Personal Property Tax Reimbursements
Beginning for calendar year 2016, the Local Community Stabilization Authority (LCSA) Act, 2014 Public Act 86, (MCL 123.1341 to 123.1362) requires personal property tax reimbursement for all operating and debt millages.
Local School Districts and Intermediate School Districts
- Local School District and Intermediate School District – PPT Distribution by Payee
- School District & Intermediate School District – Debt, Sinking, and Recreation Millage Calculation
- Intermediate School District – Operating Millage Calculation
- School District – Hold Harmless Millage Calculation
- School District – Out of Formula Calculation
- Other Municipalities – PPT Distribution by Payee
- Other Municipalities – 2016 PPT Reimbursement Calculation Tool
Tax Increment Finance Authorities
The Local Community Stabilization Authority shall distribute reimbursements in the following order of priority:
- 100% reimbursement for:
- Local school district and intermediate school district (ISD) school debt loss in the current year and local school district sinking funding millage and public recreation and playground millage;
- ISD operating millage;
- School operating loss not reimbursed by the school aid fund;
- Millages used to fund essential services (police, fire, ambulance, and jails);
- Decline in the tax increment finance (TIF) plan captured value of commercial and industrial personal property; and
- 2015 small taxpayer exemption loss.
- Reimbursement for other millages are prorated and may be less than or more than 100%, depending on total calculated losses compared to available Local Community Stabilization Share (LCSS) revenue. The LCSS revenue is derived from the State Use Tax.
The Michigan Department of Treasury has estimated that the LCSS revenues should be sufficient for 100% reimbursement of all calculated 2016 losses.
How to Calculate Reimbursements
School Districts/Intermediate School Districts (ISDs) Debt Millage
The school debt loss reimbursement to local school districts and ISDs is the eligible debt millage rate multiplied by the personal property exemption loss (PPEL) reported by county equalization directors. The eligible debt millage rate is the current year’s debt millage rate for millages levied for the payment of principal and interest of obligations approved by the voters before January 1, 2013 or obligations pledging the unlimited taxing power that were incurred before January 1, 2013. School districts and ISDs must file Form 5451 (see link below), by August 15, to report their current year debt millage rate and to be eligible to receive reimbursement for debt millages.
All Other Millages
Except for school district debt millages, ISD debt millages, and tax increment finance (TIF) plans, the calculation is complex, however, the basic reimbursement calculation is the personal property exemption loss (PPEL) reported by county equalization directors multiplied by the lowest of each millage rate levied in the period between 2012 and the year immediately preceding the current year. These millage rates are posted below under the heading titled “Millage Rate Comparison Reporting Requirement”.
In order to calculate the reimbursement for millages used to fund essential services, the Michigan Department of Treasury has requested cities, townships, counties, villages, and authorities to file Form 5448 – FYE 2012 Percentage of General Operating Millage Used to Fund Essential Services (see link below), by July 15, 2016.
Local units will not have to file a form with the Michigan Department of Treasury to request reimbursement.
Tax Increment Finance (TIF) Plans
TIF plans must file Form 5176, Form 5176BR, or Form 5176ICV (see links below) to claim reimbursement for the decline in the captured value of commercial personal property and industrial personal property. The personal property tax reimbursement to a local unit is reduced by the payments to TIF plans for that local unit’s millage.
How to Calculate the Debt Millage Rate Reported on the L-4029
Beginning for calendar year 2016, the LCSA Act requires that the calculation of debt millage rate(s) must reflect the personal property tax reimbursement for the debt millage. School districts and intermediate school districts (ISDs) adjust the calculation of their debt millage rate by increasing their total taxable value by their personal property exemption loss (PPEL). For local units other than school districts and ISDs, local units must multiply their PPEL by the debt millage rate(s) being reimbursed (see heading titled “Millage Rate Comparison Reporting Requirement” below) to estimate their debt millage reimbursement, and reduce their annual debt service requirement by this amount.
How to Calculate the Personal Property Exemption Loss (PPEL)
The PPEL is calculated by subtracting the current year taxable value of commercial personal property and industrial personal property from the 2013 taxable value of commercial personal property and industrial personal property. Calculations include Industrial Facilities Tax (IFT) property (new facilities at 50%). For operating millage reimbursement calculations, Treasury will subtract renaissance zone personal property taxable value from the PPEL calculations.
Distribution Calculation Information
Millage Rate Comparison Reporting Requirement
- MCL 123.1353(5) "The department shall calculate and make available to each municipality by May 1 of each year that municipality's sum of the lowest rate of each individual millage levied in the period between 2012 and the year immediately preceding the current year"
- 2012-2016 Millage Rate Comparison: County, City, Village, Township
- 2012-2016 Millage Rate Comparison: Local School District
- 2012-2016 Millage Rate Comparison: ISD
- 2012-2016 Millage Rate Comparison: Community College
- 2012-2016 Millage Rate Comparison: Authorities
- 2012-2015 Millage Rate Comparison: County, City, Village, Township
- 2012-2015 Millage Rate Comparison: Local School District
- 2012-2015 Millage Rate Comparison: ISD
- 2012-2015 Millage Rate Comparison: Community College
- 2012-2015 Millage Rate Comparison: Authorities
Forms for Calculation of Reimbursement
|Form Number||Form Title||Due Dates||Frequently Asked Questions (FAQs)|
|5176||2017 Tax Increment Financing Personal Property Loss Reimbursement - Non-Brownfield Authorities||June 15, 2017|
|5176BR||2017 Tax Increment Financing TIF Loss Reimbursement - Brownfield Authorities||
June 15, 2017
|5176ICV||2017 Tax Increment Financing Personal Property Loss Reimbursement for Authorities with Increased Captured Value Loss – For a copy of the form, contact Treas-StateSharePropTaxes@michigan.gov||
June 15, 2017
|5451||Personal Property Exemption Loss 2017 Debt Millage Reimbursement Claim for School Districts & Intermediate School Districts (ISDs)||August 15, 2017
Questions Regarding ESA?
Personal Property Tax Reimbursement Questions
**NOTE: The email address for PPT Reimbursement communications has changed**