Road construction not only impacts motorists, but also businesses. As such, a local lawmaker is reviving an effort from last year to allow local governments to grant property tax breaks to firms in their community that have been adversely affected by major infrastructure improvement projects, such as the Telegraph Road overhaul that roiled commuters last year and the expected roundabout construction at Pontiac Trail and M-5 in Commerce Township this year that will cause significant headaches for lakes area drivers and businesses.
State Rep. Gail Haines (R-Waterford, West Bloomfield) has sponsored two bills — House Bills (HBs) 4210 and 4211 — that would help business owners affected by major infrastructure construction projects. Under HB 4210, a major infrastructure project would have to last at least three months in the first tax year in which construction begins and has a planned duration of at least two months in a subsequent tax year in order for a business to be eligible for tax relief. The bill allows a local government to determine the period of tax relief by resolution. It defines eligible business as one that owns real or personal property subject to ad valorem taxes or a business that is contractually responsible for the payment of ad valorem taxes on real or personal property, which is or will be adversely impacted by a construction project.
HB 4211, outlining the proposed Adverse Construction Specific Tax Act, represents an amendment to the General Property Tax Act that would allow local governing bodies that are tax collecting units to exempt real and personal property owned or leased by an eligible business from regular taxation. Such businesses would have 50 percent of their real and personal property taxes exempted.
Last year, Oakland County Executive L. Brooks Patterson proposed the idea of granting temporary property tax relief to businesses negatively impacted by extended road construction projects like the Telegraph work.
Patterson’s request for such legislation was prompted by an unprecedented outcry from county businesses citing 20 to 50 percent declines in business volume due to long-term projects. He pointed toward extensive construction work this year along Telegraph Road as an example of why the proposal is necessary.
State Rep. Chuck Moss (R-Orchard Lake) said he understands Haines’ intent behind the bills, but a couple things give him pause: First, that Gov. Rick Snyder “is making all the tax credits go away;” and secondly, local governments may not be willing to “cut their own throat” by foregoing revenue in tough economic times.
State Rep. Hugh Crawford (R-Walled Lake, Wixom) said Haines’ legislation is “probably something I can support.”