Senate approves bill to restore full PILT payments to locals

LANSING – The Senate approved a supplemental appropriations bill on Thursday that includes funding to provide a full restoration for payments in lieu of taxes (PILT) to local governments for state-owned land for the current 2011-12 fiscal year, said Sen. Darwin Booher.

When the state purchases land, that land is removed from the local property tax rolls. To make up for the loss of this property tax revenue, the state is supposed to pay PILT or swamp taxes to the affected local units of government and school districts.

“The state, like everyone else, must pay its taxes,” said Booher, R-Evart. “I sponsored an amendment to ensure full restoration of this revenue because our local governments and schools count on these funds to maintain critical services and help provide a quality education. Although PILT payments are supposed to be made to locals in February, it’s already June and the payments still have not been made.” 

Booher was successful in amending the supplemental budget bill to add more than $2.1 million to fully fund PILT to local governments and schools. Without the amendment, PILT payments –once made – would have been prorated by approximately 15 percent.

“This is also about fairness. Michigan residents are not allowed to pay only part of their taxes, and neither should the state,” Booher said. “The most important thing right now is to get this vital funding to our communities and schools. However, I am also working to put policies in place to ensure that in the future the state will live up to its obligations for the land it owns – especially if the state is determined to buy more and more public land.”

To help ensure PILT payments are made in full and on time, Booher and Sen. Tom Casperson, R-Escanaba, sponsored Senate Bills 1021-1022. The bills were recently approved by a Senate committee and would also increase the amount of PILT the state would pay on land it owns.

The supplemental budget containing the PILT funds is Senate Bill 871, which has been sent to the House for consideration.