January 14, 2002

To:    County Treasurers, Controllers, Board of Auditors, Board of Commissioners

From:    Richard L. Baldermann, CPA, CGFM  Administrator, Local Audit and Finance Division  Bureau of Local Government Services

RE:    Accounting for $50 Notice Fee, Due December 1, by Opt-Out Counties Under the Tax Reversion Process

County treasurers who have opted-out of the tax reversion process (PA 123 of 1999) are required to collect a $50 fee (to cover costs associated with service of process and certified mail) related to parcels which have been forfeited. The fee is added to each parcel of property, which delinquent taxes remain unpaid, beginning on December 1, 2001.

Section 78g (3) c - mandates that once a parcel is forfeited to the county, a taxpayer must pay (among other things) all recording fees and all fees for service of process or notice to redeem that parcel. The $50 fee represents the average per parcel cost incurred by the State for both notices by certified mail and notice by publication within the 51 opt-out counties.

The above section applies to the foreclosing governmental unit; therefore, it is equally applicable to those counties that opted-in. Although the actual fee collected in an individual opt-in county may not be the same as our $50 fee, they certainly can recover costs associated with notice.

Account titled "Due State of Michigan--Publication/Notice Fee-Forfeited Parcels Fee," account number 228.53 in the General Agency Fund (formerly the "Trust and Agency Fund") No. 701, should be used to account for the amount due ($50) to the State of Michigan when collected.

The counties, which opted-in and have related expenditures as noted above, should use an account number between 801 to 832 for professional and contractual services. If county personnel perform the service, use an expenditure account for salaries and wages. The average cost should be added to each parcel. Use account number 641 "Charges for Services" for the publication/notice fees relating to forfeited parcels which is accounted for in the delinquent tax revolving fund. Part of the amount is to redeem the property or will be part of the sale price, if foreclosed.

Please call (517) 373-3227 or write our office if you have any questions.

Michigan Department of Treasury
Local Audit and Finance Division
P.O. Box 30728
Lansing, Michigan 48909-8228