Written by Forrest Wall, CAE, Vice President
Government Affairs and Industry Relations
Rent Control Preemption Under Attack
A group of Democratic Senators has introduced multiple bills which would dismantle the current Michigan law protecting against rent control.
The first effort, Senate Bill 1129, would completely repeal the existing law which prohibits local governments in Michigan from enacting rent control ordinances. This bill was introduced in the Michigan Senate on September 22 and has been referred to the Committee on Local Government.
A second proposal, which is a two-bill package, was introduced on the same date in the Senate. Senate Bills 1131 & 1132 propose to allow rent control in specific situations, with the potential for offsetting property tax breaks. These bills authorize local units of government the ability to limit rent for disabled individuals and senior citizens. An individual with a disability is defined in the bill as a person with either physical or mental disability that limits one or more major life activities of the individual. Senior citizen is defined in the bill as someone 62 or older, but the rent limitation would not apply to a person 70 or under unless the person has lived in their dwelling for the last five years. The legislation allows (but does not mandate) local units of government with rent control ordinances under this section to provide a property tax break to property subject to the rent control ordinance. The tax break takes the form of an exemption from ad valorem property taxes, with a specific tax taking its place. The specific tax is figured by taking the amount of tax that would have been collected on the parcel as though it was not exempt from ad valorem property tax, minus an amount determined by the local government but not exceeding the ad valorem tax. These bills have also been referred to the Committee on Local Government for consideration.
The preemption of local rent control is one of the most significant legislative accomplishments in AAM’s history. AAM will continue to oppose legislation attempting to repeal or change this law!