the millage expiration date

•This is always a 12/31 date with the year

of millage expiration.


112

Report millage levy for:

•Principal Residence, Qualified Ag,

Qualified Forest and Industrial Personal

(normally 0.0000)

•Commercial Personal (normally

6.0000)

•All Other (normally 18.0000 unless you

have a roll back)

57


113

• Complete the certification section

• Complete the prepared by section, so county officials know who to

contact with any questions.

• Board secretary and Board president must sign the L-4029 AFTER

the levy is approved by the Board.


114

• Use an excel version of this form or a fillable PDF can be obtained

from Michigan Treasury’s website at www.michigan.gov/treasury

• Form must be completed and submitted to county equalization,

county treasurers, and local municipalities on or before September 30

of each year.

• If you do a summer levy, the form must be submitted earlier

because tax forms are generated and sent June 30.

• Tax Rate Requests must be approved in accordance with Truth in

Taxation Hearing requirements.

http://www.michigan.gov/treasury

58

Truth in Taxation Hearing

115

• Publish notice in your publication of record“ON THE ADOPTION OF THE BUDGET FOR THE FISCAL YEAR

2016-17 AND THE 2016 TAX RATE ON NON-HOMESTEAD

PROPERTIES THAT WILL BE AT 18 MILLS AND THE 2016 DEBT

LEVY ON ALL PROPERTIES THAT WILL BE AT 8.5 MILLS.”

“THE PROPERTY TAX MILLAGE RATE PROPOSED TO BE

LEVIED TO SUPPORT THE PROPOSED BUDGET WILL BE A

SUBJECT OF THIS HEARING.”

Truth in Taxation Hearing

116

• Conduct hearing at Board Meeting before

the budget is adopted

59

Resolution for Tax Millage Rate

117

• Board

authorizes tax

levies

Usage of Extra non-PRE

118

60

Property Tax Allocation

119

• Begin your new year Current Property Tax

Allocation Tax Collection spreadsheet

• 2015 Tax Year = 2015-16 Fiscal Year

• 2016 Tax Year = 2016-17 Fiscal Year

Budget for Property Taxes

120

• From the taxable values, calculate the

taxes you will collect for General Fund

(non-PRE), Debt Fund (all properties),

Sinking Fund (all properties)

• ISD will have Special Ed (all properties)

61

121

Property Tax “Hands-on” Workshop

SettlementReconciliation

• Finalize Excel file details– Each property tax receipt by municipality (i.e.

township, city)

– County settlement collections

– Delinquent personal property tax from municipality

Property Taxes Collected

122

62

• Print and Download (Excel) - Taxable Value (4410) from https://mdoe.state.mi.us/TaxableValue/login.aspx (public access)

Taxable Values

123

• Copy and paste values into Property Tax Reconciliation Worksheet

Taxable Values

124

https://mdoe.state.mi.us/TaxableValue/login.aspx

63

• Modify content and formulas as needed for your particular situation and particular year (i.e. levy, sinking fund, tax captures like DDA, annexed parcels).

• Used to calculate expected tax collection of operating, debt, sinking fund, etc.

• Enter collected taxes, receivables, adjustments to 4410 needed.

• Tie to county settlements, L-4029, GL

Reconciliation Worksheet

125

• Tie to county settlements, L-4029, GL

County Settlements

126

64

• Tie to General Fund GL and Debt Fund GL

Taxable Values

127

• Tie to State Aid Status Report for operating revenues expected

• If they do not match either the 4410 is not updated or the update to the 4410 has not been picked up by the State. Verify and note adjustment.

Reconciliation

128

65

• Compare the L-4029 to get a sense of your expected taxable values versus final taxable values

Reconciliation

129

• Most municipalities settle with the county by mid-May.

• Settlements are basis for revised DS4410 report.

• School district pays county for surety bonds issued for DTRF.

• Delinquent taxes on personal property collected by local treasurers, unless county treasurer agrees to collect.

County Settlements

130

66

Calculate Your Foundation

Foundation per pupil __$7,693_________

x Number of

students___3,550.05______________

= Foundation Total _27,310,534.65____131

State Source

Expected Gross Foundation_ 27,310,534.65

Less Local Property Tax Revenue

__4,332,490.00

Total Expected State Aid _22,978,044.65_

132

67

State Source

• Difference should be minor

133

134

Property Tax Hands-on Workshop

Personal Property Exemption Loss

68

• The exemption of personal property was a loss for schools debt millage collection.

• Treasury will reimburse the loss under PA 86 of 2014.

• Must complete Form 5451 and submit to [email protected] due August 15, 2016.

Personal Property Exemption

135

• Need REVISED L-4050 from County Equalization.


136

mailto:[email protected]

69

• If you are in more than one county, make sure you have the IC version of the REVISED L-4050 from County Equalization.


137

• Complete form 5451 Personal Property Exemption Loss 2016 Debt Millgage Reimbursement Claim for School Districts & Intermediate School Districts.


138

70

• Use Personal Property Exemption Loss 2013 TV-2016 TV

• Enter your debt millage levied based on year of obligation


139

• Reimbursement =

19,340,444 * 8.5000 mills = $164,394

• Submit claim Form 5451 to [email protected] due August 15, 2016


140

mailto:[email protected]

71

Lunch – 12:00 – 12:45 pm

141

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