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MichiganSB 07232025-2026 Regular SessionSenateWALLET

Economic development: brownfield redevelopment authority; transformational brownfield plan; modify. Amends secs. 2, 13c, 14a & 16 of 1996 PA 381 (MCL 125.2652 et seq.) & adds secs.16a & 16b. Last Action: ASSIGNED PA 0036'26 WITH IMMEDIATE EFFECT

Sponsored By: Sarah Anthony (Democratic)

Signed by Governor

Economic development: brownfield redevelopment authority

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Bill Overview

Analyzed Economic Effects

11 provisions identified: 2 benefits, 4 costs, 5 mixed.

More tax money for redevelopment projects

Michigan raises the total cap on specified redevelopment tax revenues from $1.6 billion to $3.2 billion. The existing $80 million yearly limit remains, with another $80 million reserved for new transformational brownfield plans. Unused amounts, including money recovered or withheld after enforcement, can carry forward for existing or new plans. Carryover can add no more than $30 million above the $160 million yearly limit. This gives redevelopment projects more support but directs tax money away from other public uses.

Tax support limits for redevelopment projects

Plans approved on or after this law's effective date face a $300 million combined cap on the listed tax captures and projected sales-and-use-tax exemptions. A separate $200 million limit covers construction-period capture and projected sales-and-use-tax exemptions, excluding exemptions approved before the law took effect. Under that limit, corrective action protects plans whose actual exemptions stay within approved projections. Above-cap amounts beyond the Treasurer's small-amount allowance trigger corrective action, including reduced payments; the $300 million rule also allows repayment demands. Construction-period tax capture for a property ends five years after the plan's initial approval.

Public access to redevelopment spending records

Michigan must maintain a public webpage with covered transformational brownfield meeting materials, audits, milestones, investments, tax revenues, exemptions, and projections. Specified program-limit information must be updated at least quarterly, and other required records at least yearly. Annual project revenue and exemption figures are due by the following April 1. Board meetings considering plan approvals or amendments must be livestreamed and recorded, with recordings posted for later viewing.

Redevelopment approvals continue beyond 2027

The law removes the December 31, 2027 cutoff for approving new transformational brownfield plans. When fewer than five plans receive approval in a year, unused approval slots can carry forward. For qualifying plans with investment and other waivers, unused slots remain available through December 31, 2032, instead of 2027. The Michigan Strategic Fund must try to divide approvals equally among municipalities under 100,000 people, from 100,000 through 225,000, and over 225,000. That distribution depends on qualified applications, and no project is guaranteed approval.

Outside financial reviews for redevelopment projects

Independent financial review is required when specified yearly tax capture exceeds $10 million, measured using the first full capture year. It is also required for plans using the specified safe-harbor calculation with development costs of at least $100 million. Owners or developers pay for that review. Every plan using sales-and-use-tax capture also needs an independent revenue estimate review, paid for by the owner or developer. When either size threshold applies, the Michigan Strategic Fund must obtain an independent review of expected fiscal benefits to Michigan.

Earlier accounting choices for project owners

For projects approved after December 31, 2026, owners must elect safe-harbor income and withholding accounting before Michigan Strategic Fund approval. Earlier projects can elect before their first reimbursement for the relevant tax capture. An income-tax election cannot be undone. A withholding-tax election for an earlier project requires Fund approval to undo. Withholding safe-harbor amounts can be adjusted when disqualified employees exceed the original estimate.

Tighter tax reporting for redevelopment businesses

For newly approved plans, withholding capture excludes certain existing-job workers outside retail and hospitality. Their employers must have more than 50 Michigan employees or receive a Michigan Strategic Fund incentive. It also excludes employees of businesses moving Michigan facilities without expansion, more jobs, or another valid reason documented by third-party analysis. Employers must report disqualification information; yearly certifications can be required, and developers must secure compliance through agreements. Developers must also secure occupants' sales-and-use-tax reporting compliance; the state owes no reimbursement for unreported or unpaid amounts.

Affordable homes required in redevelopment housing

Residential transformational brownfield plans approved after this law took effect must include homes rented or sold to income-qualified households. The law defines these households as earning no more than 120% of area median income. This general requirement does not set a unit count or price. Separately, the Michigan Strategic Fund can approve capture of up to 100% of project income-tax revenues when a binding local agreement reserves at least 20% of homes as affordable housing. Required financial reviews still apply, and the law does not guarantee any household a home.

