DATE: August 27, 2002
TO: County Treasurers, Equalization Directors, Local Treasurers, Assessors
FROM: State Tax Commission (STC)

RE: COMPUTERIZED TAX ROLL

Attached is a copy of Public Act (PA) 505 of 2002 which was signed by Governor Engler on July 19, 2002 with an effective date of July 19, 2002. The language of the law that was added by PA 505 of 2002 is underlined on the attached copy of the act.

IMPORTANT NOTE: This bulletin replaces STC Bulletin 15 of 1990 regarding computerized tax rolls.

Act 112 of 1990 as amended by PA 505 of 2002 permits assessing officers to prepare a tax roll for use as a collection and accounting tool by the assessor and treasurer that is prepared and maintained by a computer system and its software. This is only permitted when the system and the procedures that are followed adhere to the requirements of Act 112 of 1990, as amended. Treasurers and assessors are not permitted to use this tool unless the computerized tax roll preparation and accounts receivable system have been approved for use by the State Tax Commission as being in conformance to the requirements of Act 112 of 1990. The Act calls for a precollection tax roll printed from a computerized database that is warranted by the assessor. This requires the local assessor to maintain the database as changes in value, legal descriptions and other items on the tax roll occur. The statute also provides for preparation of a final settlement tax roll to be prepared by the assessing officer that includes all changes that have been made since the precollection tax roll. In addition, the statute provides for an audit trail and documentation of all changes made by the assessor and for proper accounting procedures and checks by the local treasurer. Standards that the system must meet for approval by the State Tax Commission are spelled out in the statute.

The law regarding the approval of computerized tax rolls is permissive. It affects only those units who wish to establish a computerized accounts receivable system and tax roll preparation system. Manually operated tax collection systems are not affected by this procedure and must conform to the statutory provisions that are currently in force and are unchanged.

A significant change made by PA 505 of 2002 is that it allows a County Treasurer to obtain permission for use of a computerized tax roll by a local unit. Prior to PA 505 of 2002, only the local unit could apply.

IMPORTANT NOTE: Even through a County Treasurer may seek authorization for a local unit, each local unit is still required to also sign the application.

PA 505 of 2002 states that a local unit may use a computerized tax roll if the STC fails to act on an application within 120 days. Applications received by the STC will be dated and the 120-day period will begin on the date received. Any application received that is incomplete will be denied and returned to the applicant for resubmission. A resubmission will begin a new 120-day period.

If at any time the State Treasurer or the State Tax Commission believes that a local tax collecting unit is no longer in compliance, the State Treasurer or the State Tax Commission shall provide written notice to that local tax collecting unit. The notice shall specify the reasons that use of the computerized database system is no longer in compliance. The local tax collecting unit will have not less than 60-days to provide evidence that the unit is in compliance or that action to correct noncompliance has been implemented. If, after the expiration of 60-days, the State Tax Commission or the State Treasurer believes that the local tax collecting unit is not taking satisfactory steps to correct a condition of noncompliance, the State Tax Commission may withdraw approval of the use of the computerized database system as the original tax roll.

Also attached to this memo are 2 new application forms for requesting approval of a computerized tax roll. One (Form 3944) is the form to be used by a county when it applies for the local unit. The other (Form 2696) is a form to be used by a local unit when it applies on its own. A third form (Form 3945) is attached for use by the local unit to fulfill the requirement to recertify the computerized database system used as the tax roll every third year after the initial approval by the State Tax Commission. Applications should be filed with the State Tax Commisison at P.O. Box 30471, Lansing, MI 48909-7971.

If you have questions about this law, please call Harold Anderson, Manager, Local Assessment Review Section at 517- 373-3327.