Can a township keep earned interest on county allocated mills tax payments prior to the time of remittance to the county treasurer?
No. The General Property Tax Act does not give express authority to keep the interest earned while the township treasurer is holding county allocated mills prior to the time of remittance to the county treasurer for the county allocated mills. The township treasurer is required to remit payments within 10 business days after the first and fifteenth day of each month.
- Background: The general rule is that interest follows principal, unless there is statutory language to the contrary. In 1985, the Court of Appeals in Grand Rapids Public School districts v City of Grand Rapids (146 MICH APP 652) held that "Interest on public funds designated for a specific purpose follows those funds, absent a clear statutory provision to the contrary, in general, interest is merely an incident of the principal fund, making it the property of the party owning the principal."