New property rules for redevelopment plans

Transformational brownfield plans can add parcels with approval from both the local governing body and Michigan Strategic Fund. Each added parcel must qualify as a contamination site, facility, historic resource, functionally obsolete property, or blighted property. The law also limits one housing-property eligibility route to ordinary brownfield plans rather than transformational plans. Housing in a transformational plan must instead meet the separate general property eligibility requirements.

Project payments tied to yearly progress

Newly approved plans using the listed tax captures must meet yearly milestones to receive or keep receiving tax support. Agreements can set goals for construction, capital investment, or completed housing. When investment falls below the required minimum and outside the allowed safe harbor, the Michigan Strategic Fund must act. It can reduce payments for completed phases and reduce payments or cancel capture authority for unbuilt phases. For that investment shortfall, it can end all reimbursement only after finding that the owner or developer acted in bad faith.

New starting values for project taxes

A resolution adding property to a transformational brownfield plan now names the starting year for income, sales-and-use, and withholding taxes. That year no longer automatically matches the year the resolution is adopted. The starting withholding value includes withholding under the specified Income Tax Act provisions. The law also subtracts the section 266a income-tax credit when calculating starting income-tax value and income-tax capture. These changes affect project financing, not household tax-credit eligibility or amounts.

Sponsors & Cosponsors

Sponsor

  • Sarah Anthony

    Democratic • Senate

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 126 • No: 51

Senate vote • 7/3/2026

ROLL CALL:

Yes: 24 • No: 12 • Other: 2

House vote • 7/3/2026

passed; given immediate effect

Yes: 82 • No: 26 • Other: 2

Senate vote • 12/9/2025

PASSED

Yes: 20 • No: 13 • Other: 4

Actions Timeline

  1. ASSIGNED PA 0036'26 WITH IMMEDIATE EFFECT

    7/29/2026Senate

  2. FILED WITH SECRETARY OF STATE 7/22/2026 10:36 AM

    7/29/2026Senate

  3. APPROVED BY GOVERNOR 7/21/2026 1:36 PM

    7/29/2026Senate

  4. PRESENTED TO GOVERNOR 7/14/2026 11:16 AM

    7/15/2026Senate

  5. ORDERED ENROLLED

    7/3/2026Senate

  6. FULL TITLE AGREED TO

    7/3/2026Senate

  7. GIVEN IMMEDIATE EFFECT

    7/3/2026Senate

  8. ROLL CALL: ROLL CALL # 221 YEAS 24 NAYS 12 EXCUSED 2 NOT VOTING 0

    7/3/2026Senate

  9. HOUSE SUBSTITUTE (H-1) CONCURRED IN

    7/3/2026Senate

  10. RULES SUSPENDED FOR IMMEDIATE CONSIDERATION

    7/3/2026Senate

  11. HOUSE AMENDED TITLE

    7/3/2026Senate

  12. PASSED BY HOUSE WITH SUBSTITUTE (H-1) WITH IMMEDIATE EFFECT

    7/3/2026House

  13. returned to Senate

    7/3/2026House

  14. title amended

    7/3/2026House

  15. passed; given immediate effect Roll Call #289 Yeas 82 Nays 26 Excused 0 Not Voting 2

    7/3/2026House

  16. read a third time

    7/3/2026House

  17. placed on third reading

    7/2/2026House

  18. substitute (H-1) adopted

    7/2/2026House

  19. read a second time

    7/2/2026House

  20. placed on second reading

    7/2/2026House

  21. motion to discharge committee approved

    7/2/2026House

  22. rule suspended

    7/2/2026House

  23. referred to Committee on Economic Competitiveness

    12/10/2025House

  24. read a first time

    12/10/2025House

  25. received on 12/09/2025

    12/10/2025House

Bill Text

  • Public Act

    7/22/2026

    PDF

  • As Passed by the House

    7/3/2026

    PDF

  • As Passed by the Senate

    7/3/2026

    PDF

  • Senate Concurred

    7/3/2026

    PDF

  • Introduced

    12/3/2025

    PDF

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