Personal Property Tax Abatement - PA 328 of 1998
What - PA 328 allows for the abatement of all taxes on new personal property investments in the city. The exemption includes only new personal property not previously subject to taxes in the state of Michigan. The length of the abatement is negotiable based on investment, job creation, and economic impact.
Who - Eligible businesses include: manufacturing, mining, research and development, wholesale trade and office operations. It is only available to businesses that locate within a distressed core community like the city of Lansing.
Why - PA 328 is used to encourage the creation and / or expansion of manufacturing, high technology, and business operations. The incentive is to assist companies in making significant investment and creating job opportunities within the city.
Example:
The Lansing EDC is approached by a company with patented technologies derived from research at Michigan State University, and they are looking for their first manufacturing facility to begin commercial production of their product. However, being a new company, most likely running on venture capital, they are attracted to locating in a township to save on their tax liability. Yet, the building and the work force in the city are clearly advantageous to business growth. The LEDC utilizes a P.A. 328 for 12 years to offset 100% of the company's personal property tax liability on the new equipment and secure the company in the location that is most advantageous for business growth.
Cash Value of New Equipment: $2,000,000
Estimated Tax Savings over 12 Years: $63,000 (assumes 50% of true cash value of improvements)
Projects that used the 328 tax exemption: Loomis Law Firm Retention, Aquabiochip, Niowave, Emergent Biosolutions, Neogen, Barnes Aerospace
